Bitfinity Weekly: Smooth Sailings
Welcome to Issue #121 of Bitfinity Weekly for our #BITFINIANS community. If this newsletter was forwarded to you, sign up here.
What's in Today's Email?
- Global Crypto News
- This Week in our Blog
- NFT Market Bytes
- Tweet of the Week
- Meme Time
- A Matter of Opinion
Global Crypto News
Good Heavens: Leading DeFi protocol MakerDAO rebranded as Sky this week and introduced two new tokens: $USDS (an upgraded version of the $DAI stablecoin) and $SKY, a new governance token for the DAO, which fully replaces its predecessor $MKR. Maker SubDAOs have undergone a rebrand as well, and are now called Sky Stars, but will remain independently organized and run projects within Sky's ecosystem.
Not Another L2: Japanese tech and media giant Sony announced an Ethereum Layer-2 blockchain named 'Soneium', launched through the company's blockchain arm, Sony Block Solutions Labs. Soneium hopes to attract app developers across various sectors, and will be introduced through a partnership with Astar Network. According to an official statement, the Soneium testnet will provide built-in tools to help devs create globally compliant apps.
The French Affair: Pavel Durov, founder and CEO of messaging platform Telegram, was arrested in France this week. Not only is Telegram considered an essential cornerstone of the crypto ecosystem, Telegram-affiliated blockchain TON (The Open Network) has been garnering a lot of attention lately. Conspiracy theories abound as to Durov's arrest, including one revolving around a woman some are claiming is a Mossad agent.
Recovery Plan: CoinSwitch, a prominent Indian cryptocurrency exchange, is suing rival WazirX to recover over $9 million worth of assets on WazirX's platform. This legal move comes one month after a major WazirX security breach which resulted in a $230m hack. In a statement posted to X, CoinSwitch alleges that despite regular communication between the two exchanges, they have been unable to reach a solution.
Partnership Party: Betbtc.win, as a strategic partner, aims to enhance their platform and offer bleeding edge innovation on Bitcoin. Lumoz, a cutting edge platform simplifies the deployment of zk-rollups, making blockchain scalability more accessible and efficient. Moonberg AI, a cutting-edge platform revolutionizing decision-making in the crypto market.
This Week in our Blog
Ethereum has shaped much of crypto culture today, from popularizing the concept of ICOs (Initial Coin Offerings) to the implementation of smart contracts on chain. This week, we go into the details of Ethereum's journey:
Hans
The third edition of Bitfinity's Blockchain Bash showcased innovative blockchain projects, highlighting the growing momentum in the blockchain space, fostering collaboration and the exchange of cutting-edge ideas.
Fred
NFT Market Bytes
Trecherous Waters: Leading NFT marketplace OpenSea has been issued a Wells notice by the SEC, which alleges that the NFTs sold on OpenSea's platform are securities. While the SEC has sent Wells notices and taken legal action on various crypto businesses this year, this is the first time the U.S. Securities and Exchange Commission has targeted an NFT platform.
NFTs First: Former President and 2024 candidate Donald Trump released his fourth NFT collection this week, reaching over $2 million in sales in just a day. Despite the impressive sales figure, the "America First Collection" is underperforming compared to Trump's previous three NFT collections, with just 6% of the full supply having been sold.
Making the List: Forbes magazine announced a collaboration with OKX Wallet to launch an NFT-gated member community, which offers exclusive access to "high-profile events" and the Forbes Inner Circle, among other benefits. OKX Wallet users will have a "fast-track application review" for the Forbes Legacy Pass NFT, which will serve as the primary membership token.
Rough Drafts: The National Football League Players Association (NFLPA) is suing sports betting platform DraftKings over an abandoned NFT Fantasy game, alleging that DraftKings owes the union $65 million. The lawsuit accuses the betting platform of violating licensing agreements which provided the rights to use NFL players' likenesses in the DraftKings' "Reignmakers" NFT project. DraftKings discontinued all NFT-powered gaming experiences last month, citing recent legal developments.
Tweet of the Week
Meme Time
A Matter of Opinion
The U.S. Securities and Exchange Commission (SEC) has taken a drastic step in its ongoing scrutiny of the web3 space by issuing a Wells notice to OpenSea, one of the largest NFT marketplaces. This notice is a clear indication that the SEC is considering enforcement action against OpenSea, and setting legal precedent to classify certain NFTs as securities.
This development signals the increasing likelihood that NFTs, which have been at the center of a speculative frenzy over the past few years, may soon be subject to the same regulatory frameworks that govern traditional financial instruments. The core of the SEC's concern appears to be whether certain NFTs—particularly those that are fractionalized or offer profit-sharing—meet the criteria for securities under the Howey Test, which could bring them under the purview of federal securities laws.
For OpenSea and the broader NFT ecosystem, the implications are profound. If the SEC proceeds with enforcement action and the courts uphold its stance, it could set a precedent that reverberates across the industry. Many NFT platforms and projects may need to reevaluate their operational models, potentially leading to a contraction in the market as they seek to avoid falling foul of securities regulations.
The SEC's actions against OpenSea underscores a fundamental tension between innovation and regulation. NFTs, like crypto, emerged in an unregulated space, which enabled a burst of creativity and new business models. However, as these markets mature, the right way to approach regulatory guidelines becomes increasingly murky. How can we find a balance between protecting consumers and maintaining market integrity without stifling the open participatory culture that makes the NFT space so vibrant?
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