BlockFi shows top growth among U.S. companies, the U.K. posts over 10% inflation and BitGo plans to bring a lawsuit against Galaxy Digital.
Coming every Saturday, Hodler’s Digest will help you track every single important news story that happened this week. The best (and worst) quotes, adoption and regulation highlights, leading coins, predictions and much more — a week on Cointelegraph in one link.
Top Stories This Week
Fed to issue long-awaited guidelines for granting master accounts to crypto banks
Crypto’s continued journey into the mainstream has come with various levels of regulatory action across the globe. This week brought clarity in terms of expectations for crypto-focused banks seeking accounts with the United States Federal Reserve. A framework released by the Federal Reserve Board details expectations for such applicant banks, including the level of due diligence to be provided based on each applicant’s risk level. Giving crypto-focused banks access to the Fed’s so-called “master accounts” has been a slow process, but it suggests that regulators are gradually integrating digital assets into mainstream finance.
BlockFi tops the Inc. 5000 list with almost 250,000% revenue growth in three years
Centralized finance player BlockFi topped Inc. magazine’s 2022 list of U.S. companies showing the highest revenue growth over the past three years. Although the list showcases 5,000 companies posting revenue growth, making it into consideration for the list requires paying a small fee and submitting an application. Be that as it may, BlockFi has tallied a 245,616% increase in revenue — substantially higher than the company holding second place on the list.
Ethereum Foundation clarifies that the upcoming Merge upgrade will not reduce gas fees
Ethereum’s highly anticipated Merge, which involves a shift to proof-of-stake from the current proof-of-work consensus mechanism, should arrive before 2022 is over — possibly in September, according to expectations. The move is a significant piece of the puzzle regarding Ethereum’s forward progression. Although the Merge means lessened energy required for running the Ethereum blockchain, that does not mean the network’s gas fees will fall, according to the Ethereum Foundation.
“Gas fees are a product of network demand relative to the network’s capacity,” the foundation specified this week. “The Merge deprecates the use of proof-of-work, transitioning to proof-of-stake for consensus, but does not significantly change any parameters that directly influence network capacity or throughput.”
UK hits double-digit inflation for the first time in 40 years
Inflation currently affects billions of people across the globe. The United Kingdom, specifically, has now entered double-digit territory for inflation, according to the latest consumer price index (CPI) reading. July’s CPI came in at 10.1% year-over-year, up from 9.4% in June and the highest since February 1982. A sharp rise in the price of gas, food and other goods contributed to the high inflation print.
BitGo to sue Galaxy Digital for $100M over dropped acquisition
Digital asset custody firm BitGo intends to pursue legal action against crypto firm Galaxy Digital to the tune of more than $100 million. Galaxy canceled its move to acquire BitGo, stating that BitGo missed its deadline to provide certain financial documents. Legal representation for BitGo alleged that Galaxy is obligated to pay $100 million as a termination cost or an equivalent or greater amount in damages, while a Galaxy spokesperson stated the company’s choice to cancel the deal was within its contractual rights based on BitGo’s missed deadline.
FTX US among 5 companies to receive cease and desist letters from FDIC
The U.S. Federal Deposit Insurance Corporation (FDIC) has issued cease and desist letters to five companies, including FTX US, for allegedly making false representations about deposit insurance related to digital assets. The government agency claims FTX US and four other companies involved in crypto-related publications misrepresented the FDIC’s deposit insurance protection by claiming that it also applies to certain digital asset products. The FDIC has asked the companies to “take immediate corrective action to address these false or misleading statements.”
Winners and Losers
At the end of the week, Bitcoin (BTC) is at $21,394, Ether (ETH) at $1,700 and XRP at $0.33. The total market cap is at $1.02 trillion, according to CoinMarketCap.
Among the biggest 100 cryptocurrencies, the top three altcoin gainers of the week are Chiliz (CHZ) at 26.90%, UNUS SED LEO (LEO) at 12.13% and Shiba Inu (SHIB) at 8.01%.
The top three altcoin losers of the week are Convex Finance (CVX) at -26.39%, Oasis Network (ROSE) at -25.56% and THORChain (RUNE) at -24.77%.
For more info on crypto prices, make sure to read Cointelegraph’s market analysis.
Most Memorable Quotations
“Achieving a balance requires law enforcement to give up on unrealistic assumptions about unfettered access to everyone’s data on a silver platter.”
Ahmed Ghappour, general counsel at Nym Technologies
“As soon as you start to say to energy companies, ‘Oh, you can do this with your power, but not this,’ then they’ll start to tell you which networks you can mine, or you can mine this coin but not that coin.”
Andy Long, CEO of White Rock
“Right now, staking on the Beacon Chain carries the risk that the Merge doesn’t happen. But once it does, participation in staking is more accessible and has less technical risk.”
Lex Sokolin, head economist at ConsenSys
“Predicting a stock crash is a lot like predicting an earthquake. You know one will happen every so often but you can never tell exactly when or how severe it will be.”
Mati Greenspan, CEO and founder of Quantum Economics
“Those involved in illicit activity would be wise to steer clear of blockchain-related assets and stick to the tried and tested dollar. The United States dollar is still the most utilized and preferred currency for money laundering.”
Durgham Mushtaha, business development manager for Coinfirm
“While consumers tend to attribute high importance to privacy in surveys, they tend to give away their data for free, or in exchange for very small rewards in practice.”
European Central Bank Working Paper Series
Prediction of the Week
Bitcoin price dives pre-FOMC amid warning $17.6K low was not the bottom
Bitcoin’s price took a downward turn on Friday as the crypto market continues wading through a macro bearish backdrop. The asset fell below $22,000 mere days after briefly crossing the $25,000 mark, according to Cointelegraph’s BTC price index.
In a Wednesday tweet, Crypto Academy founder Justin Bennett compared S&P 500 chart activity to what was seen in 2008. “This is mind-blowing,” Bennett said, adding:
“The S&P 500 is mimicking the 2008 crash. Even the timing since the ATH [all-time high] is nearly identical. The bottom is NOT in for stocks or crypto.”
FUD of the Week
Network and token freeze after Acala exploit raises questions
Another stablecoin depeg occurred this week — this time, the result of a hacker exploiting a bug connected to decentralized finance solution Acala. The aUSD stablecoin, which aims to keep value on par with the U.S. dollar, plummeted to $0.01 after the hacker created 1.2 billion aUSD tokens using no collateral. Acala’s team turned on maintenance mode, which paused the function of several activities, including freezing the illegitimately created assets.
Study: Insider trading occurs in 10% to 25% of cryptocurrency listings
A draft of a study from the University of Technology Sydney dove into the topic of insider trading — trading based on non-public information. Evaluating specific Coinbase asset listings between Sept. 25, 2018, and May 1, 2022, the university estimated that between 10% and 25% of crypto listings are tainted by insider trading. The conclusion was reached, in part, by comparing data to past examples of insider trading on the stock market as a baseline. Definitive determination of foul play, however, is often difficult to prove.
2017 ICOs aren’t over yet: SEC files suit against Dragonchain and its founder
The U.S. Securities and Exchange Commission (SEC) is still apparently sorting out crypto-related issues from 2017. Dragonchain and multiple related parties face action from the SEC, as per a complaint filed by the government agency and publicized on Tuesday. The commission faults Dragonchain and certain parties for using an initial coin offering and presale to accumulate $16.5 million without registering with the SEC.
Best Cointelegraph Features
Court filings reveal Celsius will run out of money by October
Celsius Network has been heading down a slippery slope since it filed for bankruptcy in July.
Optimism fading? Regulatory discussion on stablecoins postponed until fall
While there is no shortage of legislative initiatives to regulate stablecoins, the idea of a U.S. CBDC remains problematic.
Another depeg: Acala trace report reveals 3B aUSD erroneously minted
As the dust settles on another decentralized finance exploit, Acala continues to trace erroneously minted tokens after a misconfiguration in a newly launched liquidity pool.