The biggest crypto news and ideas of the day |
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The main developer behind Uniswap, the largest decentralized crypto exchange, plans to launch its own blockchain as a layer-2 network atop Ethereum – part of an effort to make transactions faster and cheaper while also improving liquidity. Unichain, as the new network is known, was set to go live on a private test network Thursday, according to a press release. The project's technical development is being led by Uniswap Labs, relying on technology borrowed from the Ethereum layer-2 team Optimism's OP Stack. As such, Unichain will become a part of the Superchain, a federation of Optimism-affiliated networks that includes the U.S. crypto exchange Coinbase's own layer-2 blockchain, Base. "People actually want things to feel instant,” said Hayden Adams, the inventor of Uniswap and CEO of Uniswap Labs, in an interview with CoinDesk, when asked about the motivation for the initiative. |
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More Like Market Fakers, Amirite? |
Federal prosecutors charged four purported market makers, a handful of crypto projects, and over a dozen individuals with manipulating various crypto markets Wednesday, saying they profited from fees and selling manipulated coins at elevated values. According to charging documents unsealed Wednesday, Gotbit, CLS Global, MyTrade and ZM Quant wash traded various tokens to make it appear they had more legitimate activity than they actually did, selling some of these tokens at "artificially inflated prices" to others, marketing these coins on various platforms and convincing exchanges to let them buy tokens with reduced fees. The U.S. Securities and Exchange Commission also brought charges against ZM Quant and employees Baijun Ou and Ruiqi Lau; Gotbit and employee Feder Kedrov; and CLS Global with employee Andrey Zhorzhes, alongside a number of individuals described as "crypto asset promoters": Russell Armand, Maxwell Hernandez, Manpreet Singh Kohli, Nam Tran and Vy Pham. A representative for the Department of Justice (DOJ) said that the cases were referred to prosecution by the SEC over two years ago. Prosecutors say that the market maker defendants publicly claimed to be legitimate market makers offering legal services, but privately offered clients illegal services including wash trading. |
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Gary: Crypto's 'Unlikely' to Ever Be Currency |
U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler said he thinks it's unlikely that bitcoin (BTC) or other cryptocurrencies will ever be widely used as a form of payment and, instead, will continue to be seen as more of a store of value. Speaking at an event at NYU School of Law in Manhattan on Wednesday, Gensler responded to a question from an attendee about what the value of cryptocurrency – which was created to be separate from any government – would be to its users if totally brought into the regulatory fold. Gensler said that the agency is "merit neutral" and the investing public will get to decide "through disclosures" if there's a utility for any given cryptocurrency. "But I did teach this stuff up at MIT and so forth, so I'm just going say this – these debates literally go back to Plato and Aristotle," he said. "This is 3,000 years of history. Hundreds of great nations, thousands of nation-states – we tend to have one currency per geographic economic state. We tend even not to have bimetallism." Gensler cited Gresham's law – a monetary principle dating back to the 19th century that asserts that "bad money drives out the good" – and added that nations typically want just a single currency. |
Razzlekhan Should Get 18 Months, Feds Say |
Prosecutors have requested that Heather Morgan – better known by her rap moniker “Razzlekhan” – be sentenced to just 18 months behind bars for her role in laundering 120,000 bitcoins stolen from Bitfinex in a 2016 hack. In August 2023, Morgan pleaded guilty to one count of money laundering conspiracy and one count of conspiracy to defraud the United States, each of which carries a maximum sentence of five years in prison. Though Morgan and her husband Ilya Lichtenstein were first believed to only have laundered the proceeds of the hack (worth approximately $7.5 billion at today’s value), Lichtenstein later admitted to being the original hacker and pleaded guilty to one count of conspiracy to commit money laundering, which carries a maximum sentence of 20 years in prison. According to court documents, Lichtenstein carried out the hack alone in 2016, and did not tell his wife or enlist her help with laundering the money until four years later, in 2020, making her only an accessory to the crime after it had already occurred. |
The Takeaway: U.S. Policy's Blundering Again |
By Calanthia Mei, co-founder of Masa From the Industrial Revolution to the Digital Age, the United States has been defined by its spirit for entrepreneurship, innovation, and creativity. American entrepreneurship has been a talent magnet and attracted global minds to build and innovate in the U.S., myself included. Immigrants have founded or co-founded 65% of the top AI companies in the United States. The technological advancements that have come from the United States have been a key driver for global innovation and leadership for decades, with the rest of the world adopting these groundbreaking technologies. But it now faces a potential threat to its reign – as a once undisputed leader in technological innovation, the U.S.’s reputation and standing is now being challenged. While the U.S. for now remains a leader in venture capital funding for AI, in May 2024, PitchBook released a report showing that pre-seed and seed funding in U.S.-based generative AI companies saw a sharp decline, but companies in Asia and Europe are seeing a steady increase. We’ve seen this before. In crypto. Crypto was once the technology being championed to push us into the generation of Web3, seeing great promise, only to falter in the U.S. because of its hostile regulatory policies. The country's actions – or inactions, rather – force the question: How can it stay a global tech leader if it continues to miss the mark when it comes to new tech innovation booms? For the sake of AI innovation, we simply cannot let the U.S. fall behind like it has with crypto. The U.S.’s rise and fall with crypto is a cautionary tale that sets the scene for what could be to come in AI. In early crypto days, the U.S. was the promised land with a plethora of startups and investment funding flowing into the space, creating room for innovation, growth and mass adoption. In recent years, this has slowed down due to a lack of regulation and policy. The SEC started bringing in lawsuits and regulatory policies based on pre-crypto laws – essentially trying to fit a round peg into a square hole. The agency went after Consensys, Coinbase, Ripple and other companies that have a reputable standing in Web3, just to make… what point? The lack of clear policies and regulation hinders progress, forcing these companies to spend resources on legal battles, while pushing companies and talent elsewhere to continue building the decentralized dream. While the U.S. has stifled the growth and innovation of crypto through its policies, governments in jurisdictions like Switzerland, Singapore, and Hong Kong have embraced crypto and used their forward-looking crypto policies to vie for coveted seats on the global tech leaderboard. U.S. AI policies seem to be following in the footsteps of crypto policies and similar challenges among the two industries are arising. As of now, the United States is still the home to a majority of major AI companies and research organizations. The risk sits in the likely possibility that U.S.’s current and proposed regulatory frameworks cap the growth of the AI industry. Read the rest. |
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There Is Nothing New Under the Sun |
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