The biggest crypto news and ideas of the day |
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Welcome to The Node! This is Ben Schiller to take you through the latest crypto news. In today's news: Bitfarms to buy Stronghold, consolidating mining market; Trump retakes lead in election betting on Polymarket; Eigen Labs U.S. employees access airdrops outlawed to U.S. residents; another "fraudster" arrested in Montenegro.
The Takeaway: Prometheum CEO Aaron Kaplan says enabling an ecosystem where digital assets can be issued natively onchain is crucial to advancing trends such as tokenization and truly innovating financial markets.👇 |
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Bitcoin miner Bitfarms (BITF) said it agreed to buy rival Stronghold Digital (SDIG) for $175 million in stock and assumed debt as it looks to diversify its revenue sources beyond the production of cryptocurrency. The offer comprises $125 million in stock based on 2.52 Bitfarms shares for each one of Stronghold, a premium of 71% to Stronghold's 90-day volume-weighted average price on Nasdaq as of Aug. 16, Bitfarms said in a statement. It equates to $6.02 per share versus SDIG's close last night of $2.93. Shares are currently higher by 64% premarket to $4.80. BITF is lower by 7% to $2.19. Bitcoin miners have been coming to terms with April's 50% cut in the reward they receive for adding blocks to the blockchain. The reduction puts pressure on the industry to cut costs, particularly power usage, and replace older equipment with more energy-efficient rigs. While the event was no surprise – it occurs roughly every four years and companies had plenty of warning to prepare for it – it was still expected to unleash a "survival of the fittest" battle and send the miners looking for alternative income streams such as high-performance computing (HPC) and processing for artificial intelligence (AI) applications. |
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Eigen Labs Employees Accessed Airdrops |
Crypto companies can't afford to ignore the tech-savvy American workforce. They also can't let their brand-new crypto tokens run afoul of the world's toughest financial regulatory regime.
EigenLayer, one of Ethereum's hottest projects, embraced a solution common in crypto: it employed U.S. developers through a U.S. company. Meanwhile, a separate legal entity issued its EIGEN token from an island where U.S. securities and tax laws don't apply. Two projects in EigenLayer's realm, Renzo and Ether.Fi, went even further: they explicitly barred U.S. residents from claiming tokens in their respective airdrops. Apparently, it didn't work. Wallets with links to at least 10 U.S. employees of Eigen Labs – engineers, directors, a c-suite executive, the chief lawyer – claimed hundreds of thousands of dollars-worth of free money from Renzo and Ether.Fi, according to a CoinDesk analysis of blockchain data. CoinDesk generally does not report on individuals' personal finances. But many Eigen Labs employees chose to claim their crypto "out in public," according to a blog post that detailed the company's discontinued efforts to help EigenLayer ecosystem projects airdrop tokens to Eigen Labs staff. |
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Gamers, Live-Streamers Get a Tokenomic Boost New platform Soulbound tailors an interactive social solution to the Web3-native generation. In Wall Street parlance, “DRIP” stands for “dividend reinvestment plan.” In the Gen Z lexicon, though, “drip” is the style one exudes. It’s from this usage that Soulbound named its reputation points token. By offering gamers and community members DRIP tokens, gamer IDs and content bounties, Soulbound is pursuing its goal of empowering the new creator economy. Soulbound’s whole mission is to give creators – of games, of streaming content, of digital art – a medium through which they can earn a living doing what they love. Continue reading |
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Trump Overtakes Harris on Polymarket |
Donald Trump is once again in the lead on Polymarket’s election winner contract, with his odds of beating Kamala Harris now standing at 52-47. Despite this widening gap, the market is still pricing in a very close race, especially in the swing states: a contact that asks if Trump will win every swing state only gives it a 16% chance of happening, while a contract asking if Harris will do the same only has a 28% chance of occurring. While all swing states capture the attention of political analysts, two in particular are standing out this cycle: North Carolina and Pennsylvania. Of interest to analysts are the state’s shifting demographics – North Carolina's growing urban areas and Pennsylvania's suburban regions – and Black and Hispanic voters have evolving views on key issues like the economy, healthcare, and immigration. Right now, Republicans are leading in North Carolina with odds of 61-40, according to Polymarket, while Trump has edged up in Pennsylvania by 1 percentage point and now leads 51-50. Does any of this matter for bitcoin’s price, however? Probably not. Analysts still say that other factors like U.S. monetary policy and supply concerns influencing BTC more significantly, CoinDesk recently reported. |
Another Fraudster Arrested on Montenegro |
Polish national Roman Ziemian, the co-founder of digital currency trading platform FutureNet who allegedly defrauded users out of around $21 million has been detained in Montenegro, according to multiple reports citing an announcement from the nation's police. Both Poland and South Korea had issued international warrants for Ziemian after he escaped from house arrest in Italy in 2022. An international law enforcement operation involving Montenegrin authorities and the Interpol resulted in Ziemian getting found hiding under a false identity in a newly developed residential area in Podgorica. After conducting searches, officers of the Sector for Fighting Crime - Group for High-Tech Crime and the Regional Security Center "Centar" confiscated technical devices and items suspected of being the result of a criminal act, according to Radio Slobodna Evropa. According to the police, Ziemian is suspected of money laundering, theft and violation of law, economic crime. |
The Takeaway: Truly On-Chain Markets |
Guest post by Aaron Kaplan, co-CEO of Prometheum:
The two most popular tokenized money market funds today, according to the latest data from rwa.xyz, are BlackRock’s $BUIDL and Franklin Templeton’s $FOBXX. Collectively, they are nearing $1 billion in assets, largely from investors excited to access the benefits of a blockchain-enabled financial product. While these products introduced an important innovation into the market, they also expose a duplicity prevalent in today’s tokenized fund and digital asset market infrastructure: Projects touting blockchain innovation are partnering with traditional transfer agents, creating redundant systems by not utilizing blockchain technology to its fullest capabilities. The question that needs to be asked is what’s the difference between a digital asset and a digital receipt? A digital asset is blockchain native when it exists on a public blockchain, which serves as the source of truth and records ownership of the actual asset. In contrast, a digital receipt is merely information printed on a blockchain where the blockchain is not the source of truth. The fundamental difference to understand is the source of truth. This distinction is essential as it directly impacts the true progress of blockchain-based financial ecosystems. Enabling an ecosystem where digital assets can be issued natively on-chain is crucial to advancing trends such as tokenization and truly innovating financial markets. But for this to occur, blockchain technology needs to replace redundant legacy constructs such as transfer agents. Transfer agents – banks, trust companies, or other financial institutions – have managed investor records and transactions since the 1970s. While they alleviated paper-based inefficiencies in their time, they now represent an outdated middleman. Transfer agent-based market infrastructure is the exact type of anachronism that having securities exist onchain (i.e. tokenization) is meant to eliminate. Despite this, a majority of blockchain-enabled infrastructure solutions currently in the market deploy a hybrid transfer agent and blockchain model. The transfer agent manages security certificates of ownership as the single source of truth, and those records are then mirrored onto the blockchain, providing a digital receipt of ownership. Read the full op-ed here.
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