Citibank Covers DeFi, says Open Financial Platform Enables ‘Greater Innovation and Competition’

Citibank Covers DeFi, says Open Financial Platform Enables ‘Greater Innovation and Competition’

New York City-based Citigroup is the latest bank to educate its fund managers on the concept of the booming decentralized finance (DeFi) sector.

This week, much like other banking giants, Citi reported better-than-expected earnings for the first quarter, driven by lower loan volumes and improvements in the macroeconomic outlook.

But for the cryptocurrency industry, what has been more interesting was the fact that their latest report, “Future of Money” on Crypto, CBDCs, and 21st Century Cash, covers the benefit of DeFi.

Defined as the “open financial platform on top of which all projects reside,” the openness of the ecosystem enables greater innovation and competition and allows uninterrupted interoperability, it said.

Name checking Maker (MKR), Compound (COMP), Uniswap (UNI), and UMA (UMA), the report further notes that one can seamlessly move capital between these platforms in minutes and minimal fees.

Programmability, transparency, permission-less, non-custodial, and lack of intermediaries are the benefits mentioned by the bank.

The report particualry covers MakerDAO in detail, calling it “The Decentral Bank,” a complication system that enables collateralized loans paid out in stablecoin. DAI is the network’s own crypto-based stablecoin which the bank says is akin to “so-called commercial bank money, which is backed by deposits or cash.”

It is defined as the heart of the DeFi ecosystem, which is one of the oldest and “most sophisticated projects on Ethereum.” ETH -3.62% Ethereum / USD ETHUSD $ 2,440.76
-$88.36-3.62%
Volume 36.12 b Change -$88.36 Open $2,440.76 Circulating 115.5 m Market Cap 281.9 b
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The report then talks about how the lending protocol, which has over $9 billion in total value locked (TVL), can be thought of as a digital pawn shop or a perpetual repo market for digital assets.

The DeFi sector is growing at a fast pace, which first exploded into usage last summer when yield farming allowed people to earn as high as four-digit APY. From a mere $730 million in total value locked a year back, today, this sector has surpassed $100 billion in TVL.

The top 100 DeFi coins’ market cap has also reached about $130 billion, which was under $2 billion at the beginning of last year, as per CoinGecko.

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Author: AnTy

Bitcoin Payment Network, BitPay, Joins Square-Led Crypto Open Patent Alliance (COPA)

Bitcoin Payment Network, BitPay, Joins Square-Led Crypto Open Patent Alliance (COPA)

The alliance promotes sharing open-source patents and projects across partners.

BitPay is the latest in a string of big crypto companies to join the Square-led Crypto Open Patent Alliance (COPA), a blog post released on Wednesday confirmed. The alliance aims to enhance development across the crypto industry by promoting open-source projects and shared patents among members.

Launched in 2020, COPA is an alliance working towards ensuring Bitcoin and crypto remain completely free and open – as first envisioned by Satoshi. Square and Twitter founder Jack Dorsey has been at the forefront in calling for cooperation across the crypto field, stating the alliance will “help the crypto community defend against patent aggressors and trolls,” just like they recently did with Faketoshi, Craig Wright.

With cryptocurrencies and blockchain technologies becoming mainstream, firms in the space are changing their way of business, with patent protection and court battles becoming the order of the day, Stephen Pair, CEO of BitPay, said.

“We see both business and consumer adoption accelerating as a result of COPA industry leaders working together to advance technology innovation, making the blockchain easy to use for both businesses and consumers.”

As one of the oldest Bitcoin payment channels, BitPay saw it fit to release their patents to the alliance to enhance innovation in the crypto payment space. The platform processes cryptocurrency payments to enable borderless payments using assets such as BTC, ETH, DOGE, BCH, and stablecoins such as USDC, PAX, and BUSD.

BitPay joins Coinbase (a COPA founding member) as the second high-profile company in the COPA alliance to push forward an ‘open patents policy’ to boost the growth in developments and innovation in the crypto ecosystem, a statement from Coinbase read at the time.

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Author: Lujan Odera

DCG Owned Cryptocurrency Mining Arm, Foundry, to Open Bitcoin Mining Pool to the Public

DCG Owned Cryptocurrency Mining Arm, Foundry, to Open Bitcoin Mining Pool to the Public

  • U.S.-based Bitcoin mining firm, Foundry is opening its doors to institutional investors following the successful completion of its five months-long beta phase testing.

Foundry, a North America-based mining firm, announced on Thursday it is launching its mining pool to institutional clients following a successful five-month beta phase testing. The firm, owned by Digital Currency Group (DCG), welcomed Texas-based Blockcap to its clients’ list using roughly 10,000 mining machines provided by Foundry.

The U.S. bitcoin mining firm has seen tremendous growth in Bitcoin) mining since launching its beta phase in October last year. With 1.4% of the total Bitcoin hashrate or 2.77 exahashes per second, Foundry USA ranks as the 12th largest mining pool, stats from BTC.com shows.

The pool supports Bitcoin and Bitcoin Cash (BCH) mining through its Full-Pay-Per-Share (FPPS) model that payout block rewards and transaction fees according to a user’s contribution.

In the announcement released on Thursday, Foundry also confirmed Blockcap would join as the first institutional client. According to a statement from Mike Colyer, CEO of Foundry, the company is working on “tailor-made solutions to fit the needs of institutional mining companies.”

Blockcap, a Texas-based mining operator, purchased nearly 10,000 mining machines from Foundry, increasing its hashrate by about 0.9 exahashes of computing power. Notwithstanding, Blockcap also ordered an extra 8,400 miners from Caanan and 10,000 Antminer rigs from Bitmain.

Once delivered and installed, the hashrate contributed by Foundry USA is expected to boost, which could see the mining pool break into the top 10 largest mining pools.

Blockcap’s Executive Chairman Darin Feinstein praised Foundry USA’s efforts to build a US-based mining pool to compete with China-based pools’ growing influence. In a statement to newsrooms, Feinstein said,

“Mining on a pool that is made and based completely in the US, and offers institutional miners payouts at par with the world’s biggest pools was an obvious choice on our mission to make North America a global hub for digital-asset mining.”

The rush in Bitcoin mining across North America is growing at an astonishing pace. Recently, Bitfury’s US mining offshoot company, Cipher Mining, announced its plans to list on NASDAQ in a $2 billion valuation public sale.

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Author: Lujan Odera

Brave Acquires Open Search Engine, Tailcat; Breaking Away From Google’s Prying Eyes

Popular privacy-focused web browser Brave has bought out Tailcat, an open search engine, in its efforts to launch a private search engine.

On Wednesday, Brave announced the acquisition of Tailcat, an open search engine that was created by the team that was behind the Cliqz anti-tracking search-browser combo. Cliqz, now defunct, operated under Hubert Burda Media, exited the browser and search space in May last year.

As per the announcement, Tailcat will be used as a base for the much expected Brave Search. The Brave Search will be an inbuilt search engine that is developed to allow private and transparent surfing.

Brendan Eich, Brave co-founder, and CEO explained that the company is focused on launching Brave Search before the end of summer 2021.

“Brave is now working on integrating this technology and making it available to all as Brave Search, first via early access for testers, and then for general availability by this summer.”

At the moment, Brave browser highly depends on a number of external search engines, giving its clients a choice to use popular search engines such as DuckDuckGo that is also privacy-focused, and Startpage, and also the mainstream search engines such as Google. Brave claims that almost “all of today’s search engines are either built by, or rely on, results from Big Tech companies.”

On the other hand, Tailcat is developed on top of a fully independent index whereby it will not collect IP addresses and other personal information and data aimed at enhancing the search results. Eich explained that Tailcat engineers have been developing a privacy-focused search engine over the last seven years till Cliqz ceased operations. As part of the acquisition deal, the Cliqz development team will now move to Brave. The dev team is headed by Dr. Josep Pujol, who hailed the deal as a major breakthrough in offering an alternative to the Big Tech dominance.

The acquisition comes days after Brave announced a major achievement in its efforts to enhance its browser adoption. Brave doubled its monthly active client base from 11 to 26 million.

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Author: Joseph Kibe

SEC Commissioner Finds DeFi’s Democratization, Open Access, Transparency, & Resilience ‘Alluring’

SEC Commissioner Finds DeFi’s Democratization, Open Access, Transparency, & Resilience ‘Alluring’

Yet again, Hester Peirce, aka Crypto Mom, talked about balancing innovation and regulation but this time in decentralized finance.

SEC Commissioner Hester Peirce, aka Crypto Mom, during the recent regulating the Digital Economy Conference, while talking about the recent market mania in the meme stocks, praised the decentralized finance (DeFi). She acknowledged that people love participating in hot markets, and as regulators, the mission is simple, capital formation and investor enrichment.

The goal of our market, she said, is to facilitate the flow of investors’ money into real companies that can serve other people’s needs and then return the money so investors can build wealth and technology has the potential to turbocharge capital markets’ this ability. But, for technology to have its maximum benefit, Peirce, who has long been a crypto advocate, said, “we will need to change our attitude.”

“Specifically, we tend to look at technological innovation in the markets with deep suspicion, and that mindset has to change,” she added. For this, embracing the technology is the only way to do it, and that regulators’ role is to “protect investors and markets, not incumbents.” In order to do the best for both investors and markets, DeFi “will provide a very good test,” said Peirce.

She defined DeFi as the nascent industry which is working on building an alternative to the legacy centralized financial system (“CeFi”) run through smart contracts rather than financial intermediaries. Instead of counterparties, its users trust in smart contracts. She said in her speech,

“Although a work in progress with all the growing pains and rough edges that implies, DeFi’s promises of democratization, open access, transparency, predictability, and systemic resilience are alluring.”

As such, regulators need to provide both legal clarity and the freedom to experiment so that it can compete with CeFi, she wrote. Not to mention, increased participation in markets propelled by technology is beneficial for the markets themselves.

Besides using technology for transparency, it can be used for real-time settlement, she said, echoing Robinhood CEO’s call and pointing out how crypto transactions actually settle quickly and effectively without a central counterparty.

“The digital economy does pose some new regulatory challenges, but it also gives us new tools to meet those challenges,” concluded Peirce, adding, welcoming its potential has high payoff,

“A successful regulatory framework for the digital economy will unleash its ability to empower individuals to build better futures for themselves, their families, and their communities.”

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Author: AnTy

Miami Mayor ‘Definitely Open’ to Allocate 1% of City’s Treasury Reserves into Bitcoin

Miami Mayor ‘Definitely Open’ to Allocate 1% of City’s Treasury Reserves into Bitcoin

Meanwhile, Francis Suarez is working on accepting Bitcoin as a means to pay for services/bills in 2021.

Mayor Francis Suarez declared his Bitcoin friendliness on Twitter Tuesday when BTC proponent Anthony Pompliano urged him to allocate Miami’s reserves into the world’s largest cryptocurrency.

“Definitely open to exploring it,” said Suarez who is working on bringing tech talent to the city.

With COVID-19 bringing in more remote-working opportunities, many tech entrepreneurs are contemplating or have already moved out of the San Francisco Bay Area. Some are considering Miami as an option thanks to Suarez actively endorsing the city on Twitter.

The Mayor’s Bitcoin positive response has been to Morgan Creek Digital co-founder Pomp’s tweet, “Retweet this if you would move to Miami if Mayor Francis Suarez put 1% of the city’s treasury reserves in Bitcoin.”

The tweet received much love — 1.3k retweets and 5.3k hearts. The Bitcoin community is already on board with this idea which has already seen adoption from public listed companies.

MicroStrategy was the one to herald it which was then taken further by Jack Dorsey’s Square. Now, in small and big enterprises, everyone is slowly replacing cash with Bitcoin as a reserve asset in their balance sheet.

“Would be the first US city to do it. If Bitcoin works out, it would bring significant resources to the city. If it doesn’t work out, it would be best spent economic development dollars because of how many people would move,” said Pomp of such a move.

While Bitcoin in Miami’s treasury reserves may take time, the city could soon accept Bitcoin and crypto as a means to pay for services and bills.

“We are definitely going to be working on that in 2021…” is what Suarez said of this.

Charlie Shrem, host of Podcast UntoldStories also chimed in and called out the state of Florida to be the flag bearer of Bitcoin friendliness.

However, Jimmy Patronis, Florida’s Chief Financial Officer & State Fire Marshal isn’t keen on the idea as he said, “Got to keep public money safe. It’s not the future, it’s now. I love that the Mayor is fired up about expanding the global financial sector in Florida!”

While Florida might not be ready for that now, the crypto community already has Wyoming which has been leading with its digital assets favorable regulations. And of course, the state has already elected the first Bitcoin owner, Cynthia Lummis to the US Senate.

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Author: AnTy

Coinbase Joins Square’s Crypto Open Patent Alliance (COPA) As A Founding Member

  • Coinbase is the latest founding member to join Square’s Cryptocurrency Open Patent Alliance (COPA).
  • Coinbase joins 18 other founding members aiming to enhance the “open patent policies on crypto projects.”

An announcement on COPA’s official website this Thursday confirms Coinbase, U.S. largest cryptocurrency exchange, joins the alliance as a founding member alongside Square Inc. The alliance aims to push forward an ‘open patents policy’ to boost the growth in developments and innovation in the crypto ecosystem. Coinbase joins the alliance to push “COPA’s missions forward, educate the community and drive membership, and establish and administer the alliance’s policies.”

In September, Square launched the COPA alliance to ensure that Bitcoin and the wider crypto ecosystem remain free and secure. Jack Dorsey, the founder of Square, said at the time that COPA aims to “maintain a shared patent library to help the crypto community defend against patent aggressors and trolls,” further asking more companies to join their goal.

Since the launch of COPA, 18 crypto companies have joined the alliance, including Blockstack, Blockstream, Kraken, Protocol Labs, and Satoshi Labs.

Senior counsel at Coinbase and member of the COPA board, Brittany Cuthbert, stated his enthusiasm with the exchange joining the alliance to create a “foundational patent shield for the crypto ecosystem.” Cuthbert further said,

“As the crypto economy continues to grow, we believe it is important to help empower all projects building towards an open financial system.”

Furthermore, COPA also announced Steve Lee, Square Crypto Lead, and Dan Robinson, a Paradigm researcher, a crypto firm focused on open-source protocols, as COPA’s newest board members.

COPA’s goal aims to enhance development and innovation across the crypto field by abolishing the tying up of “foundational technology in patents and litigation,” given the market is still in its early days. The alliance aims to make these foundational cryptocurrency technologies available to everyone through tackling offensive patent lockup by developers.

All COPA members pledge not to use their foundational development crypto patents, “except for defensive reasons,” which frees up the patents used by any developer across the space. Moreover, the alliance creates a “shared patent library where members pool all of their crypto patents together to form a collective shield of patents.” This allows members of the alliance to use any patent in the library to defend themselves and deter aggressors.

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Author: Lujan Odera

Chairman Jay Clayton: The SEC is Open to Tokenizing ETFs Despite Recent Clampdowns

The Chair of the U.S Securities Exchange Commission (SEC), Jay Clayton, has said that the agency is open to discussing tokenized exchange-traded funds (ETFs). He was speaking at a Chamber of Digital Commerce webinar held on Oct 2, where he highlighted that ‘It may very well be the case that […stocks] all become tokenized.’

Despite a struggle to stay in the loop on crypto innovations, the latest sentiments by Clayton signal SEC’s openness to its underlying potential. A tokenized ETF will allow American investors to access stock indices in the form of tokens, hence Clayton’s futuristic view of integrating traditional instruments with modern-day tech ‘tokenization.’ Clayton said in a Decrypt report,

“We’re willing to try that; our door is wide open. If you want to show how to tokenize the ETF product in a way that adds efficiency, we want to meet with you, we want to facilitate that.”

SEC Actions Paint a Different Picture

While the SEC Chair appears to have taken an open stance towards tokenization, the agency’s recent clampdowns on crypto businesses state otherwise. Some industry players that have faced the SEC wrath this year include Abra, a crypto investment platform that offers clients stocks in tokenized versions. The firm was fined around $300,000, split between CFTC and SEC, given that both agencies were pursuing Abra.

Other than the clampdowns, SEC has rejected several Bitcoin ETFs citing that the BTC price can easily be manipulated. Clayton said,

”We got off on the wrong foot in this innovation. There was the theory that because it was so efficient because it could have had so much promise, we could toss aside some of those principles of responsibility and transparency.”

He was eager to note that the SEC has to stay true to its role by identifying product launch issuers in America’s financial markets. On this, he further mentioned that they are still in pursuit of ICO issuers who might have breached U.S securities regulations during the ICO boom in 2017. It also appears the SEC is entirely against the narrative of ‘payment networks,’ but instead views ETF’s a financing vehicle,

“What we don’t like is when someone says, ‘you know, the function is payments … Don’t pretend that it’s a payment system when it’s actually a financing vehicle.”

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Author: Edwin Munyui

Compound Protocol to Roll Out Decentralized Oracles Dubbed ‘Open Price Feed’

Compound, one of the most popular defi protocol, is all set to introduce open price feeds for lending on its platform using a decentralized oracle. This decentralized oracle would offer live price feeds, which would make the lending process more simplified. Open price feeds are being tested across several blockchain network including Ethereum (ETH) Kovan and Ropsten testnet. The open price feed has been live on the mentioned testnet for almost two weeks now.

Compound’s developer community has appealed to the members to come together and test the new open price feeds on the platform so that the developers can integrate it into the protocol as early as possible.

How Does Open Price Feed Work?

Open Price Feed system relies on permissionless price reporters and posters, where exchanges act as a reporter (earlier Coinbase Pro was the only exchange acting as a reporter). The reporter is responsible for signing the price feeds regularly with their public key. After reporters sign the price feed, posters would be responsible for pushing out the signed price feeds. Posters in this system are permissionless, which means anyone can become a poster if they like.

Apart from Coinbase Pro as the reporter, the system also makes use of on-chain Uniswap V2 price feed as a fallback or to verify the price feeds signed by Coinbase Pro. Uniswap is called an anchor in this system and makes sure that the data does not deviate from the market value. If the on-chain data signed by reporter differ by more than 20% for 30-60 minutes, in that case, off-chain data would be ignored.

Many other price data feed providers would join the network via governance token COMP. It is also believed once Compound aggregates enough price feeds from multiple trustworthy sources, the use of Uniswap price feeds would be discarded altogether.

Compound launched its protocol token back in June using which people can participate in the on-chain Protocol decision. 50% of these tokens would be distributed via liquidity mining incentive program. At the same time, the remaining 50% token would be distributed among early investors and developers.

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Author: James W

Ethereum Classic To Lose Over 50% Of Nodes As Top Client, OpenEthereum, Moves On

  • Open Ethereum, led by Gnosis, calls quits on supporting Ethereum Classic (ETC) development.
  • The client, formerly Parity Technologies, holds nearly 50% of ETC nodes.
  • Will ETC still hold its immutability properties?

The largest developer client on Ethereum Classic, OpenEthereum (OE), completed a vote to deprecate development on the blockchain in a bid to focus their efforts on Ethereum and other projects.

Following the vote, only Core Geth and Hyperledger Besu clients – which hold less than a third of the nodes – will continue supporting the development of ETC.

The vote on GitHub raised concerns for ETC’s immutability as the third-largest client, Multi-Geth, also deprecated ETC development on any future hard forks.

Over 50% of ETC Nodes set to go off

According to ETCnodes.org, the total number of clients on ETC blockchain totals to 631 and will be reduced to 199 nodes (Core-Geth with 194 nodes and Hyperledger Besu accounting for five nodes) when developers update or hard fork the blockchain.

Image: etcnodes.org

OE is a project that replaced Parity Technologies once the latter transferred the entire client codebase to decentralized exchange, Gnosis. Since the start of 2020, ETC developers and OE developers have been at loggerheads on the overall implementation of the Phoenix hard fork on ETC.

Speaking on why Open Ethereum is moving from ETC client support, Martin Köppelmann, CEO and Founder of Gnosis, stated OE didn’t want to get into internal governance squabbles of ETC. He further said:

“We explored various options to work with different players from ETC, but in the end, we felt we want to focus on the thing we know and that is Ethereum.”

Other developers at Open Ethereum claim it is the “perfect time for divorce” as “supporting Classic is more trouble than what it’s worth.”

Ethereum Classic Developers Respond

The animosity between the two development camps has been ranging for some time, as shown in the tweet below:

However, responding to the latest deprecation, CEO of ETC Labs, Terry Culver, had a more friendly approach towards Parity developers. As the leading developer on Core-Geth client, ETC Labs will have a larger pie on the development of ETC, but the reduction of nodes may be harmful to ETC’s security.

To prevent this, he called on ETC developers to find a balance between innovation and immutability developments on the blockchain.

Another lead developer, ETC Coop’s Executive Director, Bob Summerwill, does not focus much on Multi-Geth and OE, leaving the project calling on developers to switch to the available options. He stated:

“Multi-geth is dropping ETC support too, but both core-geth and Hyperledger Besu are both viable options which we will be recommending to end-users. Best wishes.”

Immutability: The backstory on Open Ethereum, ETC

The story can be traced back to 2016 when the Ethereum blockchain split after the DAO hack. The hard fork rolled back the transactions before the hack (forming the current ETH blockchain).

Still, some developers and users saw this as interference in the core principle of blockchains – immutability. This group remained on the original chain – renamed to Ethereum Classic.

Fast forward to 2020, and the Phoenix hard fork by ETC raised questions on immutability due to the “upgrade in the op-code pricing to align with ETH’s.” The op-code implementation raised questions on changing the tokenomics of ETC, which means the blockchain no longer holds immutability as a value proposition.

According to Multi-Geth and Parity core developer, Wei Tang, the lack of immutability on ETC makes the blockchain the same as ETH; hence it would be double work continuing to develop on both chains. His conclusion?

“I think for a healthy ecosystem of Ethereum, we should follow the majority consensus of ETH, or support a merge of ETH and ETC.”

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Author: Lujan Odera