Golden Weekly is a weekly blockchain industry summary column launched by Golden Finance, covering the week's key news, mining information, project dynamics, technological progress and other industry dynamics. This article is one of the news weekly, taking you through this week's blockchain industry events.
Headlines
▌CZ has begun serving his sentence in a federal prison in California
CZ has begun serving his sentence at a low-security federal prison in Lompoc, California. CZ's defense team, Latham & Watkins, confirmed that CZ is now in custody. In November 2023, CZ pleaded guilty to violating the Bank Secrecy Act for failing to maintain an effective anti-money laundering program; in April of this year, CZ was sentenced to four months in prison.
▌Bitfinex analyst: EU elections may hint at the future direction of cryptocurrency regulation
Jag Kooner, head of derivatives at Bitfinex, said next week's EU parliamentary elections could provide further clues about how cryptocurrencies are regulated in that market. Kooner said a rightward shift could lead to tighter cryptocurrency controls, while a pro-crypto outcome could accelerate supportive regulation such as MiCA. Investors will be watching the EU elections for regulatory cues, which could have a significant impact on the broader cryptocurrency market in June and the following months.
▌Musk: Never discussed cryptocurrency with Trump
Musk clarified on the X platform that he had never discussed cryptocurrency with Trump. Musk said that although he generally supports transferring power from the government to the people, cryptocurrency can do this.
SBF returns to the New York prison he left a week ago
Sam Bankman-Fried, co-founder of digital currency exchange FTX, has returned to the New York prison he left a week ago.
▌Foreign media: Trump accepts Bitcoin Lightning Network payment for campaign donations
Donald Trump has become the first U.S. president to accept campaign donations via the Bitcoin Lightning Network, according to Bitcoin Magazine.
policy
PayPal Obtains New York Crypto Trust License
The New York State Department of Financial Services (NYDFS) recently granted PayPal Digital a limited purpose trust license, which is typically held by digital asset custodians and stablecoin issuers. Last August, PayPal launched PYUSD, its first stablecoin issued by a major technology company, which was technically issued by Paxos Trust Company, which also holds an NYDFS trust license and has been a partner of PayPal since it launched cryptocurrency services. . Obtaining a trust license this time may be aimed at taking over the custody of crypto assets for PayPal customers and internalizing stablecoin issuance. Currently, the market value of PYUSD is close to US$400 million, a significant increase from US$190 million in early April. The top five wallets account for 71% of stablecoin balances, with major holders including Paxos, Crypto.com, Curve (DeFi), Defiance Capital, and Frax (DeFi). Among them, Crypto.com and Bullish exchange hold US$103 million and US$23 million respectively. Last November, the U.S. Securities and Exchange Commission (SEC) issued a subpoena requesting documents related to the issuance of the PYUSD stablecoin. PayPal did not respond to requests for comment on the specific uses of the trust license before publication.
▌The Hong Kong government has communicated with the Hong Kong Securities and Futures Commission to process all virtual asset platform applications as soon as possible
According to Hong Kong media Wen Wei Po, the Hong Kong government will maintain close communication with the SFC to allow the SFC to process all platform applications as soon as possible, so that citizens and investors have more secure investment options. Looking ahead, Hong Kong will further improve the regulatory framework, including regulating virtual asset over-the-counter service providers, to build a stable ecosystem for the virtual asset industry and promote its responsible and sustainable development. The Hong Kong Securities and Futures Commission emphasized yesterday that although those virtual asset trading platforms that are considered to be licensed have promised to strengthen their policies, procedures, systems and monitoring measures to comply with the regulatory requirements of the SFC, they still need to show the actual implementation and effectiveness of these measures to be satisfied by the Hong Kong Securities and Futures Commission. Before these platforms are officially licensed, the SFC does not expect them to actively promote their services or establish business relationships with new retail customers.
▌Hong Kong Securities and Futures Commission: On-site inspection of virtual asset platform license applicants’ business
The Hong Kong Securities and Futures Commission said that in the coming months, it will conduct on-site inspections of the businesses of applicants for virtual asset trading platform licenses to ensure that platforms awaiting licenses comply with regulatory requirements. If any violations are found, the application will be promptly rejected, and other regulatory actions will be taken as appropriate. The one-year transition period for the virtual asset trading platform licensing system will end on June 1. The Securities and Futures Commission reiterated that all platforms operating in Hong Kong must obtain a license or have applied for a license. The latest data shows that there are two platforms that have obtained a license, and 18 have applied for approval. The Commission also reminded all platforms and their responsible persons that they must prevent mainland residents from using their virtual asset services in accordance with legal requirements.
▌Canada is expected to adopt the International Crypto-Asset Reporting Framework (CARF) for taxation by 2026
According to a supplementary document to the 2024 budget, Canada is expected to adopt the international Crypto-Asset Reporting Framework (CARF) taxation by 2026. CARF will impose new reporting requirements on crypto-asset service providers (CASPs), such as cryptocurrency exchanges, crypto-asset brokers and dealers, and crypto-asset ATM operators, whether individuals or corporate entities.
▌US lawmakers urge the SEC to approve spot Ethereum ETF
As anticipation grows for the approval of a spot Ethereum (ETH) exchange-traded fund (ETF) in the United States, members of the House of Representatives are urging securities regulators to approve the new product. On May 22, bipartisan members of the House of Representatives, including Majority Whip Tom Emmer and Democrat Josh Gottheimer, sent a letter to SEC Chairman Gary Gensler, asking the SEC to approve a spot Ethereum ETF. The lawmakers believe that a potential spot Ethereum ETF would provide investors with an opportunity to invest in ETH in a more regulated and secure form. "We urge the Commission to maintain a consistent and fair approach in its review of pending applications for ETFs backed by other digital assets," the lawmakers wrote, adding: "Specifically, the Commission should apply the same principles it set out when approving spot Bitcoin ETPs when evaluating pending Ethereum ETF applications, as the legal considerations associated with Bitcoin also apply to Ethereum."
▌U.S. Treasury Department: No intention to ban cryptocurrency mixers, aims to enhance transparency
At the Consensus conference, Brian Nelson, the U.S. Treasury Department's Under Secretary for Terrorism and Financial Intelligence, said that the Treasury Department has no intention of banning cryptocurrency mixing services. Nelson explained that the Financial Crimes Enforcement Network (FinCEN) 2023 proposal aims to list mixers as a "major money laundering problem" and require virtual asset service providers (VASPs) to report crypto transactions involving mixing to promote transparency rather than ban mixers. While industry insiders are concerned that this proposal will lead to a blanket ban on cryptocurrency mixing services, Nelson clarified that this is only to prevent money laundering and the financing of terrorism. The Treasury Department hopes to work with the industry to develop tools that enhance privacy without supporting illegal activities.
Blockchain Applications
▌Base engineers proposed a Fjord network upgrade for OP Stack
Base engineer Roberto Bayardo proposed the Fjord network upgrade for OP Stack. The upgrade includes the introduction of EIP-7212, which utilizes the secp256r1 elliptic curve for secure and efficient signature verification, greatly reducing the gas cost of smart wallet applications. In addition, the upgrade also uses Brotli compression technology to reduce data availability costs. EIP-7212 has been implemented on Polygon, and other L2s such as Arbitrum and zkSync are expected to support it. The Fjord upgrade aims to further reduce the overall transaction fees on the OP Stack chain. The upgrade is scheduled to be implemented on July 10, 2024 and is currently awaiting approval from the Optimism Governance Committee.
▌MoonPay launches Web3 platform for brands and digital experiences
Crypto infrastructure company MoonPay has doubled down on its services for brand digital experiences. According to an announcement on May 28, the company will launch a platform of Web3 tools specifically for digital interactions. The new platform will combine existing services provided by MoonPay with new tools, including crypto payments, identity verification, authentication, ticketing, tokenization, and NFT minting.
▌Jiading District, Shanghai: Building Metaverse Infrastructure to Support Metaverse Technology to Empower the Automotive Industry
The People's Government of Jiading District, Shanghai issued the "Action Plan for Further Promoting the Construction of New Infrastructure in Jiading District (2024-2026)". It mentioned that the metaverse infrastructure will be built. Relying on Yuanchuang Bay, Nanxiang Game Valley and other positions, AIGC, three-dimensional digital space, virtual digital people, AR/VR, blockchain and other metaverse technologies are comprehensively applied to create interactive, situational and immersive metaverse demonstration application scenarios. Support metaverse technology to empower the automotive industry, focus on technology research and development, scene creation, technology transformation and other links around the sub-sectors of "metaverse + smart cockpit" and "metaverse + smart manufacturing", and create a benchmark and model for the automotive metaverse industry. Relying on the "Ai Shang Jiading" digital display and promotion platform, promote the digital service supply of cultural and tourism venues such as public libraries, museums, and scenic spots. Encourage multiple subjects to participate in the construction of the Shanghai Cultural Data Service Platform, support industry entities to carry out data collection and processing in accordance with the law, and guide the sharing and use of data resources.
▌Hong Kong Acting Financial Secretary: We will make every effort to promote financial innovation in key areas including Web3-related DeFi, virtual assets, etc.
In his keynote speech at the 2024 Caixin Summer Summit held today, the Acting Financial Secretary of the Hong Kong Special Administrative Region Government, Michael Wong Wai-lun, said that Hong Kong will continue to fully promote financial innovation, with key areas including DeFi (decentralized finance) and virtual assets related to financial technology, green finance, Web3 (third-generation Internet). The SAR government will ensure that financial risks are stabilized at a controllable level. On the other hand, it will continue to expand the interconnection between Hong Kong and mainland China's financial markets.
▌Pacmoon announces v2 with Social Validator concept
Pacmoon, the Blast Ecosystem Meme Project, announced the launch of version v2 with the Social Validator concept. The V2 "Social Validator" model mainly includes: 1. Creators' tweets about Pacmoon; 2. Validators like creators' tweets 3. Creators get points based on how many validators like posts (and how much they hold); 4. Validators can allocate daily points according to the number of creators' posts they like. It is reported that the eligibility limit for participating validators is to hold 10,000 PAC tokens. Pacmoon stated that it will airdrop tokens worth $1 million per month in the future, of which 70% will be allocated to creators and the remaining 25% will be allocated to validators.
Cryptocurrency
▌PayPal Stablecoin PYUSD will be listed on Solana
PayPal has chosen the Solana blockchain to expand its stablecoin PayPal USD (PYUSD), marking its first expansion outside the Ethereum ecosystem. According to the announcement, PYUSD has been added to the Solana network, allowing users to trade at a lower cost. The move is intended to expand the use of the PYUSD stablecoin as a payment method for small and everyday purchases.
▌HashKey Global launches LaunchPool, with Polyhedra Network as the first project
Virtual asset exchange HashKey Global announced the launch of LaunchPool and started the first project Polyhedra Network (ZK) staking mining activity, providing users with 325,000 ZK tokens with a total value of approximately 500,000 USDT as rewards. The activity period is from May 30 to June 4, 2024. HashKey Global's Launchpool platform aims to provide users with a simple cryptocurrency staking solution. Users only need to stake their existing cryptocurrencies into the pool and can withdraw the staked tokens at any time.
▌Bitcoin miner Riot seeks to acquire rival Bitfarms
Riot Platforms Inc. has acquired a 9.25% stake in Bitfarms Ltd. and plans to make a public takeover bid for the smaller bitcoin miner, which rejected Riot's offer last month, according to people familiar with the matter. Riot is offering $2.30 per share in cash and stock for Bitfarms, equivalent to an equity value of $950 million, the people said. The people asked not to be identified because the details are not public. Riot believes that recent management changes at Bitfarms indicate problems with corporate governance, and the company also plans to call for a vote to add directors to the Canadian company, the people said.
Binance France replaces Changpeng Zhao with two new shareholders
Binance France has replaced co-founder Zhao Changpeng with two new shareholders, a Binance spokesperson said, a move aimed at ensuring that Binance does not lose the right to operate in the EU's second-largest economy. Under French regulations, a company's majority shareholder cannot be a criminal. The EU's Crypto Asset Market Regulation (MiCA) allows companies to "passport" their licenses from one base country to 27 other EU countries.
▌JPMorgan Chase: The market's initial reaction to the spot Ethereum ETF may be negative
The approval of a spot Ethereum exchange-traded fund (ETF) by the U.S. Securities and Exchange Commission (SEC) has raised expectations of significant inflows. However, JPMorgan warns that these hopes may be overly optimistic compared to spot Bitcoin ETFs. JPMorgan analysts outlined several reasons for their cautious outlook. They detailed Bitcoin’s “first-mover advantage” and recent halving event as important demand catalysts for Bitcoin ETFs, which Ethereum lacks. Noting that Ethereum’s proof-of-stake mechanism has not provided a similar demand boost, the analysts stressed that Bitcoin’s halving event “acted as an additional demand catalyst for spot Bitcoin ETFs.” Additionally, they noted that the exclusion of staking in spot Ethereum ETF filings makes these funds “less attractive than platforms that offer staking benefits.” Bitcoin’s position as a competitor to gold in portfolio allocations further increases its demand for Ethereum, which is primarily seen as a utility token. Additionally, JPMorgan detailed that Ethereum’s lower liquidity makes it less attractive to hedge funds and quantitative funds.
Important economic developments
▌Fed's Bostic: The fourth quarter may be the time for the Fed to cut interest rates
Fed Bostic said that the breadth of price increases is still quite significant, and the narrowing of the scope of inflation will increase the Fed's confidence in cutting interest rates. The fourth quarter may be the time for the Fed to cut interest rates.
▌Fed Williams: I don't know when to cut interest rates, it will depend on data performance
Fed's Williams said that he did not know when to cut interest rates, which would depend on data performance; he did not feel any urgency in adjusting monetary policy; he did not need inflation to reach 2% to cut interest rates; he expected inflation to reach 2% in early 2026; raising interest rates was not his baseline expectation. In addition, Fed's Williams also said that there was ample evidence that monetary policy was restrictive; the PCE inflation rate was expected to fall back to 2.5% in 2024 and close to 2% in 2025; U.S. inflation was expected to resume slowing in the second half of 2024; GDP was expected to grow by 2%-2.5% in 2024, and the unemployment rate was around 4%; recent data did not mean a break in the downward trend in inflation.
▌Fed Kashkari: No more than two rate cuts are expected in 2024
Fed's Kashkari said he certainly does not expect the Fed to cut interest rates more than twice in 2024.
▌Interest rate swap market pricing remains stable, and the Federal Reserve is expected to cut interest rates at least once in 2024
After the release of the US PCE data, pricing in the interest rate swap market remained stable, and it is expected that the Federal Reserve will cut interest rates at least once in 2024.
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