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Lightspeed Venture Invests $2.8M in Crypto Market Maker Wintermute

6 years 2 months ago

Wintermute, an algorithmic liquidity provider, has received a $2.8 million investment from the prominent early-stage firm Lightspeed Venture Partners.

  • The London-based firm distributes liquidity with techniques similar to those used in high-frequency trading and traditional market making.
  • Founded in 2017, Wintermute provides liquidity on more than 500 spot trading pairs, on dYdX perpetual swaps and a handful of crypto exchange-traded products (ETPs) from 21Shares (formerly Amun).
  • The market maker will use the funding to expand further into crypto derivatives, as well as into the over-the-counter and decentralized finance spaces.
  • The Series A comes months after Wintermute raised an undisclosed seven-figure sum in a seed round led by Blockchain.com’s venture arm in February.
  • Lightspeed was the first outside investor into Snap, the company behind the popular video messaging app Snapchat, in 2012; it also participated in an angel round for Ripple, when it was still known as OpenCoin, in April 2013.
  • Partner Jeremy Liew said market makers were fast becoming essential infrastructure providers as the growth of new crypto market subsets and diverging regulatory regimes had seen the number of standalone exchanges explode.
  • In 2014, Lightspeed led Blockchain.com's $30.5 million Series A; the California-based investment firm raised a total of $4.1 billion across three funds in April this year.
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CoinDesk

Blockchain Bites: Crypto’s Bailout Millions, Brazil’s Binance Ban, Lightning’s Bug

6 years 2 months ago

At least 75 crypto and blockchain firms received approximately $30 million in government-backed PPP loans during the COVID-19 economic crunch while Binance continues to donate personal protective equipment equipment through its charitable wing. Here’s the story:

You’re reading Blockchain Bites, the daily roundup of the most pivotal stories in blockchain and crypto news, and why they’re significant. You can subscribe to this and all of CoinDesk’s newsletters here. 

Top shelf

Crypto Loans
More than 75 companies in the blockchain and cryptocurrency industry collected at least $30 million from the Paycheck Protection Program (PPP), a program meant to provide loans to small businesses affected by the COVID-19-led economic fallout, CoinDesk has found. According to information published Monday by the U.S. Small Business Administration, loan recipients include Zcash developer Electric Coin Company, Ethereum venture studio ConsenSys and several crypto venture firms. 

Related: Blockchain Bites: E-Gold Claims, Arca’s New Fund and Generation Z

Binance: Wins and Losses
Binance, the world’s biggest crypto exchange by trading volume, has donated 27,000 KN95 masks worth more than $60,000 to the U.K. National Health Service’s Pru Trust. Binance Charity recently created the PPE Token stablecoin, which has been used to track the delivery of masks and other equipment to hospitals. That’s as the exchange acquired crypto wallet app Swipe.io. Swipes wallet is available in more than 30 countries and allows users to purchase items with crypto via a Visa debit card. In less positive news, the Brazilian Securities and Exchange Commission (CVM) on Monday ordered Binance to immediately cease offering derivatives trading in the country. 

Lightning Bug
Researchers at the Hebrew University of Jerusalem have detailed vulnerabilities in Bitcoin’s Lightning Network that could lead to a loss of funds. The attack, explained in a paper called “Flood & Loot: A Systemic Attack on the Lightning Network,” games the slow confirmation times on Bitcoin’s network, Lightning’s “hash time-locked contracts” and the difference in settlement times. 

Benz on the Blockchain?
Ocean Protocol has completed a proof-of-concept with Mercedes-Benz maker Daimler, showing how blockchain can begin monetizing data streams within the company and across its supply chains. Announced Tuesday, the Singapore-based Ocean collaborated with Daimler AG to explore the decentralized sharing of internal sales and financial data among the multinational’s production hubs, and externally between some of its supply chain procurement partners. 

Mining Disclosures
Iran’s vice president issued a directive Monday that states crypto miners in the nation will have to disclose their identities, the size of their mining farms and their mining equipment type with the Ministry of Industry, Mines and Trade within a month.  

Quick bites
  • Confused what yield farming is? CoinDesk has an explainer
  • Viral TikTok video boosts the price of dogecoin by 20% (Decrypt)
  • Social network Voice, built on the EOSIO blockchain, has launched (The Block)
  • Alphabet subsidiary Loon launched a balloon-powered internet in Kenya (NYT)
  • Crypto entrepreneur Brock Pierce is officially a presidential candidate after filing paperwork with the Federal Election Commission (FEC) on Monday.
Market intel

Related: First Mover: As Bitcoiners Watch Dollar, Deutsche Bank Sees Trump Win Hurting Reserve Status

Unique Addresses
The seven-day moving average of the number of active ether addresses rose to 405,014 on Friday – a threshold not seen since May 2018, according to data provided by the blockchain analytics firm Glassnode. Active addresses are the number of unique addresses that are active in the network either as a sender or receiver. The increased ether activity could be associated with the explosive growth of Ethereum-based decentralized finance (DeFi) platforms, as well as the number of daily tether (USDT) transactions on the network. 

ADA Gains
Cardano’s ADA token has recorded a 170% return in the second quarter, propelling the crypto to its highest price level since June 2019. According to Daniel Ferraro, marketing director at blockchain intelligence firm IntoTheBlock, ADA’s impressive rally is the result of the excitement surrounding the “Shelley” upgrade, which would make Cardano 50 to 100 times more decentralized than other prominent blockchain networks, according to the company. Further, it will introduce an incentive scheme, or staking, designed to reach equilibrium around 1,000 stake pools.  

Exchange Losses 
Trading volumes on “top tier” crypto spot exchanges fell by 36% in June, according to a report from London-based data provider CryptoCompare, potentially related to bitcoin’s recent low volatility. Similarly, crypto derivatives exchanges experienced a 35.7% drop in volume to $393 billion – the lowest monthly volumes since the start of 2020.

Opinion

The Pirate Bay Age of Money
Lex Sokolin, a CoinDesk columnist and Global Fintech co-head at ConsenSys, writes about a pyramid scheme called Forsage that is eating up 25% of Ethereum’s bandwidth. Currently the most popular decentralized app, Forsage is just one example of the type of software that can take advantage of a permissionless system and cheat people out of their funds. “[W]e are in the Pirate Bay age of money: There is nothing to shut down, many will argue,” Sokolin writes, but “white hat hackers should come together to protect their users against naked pyramid schemes. If we don’t, there may never be real money in the system. Or worse yet, there will be no real decentralized system at all.”

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CoinDesk

FATF Plans to Strengthen Global Supervisory Framework for Crypto Exchanges

6 years 2 months ago

The Financial Action Task Force (FATF), whose advice is heeded by more than 200 countries, will meet in October to discuss ways to create a stronger global framework for the regulation of cryptocurrencies.

  • In a report Tuesday to the G-20 finance ministers and central bank governors, the international financial watchdog said regulators need to cooperate to make measures such as the Travel Rule more effective.
  • As such, the organization will work to develop an international framework for authorities to coordinate and share information about virtual asset service providers (VASPs).
  • As defined by FATF, a VASP is an open-ended term for crypto exchanges and peer-to-peer services as well as wallet providers and custodians. It can also include any business that trades or transacts in digital assets.
  • This would make the global regulation of cryptocurrencies and stablecoins, in particular, more effective, FATF said.
  • The end goal would be the framework forming the base of a global network of supervisors for the crypto industry.
  • While details are currently sparse, an FATF spokesperson confirmed the watchdog would convene this autumn to discuss how to improve international cooperation.
  • FATF is also planning to make available a list of red flags indicating possible criminal activity to regulators at the same time.
  • Siân Jones, a senior partner at XReg Consulting, told CoinDesk the framework would help regulators get up to the same speed worldwide.
  • The report gives an overview of stablecoins, cryptocurrencies that attempt to offer price stability by being pegged to a reserve currency such as the U.S. dollar. FATF said it will be providing guidance for regulators at some future point.

Also read: Germany Seeks to Expand Digital Efforts at FATF as It Takes On Watchdog’s Presidency

UPDATE (July 7, 16:55): This article has been updated to include comment from Siân Jones.

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CoinDesk

Binance Expands Reach With New Gateway for 15 Fiat Currencies

6 years 2 months ago

Cryptocurrency exchange Binance has teamed with settlement provider Etana Custody to increase the options for users buying digital assets with fiat currencies.

  • Announced Tuesday, Binance users can now fund their accounts with 15 national currencies through the fiat gateway that serves the Europe, Asia, North America and Oceania markets.
  • The 15 funding options include the United Arab Emirates dirham (AED), Czech koruna (CZK), Danish krone (DKK), Hungarian forint (HUF), Mexican peso (MXN), Norwegian krone (NOK), Polish złoty (PLN), and Swedish krona (SEK).
  • Other options like the euro (EUR), Australian dollar (AUD), Canadian dollar (CAD) and Swiss franc (CHF) are also included.
  • Once set up with a funded Etana account, users will not need to leave Binance’s website in order to fund purchases of cryptocurrencies such as bitcoin (BTC) and ether (ETH).
  • Etana provides Know Your Customer (KYC) and Anti Money Laundering (AML) standards that are compliant with the Bank Secrecy Act, per the announcement.
  • Brandon Russell, Etana founder and CEO, explained that users would be able to trade digital assets on Binance while maintaining their fiat balance on Etana.
  • Also providing services for crypto exchange Kraken, Etana Custody is a third-party custodian and settlement provider of both fiat and digital assets for brokers, traders and exchanges.
  • The addition brings the number of countries and regions in which Binance customers can fund accounts with fiat to 170, according to the firm.

See also: Binance Acquires Crypto Debit Card Provider Swipe for Undisclosed Sum

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CoinDesk

Crypto Tracer Chainalysis Raises $13M as It ‘Doubles Down’ on Government Ties

6 years 2 months ago

Cryptocurrency intelligence firm Chainalysis said Tuesday it has raised $13 million in additional Series B financing from Ribbit Capital and Sound Ventures, bringing its total for the round to $49 million.

  • As part of the deal, the New York City-based company, which builds software that traces crypto transactions, is adding Ribbit Capital general partner Sigal Mandelker as an adviser. Mandelker is a former high-ranking Treasury Department official.
  • Chainalysis said the new investments will help it “grow and deepen its government relationships.” America’s federal agency alphabet soup frequently inks seven-figure software licensure deals with Chainalysis: The Internal Revenue Service and the Securities and Exchange Commission in the U.S. have together shelled out nearly $2 million in the past two months alone. 
  • There are signs that Chainalysis’ tracing tools are growing in use beyond the U.S. government. Reactor, its flagship investigative product, increased its revenue from new foreign government customers by 400% since 2019, according to the company.
  • Chainalysis has found more success plugging into the massively lucrative public sector money funnel than any other tracing firm. But the crypto analytics competition is growing: Coinbase closed its first U.S. government deal (with the Secret Service) in May.

See also: Crypto Forensics Firm Chainalysis Adds Tracing Support for Zcash, Dash

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CoinDesk

Gelato Gives Developers a New ‘Money Lego’ Tool for DeFi Applications

6 years 2 months ago

A new decentralized finance (DeFi) “money Lego” will allow app developers to make it possible for users to automate their transactions. Called Gelato, the protocol moved from alpha to a live and audited v1 on Ethereum’s mainnet on July 3.

And, according to a blog post shared early with CoinDesk, decentralized exchange (DEX) Gnosis will be the first major platform to integrate Gelato, allowing users to swap and withdraw tokens in a “seamless Uniswap-like UX.”

“It’s a network that transacts on behalf of users or even dapps themselves, based on some conditions, like price or the collateralization ratio of a debt position,” Gelato co-founder Hilmar X. Orth told CoinDesk. 

Related: Ethereum Activity Metric Hits Highest Level in 2 Years

In short, the project gives developers simple infrastructural pieces to plug DeFi into decentralized applications (dapps). 

Gnosis did not return requests for comment by press time.

Money Lego

Blockchains do not easily lend to trading without a little tech wizardry. They are slow and expensive to keep up, and users must bid against one another to record a transaction on the ledger.

Regardless of the difficulties, DeFi projects have attempted to build a new financial system on top of blockchains because of their other valuable features, namely their permissionless nature. The Ethereum blockchain has been a common choice for DeFi – quickly approaching $2 billion currently “staked,” or pledged, as collateral – for numerous reasons, mostly boiling down to Ethereum’s rich programming language which makes building projects easier.

Related: What Is Yield Farming? The Rocket Fuel of DeFi, Explained

See also: What Is Yield Farming? The Rocket Fuel of DeFi, Explained

Money Lego are tech stacks that allow different applications to fit (or be shoved) into other projects. For example, you can deposit ether (ETH) into MakerDAO, receive the stablecoin dai (DAI) and then lend it on Compound to a trader in order to earn the network’s governance token COMP.

That being said, the infrastructure for connecting these crypto-financial Lego is still being cast. Gelato is just one such project bringing composability to DeFi and dapps, Orth said.

“For example, we have a developer building Gelato into his smart contracts, which will withdraw funds from the wallet of his users to his smart contract every month, as an insurance premium payment. If the user then runs out of cash, the insurance will automatically be cancelled and the claims of the user [will] be burned,” Orth said.

Gelato has integrated with data provider Chainlink to supply gas rates on the Ethereum network as well, according to a July 3 blog. The pairing allows users to select gas prices based on current network congestion in order to lower settlement costs.

See also: Money Reimagined: Bitcoin and Ethereum Are a DeFi Double Act

Orth said the project’s code base will hopefully transfer by “the end of the year” to a decentralized autonomous organization (DAO) for maintenance consisting of dapps using Gelato. Gelato will self-finance through network fees collected by the DAO, he said.

“It’s just really a new way of building dapps that schedule asynchronous transactions right from their smart contracts,” Orth added.

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CoinDesk

With Chat Privacy Under Threat in US, Firm Develops ‘100% User-Controlled’ Messaging

6 years 2 months ago

As the U.S. moves to pass legislation that threatens to weaken end-to-end encryption, Unstoppable Domains is planning to give users full control over their chat data with a new decentralized protocol.

  • Called Dchat, the new protocol was born out of Mozilla’s “Fix the Internet” incubator program, which invests in projects and people that design web technology with a focus on privacy and innovation.
  • Dchat functions by integrating cryptocurrency wallets and a peer-to-peer (P2P) storage network in order to securely store chat messages that are 100% controlled by users, the firm said Tuesday.
  • The tech is, in part, aimed at combating a rise in messaging privacy violations from government and organizations looking to surveil citizens or product users, such as those affected by Facebook’s Cambridge Analytica scandal in 2018.
  • Unstoppable Domains co-founder Matthew Gould said Dchat would enable users to encrypt and store messages “directly,” unlike apps like Tinder or Facebook where a user’s messages can be read by third parties.
  • Legislation known as the EarnIT Act that is passing through the U.S. Senate would, if it becomes law, force companies to provide back doors in end-to-end encrypted messaging systems in the U.S.
  • Unstoppable’s Dchat protocol “doesn’t need to worry” about the EarnIT Act because only users can see their messages, Gould claimed.
  • MyEtherWallet and imToken are already planning to launch their own apps using the Dchat protocol, which is expected to go live in the coming weeks, according to the firm.
  • Unstoppable Domains recently went into partnership with Protocol Labs, launching a decentralized censorship-resistant blogging platform on June 11.
  • The firm is backed by Draper Associates and Boost VC, and has received grants from the Ethereum and Zilliqa Foundations.

See also: Opera’s Android Web Browser Adds Access to .Crypto Domains for 80M Users

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CoinDesk

First Mover: Even Bank of America Acknowledges China Winning Digital-Currency Race

6 years 2 months ago

China’s push to roll out a digital version of its yuan isn’t likely to end the U.S. dollar’s century-long reign as the dominant currency for international payments and central-bank reserves. But it could make a dent. 

That’s the conclusion of foreign-exchange analysts at Bank of America, who argue that a Chinese digital currency might be welcomed by regional trading partners as payments become increasingly electronic.

You’re reading First Mover, CoinDesk’s daily markets newsletter. Assembled by the CoinDesk Markets Team, First Mover starts your day with the most up-to-date sentiment around crypto markets, which of course never close, putting in context every wild swing in bitcoin and more. We follow the money so you don’t have to. You can subscribe here.

Related: Germany Seeks to Expand Digital Efforts at FATF as It Takes On Watchdog’s Presidency

China appears well ahead of the U.S. in developing a central-bank digital currency, or CBDC, the Bank of America analysts wrote in a June 30 report. Federal Reserve Chair Jerome Powell, who said last year that the U.S. central bank had “not identified potential material benefits” of a general-purpose digital dollar, told Congress in June that officials are “working hard” on the issue. 

Yet the Agricultural Bank of China, one of the nation’s four state-owned banking giants, is already trialing a test interface for the digital yuan, CoinDesk reported in April. 

It goes without saying that the spread of the coronavirus has inspired a newfound repugnance for germy cash. 

“China seems likely to have a clear first-mover advantage in its adoption of CBDCs, both in terms of timing and usage,” the Bank of America analysts wrote. A digital yuan could increase the Chinese currency’s use in international commerce “even if it doesn’t immediately disrupt the USD’s dominant role in global finance.”

Related: Blockchain Bites: E-Gold Claims, Arca’s New Fund and Generation Z

The advent of digital-asset technologies has combined with the coronavirus-induced economic crisis to raise nagging questions about whether the dollar’s undisputed reign as the de facto global reserve currency might be due for a reckoning. The dollar accounts for some 62% of global central banks’ foreign-exchange reserves. 

As reported by First Mover on Monday, the German lender Deutsche Bank wrote in a report last week that a reelection victory by U.S. President Donald Trump could undermine the dollar’s dominant role in the long term, given his willingness to spurn multilateral organizations like the International Monetary Fund and World Bank. 

Such organizations have played a key role in the post-World-War-II order that helped enshrine the dollar’s premier status. The U.S tender is closely watched in digital-asset markets, since it’s the most common price denomination for cryptocurrencies like bitcoinand ether , as well as the backing for a fast-growing breed of digital tokens known as stablecoins.

“The present-day experience is more of discord and less in favor of multilateralism,” the analysts wrote. “We are seeing more rivalry in areas such as trade and technological dominance.”

It’s worth noting that China closely manages the yuan’s exchange rate against the dollar, so a digital version of the nation’s currency – also known as the renminbi, or RMB – could trade similar to a dollar-linked stablecoin. 

China has struggled to increase its currency’s usage in international commerce. Since, 2016, when the yuan was incorporated into an IMF international reserve asset, the Chinese currency’s penetration of global foreign-exchange reserves has doubled to a paltry 2%, as noted by the Bank of America analysts.  

Some 63% of Chinese banks’ cross-border claims are denominated in dollars, nearly identical to the proportion for U.S. lenders, the analysts wrote. 

“The internationalization of the RMB is happening, but the growth rate has been uneven and not as rapid as some may think,” according to the report. 

The Bank of America report comes as China’s digital yuan is attracting growing attention from top monetary economists and cryptocurrency-industry executives. 

The dollar’s hegemony is also under question, following the foreign-exchange turmoil that has sent emerging-market currencies plunging this year, saddling the world’s poorest countries with rising costs for imported consumer goods and elevated interest payments on international debt. Many bitcoin investors say the Federal Reserve’s roughly $3 trillion of money injections this year – with likely more to come – could end up debasing the dollar’s purchasing power.      

Jeremy Allaire, co-founder and CEO of Circle, which backs the dollar-linked stablecoin USDC, said on a podcast last week that China’s development of a digital currency has effectively “created a model where a household, a firm, a nation state can kind of directly transact and settle with China over the internet,” effectively bypassing payment systems in the U.S. sphere of economic influence.

Former U.S. Treasury Secretary Lawrence Summers, a guest on the podcast, said he doubted China would make it the digital yuan flexible enough to allow its citizens to freely move wealth and resources out of the country. 

“And I think a system that is so restricted that it isn’t possible to do that isn’t going to be much of a global digital currency,” he said.

The Bank of America analysts noted that several Asian countries, including Thailand, Singapore and South Korea are assessing their own digital currencies, which might become integrated with yuan-based payment systems, “especially if it entails significantly lower transaction costs and real-time transfers.” 

“Ultimately, this is likely to be the actual (and more realistic) objective for China than a serious attempt to displace the USD’s status as the global reserve currency,” the analysts wrote. 

It might be that the only serious threats to the dollar’s reign would come from within the U.S.

Tweet of the day Bitcoin watch

BTC: Price: $9,250 (BPI) | 24-Hr High: $9,374 | 24-Hr Low: $9,192

Trend: Bitcoin is feeling the pull of gravity at press time, having faced rejection at key technical hurdle early on Tuesday. 

After prices failed to cut through the 50-day moving average hurdle at $9,385 during the Asian trading hours, the cryptocurrency is now trading at $9,250, representing a 1% decline on the day.

The pullback from the 50-day MA hurdle has neutralized the immediate bullish view put forward by Monday’s 3% gain. 

Bitcoin jumped to $9,350 yesterday, confirming an upside break of the narrow trading range of $8,830–$9,300 seen in the nine days to July 5. In addition, Monday’s price gains confirmed signals of potential gains from the repeated dip demand below $9,000 seen over the past two weeks. 

A move above the 50-day MA of $8,385 would revive the bullish bias signaled by Monday’s 3% rally and open the doors to $10,000. 

On the downside, the weekly opening price of $9,077 is the level to defend for the bulls. A violation there could yield a quick drop to the 50-week MA at $8,632, with the 5- and 10-week MAs having produced a bearish crossover, the first since early March. 

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CoinDesk

Ethereum Activity Metric Hits Highest Level in 2 Years

6 years 2 months ago

Levels of activity on Ethereum have peaked to their highest in two years, going by one metric.

The seven-day moving average of the number of active ether addresses rose to 405,014 on Friday – a threshold not seen since May 2018, according to data provided by the blockchain analytics firm Glassnode. 

Active addresses are the number of unique addresses that are active in the network either as a sender or receiver. Glassnode takes into account only those addresses that were active in successful transactions.

Related: Gelato Gives Developers a New ‘Money Lego’ Tool for DeFi Applications

As of Monday, the seven-day average was down slightly to 390,162. That’s still 115% growth from the low of 180,750 seen on Jan. 30. 

The increased ether activity could be associated with the explosive growth of Ethereum-based decentralized finance (DeFi) platforms, as well as the number of daily tether (USDT) transactions on the network. 

At press time, about 3.1 million ether were locked in various DeFi applications, according to data source defipulse.com. Meanwhile, the number of daily USDT – the most used stablecoin – transactions on ether has increased by over 400% this year, as per CoinMetrics. 

Also read: DeFi’s ‘Agricultural Revolution’ Has Ethereum Users Turning to Decentralized Exchanges

Related: China Stocks Surge and NYC Real Estate Craters: 5 Stories Shaping Markets Today

The heightened demand for ether from such use cases is expected by many to fuel a major bull run. So far, however, the cryptocurrency has struggled to decouple from bitcoin, the leading cryptocurrency by market value. 

Ether, the second-largest cryptocurrency, is moving pretty much in tandem with bitcoin. The ether-bitcoin one-year correlation has risen to 89%, the highest on record, according to crypto derivatives research firm Skew. 

Some observers would argue that address growth is not a reliable indicator of adoption, as a single user can own multiple addresses. Crypto exchanges also store coins belonging to traders in multiple addresses. 

While that’s true, ether’s active addresses metric is more reliable compared to that of bitcoin. “Active addresses are inflated on bitcoin because of the UTXO model,” tweeted to Anthony Sassano, SetProtocol product marketing manager and co-founder of EthHub, an open-source initiative founded by the Ethereum community. 

UTXO stands for unspent transaction output. Under the UTXO model, bitcoin users have to use new addresses with each transaction. Meanwhile, Ethereum uses an accounts model, under which addresses get reused, as noted by Sassano. 

Bitcoin’s daily active addresses recently rose to the highest level since December 2017, suggesting scope for a price rally to $12,000, according to Bloomberg analysts. 

At press time, bitcoin is changing hands at $9,270, representing a 0.8% drop on the day and ether is trading at $238, down 1.7%, according to CoinDesk data. 

View

Ether jumped 6% on Monday to print its biggest single-day gain since June 22. However, a trendline falling from June 2 and June 24 highs is still intact. 

If network activity is a guide, the cryptocurrency could soon breach the trendline resistance, currently at $246. That would signal a continuation of the rally from March lows below $100 and expose $289 (Feb. 15 high). 

Disclosure: The author holds no cryptocurrency assets at the time of writing.

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CoinDesk

Ethereum Activity Metric Hits Highest Level for 2 Years

6 years 2 months ago

Levels of activity on Ethereum have peaked to their highest in two years, going by one metric.

The seven-day moving average of the number of active ether addresses rose to 405,014 on Friday – a threshold not seen since May 2018, according to data provided by the blockchain analytics firm Glassnode. 

Active addresses are the number of unique addresses that are active in the network either as a sender or receiver. Glassnode takes into account only those addresses that were active in successful transactions.

Related: Gelato Gives Developers a New ‘Money Lego’ Tool for DeFi Applications

As of Monday, the seven-day average was down slightly to 390,162. That’s still a 115% growth from the low of 180,750 seen on Jan. 30. 

The increased ether activity could be associated with the explosive growth of Ethereum-based decentralized finance (DeFi) platforms, as well as the number of daily tether (USDT) transactions on the network. 

At press time, about 3.1 million ether were locked in various DeFi applications, according to data source defipulse.com. Meanwhile, the number of daily USDT – the most used stablecoin – transactions on ether has increased by over 400% this year, as per CoinMetrics. 

Also read: DeFi’s ‘Agricultural Revolution’ Has Ethereum Users Turning to Decentralized Exchanges

Related: China Stocks Surge and NYC Real Estate Craters: 5 Stories Shaping Markets Today

The heightened demand for ether from such use cases is expected by many to fuel a major bull run. So far, however, the cryptocurrency has struggled to decouple from bitcoin, the leading cryptocurrency by market value. 

Ether, the second-largest cryptocurrency, is moving pretty much in tandem with bitcoin. The ether-bitcoin one-year correlation has risen to 89%, the highest on record, according to crypto derivatives research firm Skew. 

Some observers would argue that address growth is not a reliable indicator of adoption, as a single user can own multiple addresses. Crypto exchanges also store coins belonging to traders in multiple addresses. 

While that’s true, ether’s active addresses metric is more reliable compared to that of bitcoin. “Active addresses are inflated on bitcoin because of the UTXO model,” tweeted to Anthony Sassano, SetProtocol product marketing manager and co-founder of EthHub, an open-source initiative founded by the Ethereum community. 

UTXO stands for unspent transaction output. Under the UTXO model, bitcoin users have to use new addresses with each transaction. Meanwhile, Ethereum uses an accounts model, under which addresses get reused, as noted by Sassano. 

Bitcoin’s daily active addresses recently rose to the highest level since December 2017, suggesting scope for a price rally to $12,000, according to Bloomberg analysts. 

At press time, bitcoin is changing hands at $9,270, representing a 0.8% drop on the day and ether is trading at $238, down 1.7%, according to CoinDesk data. 

View

Ether jumped 6% on Monday to print its biggest single-day gain since June 22. However, a trendline falling from June 2 and June 24 highs is still intact. 

If network activity is a guide, the cryptocurrency could soon breach the trendline resistance, currently at $246. That would signal a continuation of the rally from March lows below $100 and expose $289 (Feb. 15 high). 

Disclosure: The author holds no cryptocurrency assets at the time of writing.

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CoinDesk

Binance Acquires Crypto Debit Card Provider Swipe for Undisclosed Sum

6 years 2 months ago

Exchange goliath Binance has acquired crypto wallet app Swipe.io that allows users to purchase items via a Visa debit card.

  • Swipe users can purchase cryptocurrencies from within the app and the debit cards automatically convert stored cryptocurrency into fiat currency, using the Visa payment network.
  • Swipe is already available in 31 countries, mostly in the European Union, and currently supports transactions in major fiat currencies, including the U.S. dollar, euros, and pound sterling.
  • Binance, which has been adding fiat gateways for users all around the world, said Tuesday the acquisition could help boost crypto adoption.
  • Swipe has now listed Binance’s BNB token on its platform.
  • The value of the deal was not disclosed.
  • Binance announced in April it was beta launching a debit card; it’s unclear if this has been provided through Swipe. CoinDesk has approached the exchange for comment.

See also: Binance Ordered to Halt Offering Derivatives Trading in Brazil

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CoinDesk

Crypto Exchanges See Big Drop in Volumes as Bitcoin Volatility Approaches 2020 Low

6 years 2 months ago

Exchange volumes are at a rock bottom as traders turn away from sluggish bitcoin markets.

  • Trading volumes on “top tier” spot exchanges fell by 36% in June, according to a report from London-based data provider CryptoCompare.
  • Similarly, crypto derivatives exchanges experienced a 35.7% drop in volume to $393 billion – the lowest monthly volumes since the start of 2020.
  • Bitcoin’s ATR range – a volatility metric – has nearly halved since the start of June. At press time, it was just 20 points above its 2020 low.
  • CryptoCompare CEO Charles Hayter said June’s spot prices had been flat compared to previous months and the lack of price volatility likely explained the drop in trade volumes.
  • In theory, exchange volumes could continue tracking downwards should volatility remain at low levels, he said.
  • Volumes across the entire crypto spot market – both “top tier” and “lower tier” exchanges – fell nearly 50% in June, meaning the market share for crypto derivatives has increased 5% to 37%.

Also read: Binance Ordered to Halt Offering Derivatives Trading in Brazil

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CoinDesk

FATF Under Germany: Expand Digital AML/CTF Efforts

6 years 2 months ago

The Financial Action Task Force (FATF) will prioritize the strengthening of its anti-money laundering and counter-terrorist financing efforts as part of its new leadership. 

  • Dr. Marcus Pleyer, deputy director general in Germany’s Federal Ministry of Finance, took over as FATF president from Xiangmin Liu from China. Pleyer began his two-year term on July 1. 
  • In a recent paper, Pleyer laid out his objectives for the next two years. Under Germany’s leadership, the watchdog would continue to build on the anti-money laundering (AML) and counterterrorism financing (CTF) work done by the task force. 
  • The paper notes the FATF has been monitoring the risks and opportunities presented by the digitization of economies, and plans to work towards ensuring AML and CTF guidelines can be more efficiently implemented in the private sector. 
  • The FATF held a plenary meeting earlier in June to gauge the regulatory and industry progress in implementing AML regulations for virtual assets. 
  • Some of the other objectives the FATF will pursue include looking into connections between illegal wildlife trade and money laundering, tackling financial schemes associated with ethnically or racially motivated terrorism and a new initiative to look into the financial flows of global migrant smuggling.
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Germany Seeks to Expand Digital Efforts at FATF as It Takes On Watchdog’s Presidency

6 years 2 months ago

The Financial Action Task Force (FATF), a global money laundering and terrorist financing watchdog, said it would prioritize strengthening its anti-money laundering and counter-terrorist financing efforts through digital transformation as new leadership gets under way. 

  • Dr. Marcus Pleyer, deputy director general in Germany’s Federal Ministry of Finance, took over as FATF president from Xiangmin Liu from China. Pleyer began his two-year term as president on July 1. 
  • In a recently published paper, Pleyer laid out the objectives for his term as head of the watchdog. The announcement said that under Germany’s leadership, the watchdog would continue to build on the anti-money laundering (AML) and counterterrorism financing (CTF) work done by the task force. 
  • The paper notes that the FATF has been monitoring the risks and opportunities presented by the digitisation of economies and plans to work towards ensuring that AML and CTF guidelines can be more efficiently implemented in the private sector. 
  • The FATF had also held a plenary meeting earlier in June in order to gauge the regulatory and industry progress in implementation of AML regulations for virtual assets. 
  • Pleyer’s paper also outlined some of the other objectives that the FATF will pursue: looking into connections between illegal wildlife trade and money laundering, tackling financial schemes associated with ethnically or racially motivated terrorism, and a new initiative to look into the financial flows of global migrant smuggling.
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Binance Gives 27,000 COVID-19 Masks to UK National Health Service

6 years 2 months ago

Binance, the world’s biggest crypto exchange by trading volume, has donated 27,000 KN95 masks worth over $60,000 to the U.K. National Health Service’s Pru Trust to aid the fight against COVID-19.

The Princess Royal University Hospital (PRUH) is one of London’s largest and busiest teaching hospitals. It’s part of the King’s College Hospital NHS Foundation Trust, which employs more than 11,000 healthcare workers and delivers services to more than 326,000 Londoners.

The COVID-19 outbreak has seen an unprecedented need for personal protection equipment (PPE) by the healthcare system and its workers. The timing is also auspicious, given Binance’s recently-revealed plans to open a crypto exchange and blockchain hub in the U.K.

Related: Binance Acquires Crypto Debit Card Provider Swipe for Undisclosed Sum

Read more: Binance Launching Crypto Exchange in the UK

“We’d like to thank Binance for being a strong member of our community and contributing to the fight against COVID-19,” Dr. Tarun Singhal, head of virology at the Pru Trust, said in a statement. “We hope this contribution will inspire other technology firms in London to contribute to our community as well.” 

Binance Charity Foundation

Founded in July 2018, the Binance Charity Foundation donates digital assets where applicable, and also uses blockchain’s track-and-trace capabilities to ensure donations reach the places they should. 

Binance Charity recently created the PPE Token stablecoin, which has been used to track the delivery of masks and other equipment to hospitals. Thus far, Binance’s COVID relief efforts have delivered about 1 million PPE masks to hospitals around the world, according to a company blog post.

Related: Binance Ordered to Halt Offering Derivatives Trading in Brazil

“This crisis has strained medical institutions around the world. Binance Charity has responded and provided valuable supplies to ensure the health and safety of medical workers,” said Binance’s founder and CEO, Changpeng “CZ” Zhao.

Read more: Binance, Brock Pierce Donate $1M to Puerto Rico’s COVID-19 Fight

Back in April, Binance Charity donated $1 million to Puerto Rico and the Caribbean as part of the exchange’s Crypto Against COVID campaign. The Puerto Rico and Caribbean donation included $333,333 from the Integro Foundation, a Puerto Rico-based non-profit backed by EOS blockchain co-founder Brock Pierce, one of crypto’s more colorful characters. 

“At Binance, we wanted to show our support for the NHS in a material way, boosting their PPE supplies which safeguard the health of care workers,” said  Binance Charity Foundation chief Helen Hai.

“Binance represents a new generation of fintechs that are committed to the values that inspired blockchain technology,” added Ajit Tripathi, who leads Binance charity efforts in addition to banking partnerships in the U.K. and Europe. “I am personally grateful to the NHS and the PRUH for giving us the opportunity to contribute in this small and meaningful way when it’s most needed.” 

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Mercedes Maker Daimler Tests Blockchain for Supply-Chain Data Sharing

6 years 2 months ago

Ocean Protocol, a blockchain-based data-sharing platform, has completed a proof-of-concept (PoC) with Daimler, showing how the Mercedes-Benz maker can begin monetizing data streams within the company and across its supply chains.

Announced Tuesday, the Singapore-based Ocean collaborated with Daimler AG to explore the decentralized sharing of internal sales and financial data among the multinational’s production hubs, and externally between some of its supply chain procurement partners. 

The project, which involved Daimler’s Stuttgart headquarters and its Singapore manufacturing hub, lets large enterprises feel more comfortable about sharing data and extracting insights from hitherto undiscovered datasets – while keeping tabs on who’s looking at what. 

Related: Afghanistan Approves Blockchain Project to Help Tackle Scourge of Counterfeit Meds

“We believe in the power of blockchain to unlock the value of data in a decentralized way,” Daimler technology VP Hartmut Mueller said in a statement. “On our journey towards a data-driven company this collaboration with Ocean protocol enables us to build a secure enterprise B2B data marketplace to monetize and put data to work.”

MercedesChain

Following the example of big tech, enterprises have realized data is the most valuable naturally occurring resource on the planet. Carmakers like Daimler, General Motors and BMW have been at the forefront when it comes to test-driving blockchain technology, exploring everything from vehicle identity to managing data from self-driving cars.

Read more: GM, BMW Back Blockchain Data Sharing for Self-Driving Cars

Ocean Protocol founder Bruce Pon, who previously spent five years working in Daimler’s IT department, said a company of that size can spend around $300 million a year simply trying to harmonize software, security measures and various types of administration – costs that a transparent means of data sharing and reconciliation could slash. 

Related: US Air Force Gives Blockchain Firm $1.5M to Build Supply Chain Network

“We have proved that internal and external data sharing works,” Pon said in an interview with CoinDesk. “Daimler’s IT departments can handle it and the business wants it. Blockchain can turn the company’s IT system from a cost center into a profit center.”

Examples of internal data-sharing optimized using the Ocean blockchain include sales and finance data, which could change dramatically due to events such as COVID-19, said Pon. In terms of external data, the PoC looked at the procurement of parts and equipment across various jurisdictions, he said.

Beyond Proofs-of-Concept

Back in 2016 and 2017, the enterprise blockchain world suffered from a chronic case of PoC fatigue, following an overbearance of hype around the technology. Pon said this time is different, however.

“Sure, there was ‘PoC-itis’ that happened back in 2017; we did about 50 of them, including a couple with Daimler,” he said. “At that stage, everybody was just learning. But today people know how blockchain works, and we are looking now at how to deploy this system, as the ability to buy and sell data using Ocean already exists.”

Read more: Ocean Tries New Token Sale After CoinList Offering Misses Target

As well as the transparency and the improved reconciliation of data across multiple systems, Ocean’s privacy-preserving secret sauce uses so-called “federated machine learning.” This type of machine learning is built without direct access to training data, allowing that data to remain in its original location, such as behind a company’s firewalls.

Ocean co-founder Trent McConaghy explained that Ocean takes centralized federated learning, which is popular with the likes of Google, and gives it a big dose of decentralization.

Car 2.0

Looking ahead, carmakers and original equipment manufacturers (OEMs) understand the wealth of data at their fingertips and the race to extract value from it, which could include sensor data generated by the car itself, as well as data consumed within the car by passengers.

“The Decentralized data marketplace is an interesting proposition and gives us an exciting opportunity for aggregation of data with a clear compensation approach,” Frank Schur, a technology manager at Daimler’s Singapore subsidiary, said in a statement. “Using Ocean Protocol, we want to implement this in a secure and transparent way.”

Pon said the Ocean team has done “a lot of brainstorming with automakers” on this subject. He predicts the first data-market-based subsidies might occur with trucking companies or delivery service vehicles. 

“There are ways to securitize a whole data stream going forward, like all the DHL drivers in the city of Los Angeles, for instance,” Pon said. “It’s a technology that can put the automaker on an even footing with the Googles and Bloombergs of the world.”

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Block.One Co-Founder Brock Pierce Files to Run for US President

6 years 2 months ago

Crypto entrepreneur Brock Pierce has tossed his hat into the ring to run for the U.S. presidency.

  • Pierce, known for his role with Block.One and the EOS token, as well as for co-founding Tether (originally called Realcoin), filed as a candidate with the Federal Election Commission (FEC) on Monday, according to the FEC's website, though he first announced his bid over the weekend.
  • Pierce has not yet named a vice presidential candidate, according to the filing.
  • Filing deadlines to get on the ballot in Indiana, Maine, New Mexico, New York, North Carolina and Texas have passed.
  • Nevada’s filing deadline for presidential nominations will pass in three days from press time.
  • Delaware, Florida, Oklahoma, South Carolina, Michigan, Illinois, Maine, Washington, Missouri, New Jersey, Massachusetts, New York, Arkansas, Kansas, Maryland, Nebraska, Pennsylvania, Vermont, West Virginia and South Dakota remain open.
  • Other major candidates include President Donald Trump (the Republican incumbent), Joe Biden (the Democrat and former vice president) and Jo Jorgensen (Libertarian).
  • The U.S. 2020 presidential elections are scheduled for Tuesday, Nov. 3.
  • Pierce did not return a request for comment Monday.

Read more: I Survived the Eternal Boy Playground, Will Puerto Rico?

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Binance Ordered to Halt Offering Derivatives Trading in Brazil

6 years 2 months ago

The Brazilian Securities and Exchange Commission (CVM) on Monday ordered cryptocurrency exchange Binance to immediately cease offering derivatives trading services in the country.

  • CVM said in a July 2-dated declaration that Binance is not authorized to “act as a securities intermediary” in Brazil and threatened the exchange giant – the world’s largest by trading volume – with a R$ 1,000 ($186) daily fine.
  • Binance cannot market or offer derivative services of any type in Brazil, irrespective of the contract’s underlying asset, without CVM approval, the order said. That’s because Brazilian law treats all derivatives products as securities.
  • Even so, Binance’s derivatives trading portal was still accessible from Brazilian IP addresses at press time Monday. Binance did not immediately respond to a CoinDesk request for comment.
  • The order is CVM’s first public stance on cryptocurrency derivatives trading, according to CoinTelegraph Brazil. It was not immediately how this move will affect other exchanges.

See also: Binance Retains Top Spot as CoinGecko Revamps Exchange Trust Metric

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Market Wrap: As Stocks Rally, Bitcoin Trades Above $9.3K for the First Time in 10 Days

6 years 2 months ago

A rising tide in equities is lifting all boats – including in the bitcoin market. 

  • Bitcoin (BTC) is trading around $9,295 as of 20:00 UTC (4 p.m. ET), gaining 2.7% over the previous 24 hours.
  • Bitcoin’s 24-hour range: $8,938 – $9,345
  • BTC above 10-day and 50-day moving average, bullish signal for market technicians.

Market participants are pointing to global stock markets as reasons for bitcoin’s rise in price, with the world’s oldest cryptocurrency in a narrow range just above $9,000 since July 3. 

“Equity markets are up across the board and so you see a spike in bitcoin’s price,” said Michael Rabkin, head of institutional sales at Chicago crypto trading firm DV Chain.

Related: Bitcoin Up 27% in First Half of 2020, Beating Gold, Silver and Platinum

Read More: Bitcoin Rises in Line With Stocks After Dip Below $9K

Indeed, stock indexes globally are flashing green. In Asia, the Nikkei 225 index of companies ended the day up 1.8%. Despite a rising number of coronavirus cases in Japan, gains were made in industrial stocks including conglomerate Mitsubishi. Europe’s FTSE 100 index closed up 1.5%. Optimism on fresh government stimulus across the continent contributed to leading the index higher. The U.S. S&P 500 index gained 1.6%. Record highs for tech stocks Netflix and Amazon led the way.

Since the start of June, the major stock indexes are actually beating bitcoin.

Despite some excitement in crypto price action Monday, traders point out volatility has been absent in the bitcoin markets, said Elie Le Rest, a partner at Paris-based cryptocurrency trading firm ExoAlpha, “Since the bitcoin halving on May 12, the digital asset markets have gone nowhere for six weeks in a row,” said Le Rest. “Volatility has collapsed abruptly and bitcoin remains stuck between $8,200 and $10,500.” 

Related: What Is Yield Farming? The Rocket Fuel of DeFi, Explained

Read More: ConsenSys, Polychain, Tron, CipherTrace: Blockchain Startups Got $18M+ in US ‘PPP’ Bailout Loans

Bitcoin’s one-month at-the-money (ATM) implied volatility, reflecting the market’s future expectation of volatility and calculated by using options with a strike price nearest to the spot price, has dipped. In the past month, ATM implied volatility for bitcoin has dropped from as high as 70% on June 11 to 43% on July 3, though it is creeping back up. This is something derivatives traders are following closely as they make option bets on future price action. 

Read More: Kraken-Owned Crypto Facilities Wins UK License to Offer Derivatives 

To be sure, the bitcoin price pop on Monday has stakeholders ready for a bigger price move, hopefully up, said Mostafa Al-Mashita, an executive at Toronto-based crypto liquidity provider Secure Digital Markets. “Bitcoin is poised for a big move as it’s held a tight range for a couple of weeks now,” he told CoinDesk. 

A dip in DEX

The second-largest cryptocurrency by market capitalization, ether (ETH), was up Thursday, trading around $238 and climbing 5.7% in 24 hours as of 20:00 UTC (4:00 p.m. ET). 

Read More: Arca Labs Launches Ethereum-Based SEC-Registered Fund

Ethereum-based decentralized exchanges, or DEX, have seen volumes decrease over the past few weeks. DEX week-over-week volume growth has dropped 19%, according to data from aggregator Dune Analytics.

Nevertheless, decentralized finance (DeFi) traders seem to be finding creative ways to profit that don’t necessarily require DEX. “DeFi has been killing it,” said Karl Samson, director of strategy for crypto merchant services firm Global Digital Assets Despite the drop in volumes. 

Read More: What Is Yield Farming? The Rocket Fuel of DeFi, Explained

Samson pointed to at least one new play that might be contributing to a dip in DEX: Yield farming, where crypto stakeholders leverage lenders such as Compound to gain a profit on Ethereum-based tokens. 

Other markets

Digital assets on CoinDesk’s big board are mostly in the green Monday. Notable gainers (as of 20:00 UTC (4:00 p.m. ET): 

Commodities

  • Oil is up 0.86%. Price per barrel of West Texas Intermediate crude:  $40.58
  • Gold is up 0.69% at $1,786 per ounce

U.S. Treasury bonds all climbed Monday. Yields, which move in the opposite direction as price, were up most on the two-year, in the green 2.65%.

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Social Media Bans ‘Highlight the Profound Censorship on Web 2.0’

6 years 2 months ago

The crackdown on alleged hate speech is intensifying as social media platforms either expand their policies or step up enforcement of their terms of service.

Reddit banned over 2,000 subreddits as part of a focus on what it deemed hate speech, including The_Donald as well as the subreddit for the leftist podcast Chapo Trap House. Twitch temporarily banned President Trump. Facebook booted a “boogaloo” group (part of a loose affiliation of anti-government forces that vie for a second civil war), citing its promotion of violence. And YouTube banned a group of far-right content creators, including white nationalists such as David Duke. 

The actions seem spurred by a variety of factors, including rising internal pressure from tech employees, the protests around the police killing of George Floyd, Twitter enforcing its terms of service against President Trump and growing advertiser boycotts. The moves ratchet up the volume on a longstanding debate and raise important questions about free speech in the modern internet era, including what constitutes hate speech, whether platforms are obligated to allow hateful content and, most of all, who should get to make decisions about the nature of content. 

Related: First Mover: As Bitcoiners Watch Dollar, Deutsche Bank Sees Trump Win Hurting Reserve Status

“I defend the companies’ power and right to make these business decisions, as I defend the right of individuals and organizations to ‘pressure’ them to do so,” said Nadine Strossen, a law professor at New York University and the former president of the American Civil Liberties Union (ACLU), in an email. 

But she is convinced any speech restrictions that go beyond what’s consistent with the U.S. Constitution’s First Amendment and International Human Rights principles will be at best ineffective and at worst counterproductive.

A double-edged sword

The application of social media company standards may not mitigate the potential harms of the speech at issue, according to Strossen. The standards for describing the targeted speech are overly vague and broad, meaning they give full power of discretion to those that enforce them, she said. Giving individuals that power means they’ll enforce them in accordance with their personal views and may mean that speech by minority views and voices is disproportionately censored, she said. 

This has been the case previously when platforms such as Instagram flagged body positive imagery as “inappropriate.” Facebook reportedly trained its moderators to take down curses, slurs and calls for violence against “protected categories” such as white males, but allow attacks on “subsets” such as black children or female drivers. Facebook’s formulaic approach to what qualified as a protected category is what allowed some vulnerable subsets to fall through the cracks. 

Related: Facebook, IoTeX, R3 Among New Members of Confidential Computing Consortium

See also: 93 Days Dark: 8chan Coder Explains How Blockchain Saved His Troll Forum

“Ironically, many of the very same civil rights/human rights groups that are now clamoring for more restrictions by the platforms have consistently complained that the existing ‘hate speech’ standards have disproportionately silenced Black Lives Matter activists, Pipeline protesters, and other social justice advocates,” said Strossen. “Why do they think this would change in the future?”

Amy James, co-founder of the Open Index Protocol (OIP), which is like a decentralized patent filing system protecting content that’s created on it, organizing it and making sure creators get paid, said the bans were horrifying for a number of reasons. 

“Even if you disagree with information, censoring it doesn’t destroy it, it just allows it to spread without counterpoints,” said James in an email. “But on the positive side, it highlights the profound censorship.. on Web 2.0, and the more widespread [the] awareness about it, the better.”

James added she absolutely sees more bans in the future, largely because the internet isn’t a real-life public place where First Amendment protections apply. 

“On the web, we primarily communicate using platforms that belong to private companies, so they can and should have a right to filter content however they want – based on financial criteria, community standards, etc,” said James. 

See also: In Trump Versus Twitter, Decentralized Tech May Win

That’s a key part of this debate. By entering into these platforms, you give them the right to moderate and regulate your speech largely as they see fit, with little to no recourse. It’s ironic the people most adamant about the government not intervening in private businesses lose sight of that when it comes to social media.

Look no further than Trump, who has stridently dismantled business regulations but signed an Executive Order calling for reform of Section 230 of the Communications Decency Act, which shields social media companies from liability for content they publish.

Is there a way forward?

Rather than going after legislative fixes for Section 230, James said solutions offered by blockchain and the decentralized Web 3.0 provide a better path. In practice, that looks like supporting cryptocurrencies such as bitcoin, and open-source web browsers like Brave. She also points to platforms building with OIP –Streambed Media, a tamper-proof media index, or Al Bawaba, the Middle East’s and North Africa’s largest independent news platform, which is building integrations with OIP – as good options to help encourage and build Web 3.0, which would not allow for centralized censorship.

There are “censorship-free” platforms available now like Gab and 4chan but the trade-off with these platforms is some audiences may not go to them because of their content. “One person taking a stand alone has almost no effect,” she said.

Gab and 8chan (4chan’s rowdier offspring) also face consistent threats to their ability to function, as domain name providers such as GoDaddy and payment processing companies such as PayPal and Stripe have previously booted Gab off their services. Such methods go beyond just a ban, and fundamentally affect such websites’ ability to continue. 

These platforms are based on the commitment they won’t censor you when they absolutely still could, based on their centralized nature. 

See also: Handshake Goes Live With an Uncensorable Internet Browser

Strossen envisions a market in which there are a number of viable alternatives with diverse content moderation standards to choose from. Ideally, this would result in maximally empowered end users to make their own informed choices. She points to Parler, which is branded as a free speech platform, as one recent example of where conservatives have flocked, but even its content moderation standards are “as hopelessly vague and over broad as all the other platforms,” she said.

Now, as Parler’s user base has crossed one million, CEO John Matze is also grappling with the limits of speech. 

“As soon as the press started picking up, we had a ton of violations,” Matze told Fortune. “We had a queue of over 7,000 violations, and we only had three people” to police the entire site.

The Santa Clara principles are another framework for moderation deductions. They were spearheaded by the ACLU, Electronic Frontier Foundation and others, and laid out minimum requirements for companies disclosing information about moderation. This includes publishing the numbers of posts removed and accounts permanently or temporarily suspended, giving notice to each user whose content is taken down or account is suspended about the reason for the removal or suspension, and offering a meaningful opportunity for timely appeal of any content removal or account suspension.

Strossen said no one is going to be completely satisfied with any standards no matter how they’re phrased or enforced because of the subjectivity of the issues at hand.

“One person’s ‘hate speech’ is someone else’s cherished speech, one person’s ‘fake news’ is someone else’s treasured truth and one person’s ‘extremist’ speech is someone else’s freedom-fighting speech,” said Strossen.

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