The biggest crypto news and ideas of the day |
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Hours-Long Outage at TON Blockchain |
Toncoin (TON), the native token of the TON blockchain, has resumed producing blocks after a nearly six-hour outage caused by a surge in network traffic. A blockchain not producing blocks for an extended period of time is concerning because it disrupts network stability, potentially leading to security risks and transaction delays. These crashes are uncommon with blockchains, but do occur during times of high network activity. In an earlier post on X, the official TON blockchain account had written that the "issue is occurring due to the abnormal load currently on TON." "Several validators are unable to clean the database of old transactions, which has led to losing the consensus," the team explained. For TON, a recent airdrop of the DOGS memecoin might have been the culprit as the popularity of the token caused a surge in transactions, and some observers pointed out that the network struggled to catch up to meet demand with its transactions per second (TPS) coming well under what was expected. Recently the CEO of Telegram, Pavel Durov, was arrested in France, which caused the price of TON to plunge. Telegram and TON are separate entities even though one is often used with the other. Durov was set to appear in a French court Wednesday. Despite all that, TON trimmed some of its losses throughout the east Asia trading day and outperformed most of the crypto market. |
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Cardano Heads for Biggest Upgrade in Years |
Cardano, launched in 2017 by Ethereum co-founder Charles Hoskinson, is pushing toward its biggest upgrade in two years, with major changes to the structure of its main network, introducing mechanisms allowing users to participate in on-chain governance. The upgrade, known as the "Chang hard fork," is a major milestone in Cardano’s roadmap, punctuated by the much-awaited addition of smart-contracts functionality in 2021. The Chang hard fork was initially set to go through this week, but Hoskinson announced on Friday that it had been pushed back to Sept. 1 so some exchanges, including Binance, could prepare their systems. "The magic of deadlines is that people who aren't taking upgrades seriously suddenly say damn we got to get moving," Hoskinson wrote on X. Cardano ranks as the 30th biggest blockchain by the website DeFILlama, but the project tends to be closely watched in crypto circles partly because of the colorful personality and outsize popularity of Hoskinson, known for his frequent video and podcast appearances. Hoskinson introduced Ethereum alongside co-founder Vitalik Buterin in 2014 but split from the project soon afterward. |
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Maker, Now Rebranded to Sky, Draws Ire |
Maker, which just rebranded to Sky, announced a new version of its $5 billion stablecoin DAI with a feature that rattled many crypto enthusiasts. The new token called USDS apparently has a piece of code that would allow the issuer to remotely freeze the asset, observers pointed out. The feature exists in the largest stablecoins of centralized issuers like Circle's USDC and Tether's USDT. They often freeze assets linked to illegal activities at the request of government authorities, like Tether did last week by aiding the U.S. Department of Justice in the seizure of $5 million of USDT for fraud victims. However, the feature arguably goes against crypto's decentralized ethos that MakerDAO embodied at its inception. Rune Christensen, the co-founder of MakerDAO, confirmed the existence of the freeze function but explained that it's an option built into the code and won't be switched on when the token goes live next month. "[U]pgrading to USDS is optional, and it is only USDS that will have a freeze function," Christensen said. "Dai is an immutable smart contract and cannot be altered." |
OpenSea Hit With 'Wells Notice' from SEC |
Non-fungible token (NFT) marketplace OpenSea received a notice from the U.S. Securities and Exchange Commission (SEC) that it intends to pursue an enforcement action, the company disclosed on Wednesday. "OpenSea has received a Wells notice from the SEC threatening to sue us because they believe NFTs on our platform are securities," OpenSea's CEO Devin Finzer wrote on social media platform X. "We're shocked the SEC would make such a sweeping move against creators and artists. But we're ready to stand up and fight," he added. OpenSea did not respond to CoinDesk's request for comment by press time. Wells notices are preliminary warnings that inform respondents of the charges the regulator is considering bringing against them. They usually lead to enforcement actions. Finzer said his company will fight the notice and pledged $5 million to help cover legal fees for any NFT creators and developers that may also get such notices. |
The Takeaway: What Pundits Get Wrong |
By Fred Hatfield, former CFTC Commissioner In recent op-eds, Bloomberg and the lobbying group Better Markets weigh in against the crypto industry’s giving to candidates for office they believe would support efforts on behalf of digital assets. Leaving aside their First Amendment rights to do so, as a former Democratic Commissioner at the CFTC who is now involved in regulatory compliance issues, I feel that both the Bloomberg and Better Markets statements are unfair to the fledgling crypto companies as well as to the millions of Americans who invest in these products. Certainly with regard to the Vice President, she has taken no actions that could be considered “pandering” or “caving.” Her team has rather been listening, engaging and learning about a new financial product. To do otherwise would simply be irresponsible. It seems fairly obvious to fair-minded observers that after over a decade, cryptocurrency is unlikely to go away anytime soon, as much as some may want that. Given that that is the case, you would think the reasonable person would say, “let’s properly regulate these products.” It is not true that crypto doesn’t face a myriad of state and federal regulations. What is true is that, as long as an enforcement-only regulatory approach is taken, the U.S. will see jobs move overseas, innovation will be hampered and crucial decisions will be left to the courts. CFTC Chairman Rostin Benham has been proactive in working to encourage Congress to pass sensible and protective legislation. For Better Markets to say that the CFTC is not capable of this and is susceptible to regulatory capture is slanderous. In 2023, the CFTC took a record number of enforcement actions in the crypto space representing nearly half of all enforcement actions. It is important, though, to consider that crypto-related fraud is only 1% of the annual $3.2 trillion in illegal activity occurring in the dollar and other traditional fiat currencies. So contrary to the Bloomberg and Better Markets opinion pieces, crypto is not the financial product of choice among financial predators. That's the U.S. dollar. Yes, crypto has some of the speculation and abuses we have all heard about but as a Californian I can tell you these things happened during the gold rush of 1849. Today, gold is considered the “safety” investment. Finally, I would note that the SEC has done the most to give Americans the greatest opportunity to invest in bitcoin and ether through exchange traded funds (ETFs). In fact, the SEC just approved an ETF that allows retail investors to buy an ETF that allows a leveraged bet that is 1.75 times the daily move in a single company’s security. Now that seems a risky bet even to me. |
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Securities Law Meets Godwin's Law |
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