Uniswap Labs, Startup Behind Powerhouse DEX, is Being Investigated by the SEC: Report

The US Securities and Exchange Commission (SEC) is investigating Uniswaps Labs, the startup behind the leading decentralized exchange (DEX), reported The Wall Street Journal on Friday, citing people familiar with the matter.

According to the report, enforcement attorneys are seeking information about how people use the DEX and how it is marketed.

The agency, however, didn’t confirm or deny the investigations to the news outlet. But the report says the investigation appears to be in its early stages and may not even result in any formal allegations of wrongdoing.

This comes as regulators probe further into the cryptocurrency market, going for the decentralized protocols which don’t have any middleman and provide direct access to investors without any broker.

SEC Chair Gary Gensler recently said that decentralized finance (DeFi) projects are not immune from oversight. He also called on lawmakers to give the SEC more power to oversee these platforms.

The absence of clear investor protection obligations means “the investing public is left vulnerable,” said Gensler this week.

Gensler has repeatedly said that the agency could regulate DeFi, and they even have a “fair amount of centralization” in terms of governance, fees, and incentives and called DeFi a “bit of a misnomer.”

Uniswap Labs, however, is “committed to complying with the laws and regulations governing our industry and to providing information to regulators that will assist them with any inquiry,” a Uniswap Labs spokesperson told The Journal.

“They went after a company building software. They don’t operate the exchange. It’s a very shitty precedent,” commented Banteg, a lead developer of DeFi blue-chip Yearn Finance. “Probably every DeFi project got hit at this point, even NFTs and full decentralization didn’t protect Uniswap.”

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Author: AnTy

Shift in Momentum: Binance Yields to Regulatory Pressure, the Definition of HQ Changing for CZ Too

Binance aims to move from its start-up origins to become a financial institution, but CZ isn’t leaving, rather is putting “commitment to compliance” as their top priority. The exchange has also launched the Tax Reporting Tool to help its users fulfill their tax reporting requirements.

Leading cryptocurrency exchange, Binance now wants to set up regional headquarters and be recognized by local regulators, said chief executive officer, Changpeng Zhao.

“We want to be licensed everywhere,” Changpeng Zhao told journalists, saying he wanted to “work with regulators everywhere.”

“From now on, we’re going to be a financial institution,” he said, adding that this would be breaking from its earlier decentralized model and maturing from its start-up origins.

As a first step towards getting a regulated move, Binance is becoming KYC (know your customer) compliant in order to “support” the security of its users, it said.

The exchange announced a reduction in its daily withdrawal limit to 0.06 BTC for those who are not completely verified but only have Basic Account Verification. This adjustment will be effective in phases starting from August 4 and will be completed by August 23.

The same restriction applies to new account registrations but is effective immediately.

“We continually review our policies to ensure that we surpass industry standards. This adjustment better accounts for current BTC prices. You can increase your withdrawal limit by completing identity verification.”

The same day, Binance launched the Tax Reporting Tool to help its users keep track of their crypto activities so that they are fulfilling the reporting requirements laid out by their regulatory bodies.

‘What if the less reg friendly things move to BSC/ some other chain. I’m thinking things like derivatives and lending markets. Binance has been writing a shit ton of checks in that space,” noted market maker IamNomad in response to Binance’s latest move.

Binance Smart Chain (BSC) is actually seeing a renewed interest lately, with the daily transactions on the blockchain hitting a new peak above 11.9 million on July 27 after bottoming around 3.14 million earlier this month, as per BSC Scan.

Unlike the last peak, this time, DEX PancakeSwap is not behind this success but CryptoBlades, a play-to-earn NFT game. This makes sense, given that Axie Infinity has been leading the market during the downturn of the last three months.

Amidst all this came reports of CZ looking to hire his replacement as the next CEO.

During a conversation with Mukaya Panich, CIO at Thailand’s Siam Commercial Bank’s venture arm SCB 10X, CZ said he is looking for a senior person with strong compliance and regulatory background.

“I don’t think I’m the best person to lead that effort. I think having somebody with a very strong regulatory background is actually better.”

CZ, however, took to Twitter to explain that “there are no immediate plans to replace me as CEO,” though he would like to hire someone with a special regulatory background to show their “commitment to compliance,” which he said is their top priority.

“I feel CEOs should not stay for more than 10 years, ideally around 5 years… We are always hiring for CEOs. I don’t need to be CEO, and I am not leaving.”

Much like in 2018, Binance became the leader in the crypto space; market participants believe the momentum is shifting yet again, with FTX coming on fast behind Binance to take up the first spot.

While Coinbase already had its initial public offering to mark Bitcoin top so far this year and Kraken is also planning sometime next year with FTX considering but not really needing it, CZ is now mulling a future IPO in the US but said the plan “is not 100% fixed yet.” Such plans would require Binance to have a legal entity and headquarters.

“We are setting up those structures.”

“Once those structures are in place, you may make it easier for an IPO to happen. So that’s not out of the question. But right now, we are still in the early stages.”

Binance has been facing a lot of regulatory scrutiny from all over the world especially due to not having an HQ, something regulators aren’t comfortable with, especially UK watchdog FCA which called the lack of a headquarters a “huge issue.”

Up until now, CZ has maintained that his definition of a headquarters is different from others, which is finally changing as the exchange faces the pressure of regulators and, given the latest changes made by the exchange, is also caving to them.

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Author: AnTy

Solana Leads $3M Funding Round in Blockchain Data Platform PARSIQ

Blockchain data monitoring startup PARSIQ has closed a funding round of $3 million, led by the Solana Foundation.

The funding round also included notable investors such as Axia8 Ventures, Mindworks VC, Krypital Group, CoinUnited, and others.

PARSIQ To Use Fund To Expand Product Suite

The PARSIQ platform allows users to customize their notification settings to block out undesired noise while receiving important information in real-time.

The blockchain data firm revealed that the fund raised would be used to expand its product suite.

PARSIQ tools include notifications for token transfers, price fluctuations, and other blockchain-related movements.

Apart from Solana, the PARSIQ tools are also compatible with Bitcoin, Ethereum, and some other blockchains.

Solana Founder Anatoly Yakovenko, while speaking on the investment, said access to blockchain data through apps like PARSIQ was critical.

He noted that PARSIQ would help developers of Solana-based projects worry less when building out their stack, allowing them to concentrate more on their product.

The investment into PARSIQ comes after Solana raised $314 million in a private token sale.

The sale was led by Andreessen Horowitz and Polychain Capital with participation from Alameda Research, Block change Ventures, CMS Holdings, Coinfund, and others.

Founded in 2017, Solana is an advanced open-source blockchain project focused on providing a highly scalable, secure, and maximally decentralized platform.

Dubbed the Ethereum killer, Solana has been active in building tools and networks for others to build on the platform.

It has several decentralized exchanges (DEXes) and protocols built on it such as Serum, Raydium, KIN, Audius, Mango Markets, Bonfida, Maps.me, Pyth Network, USDC, Phantom wallet, and more.

Solana Hackathon’s Step Finance To Aggregate With Solana’s DEXes

The Solana blockchain had attracted thousands of developers to its network, breaking records for the most number of participants in a hackathon this year.

The hackathon, in collaboration with Serum, had over 3,000 registrations and over 100 project submissions.

One of the projects that emerged from the Solana hackathon is Step Finance, a DeFi position manager and aggregator. Although Step Finance did not win any prize during the event, it appears to be doing very well.

Step Finance started aggregating Solana’s decentralized exchanges (DEXs), including automated market maker Raydium, SerumDex, and Orca, to give traders faster access to price information.

Step Finance’s trading dashboard, called the Step Dashboard, will enable traders to have access to $845 million of liquidity and execute trades quickly at low fees.

Earlier this year, the aggregator completed a private token sale for $2 million in a round that saw participation from various Solana backers including Almaeda Research and Raydium.

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Author: Jimmy Aki

Tax Automation Startup TaxBit Secures Investment from Paypal, Coinbase, and Winklevoss Capital

Crypto Tax Automation Startup TaxBit Secures Investment from Paypal, Coinbase, and Winklevoss Capital

According to an announcement on Thursday, Paypal, Coinbase, and Winklevoss Capital have invested in crypto tax automation startup TaxBit. The tax compliance startup seems to gain traction from prominent players in the crypto industry. More tax authorities led by the likes of IRS tighten their oversight on cryptocurrency activity.

Winklevoss Capital was already an investor in TaxBit, having participated in their seed round, which raised $5 million. TaxBit is yet to disclose how much it was funded in the latest round of investment by the three industry giants.

As the IRS forges a clear path for crypto tax reporting, stakeholders have made adjustments to meet the set requirements. Per the latest Form 1040 draft, the IRS requires anyone who took part in crypto activity within 2020 to report the same. It outlines that the scope of such activities includes virtual currencies that have been airdropped or transferred for free and obviously transactions involving crypto assets.

“If, in 2020, you engaged in any transaction involving virtual currency, check the ‘Yes’ box next to the question on the virtual currency on page 1 of Form 1040 or 1040-SR.”

Given such developments, the TaxBit crypto tax automation software is among the solutions that firms and retail are looking for to remain tax compliant. This Salt Lake City startup reduces the workload of reporting taxes through two primary applications focused on exchanges, crypto businesses, and consumers. It is not surprising that they have now increased their capital base with support from major contributors to the crypto ecosystem.

Paypal, which recently debuted into the crypto space, is likely to benefit from this investment. More users will be willing to engage crypto assets once the hustle of tax reporting is eliminated. TaxBit Founder and CEO Austin Woodward expressed optimism on the milestone,

“We want to thank our customers, partners, and investors for helping us move the cryptocurrency space forward … This investment will help us achieve our aim of being the most innovative and trustworthy provider of cryptocurrency tax technology.”

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Author: Edwin Munyui

Dfinity Project Hits Mercury Milestone, Launching Its ‘Internet Computer’ Mainnet

Dfinity Project Hits Mercury Milestone, Launching Its ‘Internet Computer’ Mainnet

Dfinity, a startup that has been building the ‘Internet Computer’, launched its Mainnet quietly on Dec. 18 according to a blog post update from the company’s founder Dominic Williams. The firm which was valued at around $10 billion last year enjoys the backing of heavyweight VCs such as Polychain Capital and Andreessen Horowitz.

Dfinity’s internet computer is an advanced computing system built on blockchain technology; it is set to compete with the likes of Amazon Web services. This new internet computer leverages Chain Key technology which basically reduces the computing workload by splitting smart contracts into two; query calls and update calls. The former can be executed in milliseconds while the latter can take between one and two seconds, depending on the rate of block production.

According to the 18,000-word blog post, Dfinity’s purpose is to extend the functionality of the public internet through blockchain technology, hence eliminating the need for legacy techs such as firewalls, databases, and cloud services. The blog goes on to highlight that,

“Ultimately, the Internet Computer allows entrepreneurs and developers to reimagine both how and what they build — a paradigm shift that will change everything.”

While Mainnet had met its release date target of Q4 2020, Dfinity had yet to go mainstream on this milestone. According to Williams, this release is more of an Alpha version given that the project is still on its path ‘Genesis’. Some of the required metrics for the Genesis version to be met include network stress testing as it grows, the release of documentation, and significant amounts of the source code.

Currently, the internet computer is decentralized and runs on nodes located in 7 independent data centers spanning Switzerland, Germany, and the U.S.A. However, the project has issued only a fraction of its 469 million governance tokens; these were allocated to the Dfinity team, early investors, and other stakeholders who will be obligated to vote once the Genesis is met.

The update, which also outlines a 20-year plan is fundamentally bullish on the prospects of an internet computer in the coming decades. It outlines that,

“The Open Internet will finally be significantly bigger than Big Tech’s closed proprietary ecosystem, which will now be in terminal decline, but will take forever to disappear for similar reasons COBOL code is still running.”

Dfinity believes that open versions of existing applications like TikTok, Uber, and Google Photos can be built on its advanced blockchain-based computing ecosystem. In fact, the firm has previously built a TikTok ‘replica’ which it dubbed CanCan to demonstrate the feasibility of its tech. Per the blog, Dfinity anticipates unlocking the Genesis version of its Mainnet within the next 2-3 months, after which the network will transition to beta.

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Author: Edwin Munyui

PayPal & Revolut’s Crypto Brokerage, Paxos, Raises $142M to Facilitate Digital Asset Adoption

Thanks to a new funding round, the blockchain startup is powering PayPal’s new cryptocurrency service is gearing up for a big year in 2021.

Gearing Up for 2021

The company confirmed that it had raised $142 million in new funds and is looking forward to significant growth in the new year.

Per a press release, Paxos confirmed that its Series C funding round was led by Declaration Partners, a New York-based investment management firm backed by billionaire David Rubenstein. The round also included Mithril Capital and PayPal, which is already a major Paxos partner.

The funding round brings Paxos’ overall haul to $240 million. Company chief executive Charles Cascarilla explained that the funds would go a long way in bolstering its expansion plans as it looks to build the “market infrastructure of the future.” He added that the company would double its workforce, expand its product solutions, and create new products to target enterprises.

The CEO also reiterated his company’s commitment to regulation and security.

Plans Ahead

While Paxos appeared to have started the year quietly, the past few months have been monumental for the firm. The company was instrumental in PayPal’s smooth entrance into the crypto space, partnering with the payment processor to launch PayPal’s crypto service.

PayPal announced its crypto offering in October, confirming that it would allow users to spend cryptocurrencies at merchants that accept its service. The crypto service will support Bitcoin, Litecoin, Ether, and Bitcoin Cash. Explaining its role, Cascarilla said in a blog post that Paxos built the underlying platform that will power PayPal’s crypto service.

As the blog post explained, Paxos fits into PayPal’s service on two fronts. Its crypto brokerage service will provide PayPal with easy crypto trading and custody. The company is lending its API to the payment processor to promote an easy and seamless user experience.

BitLicense was also instrumental in helping PayPal secure a conditional Virtual Currency License (BitLicense), allowing it to provide its crypto services to New Yorkers.

Along with its PayPal integration, Paxos is also working towards becoming a fully-registered crypto bank. The stablecoin issuer filed its application last week, looking to incorporate its Paxos General Trust in New York.

blog post to that effect explained that the company would hope to broaden its service range and coverage through the bank charter. The bank pointed out,

“Our mission is to modernize financial market infrastructure and enable the movement of any asset, any time, in a trustworthy way. A national Trust Bank charter would help us realize our goal by enabling us to serve customers across the country in the most efficient way.”

With two business opportunities laying ahead, Paxos seems poised to become more of a force in the industry come 2021.

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Author: Jimmy Aki

BlockFi Partners with Visa to Launch Bitcoin Rewards Credit Card in 2021

Cryptocurrency startup BlockFi has partnered with payment processor giant Visa to launch a credit card that rewards purchases with BTC rather than cash or airline miles.

The card is expected to be made available in early 2021, and initially, the service will be offered only in the US.

The company has already launched the waitlist for the “world’s first” Bitcoin Rewards Credit Card.

To be issued by Evolve Bank & Trust, the users of the Bitcoin Rewards Credit Card will receive 1.5% on an accrual basis on every transaction made through the card. This will then be converted to Bitcoin and placed into the account of the BlockFi every month.

If a user spent more than $3,000 the first time, a lump sum of $250 in the digital asset would be credited. The card also comes with a $200 annual fee.

“We’re excited to add credit cards to our suite of products and expand Bitcoin’s accessibility to a broader set of consumers,” said Zac Prince, chief executive officer and founder at BlockFi.

Bitcoin has rallied more than 160% in 2020, having surged to a new all-time high.

Earlier this year, Visa also joined startup Fold to offer a debit card that earns rewards in cryptocurrency. In February, Visa and Coinbase announced a debit card that allows users to spend BTC.

Besides announcing a Bitcoin reward credit card, BlockFi also reported another “record-breaking month of interest payouts.”

BlockFi’s clients earned more than 10 million in interest in November, including over 300 in BTC, 3500 in ETH, and 2 million in stablecoins.

BEG and BlockFi have teamed up to offer new users a bonus signing up and start earning by putting your crypto to work.

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Author: AnTy

VC Backed Startup, Deel, Partners With Coinbase to Roll Out Cryptocurrency Payroll Service

Deel, a San Francisco based crypto startup backed by Andreesen Horowitz, is launching a crypto payroll tool that would allow international workers to get paid in different cryptocurrencies.

Deel raised about $44 million in funding ($14M Series A and $30M Series B) during the ongoing pandemic and specialized in offering payroll and compliance services to remote workers internationally. The new payroll tool would allow the Deel customers to accept their payroll in top cryptocurrency like Bitcoin, Ether, and XRP with instant withdrawals.

Deel has partnered with Coinbase to offer its payroll tool, and users would be required to have or create a Coinbase account to use the new services.

Dan Westgarth, Deel’s chief operating officer, explained that the motive behind creating such a payroll tool was to help international workers to save hefty remittance costs charged by traditional banks and money transfer services. He explained,

“A question on a lot of people’s tongues is: will it be widely adopted? Will the companies paying these people to be willing to opt into it?

Well, we built it in a way that the company doesn’t choose. The remote worker chooses.”

“So I can be working for an old, boring institution, run by a load of old guys who don’t understand crypto and oppose it.

They could pay me in U.S. dollars, but given I’m a Deel user and given I get paid through Deel; I could elect to have my paycheck delivered in XRP — instantly.”

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Author: James W

Lightning Labs Allows Users to Earn Interest on BTC by Providing Capital to LN

Lightning Labs has launched a marketplace for liquidity on the network.

The startup focused on developing the Layer 2 payment channel for Bitcoin, Lighting network, has opened the door to “LiFi” – Lightning financial products.

This non-custodial, peer-to-peer marketplace “transforms” your Lightning liquidity into a tradable asset on the Lightning Pool, allowing the user to buy or sell access to this liquidity.

In simple words, “People can earn interest on their BTC by helping to provide capital to the Lightning Network, while keeping control of their funds.”

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Unlike decentralized finance (DeFi), where a third party is the one with the custody of your funds, as in the case of Wrapped Bitcoin (WBTC), it is BitGo; Lightning Pool allows sellers to earn yields on their BTC without trusting a third party with their sats.

“The yield is earned from buyers on the Pool willing to pay a premium for access to new capital on Lightning without counterparty risk,” reads the announcement.

The lack of liquidity on the liquidity Network has been an obstacle, “one of the most widely felt pain points,” to its adoption, which the marketplace is addressing through Pool, which will allow everyone to participate.

“We developed Pool out of a need in the market that emerged from Lightning users who were looking for new sources of liquidity to enable them to more efficiently receive funds and transact on Lightning.”

In the beginning, the payment channels will have a maximum leasing time limit of two weeks or 2016 blocks, which will be diversified to six months. The liquidity provider will receive fees on their Pool account up-front.

“Pool features a p2p auction mechanism, batched execution, and a new concept called shadowchain using bitcoin script.”

Currently, it is in closed alpha with exchanges and wallets to make sure when it launches, it has enough liquidity. And because this is not DeFi, the maximum account size, for now, is 10 BTC as it is early and needs to be stress tested.

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Author: AnTy

DeFi Trading Startup, Dharma, Adds Ability to Buy Tokens Directly from Bank on UniSwap

Dharma, a DeFi-focused startup, has been given the green light to enable Automated Clearing House (ACH) trading for DeFi tokens within 13 states in the U.S. The startup, backed by Coinbase, has been making major strides in the burgeoning DeFi space, with the latest integration of the Uniswap DEX a few months back. The startup is optimistic about becoming the ‘Robinhood’ of crypto as per earlier comments from its CEO, Nadav Hollander.

“Our goal in building ‘the Robinhood of crypto’ is to bridge the final gap between these blossoming markets and the millions of individuals who will want to tap into them as they gain popularity and mindshare.”

The ACH service by Dharma will enable its U.S clients to make direct DeFi token purchases from their bank accounts. According to the milestone update, users will incur a 1.5% fee while the weekly purchase limits have been capped at $25,000. U.S states where this service is available to include Wyoming, Wisconsin, New Hampshire, Washington, Virginia, Texas, Pennsylvania, Montana, Michigan, Massachusetts, Georgia, California, and Arizona.

With the ACH service in place, Dharma’s prospects of pivoting as the ‘Robinhood’ of crypto have increased; Nadav noted that DeFi trading with their application would undoubtedly make the participation process simpler,

“Investing DeFi has, up until now, been a bifurcated and highly technical process. Now, it’s as easy as downloading an app and connecting your bank account.”

Notably, Dharma had earlier incentivized user participation by offering to cover the gas fees coupled with a no-fee, no-gas promotion in August. Its newly integrated ACH services are being supported by APIs from a Fintech giant dubbed ‘Plaid.’ Nadav told CoinDesk in an email that they are leveraging services from an active crypto-focused bank. However, he did not disclose the name.

“We are processing ACH transfers through a direct partnership with a well-known bank active in the crypto space.”

Dharma’s journey in the DeFi space has evolved quite fast; the startup secured $7 million in a funding round back in February 2019. At the time, Dharma’s focus was an Ethereum based lending service; it later moved to stablecoin-oriented savings and finally the Uniswap integration.

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Author: Edwin Munyui