| Breaking down Ethereum’s evolution and its impact on crypto markets Was this newsletter forwarded to you?Sign up here. |
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| (As of August 16, 2022 @ 21:25:21 UTC. ETH price % change over 24 hours.) |
| Welcome to Valid Points! With the sanctioning of Tornado Cash last week, the cryptoverse has been rife with speculation about how far protocols and companies will go to comply with government regulations. Underneath this debate, a key question is being tested: Can Ethereum be censored? The answer isn’t as simple as “yes” or ”no,” and it requires differentiating Ethereum the protocol from the many apps and services built atop it. Services can be censored. Ethereum infrastructure providers like Infura and Alchemy have already restricted access to data on Tornado Cash smart contracts. Circle, the company that powers the USDC stablecoin, has begun denying service to accounts that have interacted with Tornado-linked addresses. But it’s not all doom and gloom. The Ethereum protocol – the technology dictating whether transactions get propagated out to the rest of the network – has (thus far) not been censored. If a U.S. citizen wants to shuffle money through Tornado Cash, miners will still add the transactions to blocks and propagate them out to the wider network. But as a series of Twitter think-threads have pointed out this week, this doesn’t mean that the protocol is completely immune. Read the full story here. |
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The following is an overview of network activity on the Ethereum 2.0 Beacon Chain over the past week. For more information about the metrics featured in this section, check out our 101 explainer on Eth 2.0 metrics. |
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| Disclaimer: All profits made from CoinDesk’s Eth 2.0 staking venture will be donated to a charity of the company’s choosing once transfers are enabled on the network. |
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| Celsius appears to be in even worse financial straits than previously thought. WHY IT MATTERS: A new court filing Monday from Kirkland & Ellis, a law firm the crypto lender hired to lead its restructuring efforts, included financial projections that Celsius Network will run out of cash by October. The filing also showed that Celsius’ liabilities in crypto to customers suurpasses $6.6 billion while the lender only holds $3.3 billion of digital coins,for a $2.8 billion difference as of July 29. Read more here. DeFi platform Acala’s stablecoin came close to regaining its peg to the U.S. dollar. WHY IT MATTERS: Polkadot-based decentralized finance (DeFi) platform Acala’s native stablecoin, aUSD, depegged on Sunday, falling 99% after hackers exploited a bug in a newly deployed liquidity pool to issue 1.28 billion tokens. In response, the platform burned over 1.2 billion aUSD tokens. Even though the price of aUSD plunged from roughly $1.03 per token to $0.009 after the attack, the peg was nearly regained Tuesday following the token burns, reaching 93 cents. Read more here. Research firm FSInsight says ETH might eclipse BTC’s market capitalization in the next year. WHY IT MATTERS: Ether (ETH) has a good chance of surpassing bitcoin (BTC) in market cap over the next 12 months because the Ethereum blockchain’s switch to proof-of-stake (PoS) mechanism will reduce both the production of the tokens and selling pressure from miners, research firm FSInsight said. Bitcoin has a market cap of about $461 billion, CoinDesk data shows, compared with Ethereum’s $226 billion. Read more here. Monero successfully completed a hard fork upgrade. WHY IT MATTERS: The change to Monero’s privacy-focused protocol was implemented Saturday at block 2,688,888. The upgrade brings about new privacy-preserving features including fee changes that will minimize fee volatility, improvements to multisignature functionality and a better Bulletproofs algorithm that increases transaction speed. Overall performance is expected to improve by 5%-7%. Read more here. Ethereum-based lending and borrowing platforms Yearn Finance, Iron Bank and Homora joined Optimism, the layer 2 network. WHY IT MATTERS: The DeFi firms joined Optimism to improve cross-chain interoperability, security and capital efficiency for their users. Optimism users will now be able to borrow against their crypto assets while benefiting from competitive gas fees, attractive rewards and yield options. “By launching on Optimism, we aim to make DeFi more accessible, scalable and reliable as the protocol-to-protocol liquidity backbone,” said Puff, the lead contributor to Iron Bank. Read more here. |
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| Valid Points incorporates information and data about CoinDesk’s own Eth 2.0 validator. All profits made from this staking venture will be donated to a charity of our choosing once transfers are enabled on the network. For a full overview of the project, check out our announcement post. You can verify the activity of the CoinDesk Eth 2.0 validator in real time through our public validator key, which is: 0xad7fef3b2350d220de3ae360c70d7f488926b6117e5f785a8995487c46d323ddad0f574fdcc50eeefec34ed9d2039ecb. Search for it on any Eth 2.0 block explorer site! |
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