21 Burst results for "Coin Center"
Bitcoin Magazine Podcast
"coin center" Discussed on Bitcoin Magazine Podcast
"And Christopher Wray's actual quote today from the FBI saying that this is like a must do situation. Unreal. Unreal. Yeah, so here is a story from Coin Center. I am not the biggest fan of Coin Center. I've said ever since the beginning when Coin Center got started and they were up there on Capitol Hill trying to educate these people. I knew that they were going to take this education even though it was well-intentioned by Coin Center. And they were going to use it to crack down. And I think that's what has kind of happened here. The Coin Center has dug their own grave for a lot of these crypto tokens. But anyway, the story here for tornado cash is they were an independent smart contract on Ethereum and you could mix your coins there. And it was run by two guys. OFAC came in and said, you know, we don't allow this because there's no KYC going on. That's where the OFAC compliant blocks come in. So Ethereum has, it's had up to like 80 or 90% compliant blocks at one point, but now I think it's down to like 40%. But every day there's transactions censored on Ethereum because of this OFAC compliance all around this tornado cash stuff. So yeah, now it's come out that the indictment has dropped. SEC is in, you know, indicting these two guys from tornado cash because it's a centralized thing. And yes, it is running decentralized on the Ethereum blockchain, kind of like, you know, a smart contract there. But these guys had total control over it. They had control over the front end. They had control over the code. They had control over everything. The authorities told them that they needed to start implementing KYC and they didn't do it. Now this is the space, I guess the Bitcoin space is taking this as an affront against privacy. But guys, there's a reason Satoshi was anonymous. Yes, he published code, but also people know that if you can censor something, the government will censor it. Like it's not truly decentralized if they can arrest these guys and totally crash the coin, right? Yeah, but you're even missing the frame here, Ansel. The frame is not were they right in doing this and were there better mitigations. It's do they have any credibility in the first place? They don't. I mean, this is Christopher Wray, right? This is what he says today. Today's announcement should remind criminal organizations everywhere in the world that they are neither untraceable nor anonymous. You can't hide from us behind a keyboard, he says. OK, so they catch no one else for this crime. Nobody gets caught for the money laundering, not even Hunter. No one gets caught for this stuff. And now all of a sudden it's these guys? No, no, no, no, no, no, no, no. It's what Giacomo Zucco says. No more negotiating around the KYC and complying and they didn't do it the right way or they did it. The whole thing is a scam. Money laundering is beautiful and we need to bring it back big time because whatever is going on here. Right. When they go out and they say we're going to get the money launderers, they don't catch them. They catch who they want. And it's political. This is entirely political. You know, we have their lawyers speak at Bitcoin 2023 and, you know, they didn't say it expressly. But all of this stuff goes back to the inability to deputize the banking sector, to do the job of law enforcement. And it's the weakness that has pervaded our entire system. We've abandoned Hong Kong to this folly. We gave Hong Kong away for this stuff. FATF, compliance. That was what the security law in Hong Kong was all about. It was money laundering compliance with mainland China. And so at what point are we just going to say what's the cost benefit? What's the cost benefit? Right. We're throwing more people in jail. Yet Hunter's OK. Everyone's fine.
Bankless
"coin center" Discussed on Bankless
"So what are they doing now here? Here's Neeraj on this. What's he saying from Coin Center? So Neeraj, also from Coin Center, just basically says the obvious. Roman Storm and Roman Semenov did not accept nor transmit user funds. They never touched users funds. You know, the other nefarious thing about this is that in the indictment, in the statement from the Department of Justice, they said that the majority of money going through tornado cash was illicit. But interestingly, they previously admitted that only 7% of money going through tornado cash is illicit. And that discrepancy between what they are saying in this document, saying the majority of funds going through tornado cash is all bad and nefarious, you can tell that they are just trying to work up a case here because of the fact that they previously said that they know that only 7%. So they're clearly working up a case here. So that means, David, 93% was like presumably not illicit. It was just citizens looking for... Some of my money, some of the other people's money. For privacy on chain, right? Which is, again, we don't have an HTTP. There is no privacy solution on chain right now that can be accessible on Ethereum. And this was it. This was one of those. And there was not all scammers and tax evaders and terrorists and rogue states using this protocol. It's like regular people. They're stripping this functionality because I just want to reiterate, for those who aren't familiar, we talked about this months ago when it happened, any U.S. citizen is actually not permitted. It's illegal for you to go use tornado cash right now. You cannot do it. It's an OFAC sanctioned smart contract address. And again, going down to the base principles of why this is important is like the line, the classic line is like, why do you need privacy if you have nothing to hide? Of course, I think bankless listeners don't need to have these arguments reiterated. Like when I use tornado cash, it's not because I have a skeleton to hide. Like, I just want to hide my bad trades and my stupid NFTs that I bought on one particular address. And when I send you money, I don't want you to be able to see any of my hidden stuff. Guys, it's just like, I think there's somehow this norm that we don't have around financial privacy, but you know, flip it around messaging. Imagine if the government could open up every single email, every single message. That you send to your your friends or your wife or your family and they had like read access to all of that. That's what you have without privacy on chain. I will note to you this 7% of tornado cash is legal activity. I was looking at estimates for do you know actual physical cash? What percent estimates experts estimate of that is kind of illegal or tax evading? Do you know what that number is? Higher than seven. It's 30%, David. Physical cash. Maybe we should outlaw. I don't want to give them ideas. They are also trying to do that. OK, so Seth from Privacy, another tweet from him, says the logic so that he's quoting he's got a picture of the document and says, as discussed below, this is a statement from the government. The failure to implement AMLKYC facilitated the ability of customers of the tornado cash service to transfer criminal proceeds between addresses on the Ethereum blockchain without being traced. And then importantly, Seth says, who's a lawyer, says the logic that non-custodial services must implement KYC AML is without prior legal precedent. There has never been any statement or precedent ever that non-custodial financial services have to have to enforce KYC AML. So it's one of those. How do you find out this is illegal? It's like we arrest you, you show up to your house and arrest you. Yes, exactly. There's not actually a law about this. Yeah, I will say. OK, so there's one new thing we've we've as an industry of cryptographers who are we we are downstream, the cryptocurrency industry is downstream of the cryptographers that have come before us in the 80s, 90s and early thousands. We've already fought Cryptography Wars 1.0. Why are we doing Cryptography Wars 2.0? Because as David's saying, cryptography itself, like encryption technology itself, the thing that we take for granted every day, it used to be on the U.S. Munitions list. It could not be a technology that is illegal for citizens to use. We changed that with the birth of the Internet. That's what you mean by Cryptowars 1.0. So we've done this before. Why are we doing it again? Well, because now we have the addition of cryptocurrency. So now there's this new form factor and the government thinks that it gets to have a second attempt of making cryptography illegal or at least this particular implementation. So the addition of financial assets is the novel thing here. And this is where the Torn token, the tornado cash token, actually has a story to play here. So, again, Seth from Privacy focuses on one of the elements in the documents here and says that this is most assuredly where the court will focus on profit motives as there was a clear profit at stake for the founders indicted here. Without Torn, I doubt that there will be any case at all made by the U.S. Government. And so inside of the document, there's a section that says, in connection with the creation of tornado cash DAO, the tornado cash founders made a public announcement of the creation of a new token on the Ethereum blockchain called the Torn token and created approximately 10 million Torn tokens pursuant to a formula created by Roman Storm and Roman Semenov, the defendants. Approximately 30 percent of Torn tokens were distributed to the three founders and to certain investors in the tornado cash service and including some venture capital firms. And so they were able to profit off of what the Department of Justice is saying is promoting illicit illegal activities that violate FinCEN. And so that profit motive is a new variable in what is now crypto wars 2.0. It's the strongest part of their case. If there was no token, this case would be a whole lot weaker. Yes. And so this is why we are thinking that we are doubling down on this whole Torn thing. But what did Torn actually govern over tornado cash? Could it have removed money from the pools? Could it have directed any money? The answer is unequivocally no, it could have not done that. There were some very small surface areas that tornado cash, the Torn token governed over. One of them was the relayers. I think you could approve or unapproved relayers. I think that was the big one. But really, there was no material control over tornado cash. In fact, tornado cash governance broke not too long ago from an exploit. I don't know if you remember that story, but basically tornado cash governance is now completely corrupt because of an exploit that happened. They couldn't do anything about it. They didn't have control. Yet the pools still live on. So it's actually proof that the tornado cash token is completely adjacent to the actual details of the protocol. Well, and how far back do you kind of go around that, too? Again, Ethereum stakers, Ethereum validators received some fractional proceed of a tornado cash transaction. And so there's a profit there. Like, I mean, so do you make Ethereum illegal and validating illegal? I don't know where this road leads. This is Jake Travinsky. I'm struggling to think of something, anything useful to say about this tragic mistake. That is the DOJ's decision to treat privacy and speech as crimes. I'm blank. Wow. Yeah, Jake Travinsky is blank. Oof. Yeah. When he runs out of words, the treatment of privacy and speech as crimes. Let's remember what code is and why we won crypto wars 1.0 is because encryption technology code is speech. It's speech, right? And we have protection of free speech, at least in our Western liberal democracies, or I guess so we believe. Jake continues, privacy is normal. Code is speech. The right to anonymity is essential to a free society. These are fundamental principles embodied in the U.S. Constitution. He ends with this take, in time, I'm confident they will be confirmed by the judiciary, even if today they were ignored by the executive. So he thinks we still have a case to make on the judiciary side. You remember when we first met with Jake? He said, I think all of this ends with U.S. versus crypto in some sort of Supreme Court case. And he thinks that that's where we'll have to make our stand. And I mean, we're getting closer to that, I suppose. So a tweet that I put out in response to this is, cryptography is the language of truth. A stance against cryptography is a denial of reality. Arresting those who write cryptography is futile. It merely causes unnecessary harm while resisting the inevitable. And this is what I would say is emblematic of the friction between large scale authority, coercive government, and I say coercive relatively neutrally, because that's how government works, and then also the rights and the power of the individual. Cryptography is just applied mathematics. And when you construct cryptography in many different ways, infinite different ways, one of those ways of construction, just like building blocks, just like adding some numbers together, you can get a system like tornado cache. Tornado cache is just math and it's just employed on a crypto economic system called Ethereum. There's no politics about that. It is an expression of numbers and you cannot make that illegal. And the reason why the government is trying to make that illegal is because it's looking at that thing and it's so, cryptography is so powerful that it appears like magic to people. And so that disconnect of understanding, it's seriously just misunderstanding that is what allows them to have room to make this arrest. I think I want to add to that take, right? Because you said it's applied math and somebody might say, yeah, but, you know, like nuclear weapons are just applied physics. I think the difference with cryptography is that it is a defensive technology only. It is not an offensive, aggressive weapon. It is more like a wall that you build. And it is a tool for the individual. A individual person can have a piece of communication that cannot be decrypted by anybody. Like, not even the NSA, not even Mossad, right? The full brunt of government power and spending cannot break an individual's ability to encrypt some communication and keep that secret. It is a defensive technology for the people, essentially. And that's what's at stake here. And that's what makes it even more insidious, I think. This is Amin Soleimani. Just so you get a picture of who this guy is, which Roman is this, David? Who are we looking at? This is Roman Storm at East Denver this most recent year. Looks like a regular kind of crypto ETH dev standing next to you. Like, I mean, I wouldn't be surprised if you've seen him around at conferences, David. Maybe without knowing it. Yeah, probably. It's a normal looking guy. He's from Auburn, Washington. That's like 30 minutes away from where I grew up. So what do we do about this? What do we do about this? This is Amin Soleimani, GM. I would like to talk to the manager. He thinks we should go full Karen on this and we should raise a ruckus. I don't know exactly what that looks like. That's the picture that he's showing. He's like, how to file a petition removing someone from the OFAC sanctions list. So Amin is asking you, I'll go do this after we conclude here today, Ryan, to file a petition. Say, hey, let's get Roman Semenov off of the OFAC list. Roman Storm is in jail. Roman Semenov is on the OFAC list. Can you do that? We can file a petition, sure. What else can we do? I mean, we'll do that, but it just, that'll go into, you know, I want to know, like, legal defense groups to fund. There's always like Coin Center and, you know, Blockchain Association doing great work. We've got to figure out some other calls to action here, but maybe this is related to this, David, because I know Coinbase has been working on this. Tell us about an update to this court case, because it's definitely related. Yeah, it's related and also bad, also negative. So this is the lawsuits against tornado cash. So way back when, after tornado cash was added to the OFAC sanctions list, there was the mass dusting of people out of the tornado cash contract address, which if you are a U.S. citizen and you received any of this dust, that made you violate OFAC sanctions list because the law makes no effing sense. It doesn't account for the idea that a smart contract, if deemed illegal, can go touch you if somebody else uses the logic of that smart contract to send you money, which is exactly what happened. It's like if you got an envelope with something bad in it and somebody dropped that in your mailbox, you would be legally responsible for that. Yes. And so there are a handful of people suing the Department of Treasury over this. And so Coinbase is sponsoring one of them. Coin Center is sponsoring me. I'm the other one. And so this is not my case. This is the Coinbase sponsored case where I think the TLDR is that the United States Treasury has won one of these lawsuits. Coinbase is going to appeal this, but the tweet here is the district court in the Van Loon versus Department of the Treasury. That Van Loon name sounds familiar. That'll be Preston Van Loon, who is one of the co-founders of Prismatic Labs. The related suit challenging the OFAC sanctions has held in favor of the U.S. government's on the merits, meaning that the Treasury wins and the sanctions designations are upheld. This tweet goes through the logic here. Three main points. The tornado cash is an entity, so it can be designated under sanctions regulations. We, the crypto industry, want the tornado cash to not be an entity. We want it to just be code because of how it is. That's what it is. That's what it is. In an association composed of its founders, developers and the DAO, a body of persons who have combined to execute the common purpose of developing, promoting and governing tornado cash. So you can start to see where the torn token and the tornado cash DAO start to be a very relevant variable here. So that's the first of three reasons. OFAC's determination, here's the second, that smart contracts constitute property under the applicable regulations is not plainly wrong. So the court will defer to that determination. In particular, regular contracts are property under the regulations. And so therefore, smart contracts are just code enabled species of unilateral contracts. How many things can you get wrong? I mean, like you can make a smart contract that is a property. So an NFT, for example, is a smart contract and I own NFTs. And so that is my property. But I don't own a tornado cash, even though it is also a smart contract or a system of smart contracts, because you need to take the thing in facts and circumstances like calling something a smart contract doesn't tell you much about what that thing is. An ERC 20 token is a smart contract. An NFT is a smart contract. A DAO is a smart contract. Uniswap is a smart contract. Literally everything on Ethereum, other than externally owned accounts, are smart contracts. So everything on Ethereum is a smart contract. Not everything on Ethereum is property. So we need to figure this one out. Treasury. So that's the second point. The third, no First Amendment conflict here has happened because the sanctions does not prohibit all expression, just an expression using one service. So this first amendment is our is our free speech one. Yes. So they're saying that this is OK because tornado cash is not a public place or forum. No problem here has been caused by a chilling effect on code developers because it only limits transactions, not writing or otherwise interacting with the code itself, saying that when you type in the numbers in your keyboard and those numbers happen to manifest into a valid transaction, that transaction is not speech, which we want it to be speech. It ought to be speech. It's it seems very simple. Treasury and the U.S. government does not want an HTTPS for money. Yeah, they just do not want that. Right. That is not written anywhere in the Constitution that gives them the right just because something's digital. They think they can surveil it. They think they can access it. We don't think they they should. We don't think they can. It seems incredibly obvious to me, but they are losing this case. And so where do we where do we go from here? So the Coinbase case is going to proceed. I think that's going to be appealed to a new court about the coin. You also have the coin center case, which you mentioned you were a plaintiff on. And so I am the plaintiff of the plaintiff on. So it's like David Hoffman versus Janet Yellen and Treasury that hasn't proceeded yet. So that's going forward. So we're pushing back in the court system. But this this this court ruling was a pretty major setback in the actual arrest of open source developers is, again, another major setback here. So not when Paul Graywell, the chief legal officer of Coinbase, just says rights are rarely secured. That is on a path that is always up into the right. We will continue to believe the plaintiff's challenge to OFAC tornado cash action is correct. So they're not backing down. They're just going to appeal this and we're going to have another rodeo. The instances in which I've talked to two people at Coin Center, both Peter and Neeraj from Coin Center, they've both said very positive things about the progression of my case. They think that they kind of revealed that Treasury actually didn't really understand what they were getting into. I can't really say too much, but positive sentiments, but we don't really know until the day actually comes and the ruling is ruled upon. So plenty of reasons to be optimistic about it. Guys, we'll try to come back next week with some more substantial action items for you and places you can donate things you can do, but definitely there'll be a place to contact your representatives if you live in the U.S. If you don't live in the U.S., look, I think the battle will be fought in your jurisdiction as well. And so look at the U.S. as kind of a bellwether for some of these things, because if it's not there, it's coming to a jurisdiction near you.
The Breakdown
A highlight from Tornado Cash Arrests: Attack on Terrorism or Attack on Privacy?
"Welcome back to The Breakdown with me, NLW. It's a daily podcast on macro, Bitcoin and the big picture power shifts remaking our world. What's going on, guys? It is Thursday, August 24th, and today we are talking about tornado, cash and some big announcements of arrests yesterday. Before we get into that, however, if you are enjoying The Breakdown, please go subscribe to it, give it a rating, give it a review, or if you want to dive deeper into the conversation, come join us on the Breakers Discord. You can find a link in the show notes or go to bit .ly slash breakdown pod. Well, friends, a bit of a big announcement yesterday. On Wednesday, the Justice Department unsealed charges against two tornado cash co -founders. Roman Storm, who lives in Washington state, has been arrested and Roman Semenov, a Russian citizen, remains at large and is believed to be currently residing in Dubai. In addition to the charges, Semenov has been added to the Office of Foreign Asset Control Specially Designated Nationals list, which is the list of sanctioned companies and individuals. The pair are charged with conspiracy to commit money laundering, conspiracy to commit sanctions violations, and conspiracy to operate an unlicensed money -transmitting business. A third co -founder, Alexey Pertsev, you will remember, was arrested in the Netherlands in August of last year, and Pertsev is currently awaiting trial on money laundering charges from home detention after spending over six months in jail. Ofack said in a statement that, quote, tornado cash has been used to launder funds for criminal actors since its creation in 2019, including to obfuscate hundreds of millions of dollars in virtual currency stolen by Lazarus Group hackers. Alongside Semenov being personally added to the sanctions list, eight Ethereum wallet addresses were identified as belonging to him. According to Elliptic, these addresses have processed more than $11 .5 million in crypto transactions. Now, the DOJ claims that tornado cash has, quote, facilitated more than $1 billion in money laundering, including, quote, hundreds of millions for North Korea's Lazarus Group. The key to the case, according to U .S. Attorney Damian Williams, is that the pair here charged, quote, knowingly facilitated money laundering. He said in a statement, while publicly claiming to offer a technically sophisticated privacy service, Storm and Semenov in fact knew they were helping hackers and fraudsters conceal the fruits of their crimes. Today's indictment is a reminder that money laundering through cryptocurrency transactions violates the law and those who engage in such laundering will face prosecution. Now, Storm's lawyer claimed that the case hinged on a novel legal theory. He said in a statement, Now, let's take a step back and put this in the context of what happened last year. In August of last year, tornado cash was placed on the sanctions list. The use of sanctions to prohibit the use of anonymizing services was controversial within the crypto industry. Both Coin Center and a group of individuals backed by Coinbase have sued the Treasury Department over the sanctions, with each lawsuit claiming that the sanctions impinge on U .S. protections around the execution of computer code. In addition, they claim that autonomous smart contracts cannot be the subject of sanctions law as they are not the property of a sanctioned individual or group. Last week, however, the Coinbase lawsuit was dismissed, with the judge writing in their decision that smart contracts are analogous to vending machines in the way they carry out their predetermined task. The judge wrote that, Now, let's dig into the charges a little bit. The newly unsealed charges explain the functionality of tornado cash and how Storm and Semenov established a token system around the protocol in order to profit from its operation. Tornado cash allows users to deposit ETH to be mixed with other depositors. Users receive a secret note, which can be redeemed for the deposited ETH at a new, unrelated address. In order to facilitate the withdrawal of ETH to fresh wallets that could not pay gas fees, tornado cash established a system where users could use relays to process withdrawal requests using the smart contract. Relays would take a fee for providing this service. This process makes private transactions possible on the Ethereum network, breaking the ability to trace funds through blockchain analytics. Storm and Semenov, the government accused, would frequently give instructions on how to maximize the anonymity provided by the service, including waiting several days before withdrawing to ensure that transactions couldn't be linked. Nine months after the launch of tornado cash in August of 2019, the developers updated the smart contract to remove their private keys. This made it impossible for the code to be further modified and relinquished any ability to control its operation. In December 2020, the founders created the tornado cash DAO to make governance decisions around the protocol. The DAO issued torn tokens and distributed them with 8 % of the supply going to each founder and 6 % going to venture capital backers. The DAO then used these tokens to create an incentive scheme to encourage relay to compete to process transactions and to incentivize users to deposit funds to increase the anonymity set for the protocol. The indictment alleges that the founders profited from the price appreciation of the torn token, ultimately cashing out for $2 .6 million each in August of 2022. Now where the nuance in this case comes in is the question around were these charges for writing code or were they charges for some other type of activity that the government sees as beyond the pale. Obviously, when we're talking about something where the implications are the big thing that matters, these sort of details are essential to really understand. And indeed, in this case, the charges against Storm and Semenov go deeper than just writing and publishing the code underlying tornado cash. In fact, the DOJ appears to be much more focused on the actions taken by them to support, promote and profit from the protocol after its initial deployment. The indictment claims that the developers were aware and indifferent to the use of tornado cash to launder the proceeds of crime from the beginning. As far back as November 2021, the government says the developers considered whether they should implement KYC and anti -money laundering features into tornado cash and chose not to. This consideration became more serious after the $552 million Ronan Bridge hack in March of 2022, given that the following month the attack was attributed to the Lazarus Group, which had been on the sanctions list since September 2019. The stolen funds were very publicly identified as being laundered using tornado cash. According to encrypted chats disclosed in the indictment, Storm sent a message to his fellow developers as the news broke in April stating, Guys, we are effed. The tornado cash team then implemented some perfunctory controls on the protocol's front end, such as the website used to access tornado cash would now block deposits from wallet addresses on the sanctions list. However, in encrypted chats, the developers acknowledged that these controls would be quote easy to evade by interacting with the smart contract directly. The indictment also introduces evidence that the developers were aware of just how rampant money laundering was on tornado cash. In encrypted chats, they shared an article which claimed that more than 90 % of transactions through the service were related to criminal acts. In the three months that followed the Ronan attack, as much as 15 % of volume was attributed to the laundering of those funds. The key allegation in the indictment is that, quote, Throughout this time period, the Tornado Cash founders continued to operate the Tornado Cash service and facilitate the Lazarus Group's money laundering and sanctions evasion, including by paying the U .S.-based web hosting service to continue to host the Tornado Cash website, continuing to maintain and keep the UI accessible to customers, and promoting the Tornado Cash service in public statements. Moreover, they maintained the Relayer algorithm and the Relayer registry, which allowed them to profit financially from the continued use of the Tornado Cash service by the Lazarus Group. As to the charges, the developers have been charged with three counts each. Conspiracy to commit money laundering, conspiracy to commit sanctions violations, and conspiracy to operate an unlicensed money transmitting business. As you might imagine, the crypto legal community has a lot to say about whether the facts alleged in the case established that Tornado Cash or the system of relays around it legally qualify as a money transmitting business. Peter van Valkenburg, the director of research at CoinCenter, said, The factual allegations of unlicensed money transmission are in conflict with FinCEN's longstanding guidance that a, quote, anonymizing software provider is not a money transmitter. In an accompanying article, Valkenburg says that the only part of the indictment that indicates the developers were operating an unlicensed money transmission business is that they, quote, engaged in the business of transferring funds on behalf of the public. According to Valkenburg's analysis of the law, this falls short of the legal definition which requires acceptance of funds from a customer for the purposes of transmission. The implication is the same one that Tom Emmer has been putting forward in his blockchain regulatory certainty bill that, quote, if you don't custody consumer funds, you are not a money transmitter. However, Preston Byrne, a lawyer at Brown and Rudnick, noted that there is some legal nuance in the way the DOJ went about charging the developers. He said, The feds don't need to show that they accepted or received funds because defendants aren't charged with the underlying offense, they're charged with conspiracy. Preston expanded that thought, There is a huge difference, he wrote, between a, merely publishing code for discussion purposes which could be used unlawfully, and b, running an unlawful business which monetizes that code. After reading the tornado cache indictment, if things are as alleged, it was the latter. For the purposes of 18 USC 1960, the publication of protocols on GitHub isn't the same thing as operating a whole damn system, including hosting a UI and bolting on a shitcoin to it, where the returns from the coin are linked to the provision of liquidity for the system. I think it is that involvement with the essential functionality of the system which makes it not subject to the network access carve -out from the definition of money transmitter. Do we need privacy in crypto? Absolutely. Are there ways for people to run code that does this lawfully? Yes. Was tornado cache the way? No. Now of course, as much nuance as there might be in the specifics of how the defendants were charged, one of the big concerns is the chilling effect on privacy norms in open source development that it might have no matter what the charges actually are. In a rare moment of speechlessness, Jake Travinsky, the chief policy officer of the Blockchain Association said, I'm struggling to think of something, anything, useful to say about the tragic mistake that is the DOJ's decision to treat privacy in speech as crimes. I'm blank. Later, he followed up, Privacy is normal. Code is speech. The right to anonymity is essential to a free society. These are fundamental principles embodied in the U .S. Constitution. In time, I'm confident they will be confirmed by the judiciary, even if today they were ignored by the executive. Chris Bleck wrote, The arrest of Roman Storm and Roman Semenov of Tornado Cache isn't about money laundering. This is an attack on privacy. It's an attempt to chill the open source community into compliance. The government does not want you to do anything that it's unable to observe and judge. Dystopia Breaker writes, Take a moment to consider the broad and absurd implications of writing software that is used in a bad way makes the author legally responsible for every bad use would mean. No signal. No privacy tools. Total handover of power to centralized orgs and illegalization of privacy. Ultimately, this position is so absurd that it seems unlikely to be accepted. It's remarkable that they went with it. Masari's Ryan Selkis said, We are so far from our founding principles, we just jailed a software developer for building encryption tech and daring to empower citizens to transact freely. Utterly disgusting. We need a total evisceration of our political police state and D .C. No reform. Mass layoffs. And Udi Wertheimer really summed up many people's feelings when he said, Today is a sad day for America and for freedom. Privacy is for everyone, and it is crucial that as an industry we keep fighting for it, no matter the setbacks. No one else is going to. At this point, I think in crypto, we're almost anesthetized to more government actions against the industry. But I think this one is worth holding aside and putting in a slightly different category. The conversation here isn't really about cryptocurrency, except in so far as it was used as a reward mechanism for people who are promoting this protocol. Obviously, the much bigger questions are about the nature of privacy, about the rights of software developers, about the responsibilities of software developers, about the tools that the government uses to fight money laundering and terrorism. They are, in other words, emblematic of bigger concerns and bigger questions. It's reasonable to have contradictory feelings about this, but that's exactly why we need regulatory clarity, not just for crypto, but for software development. And guess what? In a world of AI, these questions are coming up all over again. The question in particular of whether the developers of software can be held accountable for how it's used is becoming an even bigger question than it ever has been in the past. In other words, this one is worth considering for far more than the implications for just this industry, but for the very basis of the technology -driven society that we live in. Anyways, guys, that is going to do it for today's breakdown. I will, of course, keep you updated as the situation evolves. Until next time, be safe and take care of each other. Peace.
Simply Bitcoin
"coin center" Discussed on Simply Bitcoin
"He said the government just ruined two lives and I can't figure out what law was broken. Money transmission, tornado crashes, non-custodial profiting because bad people use tornado crash. Companies profit from bad people using their services every day. Extremely dystopian. What Zach is saying is very important because shift this to Bitcoin. They're setting a precedent, right? These open source software developers, right? They develop a software, right? And, you know, bad people used it. In this case, it was the North Koreans, right? And I don't want to say the North Koreans are, I don't want to, I don't have an opinion on that, but you know, from the eyes of the US government, North Korea bad. But basically, they created this software, right? And, you know, they profited from it. I guess that's where you can make the case that, you know, that part was bad. But what if they didn't profit from it? What if they just created in the first place and, you know, people that the US government deems bad people use it? You know, again, it creates a precedent. Like this is crazy that people are being jailed for developing software. I get it. You can make the argument that, you know, this wasn't fully decentralized. You can make the argument that they were profiting off of people that shouldn't have been using this software. But again, I do not trust any single type of creep like this should always be called into question. And you should always shine a light of truth on it. Anyways, very, very scary times. So, Zach said it best, extremely dystopian. So this was back to the original article when we covered when the news broke. And this is Coin Center, which is like kind of like a lobbying arm for the Bitcoin and shitcoin industry in D.C. And they covered, you know, when this happens. Right. And it said Coin Center is suing Office of Foreign Asset Control over its tornado cash sanction. The Office of Foreign Asset Control does not have the authority to sanction a smart contract and Americans have a right to use privacy tools. It goes on to say today, Coin Center, along with a group of normal privacy seeking workers, donors, activists, public figures filed a lawsuit against the Treasury Department to keep privacy normal to delist tornado cash privacy tools from sanctions. Again, this is setting a precedent. What open source software is next? Because it's very easy for them to say that Bitcoin's open monetary network is allowing, quote unquote, bad people in the eyes of the U.S. government to circumvent U.S. sanctions. It enables money laundering. Like you could see where it's going ever so slowly or how they could frame it. Anyways, goes on to say second, even Treasury's own regulations and PAC's executive orders limit the ability of sanction controls to transact to transactions with persons, entities or their property. The tornado cash sanction was made without a statutory and also without regulatory authority. It was made contrary to law. Third, in sanctioning tornado cash tools, the Treasury failed to consider the collateral consequences of its actions or manifest any awareness of or jurisdiction for their significant deviation from previous sanction policies. Their actions were arbitrary and capricious.
Daily Crypto Report
"coin center" Discussed on Daily Crypto Report
"The FBI has issued a warning that North Korean hackers from the Lazarus group might try to cash out more than 40 million in stolen Bitcoin. These hackers connected to the DPRK have a history of crypto heists. The FBI has identified specific Bitcoin addresses where the stolen funds are located and recently moved to. The Lazarus group is known for spear phishing and malware to target the blockchain sector, often initiating attacks through deceptive emails aimed at IT employees. Notable hacks attributed to the group include those on AlphaPo, CoinsPaid, Atomic Wallet, Harmony's Horizon Bridge, and Sky Mavis' Ronin Bridge with losses reaching hundreds of millions of dollars. Former OpenSea executive Nate Chastain has been sentenced to three months in prison for insider trading involving NFTs. He was found guilty of fraud and money laundering after making over $50,000. By trading NFTs, he knew it would appear on OpenSea's homepage. Chastain used anonymous wallets and accounts to hide his actions. Despite prosecutors initially seeking a longer sentence, the judge cited Chastain's modest earnings from the trades for the lighter punishment. Chastain will also undergo three months of home confinement and then three years of supervised release after serving his prison term. The case is a warning against insider trading and the NFT market. Will Coin Center, the crypto-focused policy non-profit, have sent a letter to two Congress members urging for clear regulations on crypto taxation? They highlighted the need for guidance on accounting when taxing crypto as property and collecting capital gains taxes. Coin Center also advocated for a de minimis exemption which would set a threshold below which no tax is due to avoid excessive taxation on smaller transactions. They argue that without such an exemption, cryptocurrencies would be too complicated for daily use in payments, especially in microtransaction scenarios. Coin Center has been advocating for a de minimis exemption since 2020. Will DeFi lending protocol Maple Finance has raised $5 million in strategic funding with Blocktower Capital and Tioga Capital co-leading the funding round. The funds will be used to facilitate expansion in Latin America and the Asia Pacific region as well as to establish partnerships with other protocols, financial services providers, and credit experts. Maple Finance aims to transition from DeFi into the traditional finance sector, positioning itself as a leading lending marketplace and tech provider. The platform currently has over $2.2 billion in total loans issued and over $45 million in total assets deposited. And finally, payment startup MoonPay is offering a solution to Binance US customers after the exchange suspended US dollar deposits. Customers can now use MoonPay to buy USDT using credit or debit cards and then convert it into crypto tokens, allowing them to withdraw fiat from the crypto exchange. Binance US had to suspend dollar deposits after losing relationships with banking partners in the US due to legal action from the US SEC. Well, that's all for us today. Visit us at dailycryptoreport.io for sources and links. And listen to us everywhere else you podcast under Daily Crypto Report.Hey, guys, welcome to the collective. I'm Brianne Helfrich, a 26-year-old bioethics, PhD student and clothing brand CEO. Welcome to my podcast where we talk all things health and wellness, navigating your 20s and becoming the best version of yourself. So sit down, play that episode and join the collective. Hey, this is Mary Beth Lassiter. Are you craving a new podcast? I've got a recommendation. Check out Gravy, the James Beard award winning podcast that shares stories of the changing American South brought to you through the foods we eat. It's produced by the Southern Foodways Alliance and distributed by APT Podcast Studios. Listen to Gravy on your porch during happy hour to hear about the mystery of the missing Pappy Van Winkle bourbon. Don't miss out. Follow Gravy wherever you get your podcasts.
The Breakdown
A highlight from Tornado Cash Sanctions Upheld In Court
"Welcome back to The Breakdown with me, N .L .W. It's a daily podcast on macro, Bitcoin and the big picture power shifts remaking our world. What's going on, guys? It is Saturday, August 19th, and that means it's time for the weekly recap. Before we get into that, however, if you are enjoying The Breakdown, please go subscribe to it. Give it a rating, give it a review, or if you want to dive deeper into the conversation, come join us on the Breakers Discord. You can find a link in the show notes or go to bit .ly slash breakdown pod. Now, today we are catching up on a ton of legal updates that have happened this week. This continues to be the big theme of this bear market is legal cleanup, legal proceedings, legal blah, blah, blah, which unfortunately is just sort of part of the phase that we have to get through before we get to the exciting stuff like, you know, usage and excitement and whatever, anything that isn't just legal stuff. But here we are. However, I want to start with something that is a little bit more on the market structure side, given the dump that we had on Thursday. So in the middle of the week, the block started reporting that yet another crypto market maker was pulling back. Apparently, longtime crypto market maker GSR has been scaling down operations during the bear market. Now, this is a firm that has been active in crypto order books since 2013. They had already conducted two rounds of layoffs and appeared to have also lost multiple executives and department heads. The firm's chief financial officer, Jonathan Hu, has been the highest profile departure. He joined the firm in 2021 and helped build out the company's finance department. Anonymous sources speaking with the block criticized the firm for expanding too rapidly during the height of the bull market. GSR brought on scores of traditional financial professionals to help expand the firm. In 2020, the firm had just 25 employees, but the number went up to more than 300 at its peak. One source said, quote, The executive team is mostly friends, and I think it threw off a lot of the momentum GSR built in the previous cycle. They hired a lot of corporate Wall Street executives that came in at the top with the bull market, which ended up costing the firm dearly. Another source said, quote, Some of the leadership is out of touch with true crypto. Now, a spokesperson for GSR said, Our business operations and strategy have evolved naturally to respond to changing market conditions, and there has been no restructuring. GSR president Rich Rosenblum took this even farther. On Wednesday, he wrote, Regarding the block's reporting yesterday, we worked with the reporter in good faith, but it's clear the story was always intended to be a negative one regardless of the facts. Here is some additional color on GSR. GSR's business is strong. We have navigated three volatile bear markets successfully without raising outside capital. The firm has a solid balance sheet. We continue to be profitable and increase our market share regardless of market conditions. The article tries to suggest that departures over 18 months are more than bear market norms. We've had many personnel changes over the last decade, but juxtaposing it alongside strategy changes in a bear market to write a sensational piece is irresponsible. We aren't going anywhere, and we continue to be very bullish. We are one of the longest operating and one of the best funded companies in the space. We stand stronger and better positioned now than at any other point in our history. Obviously, this has gotten very quickly into a he -said -she -said, but mostly why it's worth paying attention to, at least with a little bit of side -eye, is what Noelle Acheson wrote, More market -maker scalebacks is not great for crypto market liquidity, which is already low. With that, though, let's move into the legal stuff. First, a group of investors and developers have lost a lawsuit which challenged the legality of the tornado cash sanctions. The litigation, which was funded by Coinbase, claimed that the US Treasury had exceeded its authority in dealing with tornado cash using sanctions law. In coming to their decision in a district court in Texas, the judge found that tornado cash itself was sufficiently coherent in operation to be considered an entity capable of being sanctioned. The Treasury Department can only sanction entities such as individuals, companies, or unincorporated associations. The judge found that the Treasury had identified an entity when it designated tornado cash as including the developers and the DAO which governed the operation of the mixer. The judge wrote that, The DAO is an entity unto itself that, through its voting members, has demonstrated an agreement to a common purpose. As the government notes, the structure is not unlike that of stockholders of a corporation who may not intend to vote in a shareholder meeting without this affecting the structure of the entity. They ultimately found that adding tornado cash to the sanctions list was not plainly inconsistent with its regulations. The judge also rejected the argument that there was no property which could be the subject of sanctions. Litigants claimed that the tornado cash entity, whatever that constituted, does not have property rights in the smart contracts identified by the Treasury. Sanctions can only prohibit US citizens from transacting with sanctioned entities in relation to property, so their use to prohibit interacting with a smart contract was a novel application of the law. The litigants also made an argument that the sanctions violated First Amendment rights to free speech. The tornado cash sanctions were somewhat unique in that they prohibited US citizens from transacting in a privacy -protected manner. The Treasury is not allowed to sanction US individuals, so there was an argument that prohibiting them from using tornado cash was unconstitutional. Now, the tornado cash sanctions drew widespread criticism from the industry when they were put in place last August. The measure was taken ostensibly to deal with North Korean hacking group Lazarus. However, critics said the sanctions were too much of an impingement on privacy and crypto. Coin Center have filed their own legal challenge to the sanctions which is yet to be heard. Next up, the SEC has been allowed to move forward with an appeal in the Ripple case. The regulator is attempting to appeal the parts of the case which were decided against it. Namely, that the programmatic sales of XRP tokens and distributions to employees and contractors were not to be considered the sale of securities. The SEC requested leave to file a motion to appeal last week, to which Ripple objected, claiming that The judge has now granted this leave to file the motion. Once filed, the court can either accept or reject the SEC's reasoning to appeal the decision. If successful, the appellate court would also need to agree to hear the case and then determine whether the SEC is successful in their appeal. Bill Hughes tried to sum up some of this extreme legal complexity saying, The court has not granted leave to appeal. It granted leave to file a motion for leave to appeal. The court just decided, yeah, we can deal with this issue. Again, guys, this is the kind of minutiae that we're dealing with right now. Ultimately, it's important, but I don't think any of us will be sad for the days when we get to focus on other things. Speaking of other things, the Federal Reserve has brought an enforcement action against Farmington State Bank, which used to be known as Moonstone Bank. Moonstone was the tiny bank in rural Washington which accepted an $11 .5 million investment from Alameda Research in March of 2022. The thing that made that investment notable and weird was that it was more than double the bank's entire net worth at the time. Moonstone also had ties to Deltech Bank Executives, which is the Bahamas bank that notoriously dealt with stablecoin issuer Tether as a customer. Moonstone was one of the smallest federally chartered banks in the country. Indeed, last year photos circulated of its headquarters, which appeared to be a farm shed with a pickup truck parked out in front. In January, the microbank announced that it would be stepping away from plans to offer banking services to digital asset and cannabis companies. But, apparently unimpressed with this concession, the Fed has now ordered the bank to wind down in a manner that protects the bank's depositors and the deposit insurance fund. Farmington has also been prohibited from distributing any dividends or assets without approval from regulators. Caitlin Long writes, Wow, Moonstone Bank, aka Farmington Bank, is liquidating after the Fed issued a cease and buy a small existing bank and chain business plan, currently underway by crypto or crypto -adjacent companies. Bitcoin or TBH joked, Both residents of Farmington are quite concerned about this turn of events. Caitlin Long again responded and said, That's what happens with charter strips. Companies search for tiny banks, acquire them, and change the entire business plan thereby skirting all the requirements of starting a De Novo bank. Fed policy favored charter strips by holding them to a far, far lower standard than De Novo's. Speaking of Alameda and FTX, FTX and Genesys have reached an agreement on lending arrangements between the two firms and the disposal of collateral. Genesys will pay $175 million to Alameda Research to settle their claims. Genesys lawyers wrote in a court filing that, The settlement will, among other things, significantly smooth the path to confirmation of the Genesys debtors' Chapter 11 plan of reorganization, as well as eliminating the risks, expenses, and uncertainty associated with protracted litigation among the FTX debtors. FTX had originally filed the claim for $4 billion in May, Genesys counterclaims stating that they had $175 million stuck on FTX after it collapsed. In other words, both firms had outstanding loans with each other at the time of their respective bankruptcies. Genesys interim CEO Darar Aslim said, The terms of the settlement agreement provide significant and near -term benefits to the Genesys debtors and their creditors, in contrast to the uncertainty and expense of fulsome litigation of the FTX claims and Genesys claims. This settlement will extinguish all claims between the firms, which is potentially problematic given that they are significantly less than FTX had originally claimed from Genesys. Adam Cochrane wrote, Barry paid $175 million on a $4 billion debt position, and it means that Genesys claims from FTX are settled and can't go back to DCG and Grayscale? This is a damn good deal for DCG but horrible deal for FTX creditors. And indeed, FTX creditors are not happy. At a FTX creditor on Twitter says, FTX asked court to settle Genesys dispute for a $175 million Genesis claim, the release of a $175 million customer claim and near -worthless Alameda claims. Down from first $3 .9 billion to $2 billion asserted, this must be the worst deal to date, especially in the light of the new DCG -Genesis -DOJ investigation. Genesys claims are currently worth more than FTX's even as Genesys lender balances are inflated by the interest they earn from lending, among others, to Alameda. Genesys was repaid by Alameda quote -unquote with billions of FTX customer funds in 2022. Coins they hold may be directly traced to FTX customer deposits. We expect the UCC to object to this quote -unquote deal. Now, there is, of course, a different interpretation than just Barry negotiating a great deal. Napgener tweets, Again, my timeline is way off here. Everyone is raging at the FTX estate. I mean, basically, FTX is not going to settle for that little unless Genesys is truly cooked. Barry Silbert is in big trouble. Now, obviously, we don't know the answer to that, but it certainly doesn't look good and feels like a pretty reasonable open question. Lastly, today, we'll end on a little bit of a positive note. Coinbase had been granted approval to offer crypto futures to U .S. customers. Nearly two years after applying, the National Futures Association granted a license to Coinbase, which will now be authorized to operate CFTC -regulated futures markets. Coinbase joins the CME and the recently approved CBOE in offering the products legally onshore. Andrew Sears, the CEO of Coinbase Financial Markets, said, Offering U .S. investors access to secure and regulated crypto futures is key to unlocking growth and enabling broader participation in the crypto economy. CFTC Commissioner Christy Goldsmith -Romero said, I have been vocal about the benefits of bringing appropriate crypto activities into the regulated space in order to protect customers but in a way that supports oversight, accountability, transparency and risk management. JP Morgan analyst said the license will open up new revenue opportunities and demonstrated, quote, the staying power of crypto markets in the U .S. They estimated that futures trading could represent hundreds of millions in new business to Coinbase. Coinbase product executive Greg Tussar said, We believe this is a watershed moment to be able to bring regulated crypto products to U .S. customers. Where regulations are clear and sensible, we will work with regulators to receive the authorizations needed to offer products that align with our purpose of using crypto to update the financial system to advance economic freedom and opportunity. Congrats to Coinbase on that license. And thank you to them for giving me something to close the weekly recap on that isn't just a legal decision. Anyways, guys, hope you are having a great late summer weekend. Enjoy it. Soak it in. I know for many of you, summer is the best. For me, it's always all about fall. So with that, I leave you to go grab some old painting from a goodwill so that I can do the ghost painting trend on TikTok with my family this weekend. Until next time, be safe and take care of each other. Peace.
The Crypto Overnighter
"coin center" Discussed on The Crypto Overnighter
"A group of crypto proponents, backed by Coinbase, recently faced a setback in their legal battle against the U.S. Treasury Department. Their contention was that Treasury had overstepped its bounds by sanctioning tornado cash. Tornado cash is a service designed to anonymize crypto transactions. Judge Robert Pittman, presiding over the U.S. District Court for the Western District of Texas, delivered a verdict that may have far-reaching implications for the crypto world. Tornado cash is not just a service, it's an entity with a vested interest in smart contracts. The judge's decision emphasized this, stating that tornado cash is indeed an entity, including the decentralized autonomous organization that oversees it. This now, through its voting members, have shown a commitment to a shared goal, much like shareholders in a corporation. The judge dismissed several arguments from the plaintiffs, including the notion that tornado cash doesn't possess a property right in the smart contracts being designated. The Treasury's move to sanction tornado cash was based on allegations that it was a primary tool used by malicious groups, that groups such as North Korea's Lazarus Group used it to launder stolen crypto. This decision was met with significant backlash from the crypto community. Coin Center filed its own lawsuit shortly after the one backed by Coinbase. The implications of this lawsuit are profound. The Treasury's decision to sanction tornado cash and the subsequent court ruling highlight the ongoing tension between the government regulators and the crypto industry. The crypto community tends to view such actions as overreaches that stifle innovation and infringe on rights. Tornado cash's designation as more than just software, but an entity with rights and interests, sets a precedent that could shape future interactions between regulators and crypto platforms.
The Café Bitcoin Podcast
"coin center" Discussed on The Café Bitcoin Podcast
"Isn't it the worst being the host when you make a comment and nobody does anything and it's just all quiet that you feel responsible for it? Yeah, I'm just throwing out things. We need that cricket soundboard so we can really just grind the salt in the wind. I can hear HODL for some reason. You know, the other thing I saw though was the Fed coming out with new supervision guidelines. I don't know if you guys saw that, but they're basically saying that any kind of bank or organization that provides quote-unquote crypto asset activities basically are going to have written approval from the Fed. This is what I wanted to ask Joe about actually. Joe, do you know when we're likely to see any official language on the back of that Fed announcement? Because I would really like to read specifically what they are talking about. Joe's gone. Joe's long gone. Okay. Sam, is that the legislation that Coin Center is trying to push back on? I believe so. Yeah, I believe so. I mean, to me it just showed the Fed's basically trying to play gatekeeper against a specific industry. Anyone who does crypto asset related activities are going to be subject to novel supervision. And basically what that means is they're going to have to get approval to allow that from the Federal Reserve. This just kind of detailed what that means and what would be the process there for these novel supervision of this new industry. So I thought it was the Fed kind of grabbing supervisory role over this new industry and playing gatekeeper and that's what Coin Center I think is fighting up against. Sam, was that legislation you mentioned regarding mining? That was the tax break was specific to natural gas, flare gas mining, etc. Yeah, that was HB 591. That was the law that was enacted earlier the year. Just that Texas will waive taxes on gas consumed at the well sites that's otherwise vented or flared. Gotcha, thank you. I work at a mine in Texas and I had not heard about that. That's very cool. See, someone appreciated that comment. There you go. Thanks, Fish. Joe, what's up? Yeah, no, I heard HODL invoke my name. What did you say? I was working on something. Well, I don't know. Joe, did you see that Federal Reserve came out with that new supervision of entities that do crypto asset activities? Did you happen to see that? NASP. Novel Activity Supervision Program. What did you think about that? Joe, what I was asking specifically is when are we likely to see language around that announcement? Well, we already have the program mechanics that they've given us. It's on the Fed website. You guys going to see this? This was published Tuesday. No, could you break it down for us? Sure. So, as the name would imply, it's a supervision program. So, it outlines banks that have 10 billion or less in consolidated assets. And so, there are some banks excluded, obviously. But basically, what it requires is it requires collaboration between banks and even non-banks to deliver application programming interfaces, APIs into certain software. So, the Fed can gather real-time data into crypto-focused entities and their deposits, payment software. And the whole idea about it is to use real-time data involving mechanics of crypto transfer and banking rails to outline risks. They want to explore the quote-unquote novel activities so they can determine if there's systemic risk in the system. So, it's nothing more at this point than making sure that banking entities that are engaging these types of programs will have reporting obligations particular to those activities to the Fed. And then they claim they'll have oversight and work with academics to publish potential risks that may be identified so they can better control banking policy. Does that make sense? Yeah. Are there any restrictions similar to the guidelines that the BIS proposed or no? Not at this point? No. It's strictly supervision, right? So, the Fed has a supervisory role where they really just want to look at stuff and see if there's some sort of systemic risk. But then, they already have tools in their disposal if they identify systemic risks related to certain activities. They can demand further examinations. They can temporarily suspend banking licenses. There's already tools that they can do. And the concern with something like this is if they're gathering this data in real-time and arbitrarily shutting off rails, which as you know, Hado, because we talked about this, I expect a ton of that in the near future. I think more and more banking partners, ACH rails, wire transfers will be shut down to those engaging in crypto-related activities.
CoinDesk Podcast Network
"coin center" Discussed on CoinDesk Podcast Network
"Poor content person at coinbase who put this into the right. And now it's like, let's bash coinbase. It just hurts. It just hurts. Yeah, the Pepe phenomenon. I mean, Pepe and wow Jack, they've been around for a long time, and they've sort of gone through different associations over time. I saw niraj coin center's chief comms officer and public face was out there saying that Pepe had been exonerated since its affiliation with some of these alt right groups. I don't know if I saw the official exoneration of Pepe. I may have missed that one. But Pepe means are just good wholesome fun that preexisted all that all right nastiness that became associated with it. So I mean, I can see why coinbase would feel so inclined to make that shout out. I mean, if you go back a couple of years, where Brian Armstrong claimed a CEO said coinbase was not going to take a political stance on anything in the wake of many sort of social movements rising up in the U.S.. That was a big stink, right? So it's not as though coinbase is sort of a bastion of Silicon Valley wokeness and that this was in there and that it's par for the course in terms of their messaging. So it's interesting that this is falling on their feet the way it is in the wake of some of those past comments from Bayern Armstrong. But yeah, man, I mean, they're not wrong to warn people like not to get burned by the Pepe coin. They've seen this one. They've been in the cycles. We've all been in these cycles. The crash is coming. Watch out. Be safe out there. Have fun with it while you can, but the long-term investment prospects probably not great. And you can look back to previous meme coins over the years and look at some of those examples. But I don't know, Adam, historical perspective. I'm tossing it to you. Yeah, I got a lot to say about this. I got a lot to say about this. Okay, so first off, when you look at a publication like this coming out of coinbase, coinbase is trying to generate organic organic people looking at it and paying attention to it. But they have to walk a really thin line here between coinbase can't tell their writers what to say. And their writers are probably people, again, who come from a journalistic background because that's what these big companies wind up hiring. And I mean, let's be real. Like alt right, right wing influencer. There's so many dog whistles that exist out there today that basically are designed to tell audiences on the democratic side of the table. Don't pay any attention to this person. Everything they're saying is a lie. And you should just hate them because of that. Again, one of my favorite journalists, a couple of my favorite journalists Glenn greenwald, Matt taibbi, I forget the guy shellen Stein schellenberger, Michael schonberg. Again, these are all classic liberals who are now routinely described by outlets that are supposedly non biased like Politico as alt right influencers and this is ridiculous. These are the people who brought us information Glenn greenwald's case about all of the government nonsense that was going on that was proven to be true. Again, this was a liberal cause for so long. And so again, it's just to say that whenever you hear people talking about that, it's oftentimes really valuable to look at what's actually being said rather than just taking the disclaimer of, oh, this person's on the right wing, which then means that you shouldn't pay attention to it. So moving past that, the Pepe thing, again, we live in a world of memes, memes are ideas that express things that are fundamental to who we are and to our experience as humans, and often are very, very difficult to express with words, but can be expressed very easily with a fraud, right? There are literally tens of thousands of frog emojis out there based off of the Pepe meme that express every type of emotion that you can imagine, and there are tons of people out there, especially in the younger generations who identify with these because it's easier to express these ideas as memes, even if it's just to express what I'm feeling right now. Again, the wow Jack thing, for example, that's like a lot of times that's about being sad or it's about being happy behind a facade of being sad. Again, these are complex ideas that if you try to articulate them with words, don't go very well. But if you can articulate it with a simple animated GIF or something like that, then why wouldn't you? So again, decentralized movements, which means very much are, are always characterized by people who don't like them by the worst possible interpretation of the worst possible person who you can find who ever said anything that wasn't negative about the thing. So that remains true here today and my final point is is that memecoins are gambling. They are not investing. They are gambling. So this is the casino telling you, hey, you're gambling, but we're not going to call it that because that would be kind of weird because we don't have a license for you to gamble. So let's just say, don't think about this as a long-term investment and be careful, blink, you know? Jen, what do you got? I think we got to leave it there. Adam made three very great points. So Adam, you take us into the last segment. What about the ladies? Thank you for coming to my TED Talk. All right, it's okay. We can just say malady. On three one two three. I don't participate. Come on out. Okay, moving on. Moving on. Last story of the day, and finally, coin desk has got an interesting op-ed out this morning, authored by DJ Wendell, that Scott me feeling
The Breakdown
Elizabeth Warren Has Declared War on Crypto
"The crypto community is extremely fond of the apocryphal Gandhi phrase, first they ignore you, then they laugh at you, then they fight you, then you win. We have a tendency to pretty much always think we've entered the then they fight you phase, but as of this quarter, I think it's pretty much official that we are now well and truly into the then they fight you face. The breakdown has had numerous shows about operation choke .2 and what seems like a coordinated effort to deplatform crypto companies from U.S. banking and in general push crypto offshore. But just in case there was any doubt, any doubt at all. Yesterday, Elizabeth Warren, the self styled emperor of the crypto antagonists, announced her formal reelection campaign for her Senate seat in Massachusetts. To do so, she released a video on a series of graphics with her looking determinedly off camera, with a big blaring headline that had been recently written about her. Some of the accomplishments highlighted included, subsidized child care, and over the counter hearing aids, great things for sure. But that wasn't all she chose to focus on. And what she did focus on would overshadow all of it. The image she chose to start that video, the headline reads Elizabeth Warren is building an anti crypto army. The headline is drawn from a February article in Politico, which covered the senator's sponsorship of the digital asset anti money laundering act last year. That act would require software providers and blockchain validation infrastructure operators to record significant personal information about protocol users and proactively generate money laundering reports without any government requests for information. Coin center called the bill unconstitutional and said it was, quote, a direct attack on technological progress, and also a direct attack on our personal privacy and autonomy. Of course, that's not Warren's only attack on crypto. Since this time last year, senator Warren has sent at least 15 letters on the topic of crypto to regulators, companies, and even the FTX bankruptcy judge. She's also sponsored at least two bills which were dramatically increased the data collection requirements within the crypto industry.
The Crypto Overnighter
"coin center" Discussed on The Crypto Overnighter
"SEC chair Gary gensler agrees with U.S. president Joe Biden's request. That's because Joe Biden wants to give the SEC $2.4 billion in funding. The reason for the funding is to continue to combat quote misconduct in the cryptocurrency industry. Gensler submitted testimony for the march 29th budget hearing with the house appropriations committee. He said that the extra funding was needed in order to keep up with the fast pace of innovation. Gensler also explained that the cryptocurrency industry has had a lot of misconduct due to technological innovation. To address this issue, new tools, expertise, and resources are required. According to gensler, the extra funding would enable the SEC to employ 170 new staff. These new hires would work mostly in the enforcement and examination divisions. The SEC chair noted that the previous year's budget increase allowed the regulator to surpass its 2016 staffing levels for the first time. However, he added that the agency still needed more resources. Spoiler alert. Government agencies always need more resources. As the regulatory agency responsible for keeping the watch over the markets, the SEC means to keep pace with the increasing complexity of the capital markets and the activities of bad actors. Gensler reiterated his description of the cryptocurrency industry as the wild west. He stated that the industry is filled with non compliance, and he warned that investors were risking their hard earned assets in a highly speculative asset class. In the fiscal year of 2022, the SEC received over 35,000 tips complaints and referrals from both whistleblowers and other sources. These reports aided in the regulator taking more than 750 enforcement actions. Those actions resulting in $6.4 billion in penalties and disgorgement orders. And that's what it's all about. Getting the agency more money to use to get more money. So 30 of those actions were connected to the crypto industry. By itself, that led to $242 million in monetary penalties, which is a 36% increase from the 22 actions announced in 2021. The coin center think tank has warned that a bill introduced in the U.S. Senate called the restrict bill could have a wide and unexpected impact if it becomes law. This bipartisan bill, known as the TikTok ban, aims to restrict the emergence of security threats that risk information and communications technology. This bill has been introduced because there are suspicions that the Chinese owned TikTok app is gathering user data on behalf of the Chinese government. If past, the restrict bill could potentially pose a threat to cryptocurrencies. So here's what's going on. This proposed act would give the commerce department new powers to address the ongoing threat posed by technology from foreign adversaries. This would include the ability to review, prevent and mitigate information communications and technology transactions that pose undue risk to the national security of the United States. The foreign adversary is listed under title 15 of the code of federal regulations are China, including Hong Kong, Cuba, Iran, North Korea, Russia, and the Maduro regime in Venezuela. Coin center has stated that the restrict bill is similar in concept to the international emergency economic powers act. That's the name of the act that authorizes the treasury's office of foreign assets control to prevent Americans from transacting with sanctioned parties. Coin center highlighted the misuse of this law to ban a class of technology, including the sanctioning of tornado cash immutable smart contracts. Coin center expressed concern that the restrict bill creates a broad authority with few checks to ban almost anything linked to a quote foreign adversary. The restrict bill would be both simpler to apply in more difficult to challenge. According to coin center, this has significant implications for the cryptocurrency space that can not be ignored. The restrict Bill carries severe penalties, including imprisonment for 20 years and finds for $250,000. Legal experts have noted that the bill's vague wording could be applied to restrict a range of technologies, including virtual private networks. The lead author of the bill is Democrat mark Warner. And he believes that a comprehensive and risk based approach is necessary to tackle potentially dangerous technology before it gains the foothold in America. Among sponsors of the restrict Bill is Kirsten gillibrand, who is the co author of the responsible financial innovation act with Cynthia lemus. And while I appreciate the senator's work on cryptocurrency legislation, I can not support this legislation. Justin's son, founder of the Tron blockchain, lost his diplomatic role for Grenada. A report by the Grenada broadcasting network said son was no longer an ambassador. This after the new national party lost the June 2022 elections. It appears that sun lost his position because the national democratic Congress took power instead. GBM reported that all ambassadors were recalled by the new administration a few months after taking power. Now, although sun has not commented publicly on his status, there's been speculation on social media and in the press about whether he still holds the position. Sun was appointed as the ambassador for the World Trade Organization by Grenada's government in 2021. And son has been vocal about his ambassador's status. Referring to himself as his excellency in interviews and on social media since his appointment. He even tweeted from his diplomatic Twitter account in October and still uses the his excellency title on his personal Twitter account. Now we covered it here just last week when the U.S. SEC sued son for fraud and securities violations. This lawsuit also implicated three of sun's companies, including the Tron foundation. These accusations include manipulating the market for TRX through wash trading and paying celebrities to promote TRX without disclosure of compensation. Hate celebrities including Lindsay Lohan and Jake Paul have several charges related to the case. And that's going to do it for us tonight. I want to thank you my listeners because when you stop listening, I will stop talking. If you enjoyed tonight's show, then please, like, follow subscribe. Leave a rating or a review. And in the meantime, we'll see you tomorrow night.
CoinDesk Podcast Network
"coin center" Discussed on CoinDesk Podcast Network
"It gives the government authority over all forms of communication domestic or abroad, and grants powers to quote enforce any mitigation measure to address any risks to national security now, and in quote any potential future transaction. So what happens if you are designated a national security threat? What can they access of yours to confirm it? Everything. Notice the preemptive attack on quantum encryption in there too. It also allows the director of national intelligence and secretary of commerce, the authority to universally designate new foreign adversaries without notifying Congress and a 15 day window to notify the president. It also requires a joint resolution of Congress to overturn. If you recall from before for an individuals can now also be U.S. citizens that are deemed to be a national security threat, once designated the bill grants authority to enforce any action deemed necessary to mitigate the threat with no due process and few limits on punishments. Now, it's not just folks on the right side of the aisle who are asking questions about this. Representative Alexandra Ocasio-Cortez, AOC, put forward a critique of the logic behind a potential TikTok ban in a TikTok video. In that video, she highlighted that the issue of excessive surveillance isn't just a TikTok problem. She said quote, it doesn't really address the core of the issue, which is the fact that social media companies are allowed to collect troves of deeply personal data about you that you don't know about without really any significant regulation whatsoever. In fact, the United States is one of the only developed nations in the world that has no significant data or privacy laws on the book. Still, unfortunately, these politicians on both the right and the left seem to be pretty firmly in the minority right now. Unsurprisingly, bitcoiners have been some of the first on the scene to raise awareness about the problems of this bill. Some of them have suggested that it might ultimately end up being used as a tool to target crypto. U.S. Space Force major Jason Lowry says, I don't know how else I can be more explicitly clear with the public about without getting in trouble. Your First Amendment rights to free speech will not protect you from government regulators who are actively maneuvering to ban Bitcoin under the argument that it represents a threat to national security. Coin center also published a broad critique of the restrict act this week, covering not only the impacts on the crypto industry, but also concerns around the features of the bill which would undermine constitutional rights. They wrote quote, although the primary targets of this legislation are companies like TikTok, the language of the bill could potentially be used to block or disrupt cryptocurrency transactions and in extreme cases, block Americans access to open-source tools or protocols like Bitcoin. According to coin center, the bill duplicates many of the powers that already exist within the treasury sanctions body O fact, but without the same safeguards. Opaque sanctions decisions require that a state of emergency be issued by The White House before any action is taken. While the restrict act would allow the commerce department to take actions that look very similar to sanctions without such a high standard. Coin center question why these broad powers to criminalize transactions need to be duplicated across multiple governments. While ofac sanctions contain a
The Breakdown
"coin center" Discussed on The Breakdown
"David writes, maybe they didn't say they were insolvent because signature wouldn't hand over data, but if you look at their financials, they were very distressed from depositor bleed end of year, and Friday before they shut lost 20% of deposits. So yeah, they were insolvent. Nick bites back didn't take you for a department of financial services apologist. Bailey says I'm not, but let me paint an alternative version of events. Signature was insolvent as made clear by their financials. The FHLB lent them tens of billions of dollars in order to help shore up their liquidity. When that wasn't enough, regulators stepped in and ensured all deposits effectively bailing out 25 billion of uninsured deposits belonging to a thousand plus exchanges, corporate treasuries, crypto funds, and stablecoins. That if lost would have decimated our industry and affected millions of people, 25 billion is a very large percent of all Fiat liquidity in crypto. The signature board in an effort to deflect legal liability invented crypto as the cause of their failure rather than their own financial mismanagement. While the regulators insist that had nothing to do with what happened, banks across the country read the headlines and media and say, um, crypto is really risky. Look what happened to these other banks. We shouldn't touch it. Thereby damaging our industry's ability to secure new banking relationships for years to come. So my argument is that perhaps we shouldn't spread a fake narrative about what actually happened here so that we don't end up creating false perception resulting in real harm. And be thankful that the government just bailed us out because of our systemic importance to the U.S. financial system. Just a thought. Now, David wasn't alone in this alternative narrative. Nourished from coin center said basically where I am, let's not create headlines that make us look worse. If every regulator is saying crypto is not the cause, do we really want to push the idea that it is? Isn't that worse overall? Now, all of this is totally plausible, and frankly, in some ways, I wish it were the explanation that I believed. But friends, as they say in the princess bride, these well meaning folks fell victim to one of the classic blunders. The most famous of which is never get involved in a land war in Asia, but only slightly less well known as this. Never go in against Nick Carter when the death of a bank is on the line. Literally just an hour after there's a whole exchange, Reuters published a piece about the government's process for selling SVB and signature bank. According to people familiar with the matter, the FDIC is collecting bids which need to come in by March 17th. They retained investment bank piper
Crypto Altruism Podcast
"coin center" Discussed on Crypto Altruism Podcast
"So QF is really what got us to where we are today. And I think it'll still continue to be a primary driver in why people come to get coin and use our tech. But there could be other types of funding mechanisms that we build or other people build on top of the protocol that end up getting adoption as well. Yeah, that's awesome. I love that. And quite there, I mean, it sounds like it's for all the right reasons and really living up to those kind of web three principles of, you know, transparency and open-source and decentralization, of course. So that's great that you're making that shift. And I'd love to hear about kind of the impacts that you've seen of Bitcoin grants so far both on the kind of legacy C grants and the new protocol that's being built. Yeah, absolutely. So like I said, the majority of what we've done so far have all been on C grants, the old protocol, we've distributed over $50 million since our inception in 2017. And really since these grants around started in 2019, 40 million of which has been given to early stage builders working on projects across DeFi, open-source, climate, and beyond. And we've actually kind of helped sustain some of the what I might say are top names in web three. Including optimism, uniswap, while it connects, prism, lighthouse, Po app, ethers JS, yearn, coin center, and many more. And a lot of these projects started out as Bitcoin grants. Some later went on to launch a token or to raise VC funding or whatever it is. And at that point, we kind of, people usually withdraw themselves at that point once they have external funding, but we also had kind of set these rules around if you raised over a certain amount of VC funds or via token sale that you're no longer eligible for matching. But what's been really cool is a lot of these projects that maybe kind of got their start viacoin grants in the early days are now giving back to the matching pool. It's like full circle. I like that, yeah. Yeah, it's really awesome to see. I mean, I think uniswap, optimism, yearn, one inch, there's many more and forgetting. But they're kind of paying it forward, paying it back. And I mean, they're paying back much more than they ever got from the protocol, but it's really cool to see this kind of flywheel effect of this project. Graduates, it becomes successful. It's earning revenue or whatever the funding comes from. And they decided to give back to other early stage projects. And I guess I just call out none of this would be possible without the matching pool funders and donors. Because we could try to run these donation rounds all we want and try to get individuals to donate smaller amounts to individual projects. But it's really that matching component that is what excites and incentivizes people to care about donating and to want to vote with their funds.
What Bitcoin Did
"coin center" Discussed on What Bitcoin Did
"Yeah. But anyway, I prefer my cotton donut candy. But anyway, so I went in and I was like, oh, have you got like store be fucking milkshake or something? This dude was like, no, we only have tobacco flavor, but I said, what do you mean? It's like, well, we're not allowed to sell flavored vapes in the cities. I was like, oh, shit, he's like, but are you a cop? I was like, no, I'm not a cop. He's like, are you sure? And I was like, yeah, I'm not a cop. He's like, okay, I've got a secret stack of flavors. And he brings out a box and so you still get them, obviously. Yeah. Still together. Are you a cob? New York's not dead. New York is not dead. It's just changing. It's a hard place to stay if you want what New York was, you know, whatever decade or whatever. Because it's just gonna, it's just a brutal pace of change in the city. Yeah, what do you think their Adams? He came in, I think he drifted the Bitcoin thing. Yeah. A little bit. A little bit. I mean, you know, we haven't heard from him yet. We've done some outreach. There are a lot of problems in New York, right? I think there was also sort of like a push towards this stuff, SPF was deploying a lot of capital for politicians. So maybe a lot of politicians were sort of signaling that they would be interested in some of that as well. Either from SPF or others in the crypto space that we're going to be deploying into political donations. Maybe that has sort of fallen by the wayside with the lapse of the crypto market. And I don't think bitcoiners were really doing that that much. We got some activity well, obviously El Salvador and Samson's thing. But I don't think it's been terribly localized in the U.S.. Beyond the great work of coin center and Bitcoin policy institute in those guys. But we got a big rat problem. We have a rat Tsar in New York City. A rats are not going to be like a cool band. Yeah. Hey, do you want to go and see rats are at that point in pubkey tonight? Yeah, fuck. So maybe it's a product of both of those things. Maybe there's a little bit less value in pursuing Bitcoin and crypto right now. There's also a massive look, the NYDFS leads the charge. For tightening the screws on any Bitcoin or crypto intermediary. The New York department of financial services. So that's where Ben lawsky was the superintendent or commissioner of and they rolled out the bit license back in. 1415 like that. Fuck you, Ben. It was a truly suboptimal piece of legislation. It was duplicative. We already had money service and money transmitter and then to layer on that third one was another reason why I think a lot of bitcoiners and Bitcoin companies have shied away from New York City. So it was a layup for himself. Oh, very much.
Unchained
"coin center" Discussed on Unchained
"The famous economist <Speech_Female> and longtime <Speech_Female> crypto skeptic, <Speech_Female> has fallen victim <Speech_Female> to the very thing he <Speech_Female> criticized. <Speech_Female> He recently took <Speech_Female> to Twitter to complain <Speech_Female> about being blacklisted <Speech_Female> by Venmo, <Speech_Female> a centralized payments <Silence> app. Niraj <Speech_Female> Agrawal of coin center tweeted <Speech_Female> back at him, <Speech_Female> quote, were you trying <Speech_Female> to buy drugs <Speech_Female> or assassination <Speech_Female> and posted a <Speech_Female> screenshot of a tweet <Speech_Female> of krugman's <Speech_Female> in which he said that it <Speech_Female> wasn't a big deal <Speech_Female> to use a third party for <Speech_Female> payments, quote, <Speech_Female> unless you're <Speech_Female> buying drugs, assassinations, <Speech_Female> et cetera. <Silence> <Speech_Female> Samson Moe replied, <Speech_Female> chatting <Speech_Female> by facts <Speech_Female> must be tedious, <Speech_Female> a dick at <Speech_Female> krugman's famous <Speech_Female> 1990 8 <Speech_Female> proclamation that <Speech_Female> by 2005, <Speech_Female> the Internet's <Speech_Female> effect on the economy <Speech_Female> would be no <Speech_Female> greater than the fax <Silence> machines. <Speech_Female> And of course, Michael <Speech_Female> saylor wrote, <Speech_Female> Bitcoin <Speech_Female> fixes this. <Silence> Vitalik Buterin <Speech_Female> <SpeakerChange> sells $700,000 <Speech_Female> <Speech_Female> in chick coins. <Silence> <Speech_Female> When the creator of Ethereum <Speech_Female> makes market <Speech_Female> <Advertisement> moves, people <Speech_Female> pay attention. <Speech_Female> Jenny Hogan from <Speech_Female> unchained has <Speech_Female> the update. <SpeakerChange> <Speech_Female> So Vitalik Buterin <Speech_Female> recently sold about <Speech_Female> $700,000 <Speech_Female> worth <Speech_Female> of coins, <Speech_Female> which are these joke <Speech_Female> coins that are often <Speech_Female> a huge waste of money. <Speech_Female> Not to be confused <Speech_Female> with regular cryptocurrency, <Speech_Female> which are <Speech_Female> non joke coins <Speech_Female> that are often a huge waste <Speech_Female> of money. But like a hot <Speech_Female> girl in a bar, vitalik <Speech_Female> actually got these coins for <Speech_Female> free. Turns out that <Speech_Female> sometimes people will send <Speech_Female> free coins to <Speech_Female> a celebrity in the <Speech_Female> hopes that their followers <Speech_Female> will copy them and then buy <Speech_Female> the coins. It's not a <Speech_Female> bad strategy. I mean, people <Speech_Female> do copy the talent. <Speech_Female> That's why unicorn <Speech_Female> T-shirt sales have <Speech_Female> gone through the roof in <Speech_Female> recent years. Anna <Speech_Female> can have positive <SpeakerChange> repercussions. <Speech_Female> One time <Speech_Female> Shiba Inu sent <Speech_Female> about half their total <Speech_Female> coins to vitalik <Speech_Female> and he donated them <Speech_Female> to a COVID relief <Speech_Female> fund. Which I have to imagine <Speech_Female> is the sole <Speech_Female> reason why the pandemic <Speech_Female> is wrapping up <Speech_Female> after a mere three years. <Speech_Female> <SpeakerChange> Is it <Speech_Female> rude to sell something <Speech_Female> that somebody gave you for <Speech_Female> free? My mother would <Speech_Female> say yes, but in my <Speech_Female> defense, I think that a <Speech_Female> <Advertisement> gift card for egg <Speech_Female> <Advertisement> freezing was kind of a weird <Speech_Female> <Advertisement> birthday present. <Silence> <Advertisement> <SpeakerChange> <Speech_Female> <Advertisement> Thanks so much for joining <Speech_Female> us today to learn <Speech_Female> more about Elliot and the <Speech_Female> ongoing fight between <Speech_Female> greyscale and the SEC. <Speech_Music_Female> Check out <Speech_Music_Female> the show notes for this episode. <Speech_Music_Female> If <Speech_Female> you've been enjoying unchained, <Speech_Female> please share with <Speech_Female> family friends or <Speech_Music_Female> others who have an interest in <Speech_Music_Female> crypto. Unchained <Speech_Music_Female> is produced by <Speech_Female> me, Laura shin, <Speech_Female> without from Anthony yoon, <Speech_Female> Mark Murdock, <Speech_Female> Matt pilchard, <Speech_Female> Zack seward, juana <Speech_Music_Female> renovation, Sam shri <Speech_Music_Female> rum, chini Hogan, <Speech_Music_Female> Ben Munster, <Speech_Music_Female> Jeff benston, <Speech_Music_Female> Leandro Camino, <Speech_Music_Female> pamma, gymnast, shashank, <Speech_Music_Female> and CLK <Speech_Music_Female> <Advertisement> transcription. <Music> <Advertisement> Thanks for listening. <SpeakerChange>
The Bitboy Crypto Podcast
"coin center" Discussed on The Bitboy Crypto Podcast
"And we founded a group called the digital currency traders alliance. D CTA is the nation's only pro cryptocurrency consumer protection group, a focused specifically on retail investors. And I know you were talking earlier about how there's no one in D.C. actually representing retail. In your absolutely correct. We saw this gap a long time ago. We figured someone actually has to step up for the little guy and we figured between our two ourselves we have 25 years of experience and we wanted to teach the average American, the tools of the trade and giving us some insider tips on how to actually lobby politicians effectively. Nate, do you have anything add on? No, I mean, one of the things, one of the things we've seen when it comes to getting folks active is they think their voice, their voice, it doesn't matter. And I think it's important for people to understand. It's like, I've been doing this 15 years. I've got a speech impediment. I was an average guy, and I showed up, I helped organize, you know, history is written by those by those who show up. So, you know, your voice matters. And that's the big thing we want folks to work in all this. And we're really trying to also focus on the state level because the state level is going to be the next big the next big battleground. Yeah. Well, I think and of course we have, you know, we have coinbase with their coinbase 35, I think it is. To 435 congressional districts, right? And they're looking for a push. And I think they're really, look, we would like to partner with them if they're going to go on the congressional on the state level or on the district level because their coinbase is pushing for industry standards. They're not exactly to protect the little guys. So people hear this they hear this four 35 and they're like, oh, it's cool. They're going to, guys, they're looking for their own interests. They're not looking out for your interest. I'm not saying coinbase is bad. I'm just saying, they're hyper focused in what they're doing. And this is not a push for the average person in crypto. Like for that to be the case, somebody's got to get out there and do it. And it's us. We're the ones that are out doing it. You guys are on the West Coast. We're over here on the east coast. And even some of these other even the blockchain association and coin center are like, I'm concerned a little bit there for the industry and everything's already industry. But what about investors? Yeah, no. That's one of the main reasons oh here, all that. Oh, it's just going to say I was just going to say you're spot on, man. And we thought it was so funny. We announced our stop the SEC campaign last week. Within 48 hours of us launching coinbase saw this crypto launch this crypto four 35 campaign. And I'm literally in Washington. I'm in Washington talking with the Congress the day they release it, you know? And we always hear people say, you know, like, oh, your voice doesn't matter. You know, what's the point of doing any of this? I'm like, are you guys stupid? Look, coinbase literally launched this campaign because they're worried about the consumer voice being co opted.
The Breakdown
"coin center" Discussed on The Breakdown
"Things back to the U.S., a story I share not because of it being some urgent concern, but just because it shows how crypto critics are pretty emboldened right now. A bill has been introduced in the Illinois state Senate, which lawyer drew hinkes has described as quote the most unworkable state law relating to crypto and blockchain that he has ever seen. The bill was introduced by state senator Robert Peters and would require that crypto miners validators and node operators facilitate blockchain transactions without the use of private keys in response to court orders. Titled the digital property protection and law enforcement act, the bill would allow the courts to order any blockchain transaction that is deemed to have originated in the state be rescinded. Network operators would be forced to figure out a way to do the impossible and reverse blockchain transactions or face fines of 5 to $10,000 per day. The bill also appeared to mandate that any person using a smart contract to deliver goods and services would have to include code in their smart contracts to allow compliance with the law. Perhaps the most insane thing about this is that there would be no defense based around the impossibility of this feat. In other words, if crypto protocols had not enabled miners to invalidate transactions via backdoor, then they would still be subject to fines. Under the proposed legislation, a court would be able to order a transaction be reversed as a remedy for a loss private key, fraud, a mistake, or to enforce the transfer of collateral. Now, obviously the law is ostensibly about consumer protection. But it also is just completely counter to the way that blockchains work. Carlo Reyes an assistant Professor of law at SMU law school rights. Please lawmakers stop grandstanding about crypto and only pass laws if you understand what you're saying. This may be the worst proposed blockchain related bill I've ever seen, and clearly evidence is a lack of understanding and how the tech works. Peter van wolkberg from coin center writes the proposed Illinois legislation is absurd and utterly misunderstands the way these technologies work. Essentially asks persons in the state to violate the laws of physics, making transactions without private keys in order to obey the laws of Illinois. Like asking vehicles to levitate when they use state highways. Now I think all of these skepticism are correct, but for the sake of trying to actually derive understanding and value out of this, I think there are two things worth noting. As I said at the top, the first is the emboldening of crypto opponents right now in the U.S.. The second, which is perhaps even more worthy of consideration, is how immutability is just a really different phenomenon, and one that runs up uncomfortably against the traditional financial system.
CoinDesk Podcast Network
"coin center" Discussed on CoinDesk Podcast Network
"Would have to include code in their smart contracts to allow compliance with the law. Perhaps the most insane thing about this is that there would be no defense based around the impossibility of this feat. In other words, if crypto protocols had not enabled miners to invalidate transactions via backdoor, then they would still be subject to fines. Under the proposed legislation, a court would be able to order a transaction be reversed as a remedy for a loss private key, fraud, a mistake, or to enforce the transfer of collateral. Now, obviously the law is ostensibly about consumer protection. But it also is just completely counter to the way that blockchains work. Carlo Reyes an assistant Professor of law at SMU law school rights. Please lawmakers stop grandstanding about crypto and only pass laws if you understand what you're saying. This may be the worst proposed blockchain related bill I've ever seen, and clearly evidence is a lack of understanding and how the tech works. Peter van wolkberg from coin center writes the proposed Illinois legislation is absurd and utterly misunderstands the way these technologies work. Essentially asks persons in the state to violate the laws of physics, making transactions without private keys in order to obey the laws of Illinois. Like asking vehicles to levitate when they use state highways. Now I think all of these skepticism are correct, but for the sake of trying to actually derive understanding and value out of this, I think there are two things worth noting. As I said at the top, the first is the emboldening of crypto opponents right now in the U.S.. The second, which is perhaps even more worthy of consideration, is how immutability is just a really different phenomenon, and one that runs up uncomfortably against the traditional financial system. Even people who aren't crypto opponents might feel like the U.S. does need to do something about fraud. And to the extent that reversing transactions isn't viable, our time is probably better spent on helping legislators understand what workable solutions there are. Even if it's just in the form of consumer education and better warnings around tools. Anyway, it is poised to be another interesting week. There is more FTX fallout with another of SPF center circle. Apparently on the verge of pleading guilty. And I think there's also some really interesting stuff happening around Caitlin long's custodia. Long came out last week and said that she had handed over evidence of probable crypto fraud, yet that wasn't listened to and still she had her custodia bank targeted by the feds. Kraken's Jesse Powell actually went a little further on this line and shared a theory on Twitter. He writes, I have a theory. Regulators let the bad guys get big and blow up because it serves their agenda. One destroy capital and resources in crypto ecosystem to burn people in deterrent option, three give air cover to attack good actors. The bad guys are actually on side. Good guys are the enemy. If the bad guys can run long enough without blowing up, they just might kill the good guys for you. Bad guys operate with huge competitive advantages. They suck up users, revenue and venture capital that would otherwise have gone to good guys. Bad guys can always be jailed later. Now this is something I think we're going to explore much more this week, but listen, with the Hong Kong and Asian narrative, it's certainly sort of feels like we're coming to a culmination of the question of what the U.S. wants its role to be in all of this. That's definitely the biggest theme I'm seeing for this year and I am excited to dig more into it with you guys in the days, weeks and months to come. For now, I appreciate you listening and until tomorrow be safe and take care of each other. Peace
Ethereum Daily
Senators Push Digital Asset Anti-Money Laundering Bill
"U.S. senators Elizabeth Warren and roger Marshall introduced a new crypto Bill targeting self custody wallet blockchain infrastructure providers and node operators, coined as the digital asset anti money laundering act the bipartisan bill would require un hosted wallet providers and node operators to register as financial institutions. It would place KYC and AML reporting requirements on blockchain infrastructure providers. It would also prohibit providers from making transactions using privacy tools, coin center describes the bill as an opportunistic and unconstitutional assault on cryptocurrency, adding that it would do nothing in preventing the next FTX.
Coronavirus
"coin center" Discussed on Coronavirus
"Locked lobby. Lobsters donate one thousand. Eath for crypto lobbying ethereal reaches a new all-time high hash rate and immutable x. Raises a sixty million dollars series b funding round. All this more from today in theory him starts right now. The lobby lobster. Nf t- dow has voted to donate one thousand. Eath to washington crypto. Lobbying group coin center. The funds were collected through the sale of ten thousand lobby lobster. Nfc's that sold for point. One each on august fifth. The nfc project netted one thousand in less than an hour after its launch. A dow poll voted yesterday to give the funds to nonprofit research and advocacy organization. Coin center lobby. Lobsters still receive a seven and a half percent royalty on sales to open see the project colds a monthly poll on universe. Xyz to decide where to direct bundy and for crypto lobbying the lobbying efforts come as sec. Chairman gary ganster said. He's in favor of regulating defy earlier this month. The sec launched an investigation into unit swap and threatened to sue coin base if it went forward with its lending product that would give customers four percent interest on. Us dc holdings more than one point. Six billion dollars is locked up on yield farming project rb neon users who stake ethan. The platform are rewarded with up to thirty eight percents. Apr in the form of neon. Meam tokens which are currently worth about a dollar and sixty eight. Cents users can reportedly earn up to six thousand percent. Apr for staking. Their neon tokens or by becoming liquidity provider. Armenian was created by an anonymous developer and launched on september eighth. The layer to base project holds more than seventy percent of arbitrage total value. Locked anonymous greater says he created the platform to pump arbitrage and eath by proxy. And he believes there's no other scaling strategy but roll-ups according to define five the neon token price reached an all time high of seven dollars and seventy six cents on september twelve before crashing. Back down. Me tokens often shoot up in price within a short period of time only to crash after being dumped on investors. It's important to note that there are high risk involved when investing in a yet to be audited project by anonymous developer. Armenian has no affiliation. With other mean tokens neon version. Two and neon finance layer two options trading protocol. Lyra has announced the launch of its liquidity mining program. Lyra will begin distributing seven hundred. and fifty. thousand. Lyra tokens to liquidity providers starting on september thirteenth. The goal of the program is to increase the supply of s usd on optimism to better enable liquidity for traders as usd is the asset used by lara's liquidity pause providing collateral for all options purchased the project launch earlier. This month and has only been able to attract half a million dollars in equity forcing traders to use high slippage. Could eighty providers will receive lyra in proportion to their share of the total liquidity in the swap s usd and dipoto as well as liars either market poor. The rewards earned during the two week program will be distributed when liars token is officially launched. The lyra platform bring sophisticated hedging techniques on layer two lyra uses synthetics for automating long and short trades on underlying assets. Ethereal hash rate has reached a new all-time high of seven hundred and fifteen point. Four tara hashes. per second. A measurement of the computational power devoted to mining ether. The hatchery has been on an upward trend. Ever since the start of defy summer the hash rate had dipped in early june amid reports of china cracking down on cryptocurrency mining. The people's bank of china also urged alipay and major banks to crack down on crypto trading. It was also expected that mining would drop after he theorems london hard fork in august which change the block reward however the rising demand for ethereal caused by the nfc boom kept mining profitable causing new miners to join the network and lastly immutable the australian based startup behind. The nfc layer protocol immutable. X. has raised an additional sixty million dollars in a new round of funding investors included galaxy interactive apex capital and vader fund among others immutable intends to use a series b funding to grow its team and further develop its nfc based games. God's unchained and killed of guardians immutable ex uses zero knowledge proofs to validate transactions off chain. Removing gas.