LianGuai Morning News | Curve, Metronome, etc. offer a 10% bounty to hackers to encourage them to return cryptocurrencies
LianGuai Morning News | Curve, Metronome, etc. offer 10% bounty to incentivize hackers to return cryptocurrencies
Headlines
▌Curve, Metronome, and Alchemix offer 10% bounty to hackers to encourage the return of stolen cryptocurrency
Curve Finance and other projects affected by the reentrancy attack this week plan to offer a 10% bounty to hackers in exchange for the return of the remaining stolen cryptocurrency. The vulnerability on July 30 resulted in approximately $70 million worth of cryptocurrency being stolen, making the bounty close to $7 million. Curve, Metronome, and Alchemix wrote in an on-chain message sent to the hacker’s Ethereum address, “We will not pursue this matter further, and there will be no legal risks or law enforcement issues.”
The statement sent to the hacker also added, “If you choose not to voluntarily return and complete the process by 08:00 UTC on August 6th, we will expand the bounty publicly and offer a full 10% reward to anyone who can identify your identity in a manner that results in your conviction in court. We will pursue you from all angles within the limits of the law.”
LianGuai previously reported that this attack was caused by a serious vulnerability in the Vyper programming language version. Multiple liquidity pools using Vyper 0.2.15, 0.2.16, and 0.3.0 became targets of the reentrancy attack, affecting four liquidity pools on Curve Finance.
▌Analyst: Fitch’s downgrade of US credit rating strengthens Bitcoin’s status as a hard currency
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Ratings agency Fitch downgraded the long-term rating of the United States on Tuesday, citing expectations of deteriorating fiscal conditions over the next three years and high and growing government debt burdens. Gordon Grant, Head of Genesis Sales and Trading, said that the downgrade has attracted investors’ attention to Bitcoin and strengthens its position as an alternative to the US dollar as a hard currency.
Grant analyzed that after Fitch downgraded the US credit rating from AAA to AA+, we saw an increase in cryptocurrency prices. As borrowing by the US Treasury increases, interest costs rise, and funding needs increase, people are beginning to recognize the demand for alternative hard currency solutions. He added that recent macroeconomic dynamics have refocused investor attention on the hard currency characteristics of Bitcoin.
Market
As of the time of writing, according to coinmarketcap data:
BTC recently traded at $29,129, with a daily change of -0.23%;
ETH recently traded at $1,836.04, with a daily change of -0.24%;
BNB recently traded at $241.12, with a daily change of -0.05%;
XRP recently traded at $0.6634, with a daily change of -1.12%;
DOGE recently traded at $0.0736, with a daily change of -0.81%;
ADA recently traded at $0.2923 with a intraday change of -1.39%;
MATIC recently traded at $0.6676 with a intraday change of -1.59%;
WLD recently traded at $2.3286 with a intraday change of +0.72%.
Policy
▌SEC Chairman: Current regulatory system lacks the ability to deal with AI risks
SEC Chairman Gary Gensler has downplayed the focus on cryptocurrencies and shifted attention to artificial intelligence. Gensler stated that large-scale automation could have a chain effect on the trillions of dollars of assets traded in markets regulated by the SEC. He warned that while the predictive capabilities of AI can help companies better serve their clients, it can also be used to conceal liability when things go wrong.
Gensler believes that the current regulatory system does not have the ability to address these risks. Coordinating AI models among major trading firms could lead to greater market volatility and instability.
Gensler’s shift in focus to AI does not mean that the SEC is relaxing its control over cryptocurrencies. Several lawsuits involving major cryptocurrency companies such as Ripple, Binance, and Coinbase are still pending, indicating that under Gensler’s leadership, the SEC is still committed to enforcing its current actions against cryptocurrency companies.
▌Coinbase plans to “completely” dismiss SEC’s charges
Coinbase’s Chief Legal Officer, LianGuaiul Grewal, announced during Thursday’s earnings call that the company plans to submit an order to “completely” dismiss the lawsuit brought by the SEC. Grewal expressed confidence in Coinbase’s rebuttal arguments submitted to the court, and the exchange hopes to work with the SEC and lawmakers to gain regulatory clarity.
Blockchain Applications
▌Brave launches image and video search engine Brave Search
Privacy-focused search engine and browser maker Brave announced the launch of its privacy-preserving image and video search, Brave Search. The company explains that this means users will no longer have to leave Brave when they want image or video search results, as the results will now be provided directly from Brave Search’s own independent index.
Brave had previously announced in April that it would no longer rely on Bing’s index, which previously accounted for 7% of all search results. Brave states that the image and video search feature has been developed for several months and its results will also be available through the recently launched Brave Search API.
▌Matter Labs: Accusation of code plagiarism is false, attribution is provided
Polygon, the Ethereum scaling company, stated in a tweet on Thursday that Matter Labs, the company behind zkSync rollup, copied parts of Polygon’s open-source code without providing attribution. Matter Labs denied these accusations in a statement and stated that the code “clearly belongs to” a line at the top of one of the relevant files. A spokesperson for Matter Labs said that Polygon’s blog post contains “untrue claims.” “The new Boojum high-performance proof system leverages 5% of Plonky2, which is prominently reflected in the first line of the code module.”
▌Multicoin Capital Partner: ZK is not a practical solution for DeFi privacy
Kyle Samani, a partner at Multicoin Capital, said that zero-knowledge proofs (ZK) have their place, just not in DeFi. ZK Rollup is not the correct answer for on-chain privacy. Samani explained that concepts like collateral management, solvency, and health factors don’t apply when everyone is submitting a bunch of private proofs on-chain. DeFi needs a top-down perspective to be effective, which fundamentally doesn’t map to a bunch of encrypted ZK transactions.
Samani suggests that the correct way to achieve privacy in DeFi is through FHE, or fully homomorphic encryption. Contracts would be encrypted end-to-end, and state transitions would be applied by validators. The advantage of this system is that it preserves the core logic of the system, which is the correct way to solve the problem.
▌Offchain Labs launches permissionless verification protocol BoLD
Offchain Labs, the development team behind Arbitrum, a second layer scaling solution for Ethereum, has launched a permissionless verification protocol called Bounded Liquidity Delay (BoLD). Ed Felten, co-founder and chief scientist of Offchain Labs, said that BoLD will be the first protocol to resolve Rollup disputes, allowing anyone to become a validator without the risk of delay attacks. The key attribute of BoLD that avoids delay attacks is that it can resolve all disputes within a single program. Felten noted that in the coming weeks and months, Offchain Labs will release instructions to run the Nitro developer testnet using BoLD, followed by the testnet. The Arbitrum DAO is expected to consider deploying BoLD on Arbitrum One and Nova.
▌Report: Smart contracts deployed on Ethereum and related blockchains increased 12 times in the past year
According to a new report by Alchemy, the number of smart contracts deployed on Ethereum and related blockchains increased 12 times in the past year. Blake Tandowsky, growth analyst at Alchemy, attributes this boom to the second layer blockchains built on top of Ethereum, such as Arbitrum and Optimism, which greatly reduce the cost of using smart contract platforms. Alchemy stated that although the number of developers has decreased, the remaining developers are developing more smart contracts than ever before.
The report also states that the number of new user-friendly crypto wallets in July increased by over 1,200%, or 13 times, and there are nearly 300,000 active users of smart contract-based wallets, with 22,000 active users in June.
Cryptocurrencies
▌Coinbase CLO: We do believe we can win in the SEC lawsuit
LianGuaiul Grewal, Chief Legal Officer of Coinbase Global, stated in a post-earnings conference call that regarding the lawsuit with the SEC, I want to be very clear that we do believe we can win, and we expect to win. It was previously reported that Coinbase and Binance were sued by the U.S. Securities and Exchange Commission in June. According to the SEC, at least 13 of the cryptocurrencies listed on the Coinbase platform are securities.
According to Refinitiv data, Coinbase’s revenue in the second quarter was $707.9 million, exceeding the expected $663 million. The trading volume for this quarter decreased from $217 billion a year ago to $92 billion, and the loss narrowed from $1.09 billion in the same period of 2022 to $97 million.
▌Data: Lido Finance Still Dominates the Staking Industry with Over 28% Market Share
According to data from IntoTheBlock, Lido Finance remains the largest staking service provider in the cryptocurrency industry, with a total market share of over 28%. Coinbase and Stakefish rank second and third in the staking services, with market shares of 7.72% and 5.69% respectively. The top 5 staking services are Kraken, Binance, and Figment. Kraken has a staking market share of 5.33%, while Binance and Figment have market shares of 5.22% and 3.83% respectively. Rocketpool ranks last with a market share of 2.91%, and Staked.us has a market share of 2.42%.
▌Traders Sell a Large Amount of USDT on Curve and Uniswap, Causing USDT to Fall Below $1
On-chain data shows that traders seem to be selling a large amount of USDT in the main stablecoin pools of Curve Finance and Uniswap, causing the pools to be severely imbalanced. The USDT balance in Curve’s 3Pool has soared to 62%, which consists of USDT, USDC, and DAI stablecoins, while USDC and DAI account for about 19-19% of all assets in the pool. The USDT-USDC trading pool on Uniswap is one of the most liquid currency pairs on the platform, with a USDT balance of $105.4 million and a USDC balance of only $6.5 million. This imbalance indicates that traders prefer to hold DAI or USDC rather than USDT because there are more USDT sellers in the pool.
According to CoinDesk and CoinMarketCap data, due to selling pressure, USDT has been trading below $1 during the US stock market trading session, falling to as low as $0.9976. The reason for the sell-off is still uncertain at the time of writing.
▌Binance USD Market Cap Falls Below $3.5 Billion, Shrinking Over 65% in the Past Five Months
According to the latest data from CoinGecko, the total market cap of Binance USD (BUSD), a US dollar stablecoin issued by LianGuaixos, has fallen below $3.5 billion, standing at $3,495,331,621 at the time of writing. Historical data shows that BUSD fell below $10 billion on March 3, 2023, below $5 billion on June 7, and below $4 billion on July 13, meaning that this metric has shrunk by over 65% in the past five months.
▌Block Reports Q2 Net Revenue of $5.5 Billion, $2.4 Billion from Bitcoin Business
Payment company Block Inc., founded by Jack Dorsey, announced a gross profit of $1.87 billion for the second quarter of 2023, a year-on-year increase of 27%. The company stated that out of the $5.5 billion in net revenue for the second quarter, $2.4 billion came from its Bitcoin business. The company’s Bitcoin revenue has grown by 34% compared to the same period in 2022 and refers to the total sales of cryptocurrencies sold to customers.
The Cash App business of Block generated $1.16 billion in Bitcoin revenue, a 39% increase compared to the same period in 2022. The company stated that this revenue could have made a greater contribution to its profits if it weren’t for the market price decline. As of June 30, 2023, there were no impairment losses on the Bitcoin holdings of the company, with a total Bitcoin holding value of $245 million.
▌Bitstamp Launches XRP Lending Service with 2% Annual Yield
Cryptocurrency exchange Bitstamp has announced the launch of its XRP lending service shortly after relaunching XRP trading last month. The annual yield (APY) for XRP lending has been increased to 2.0%. The company stated that it is partnering with Tesseract to provide lending services, which only offers loans to reputable institutions and conducts strict risk and credit assessments on all borrowers. Tesseract classifies counterparties into four categories, with the first category including large top-tier market makers from traditional finance and the fourth category including small institutional borrowers.
▌Coinbase Q2 2023 Revenue: $707.9 Million, Exceeding Analyst Expectations
Coinbase (COIN.O) reported a revenue of $707.9 million for Q2 2023, surpassing market expectations of $633 million. In the same period last year, the revenue was $808 million. The trading revenue for the second quarter was $327 million, compared to $375 million in the first quarter. Interest income decreased from $241 million in the first quarter to $201 million. Out of the interest income in the second quarter, $151 million came from its holdings of USDC. The total trading volume declined to $92 billion, compared to $145 billion in the first quarter. Coinbase stated that its operating expenses decreased by nearly 50% year-on-year, partly due to a 30% reduction in employee headcount.
The Coinbase stock price rose 5.5% to $95.60 in after-hours trading on Thursday, with a year-to-date increase of approximately 160%.
▌Glassnode: Bitcoin Outflow from US Exchanges Significantly Lower than Overseas Exchanges
Data from blockchain analytics firm Glassnode shows that the outflow of Bitcoin from US exchanges is significantly lower than that from overseas exchanges. Glassnode categorizes leading exchanges by region, with Coinbase, Kraken, and Gemini classified as onshore (US) exchanges, and Binance, Huobi, and OKX classified as offshore exchanges primarily serving the Asian market. The report found that despite facing increasingly strict regulatory scrutiny, the outflow of funds from US exchanges has significantly decreased. The highest monthly outflow from Coinbase, Kraken, and Gemini occurred on July 20, with 22,241 BTC leaving these platforms. As of August 2, the monthly outflow from US exchanges was 13,346 BTC, significantly lower than the outflow of 32,466 BTC from offshore exchanges.
Important Economic Developments
▌Comprehensive Debt-to-Equity Program to Be Released Soon
Recently, there have been frequent policy signals to effectively prevent and resolve local government debt risks. Experts believe that with the continuous recovery and overall improvement of the Chinese economy this year, the risks of local government debt are generally controllable. Currently, there are multiple means to effectively prevent and resolve local government debt risks, such as debt restructuring, extension, and reorganization. The timing for the release of a comprehensive debt-to-equity program is gradually maturing, and it is expected that related policy measures will be expedited, with further progress in the issuance of special refinancing bonds.
“The prudent resolution of hidden debt stock through the overall coordination of funding asset resources and various policy measures may become a key focus,” predicted Gao Ruidong, Chief Macro Economist at Guotai Junan Securities. As one of the measures in a package plan, it is believed that a new round of hidden debt risk resolution pilot projects may be launched this year. For some local governments that meet the conditions, they will be allowed to issue refinancing bonds to replace their hidden debts, thereby extending the debt maturity, reducing interest rates, and alleviating risks. Experts believe that the current trend of China’s economic recovery remains positive, and the overall risk of local government debts is controllable. In the medium and long term, effective prevention and resolution of local government debt risks require continuous promotion of financial and tax system and mechanism reforms.” (China Securities Journal)
LianGuai Encyclopedia
▌What is UniswapX
UniswapX will improve swaps in various ways: obtaining better prices through aggregated liquidity sources; gasless transactions; preventing MEV; no fees for failed transactions. In the coming months, UniswapX will expand to gasless cross-chain swaps.
Disclaimer: LianGuai, as a blockchain information platform, publishes articles for informational purposes only and does not constitute actual investment advice. Please develop a correct investment concept and enhance risk awareness.
