October 8, 2022
Issue No. 23
Welcome to this week's AtherXplorer, covering the latest in gaming, blockchain, and everything in between.
This week’s top picks include:
- Blockchain & Defi: Binance Smart Chain Halts After 'Potential Exploit' Created Extra BNB
- NFTs: Gala to Launch Trolls VOX; NFT E-Books are coming
- Web3 & Metaverse: Japan to Invest in Metaverse and NFT Expansion
- Gaming: Interesting Twist for Pokemon S & V; Shrapnel Cinematic Trailer
- Legal Landscape: SushiSwap Mulls Legal Shakeup with Crypto Governance in CFTC Crosshairs
Blockchain & DeFi Developments
DeFi Platform Ribbon Finance's Unsecured Lending Product Sees Crypto Firms Borrow Over $10M
Ribbon's Lend, which went live on Monday, allows depositors to lend unsecured funds to institutional market makers of their choosing with high liquidity.
The protocol has seen users deposit 15 million USDC, the U.S. dollar-pegged stablecoin. Of that, more than 10 million USDC has been borrowed by Alameda-backed quant trading firm Folkvang Trading and market maker Wintermute, which recently lost $160 million in a hack.
"We see that there is still demand in decentralized finance for high yields. Users are willing to move out the risk curve if the risk-reward makes sense,"
Julian Koh (co-founder and CEO of Ribbon) told CoinDesk.
"Undercollateralized lending to reputable institutional trading firms seems to fit that category well."
At press time, the annualized percentage return for loaning out USDC to Folkvang and Wintermute was nearly 7%. That's significantly greater than the 0.5% available on top decentralized platforms like Aave and Compound.
Ribbon describes Lend as "an uncollateralized Aave, offering the best of both traditional finance and decentralized finance."
An institution can borrow USDC from AAVE at a much lower cost but at the expense of locking another cryptocurrency as collateral. In other words, the borrower stands to lose the liquidity of the collateral locked, which isn't the case with Ribbon's Lend.
Stablecoin Issuer MakerDAO to Invest $500M in US Treasurys, Corporate Bonds
The community governing MakerDAO, the decentralized autonomous organization (DAO) behind stablecoin DAI, has allocated $500 million for investing in U.S. Treasurys and corporate bonds.
The funds will come from its overcollateralized stablecoin, with 80% going toward U.S. short-term Treasurys and 20% to investment-grade corporate bonds. MakerDAO's community voted in favor of the allocation proposal, which was presented in late June.
Stablecoins and their collaterals have been the subject of debate since the implosion of the $40 billion Terra ecosystem and its stablecoin UST, which had ripple effects on the broader crypto market.
The move by Maker is aimed at diversifying its balance sheet into "scalable legacy finance investments, limiting exposure to any one asset and expanding revenue streams" and will be initiated by decentralized finance (DeFi) asset adviser Monetalis.
In a separate announcement, digital asset bank Sygnum said it is the lead partner in the $500 million diversification effort. Maker said that it has completed a $1 million transaction with the remaining investments to follow. Signum said it is working with BlackRock Switzerland to allocate $250 million in the first phase of the plan.
DAO are entities with no central leadership and whose decisions are carried out by software rather than by human managers. DeFi is an umbrella term for lending, trading and other financial activities carried out on a blockchain without traditional middlemen.
Maker's investment plan is an example of decentralized governance participation and an effort by the industry to make tainted algorithmic stablecoins more stable. MakerDAO’s stablecoin DAI is decentralized, but also overcollateralized, backed by ether (ETH) deposited into its smart contracts.
Binance Smart Chain Halts After 'Potential Exploit' Created Extra BNB
According to blockchain security firm SlowMist, the exploit allowed cybercriminals to get away with over $570 million in digital assets, including Ethereum, Polygon, BNB Chain, Avalanche, Fantom, Arbitrum, and Optimism.
According to Sam Sun, a researcher at Paradigm, the hacker somehow convinced the Binance Bridge to send out 1 million BNB tokens. When it worked, the hacker used the same exploit to have another 1 million BNB tokens sent to an address they controlled.
Binance CEO Changpeng Zhao later posted an update pointing to a thread on Reddit where the company provided more technical details, and said that “the current impact estimate is around $100m USD equivalent."
"An exploit on a cross-chain bridge, BSC Token Hub, resulted in extra BNB," Zhao explained.
This hack seems to be similar to the recent Ronin and Harmony Cross-Chain Horizon Bridge exploits.
Gala to Launch DreamWorks Animation's Trolls VOX
In total, 8,888 unique DreamWorks Animation's Trolls VOX will be released, including ones inspired by Poppy, Branch, Guy Diamond, and other dynamic characters.
Fans of DreamWorks Animation's Trolls franchise, Gala, and VOX will be able to purchase a mystery VOX Box, which, once exchanged, will be revealed to the owner. Each VOX in the DreamWorks Animation's Trolls VOX collection will have unique traits inspired by characters from the hit franchise with some DreamWorks Animation's Trolls VOX being more special than others. Similar to Gala's widely popular Mirandus Dragon VOX, which sold on the secondary market for $1.48 Million, the DreamWorks Animation's Trolls VOX drop will feature a special 1 of 3 VOX in the collection - the Yarn Snake.
"We're beyond excited to see where this and our other big IP collaborations go. The future of VOXVerse is very bright, watch this space." "The DreamWorks Animation's Trolls VOX will further our goal of continuing to expand the DreamWorks Animation Trolls franchise in new and unique ways, providing fans with compelling opportunities to engage with their favorite characters,"
said Jim Molinets, SVP of Production, Universal Games and Digital Platforms.
"As entertainment brands and Web3 continue to converge, we believe the VOX Trolls will become coveted digital collectibles that will provide fans with potential for more rewards over time."
HUGO partners with Imaginary Ones!
Global fashion brand HUGO announced on the 4th of October that it will collaborate with renowned Web 3.0 company, Imaginary Ones on a holistic, 360-degree metaverse experience.
An exclusive HUGO x Imaginary Ones’ NFT collection of 1,001 3D animations, entitled ‘Embrace Your Emotions’ (EYE), will be launched in early November.
Miah Sullivan, Senior Vice President of Global Marketing & Brand Communications at HUGO BOSS, said:
“The metaverse is an exciting new space for fashion brands, one that is rich with potential for HUGO. We are excited to partner with Imaginary Ones to deliver an NFT collection of beautiful 3D assets that enables us not only to further explore this virtual world but also to share a message of self-acceptance and being true to yourself, which is at the heart of what HUGO stands for”.
Exclusive NFT collectibles for The Pet Collective
Trusted Media Brands is announcing the debut of its exclusive NFT collection with Theta Labs for The Pet Collective, one of the largest animal-based media brands in the world with over 47 million social followers and the largest pet account on TikTok.
"As the media landscape continues to evolve, we are constantly looking for new ways to push the boundaries of next-generation digital storytelling," said Jacob Salamon, vice president of business development at TMB.
Opening the limited edition pack will unlock one (1) random The Pet Collective clip to add to the buyer’s ThetaDrop collection.
NFT E-Books are coming!
Book.io is the leading platform for NFT eBooks and digital content in the Web3 era. Their proprietary technology, Decentralized Encrypted Assets (DEAs), allows all types of media to live perpetually, protected on the blockchain – a seismic shift for blockchain utility.
The platform is building the infrastructure for putting eBooks and audiobooks on-chain, which will allow readers to truly own the digital books they purchase, instead of the current industry licensing model.
Working together with Ingram’s print-on-demand service, Lightning Source, will enable Book.io to bundle NFT eBooks with bespoke printed physical books in an industry first, named Mint & Print, allowing the ability to print singular physical books based on NFT eBook ownership and deliver those printed books within 48 hours anywhere in the world!
'Please, Mom!' Kids Enticed by Web3 Projects with Plush Toys, Adorable Avatars
Major retailers Walmart and Macy’s, storied children's brands Mattel and Nickelodeon, plus top-flight web3 investors like Andreessen Horowitz are among those investing millions as they join forces in the hopes of convincing kid consumers – and their parents – to embrace digital assets like NFTs.
VeeFriends, the NFT collection from serial entrepreneur Gary Vaynerchuk, is the latest entry. It has partnered with traditional brick-and-mortar U.S. retailers Macy’s and Toys ‘R’ Us in order to launch a line of toys that will be sold in stores, each of which is essentially a physical reimagining of VeeFriends NFTs.
“We chose characters that we think to embody exciting features for first-time collectors, much like some of the toys I picked up on the shelves of Toys ‘R’ Us the first time,”
said Vaynerchuk, Founder, and CEO of VeeFriends, in a statement.
Stores will carry both plush toys priced at $24.99 and smaller collectible figures for $29.99, featuring several VeeFriends characters like Common Sense Cow and Gratitude Gorilla. About a year ago a Common Sense Cow NFT sold for 50 ether on OpenSea, which is now worth roughly $67,000.
Warner Music Group’s Web3 Expansion - Metaverse Job Posting
Music and entertainment conglomerate Warner Music Group (WMG) is continuing to expand its Web3 strategy, evident in its latest job posting for a senior director for metaverse development.
The role, posted to LinkedIn on Wednesday, calls for someone based in New York to lead its metaverse strategy, including "music entertainment experiences in metaverse and gaming." Specifically, WMG says that metaverse projects will focus on "immersive experiences and strategic content integration." The ideal candidate, according to the listing, is someone with experience working at a game developer, studio, or metaverse platform who also has a deep understanding of content licensing and the global digital media landscape.
The new hire will add to WMG's growing portfolio of key roles focused on developing its Web3 ecosystem and metaverse projects. In April, the company brought on Linkin Park co-founder and music tech pioneer Mike Shinoda as its community innovation adviser, where he is helping to "shape the company’s artist-centric approach to Web3." In September, the company appointed Niels Walboomers as president of records and publishing for Benelux (as Belgium, the Netherlands, and Luxembourg are collectively known), who said he hoped to "broaden the range of talent we work with even further and be super innovative about we connect them with fans in the web3 era."
WMG has also embraced blockchain-based collaborations with major metaverse platforms and NFT marketplaces. In January, the company announced that it would launch a music-focused theme park on the metaverse platform The Sandbox featuring the company's expansive roster of artists. In February, it announced a partnership with blockchain gaming company Splinterlands to develop play-to-earn games. The company has also worked on interactive experiences with gaming platform Roblox, digital collectibles platform Blockparty, virtual entertainment provider Wave, avatar technology company Genies, and NFT marketplaces OneOf and OpenSea.
Other major entertainment companies are expanding their Web3 teams, including Walt Disney (DIS), which posted a job listing last month for a principal counsel specializing in non-fungible tokens (NFTs) and decentralized finance (DeFi).
Japan to Invest in Metaverse and NFT Expansion
Japan’s Prime Minister Fumio Kishida said in a policy speech on Monday that the country’s plans for investing in digital transformation include non-fungible tokens (NFT) and metaverse services.
The country has steadily been promoting investment in digital technology, including through tax incentives for companies that embrace a digital future. In his speech to Japan’s parliament, Kishida said the country will continue to focus on “supporting the social implementation of digital technology” and will “promote efforts to expand the use of Web3 services that utilize the metaverse and NFTs.”
Japan’s federal foray into Web3 follows a trend of officials taking strides to implement Web3-related services in the country – rather than following the typical bureaucratic route that policies must often travel through. Kishida’s administration recently established a Web3 policy office under the Ministry of Economy, Trade, and Industry (METI), which is focused on creating policies for the country’s gradual blockchain expansion.
In April, a task force launched by Kishida’s Liberal Democratic Party and led by politician Akihisa Shiozaki released an “NFT White Paper,” which called Web3 the “the new frontier of the digital economy” and outlined plans to advance the national strategy on Web3.
METI is also reportedly looking into a proposal to offer tax exemptions to Japanese crypto companies in order to entice them to keep their business in the country and further fuel the nation’s growing Web3 industry.
Polygon Studios Metaverse Lead’s Take on JPEGs NFTs
Brian Trunzo, metaverse lead at Polygon Studios, doesn’t think that tokenized images will be the most prominent use case for NFTs. In an interview at the Chainlink SmartCon 2022 conference, he told Decrypt’s Dan Roberts and Stacy Elliott that the crypto industry will have achieved mainstream adoption of Web3 technology, NFTs, and the metaverse when “we stop saying it”—when those terms are no longer necessary.
Trunzo believes that skeptics of the technology are informed by a limited understanding of Web3 and suggests that a wider set of NFT use cases will take hold in the future. “It's because their understanding of it is that which the mainstream media reports to be right-click-save JPEGs, an investable asset class—which is not the future of Web3 and NFTs, in my mind,” he explained.
Polygon Studios works with creators and companies that are building on Polygon, a sidechain scaling network for Ethereum, the leading blockchain for NFTs and decentralized apps. In his role as metaverse lead, Trunzo and his team help pave the way for technology to support immersive applications and NFT-powered experiences from various creators.
He pointed to Starbucks’ recent NFT announcement as an example of how he sees the assets being used as a technology layer rather than an asset class itself. Starbucks will use Polygon to give away NFT stamps to customers, as well as sell premium NFTs, all of which can earn customers real-world perks and experiences.
“If Web2 was measured in engagement, [then] Web3 will be measured in gamification—brand immersion,” he explained.
In the case of Starbucks, it won’t be a game-like 3D metaverse akin to Decentraland or The Sandbox, but the NFT-powered program is designed to engage users across digital and physical spaces alike.
That sort of Web3 gamification is one of the biggest opportunities he sees in the space, along with digital fashion. Trunzo, who previously co-founded real-world menswear brands, said that metaverse fashion will tap into users’ need not only for self-expression but also vanity and a desire to showcase virtual “flexes.”
And when it comes to true video game experiences, Trunzo is unsurprisingly on the side of the debate that sees NFTs as a prospective benefit. Many gamers aren’t thrilled about NFTs, in part because of scams and speculation but also a widespread belief that creators and publishers will use them to extract even more value from players.
Even with that stigma out there, Trunzo expects a “genie out of the bottle moment” in which more and more players embrace the benefits of using NFTs in games. In his view, the ability for players to truly own their progress and unlock benefits as NFT assets—which can then be sold or perhaps even across in other games—will be a real plus.
With the Metaverse Opportunity Topping $1 Trillion, it’s Time for Brands to Make the Leap
JP Morgan is betting on the metaverse, calling it a $1 trillion yearly opportunity in a recent report — and it’s putting its money where its mouth is, opening the first bank ever in the virtual world. It’s a strong indicator of the opportunities for brands and businesses in the growing decentralized metaverse economy if they enter this new space strategically.
What does that look like? Yonatan Raz-Fridman, CEO of Supersocial, and host of the Into the Metaverse podcast sat down with Marty Berman, vice president of North America/LATAM for LandVault to dive into what this means for brands that make a move now to establish a presence in blockchain-based metaverse-type platforms — from gaining a foothold to developing a long-term metaverse strategy.
“So many brands right now think of the metaverse as an extension of the internet, the next version of the internet, but it just isn’t there yet,” Berman explained. “It’s not a scale-and-reach opportunity right now. There aren’t 70 million consumers there. It’s about quality over quantity — it’s about inviting consumers in to experience your brand in a new and exciting way, that you just can’t in other mediums.”
Why brands should start now
Establishing a presence in the metaverse is a longer-term commitment Berman said. It’s also a brand-new challenge. You’re going from a consumer sales standpoint to an invitation to connect in a whole new world, building an interactive narrative rather than a one-way conversation. That takes time to click.
“As I like to say, aim small and miss small right now,” Berman says. “Right now the opportunity is to get in and before consumers. Think of it as an 18-24 month journey that you’re going to take your brand and your team on to understand what consumers interact with. Before this takes off, you want to be able to understand what engages your consumers, so you can iterate and test and learn as you continue to build on the experiences.”
Games & Blockchain Gaming
Interesting Twist for Pokemon Scarlet and Violet!
The Pokemon battle system has always been pretty standard for well over a decade. Based on the element strength and weakness system, your Pokemon can execute super effective moves against other Pokemon it is elementally effective against. For example, Water is super effective against Fire and Fire is super effective against grass types, etc.
Pokemon Scarlet and Violet will introduce a new mechanic called Terrastallization! Yes, it sounds quite fancy, but what it simply means is that a Pokemon with a base element can now also have a Terra sub-element that is completely independent of the base element!
For example, a Pikachu which is an Electric type Pokemon can have a Terra element that is a completely opposite one such as Ground which electric types are usually weak against. There are 18 different element types in Pokemon Scarlet and Violet, meaning there are countless combinations of Pokemon and Tera types.
The catch is, your Pokemon won’t be in its Tera form permanently. Trainers will need to use something called a “Tera Orb” to “terrastalize” their Pokemon in battle. And once the battle ends, the Pokemon returns to its normal form (similar to the Dynamax mechanic in Sword and Shield)
In PVP tournaments, Tera Pokemón might completely throw even veteran PVP players off guard and may call for sudden improvisations in the midst of the battle! We will wait to see how players take advantage of this new Tera mechanic in PVE and mainly PVP battles! The game is scheduled for release on the 18th of November 2022!
In-Game Ads Seem Pretty Effective!
According to New research by in-game advertising platform, Anzu.io and attention technology company Lumen Research has found that viewers are 34% more likely to view in-game ads compared to those on other digital channels, such as social media and websites. In total, 83% of in-game ads were viewed, compared to Lumen’s benchmark of 62%
“These results clearly demonstrate the power in-game advertising has to drive attention which then converts to brand recall, favourability, and purchase intent, demonstrating how brands can use in-game to reach consumers at every stage of the marketing funnel,” said Anzu co-founder and CEO Itamar Benedy.
Developers can make use of this information in quite a few ways.
- Pre-Launch Marketing via in-game ads. Most mobile games require players to watch some ads or provide some bonus rewards for watching ads. Developers could market their game trailer/clips via these mobile in-game ads to get the attention of some of their key target audiences based on the games they play!
- Additional revenue for F2P Games. As annoying as it is, most free-to-play games have ads, and even games as F2P friendly as “Cookie Run Kingdom” have an option for players to watch an ad for a small bonus reward.
- Time Limited Campaigns once the Game is Live! There is no better time to get more players in than when there is a specific campaign running. Advertising campaigns via in-game ads through other web2/web3 games might be the best way to drive urgency for new players to join in!
New “Super Mario Bros Movie” Trailer
The upcoming “Super Mario Bros Movie” trailer was released a couple of days ago and fans are in awe of how beautiful it looks.
Watch the trailer in full glory (4K) 👇
Shrapnel Releases Cinematic Trailer Made with Unreal Engine 5
Sharpnel, said to be the world's first blockchain-enabled moddable AAA first-person shooter released their highly anticipated trailer just last week!
The trailer appears to be a purely cinematic showcase, however, much of the hype is set on the trailer built on Unreal Engine 5. The trailer aims to reflect the blockbuster quality gameplay and graphics that players can expect to see and that they have come to know and love in current Web2 game offerings.
To produce a video of such high quality, a host of industry veterans and experienced studios came together. It was produced in partnership with Sydney-based animation studio Plastic Wax, which has worked on such titles as Fortnite, Tomb Radar, Hitman, and more.
The trailer was viewed over 60,000 times on Twitter and YouTube and retweeted over 4000 times! As impressive as the cinematic trailer is, there is still much to be seen on how the actual gameplay might turn out to be!
Domination and Subgenre - Finding your Niche in the Global Mobile Market
The mobile market is home to some of the biggest game franchises in the world, with the leading titles generating billions of dollars annually. However, looking at the revenue generated across the market as a whole, it can be seen that the top 10 games account for only 17 percent of the total consumer spend in the first half of 2022. An astonishing 65 percent of the total revenue comes from titles ranging from 21 through to 1000.
This suggests that mobile gaming remains as dynamic as ever, with plenty of room for fresh innovation and competition from established publishers and newcomers alike.
The European and the US markets follow this trend fairly closely. In the US for example, the top 10 games account for 18 percent of consumer spending, which implies a significant opportunity for titles outside the top 20 hits to carve out substantial market share.
However, this varies hugely according to region. In Brazil, 42 percent of the total spend goes on the top 10 titles, while in China 50 percent goes to the leading games. So for developers working in these markets, it’s vital to use tools such as data.ai to understand the competitive landscape, identify partners, and adopt appropriate build-and-buy strategies.
If we dive into the details of each genre and subgenre, we can find out more about each category and game type. We can see exactly how dominant the top titles are within that subgenre in terms of consumer spending. We can find out which areas of gaming are more saturated than others and where the opportunities exist for new and breakthrough hits.
By visualizing the data, we can see that those opportunities vary wildly across the different categories. For developers and publishers hoping to enter the mobile market and achieve commercial success, the choice of game type will have a huge impact on the chances of success.
The data showing consumer spending by genre reveals two edge cases, Open World RPG and Casino/Slots, highlighting those enormous differences.
Bitcoin NFT Marketplace Gamma.io Launches Its .btc Marketplace
The digital marketplace for Bitcoin non-fungible tokens (NFTs), Gamma.io, has launched its marketplace for .btc decentralized identities and domains, established on the Stack programming layer for Bitcoin.
In an October 5 press release, Gamma.io confirmed the launching of its .btc domain marketplace for digital products built on the Stack programming layer for Bitcoin. While commenting about the new marketplace, Jamil Dhanani, the founder of Gamma.io, remarked:
“At Gamma, we strongly believe in the future of decentralized identities, and we’re excited to take this step in furthering their adoption of the most secure blockchain. Recent technological breakthroughs using the Stacks programming layer have unlocked the user experience needed to make them a reality, in a way web3 users have come to expect from other decentralized identities, like those on Ethereum.”
Gamma.io is an open digital asset marketplace renowned for offering secure Stack-powered Bitcoin NFTs. Gamma.io features three core platforms, including a marketplace for NFTs, a launchpad for artists, and a social platform for creators and collectors.
The Bitcoin NFT Marketplace supports more than a million NFT collections and facilitates millions of dollars of transactions. The market platform also supports the largest number of NFT contracts from any platform built on the Bitcoin blockchain.
Gamma.io hinted about launching the .btc domain marketplace alongside plans to become the social hub for NFTs in April. The Bitcoin NFT marketplace will now serve as the home for collectors, creators and investors. The market platform will allow users to explore trade and showcase NFTs through the Bitcoin ecosystem.
Gamma.io Follows ENS’ Footprints The Bitcoin NFT marketplace reportedly seems to be following the footprints of its main rival .eth domain marketplace, the Ethereum Name Service (ENS), following the launch of its .btc domain marketplace.
In recent months, the ENS has exploded in growth and popularity as many crypto users understand the power of decentralized identity. Gamma.io anticipates that its new Bitcoin Name Service (BNS) marketplace will revitalize the initial vision of Bitcoin addresses.
Dapper Labs Sets Launch Date for LaLiga Golazos NFT Marketplace
Like NBA Top Shot and NFL All Day, the Flow-based platform will serve up NFT collectibles based on notable video highlights.
Following the path of NBA Top Shot and NFL All Day, Dapper Labs’ previously announced NFT platform based on the LaLiga Spanish soccer league will launch in closed beta later this month.
The marketplace, called LaLiga Golazos, will open up to select users on October 27 and drop its first pack on that date. Both Top Shot and All Day held months-long closed beta tests that gradually added more and more users before eventually opening to the wider public.
Like those other sports offerings, LaLiga Golazos will sell NFT collectibles minted on the Dapper-created Flow blockchain, with video highlights turned into trading card-like assets that can then be sold and traded. Dapper’s tie-up with LaLiga was first announced in September 2021, with the platform originally due to debut this past summer.
AppLovin Launches “Vessel”, First NFT Marketplace for App Devs to Monetize Mobile Gaming
AppLovin, the leading growth platform for developers, today announced its first NFT marketplace to launch in app stores through its subsidiary, OpenVessel Technologies, LLC. Vessel, which is currently live in Apple and Google Play app stores, enables mobile game developers to easily integrate non-fungible tokens (NFTs) into games to drive engagement and revenue.
“Vessel represents the next evolution in mobile game monetization, giving developers a new opportunity to monetize apps and drive meaningful engagement and growth,”
said Rafael Vivas, AppLovin’s General Manager of New Initiatives.
“The marketplace is live, and our engagement data shows that consumers are more than ready to take part in new ways to play and earn. By combining the consumer demand of NFT creation and purchasing with the high engagement levels associated with gaming, Vessel is showing strong potential as a new monetization stream for mobile games.”
An all-in-one marketplace and wallet, Vessel makes it easy for consumers to gain access to customized NFTs. Developers can allow users to securely buy, sell, and trade their NFTs and convert their earnings into cash. Vessel has cleared both the Apple and Google Play store reviews, meeting both app stores’ stringent guidelines.
Vessel is finding strong early interest with dozens of developers actively integrating the marketplace into their games to drive additional revenue. Using Vessel, Lion Studios integrated an NFT in-game event into its Match 3D game and saw strong engagement and meaningful average revenue per daily active user (ARPDAU) increases.
“NFTs have always had the potential to become a powerful tool for developers; all we had to do was simplify the idea so that our customers could understand the benefit,”
said Randal York, Product Manager for Lion Studios who spearheaded the NFT integration for Match 3D.
“Vessel gave us that ability and our audience embraced it. It was amazing to see a significant increase in in-app purchases for our NFT event compared to previous events.”
National Policies & Legal Updates
US Risk Watchdog Asks Congress to Name Crypto Spot Market Regulator
The top U.S. financial regulators are warning of dangerous holes in the oversight of crypto and are asking Congress for more powers, including settling which agency will oversee the bulk of trading in bitcoin and other non-security tokens, according to a report unanimously approved at a meeting of the Financial Stability Oversight Council (FSOC) on Monday.
The council's report flags several of the unregulated hazards in the digital assets industry, including the spot market for bitcoin (BTC). These latest recommendations from the group, which is led by Treasury Secretary Janet Yellen, effectively bolster the two leading efforts in crypto legislation: a bill that would put the Commodity Futures Trading Commission (CFTC) in charge of overseeing that spot market, and another that would establish rules for stablecoin issuers.
“Innovation without adequate regulation could result in significant disruptions,”
Yellen said during the council’s Monday meeting.
She said the report "identifies a number of current gaps in regulation" and finds that crypto assets "could pose a risk to financial stability."
The 125-page FSOC document concluded that potential fraud and manipulation in crypto trading begs for a spot market watchdog, according to a staff presentation at the meeting. Legislation in both the Senate and House would place the CFTC in that role, though the bills leave the Securities and Exchange Commission (SEC) with the authority to decide which tokens are "securities" over which it will have jurisdiction.
The FSOC – whose members include the heads of financial agencies, including the Federal Reserve and both the SEC and CFTC – is also preparing to recommend that U.S. regulators need to be able to reach into all corners of digital businesses. They not only need to be able to supervise a crypto firm, but also all of its affiliates and key service providers – as the Fed can do when it oversees Wall Street banks, the report will argue, asking Congress to grant that power.
As expected, the report calls for Congress to “create a comprehensive federal prudential framework for stablecoin issuers” that will let regulators set up guardrails around the tokens that are so vital to current crypto trading and future payment ideas. A high-profile bill in the House Financial Services Committee is seeking to do that.
With Crypto Governance in CFTC Crosshairs, SushiSwap Mulls Legal Shakeup
Popular decentralized crypto exchange SushiSwap is mulling a revamping of its legal structure, an effort with potentially greater potency amid increased regulatory scrutiny of crypto projects governed by so-called decentralized autonomous organizations (DAO).
SushiSwap, whose DAO token holders decide on everything from leadership to artist grants, was advised this month to divvy itself up into a trio of legal entities based in Panama and the Cayman Islands. The new structure proposed by law firm Fenwick & West LLP would “mitigate risk,” according to a write-up posted on Sept. 22 in SushiSwap’s governance forum.
Governing crypto trading infrastructure via such investment collectives has never been riskier. Last week, the Commodity Futures Trading Commission sued Ooki DAO for alleged violations of U.S. investment laws, seemingly targeting everyone who votes in that DAO – undermining the notion that “decentralization” can shield DAO members from liability.
The robust participation in Sushi DAO votes is, however, a stronger claim to decentralization than Ooki has ever seen, Nansen data shows. More than 1,800 individual wallets have voted in Sushi DAO in the past six months, compared with a mere nine in Ooki over the same period. That said, Sushi DAO’s clout pools around token heavyweights; crypto hedge fund Arca accounted for 29% of a July vote on collecting arbitrage profits, according to Nansen.
“Simply calling an unregistered group of individuals voting on governance a DAO isn't going to fly, and that's what the newest lawsuits target,”
newly elected SushiSwap leader Jared Grey posted on the platform's Discord channel on Thursday. (He won the election to become “head chef” with 62% of votes coming from just two addresses.)
“Currently, Sushi is unregistered and needs legal entity protection asap.”
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