Coinbase’s USDC Bootstrap Fund to Provide $1.1M In Liquidity for DeFi DApps Uniswap, PoolTogether

Coinbase has announced on Wednesday that it has put $1.1 million USDC into the Uniswap and PoolTogether Ethereum DeFi Applications (DApps).

The investment is from the USDC Bootstrap Fund that was launched with $2 million in initial funding by Coinbase in September last year. Uniswap, a liquidity provider for Ethereum, and PoolTogether, a ‘no-loss‘ lottery DApp that helps you earn through savings. The USDC Coinbase funded into the two projects is not to be considered an investment, but more a deposit into both of the applications’ liquidity.

More on Uniswap

The USDC/ETH Uniswap liquidity pool is going to receive $1 million from Coinbase. The Dapp works better when the pools are bigger. Here’s what the founder of Uniswap, Hayden Adams, had to say about this:

“It provides a significant improvement to prices on that pool. The pool can support larger trade sizes and more volume.”

Uniswap sets matched pools when an ERC-20 token gets paired with the same value of ETH. The tokens can be traded for one another by users, but without ever touching the middle ETH. Increasing the funds for each pool causes the bandwidth for any ERC-20 token to expand. In a broader market, small pools get out of line easier than large pools, so they’re better to integrate with apps.

More on PoolTogether

Coinbase will inject $100,000 in USDC into PoolTogether’s daily price in their ‘no-loss’ lottery. PoolTogether works by users making USDC or DAI deposits that go into Compound to earn interest. Depending on the token, one user wins all the interest every week or every day.

Tokens can be withdrawn at any time and those who lose always get a second chance with the following pool. PoolTogether is nothing like sponsored pools, in which funds are going into the pot and there’s no possibility to win the prize. Here’s what Leighton Cusack, its founder, had to say about it:

“We do see a lot of players – especially larger ones – tracking the sponsorship. Since a significant portion of the prize pool is sponsored it makes a pretty big impact on the expected value and return players see.”

It’s a good idea to boost PoolTogether as much as possible. In early March, the site’s USDC daily prize was $45, whereas yesterday it was only $2. The entire DeFi sector is in fact down, so USDC deposits on Compound are paying around 0.46% at the moment.

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Author: Oana Ularu

Coinbase Custody Moves Tezos (XTZ) Staking Bakery From US to Ireland For Regulatory Reasons

Coinbase has managed to move the Tezos Staking Bakery, the largest validator since its launch in 2019 which the exchange has been operating since launch, from the United States to Ireland in less than 60 seconds on March 31. The move of staking Bakery was done in the light of regulatory requirements of the Swiss digital asset product provider, Amun.

Coinbase has been offering its custody and baking service to Amun ever since they launched their Tezos-based exchange-traded product on Swiss exchange, SIX. The regulatory changes in the Amun were the sole reason behind the recent move, which required all its staking products and services to be operational within the European Union.

Coinbase Cites Two Prominent Strategies Which They Took Under Consideration Behind the Move to Ireland

Coinbase noted that they pondered over two strategies before deciding to move the Tezos Bakery from the United States to Ireland. The first one was to stop any activity of its US-based validators before deploying the Irish validators. Although the process required nearly an hour in downtime, it ensured that the security risks were minimal.

The second strategy was to initiate the Irish validators before shutting down the US validators and stop the US validators when the Irish validators were completely in control. However, this move would have exposed the validator network to significant security risks. In the end it was decided that the way to go about it was to decouple the validator’s endorser from the node which eventually helped in making the migration process to complete in under 60 seconds.

As a result of decoupling, the exchange found that voting on blocks was being done from Ireland while new blocks were being produced from the United States. Coinbase finally saw a couple hour window suitable for moving the baker to Ireland and eventually completed the migration. Coinbase explained,

“A Tezos validator has two main components: the baker, which produces new blocks that include transactions in the digital ledger, and the endorser, which votes on blocks that other validators produce […] Large Tezos validators typically only produce or bake new blocks every few minutes or hours, but they need to vote or endorse almost every minute.”

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Author: James W

Coinbase Wallet Users Can Now Earn Interest From DeFi DApps Directly In The App

The Coinbase Wallet has just integrated with decentralized finance (DeFi) apps in order to allow its users to lend crypto assets and track the growth of their interest straight from the wallet app.

As an announcement made by Coinbase on Wednesday says, Coinbase Wallet users are already putting millions into DeFi platforms through the wallet’s Dapp browser and WalletLink. Still, Coinbase wants to make their experience even more enjoyable. Until now, they didn’t have the option to compare rates from different providers, nor were they able to see the total of their balance with these providers with out leaving the app itself.

What Does the New Feature Bring?

According to the Coinbase announcement, the new wallet feature allows users who own a Coinbase wallet account to interact with lenders such as dYdX and Compound, which are both DeFi platforms. They can choose their coin and a smart contract provider in order to invest as much crypto as they want into one of the DeFi products.

As said before, they can view how much interest they’re earning and their total balance without having to exit the wallet. iOS users will have the new feature this week, while Android users will still have to wait a few more weeks.

DeFi Products Are Risky

Coinbase wanted to warn investors about the fact that DeFi products are quite new and present a risk. Caution was advised when using them. Here’s what the announcement reads exactly:

“Before you get started, please be aware that DeFi lending apps are relatively nascent and come with risks.

DeFi apps are programs running on the blockchain, and like any computer code they can potentially have bugs that cause you to lose money. Returns are not guaranteed and your deposits are not insured.”

Basic information and the definitions of minimum collateral or contract’s assets under custody are being provided for the wallet’s users to know better what contracts to choose. However, they’re still advised to do their own research in order to understand how the apps work and the risks they’re about to take.

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Author: Oana Ularu

Gemini’s Winklevoss Twins, Coinbase CEO Among Founding Donors Of Crypto Lobbyist Group

  • Gemini founders, the Winklevoss twins, Coinbase CEO, Brian Armstrong and other top crypto personalities join in the HODL Political Action Committee (PAC)
  • HODL PAC lobbies for crypto in Congress alongside helping crypto/blockchain friendly senators into the house.

HODL PAC, founded by Tyler Whirty of VC firm, the Takoma Group, has since raised over $20,000 USD from various investors within and without the crypto community. The PAC hopes to bring change in congressional laws regarding crypto and blockchain by helping electing crypto minded leaders. The HODL committee aims to raise cash from the public and offer a token voting platform to select the preferred candidate that the voter wishes to donate to. The official report reads,

“The time is now to set policy that allows the decentralized economy to thrive and enables Americans to lead this revolution. We want to support the candidates that support that vision of the future.”

HODL PAC receives massive support from crypto

HODL PAC has received support from some of the biggest names in crypto including Tyler and Cameron Winklevoss, founders of the Gemini exchange and Coinbase CEO, Brian Armstrong. Other founding donors to the lobbying group include Olaf Carlson-Wee, chief investment officer at Polychain Capital; Nathan McCauley, CEO of Anchorage; and Don Wilson, CEO of DRW.

As explained above, HODL PAC has received over $21,000 USD, with a portion of this amount, about $5,000, spent on operations of the commission so far.

However, the big names will not have complete control of who the money goes to as the public (whoever contributes to the fund) will have a “vote” on the sharing. While the PAC currently does not intend to accept cryptocurrencies, the idea to offer voting tokens is in development.

The voting mechanism on HODL PAC

A contributor will be entitled to an equivalent number of “votes”. The votes can be shared towards different participants but in a quadratic voting system. This means that for each subsequent vote a voter places, it will give the next politician a smaller portion of the donation than the prior politician. Tyler Whirty said,

“It’s the idea that each traditional vote costs the square of that vote. So one vote costs one, two votes cost four, three costs nine and so on.”

The quadratic voting mechanism is set to regulate the power of big players by ensuring they don’t have increased influence on where the funds are directed.

So far, the committee is yet to donate to any politician with a limited number of senators and representatives showing up for crypto. Since Andrew Yang dropped out of the Democratic Presidential race 2020, and Eric Swalwell of California dropped out of the governor race, a limited number of politicians are accepting crypto, let alone champion.

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Author: Lujan Odera

Coinbase’s Visa Debit Card Goes Live On Google Play, Available To All iOS, Android Phones

Users of Coinbase Card who also own Android supported smartphones can now integrate the two through Google Pay. This means that the card can now be imitated by a smartphone.

Coinbase Card links a crypto holder’s balance as reflected in the exchange platform which can then be utilized to spend the cryptocurrency through immediate conversion to fiat.

Announce in a blogpost made by Coinbase, the new service will only be available to European Union residents as well as those within the European Economic Area including the United Kingdom. However, the card can be used to spend crypto anywhere that Visa is supported in the world.

As per the announcement, Google Pay will now imitate the actual card during offline buying as the NFC chip contained in the device will be used on any terminal which contactless payments has been enabled. This means that Android supported smartphones or smartwatches are eligible for use. However, the NFC chip requirement indicates that various budget-based devices may lack the requisite Google Pay support.

The press release also clarified that due to existing Google Pay restrictions, the service will not be available in various countries where the Coinbase Card is supported. Some of the countries where Google Pay has restrictions include, UK, Ireland, Sweden, Spain, Slovakia, Czech, Croatia, Norway, Denmark, Poland, Italy, Belgium, Finland and France. However, Coinbase has committed to expand the list of supported countries in the near future.

The linkage with Google Pay now means that one can use the card just after ordering before the physical card can be delivered. It however remains unknown whether there are plans to support Apple Pay in the near future to tap to a wider market.

In the recent past, Coinbase has been pushing for an increase in debit card adoption. Last month, Coinbase was given the priority of being a principal Visa card issuer which means that the crypto exchange firm can now issue debit cards directly rather than relying on partners.

The current Coinbase Card was developed in partnership with Paysafe Financial Services which is behind products such as Skrill as well as PaysafeCard.

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Author: Joseph Kibe

Coinbase Loses Chief Legal Officer To US Office of the Comptroller of the Currency

Brian Brooks, the chief legal officer of Coinbase, has left the crypto exchange in order take the second senior role with the US Office of the Comptroller of the Currency (OCC).

The announcement was made by the OCC on Monday. It says that Steven Mnuchin, the US Treasury Secretary, has appointed Brooks as deputy starting with April 1. Brooks used to be Fannie Mae’s general counselor, corporate secretary and executive vice president. He also worked as chief legal officer for Coinbase from September 2018. Mnuchin said the cooperation with him will improve the financial system’s security.

What Does the OCC Do?

The OCC supervises and regulates US financial institutions and national banks. It was formed back in 1863 and is an independent entity that makes sure banks meet risk requirements and capital. Joseph Otting, who runs the OCC, was nominated and sworn by President Donald Trump back in 2017. About the collaboration with Brooks, he said that it will bring to the agency extensive banking, career and legal innovation. Here are his exact words about Coinbase’s former chief legal officer:

“He is a visionary thinker with a passion for service and a deep understanding of how the financial services industry supports our nation’s prosperity. We are fortunate to attract such an experienced and talented individual to join our federal agency.”

Brooks Supported the Development of a Private Digital Currency in the US

Brooks has been very vocal when it comes to the US creating a private virtual currency. He even wrote in the Fortune Magazine, back in 2019, that the digital dollar would be better built by private corporations. Furthermore, he conceptualize a process in which the public sector sets the monetary policy and the private space builds the actual technology for it. Here’s what a spokesperson for Coinbase said about Brooks and its future role at the OCC:

“Brian is an amazing and accomplished leader who has been invaluable in shaping the Coinbase legal and compliance programs, and helping policymakers and regulators better understand the opportunities and benefits of crypto. We’re always proud of Coinbase alumni who go on to serve in government, bringing a crypto-friendly perspective with them.”

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Author: Oana Ularu

2017 Tech Rolls Out On Coinbase; Bitcoin Batching Will Help Reduce Network Fees by 50%

Coinbase has announced rolling out Bitcoin Batching for its transactions going forward. The firm posted a blog on March 12 noting that they’ve officially launched this feature and are optimistic it will save users up to 50% in fees.

Despite the extremely volatile crypto market in the past 24 hours, Coinbase proceeded to pioneer Bitcoin Batching within its network. Prior to this development, the exchange has been broadcasting single BTC transactions on the chain but this will now be done in batches. The blog highlighted that the move will not only reduce operation costs but ease congestion on Bitcoin’s network;

“we anticipate that this will reduce our load on the Bitcoin network by more than 50%, and the network fees our customers pay will automatically be reduced by an equivalent amount when sending.”

With this innovation, Coinbase is hopeful of improving the BTC protocol in order to facilitate scalability and reduce processing time. The blog further noted that general Bitcoin network fees will be fairer if transactions were to be executed in a timely fashion.

Stakeholders Reaction to Coinbase BTC Batching

As one would expect, Coinbase users stand to benefit the most from this initiative. The blog said that no action was required from them given the launch; they, however, should start realizing the fee benefits of Bitcoin batching immediately.

Some Bitcoin enthusiasts, on the other hand, have criticized the project on twitter. They said that Coinbase was late to the game as its peer competitors such as Kraken that rolled out bitcoin batching as early as 2017. This tech, while not new, has the potential for privacy issues and has become a somewhat hot topic in the past. According to industry experts, BTC batching exposes the addresses of recipients in that particular batch. One does not necessarily know the exact PII but will have the information that you both received BTC funds from a certain exchange.

Coinbase said that they are currently in the process of integrating both the normal exchange and Coinbase Pro. They, however, added that users who operate on the latter will not feel the effect as they already recover 100% of their network fees.

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Author: Edwin Munyui

Leading French Bank, BNP Paribas, is Blocking Transfers to Coinbase Crypto Exchange

International French banking giant, BNP Paribas, is allegedly blocking funds transferred to Coinbase crypto exchange. According to one of the bank’s clients, this action began just recently given they could use BNP Paribas as an intermediary at the beginning of March.

Speaking to news site Cointelegraph, the client preferred to stay anonymous but shed light on this development in detail. Most notably, was a response they got from the BNP Paribas customer service in regards to Coinbase’s transfer issue. The bank, through one of its representatives, said that it was considered an illegal operation. It further cited privacy coin, Monero, crypto scams, and malware as the reasons for cutting financial interactions with Coinbase.

Reports, however, indicate that Coinbase is the only crypto exchange suffering the BNP Paribas wrath. The anonymous client also highlighted that they did not receive any prior warnings from the bank relating to the matter.

The move by BNP is not an unprecedented one within the volatile crypto market. Popular banks like JP Morgan and Citi have in the past implemented limits to crypto operations; the most significant one yet is the credit card ban for digital asset purchases back in 2018.

Bulgarian banks also took similar measures during the 2017 bull run which saw Bitcoin hit the highs of $20,000. They basically terminated some accounts that were run by crypto exchanges.

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Author: Edwin Munyui

Crypto Wallet Argent Raises $12M From Paradigm To Make DeFi Easier To Use

Spearheaded by Fred Ehrsam, the co-founder of Coinbase, Paradigm led Argent’s $12 million Series A funding, together with Index Ventures and Robert Leshner, the founder of Compound.

Ever since it was founded back in December 2017, Argent raised $16 million in funding. Leshner said its investment opportunity attracted him because the London-based wallet startup offers both a good user experience and an effective smart contract architecture.

3,000 Active Users in the Argent 6-Month Closed Beta

Itamar Lesuisse, the CEO of Argent, said more than 3,000 accounts were used actively in the Argent’s 6-month closed beta period and that over 1,000 are on the waiting list for the April’s public launch. Half of these users use DeFi products such as interest-bearing deposits and loans. When it comes to why Paradigm has been attracted to Argent, partner Matt Huang says that it’s because this company’s mobile wallet has a great balance between security and usability.

DeFi Product Options to be Expanded in 2020

Explaining how his product is as simple to use as Venmo, Lesuisse said he has plans to expand the DeFi product options in 2020. The Argent mobile wallet is indeed very simple to use, as it allows users to buy crypto by using their Apple Pay accounts and debit cards, through MoonPay and Wyre. Besides, it has a unique identifier that’s associated with the phone on which it’s being used, not to mention a backup recovery system that sends data to either Argent or someone close to the user.

Argent Is Currently Receiving Small Feeds from DeFi Providers

For now, Argent doesn’t focus on monetization, as it only receives small fees from DeFi providers such as the Kyber Network. According to Lesuisse, a user holds an average of $2,000 in his or her Argent wallet. Making comments about the bugs associated with smart contracts and Argent, Huang said that:

“It’s an easy way for consumers to interact with DeFi. Argent can’t prevent some of the risks that might occur in the DeFi space overall. As a user, you’re still exposed to and should be comfortable with the actions you take.”

In other words, the risks exist, whether it’s Argent or another wallet provider running the DeFi.

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Author: Oana Ularu

Coinbase Admits To Testing Clearview’s Controversial Facial Recognition Software

The California-based crypto exchange giant, Coinbase, has admitted to using the controversial facial recognition software developed by Clearview.

According to BuzzFeed, which obtained an internal document from the New York-based AI company – Clearview – shows that the company has, so far, partnered with over 2,000 firms and authorities globally through the sale of its still controversial technology or through mutual sharing.

The company is currently facing a number of legal threats from organizations like Google and Apple.

Clearview’s facial recognition software, alongside its current operations, have faced intense scrutiny after the New York Times published a story indicating that the startup’s database contained over three billion images scraped from various websites and social media networks without the awareness or consent from users or publishers.

Hoan Ton-That, Clearview’s CEO, had indicated that the technology had only been used by law enforcement agencies, with the firm only working with organizations in the United States and Canada.

However, an anonymous source has since exposed the whole list of Clearview’s clients from over 26 nations.

The list includes renowned businesses like Walmart, Best Buy, Macy’s as well as banks, universities, government agencies, high schools and various police departments.

However, it is the inclusion of Coinbase that is surprising to the majority of crypto enthusiasts since the industry is driven by the need to have privacy.

A spokesperson for Coinbase has explained to BuzzFeed that the exchange was a test of the technology for security purposes as well as compliance. She explained, that Coinbase’s use of Clearview’s AI as a potential security framework.

“We used Clearview to see if the service could meaningfully bolster our efforts to protect employees and offices against physical threats and investigate fraud.”

The spokesperson went on to say that the exchange has yet to make any commitments on the use of this technology.

Coinbase is no stranger to user privacy issues, having previously been forced to clarify that it didn’t sell clients’ data after a top executive admitted that a former analyst had sold clients’ data to third parties.

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Author: Joseph Kibe