#40

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Prices on 2021-09-24 07:15 UTC.
Regulators

Governments try to regulate the crypto space

Mixed messages continue emerging in countries across the globe, ranging from complete bans to nation-wide adoption of cryptocurrencies.

Nearly 60 crypto exchanges announced the suspension of services in South Korea due to the country’s new regulations that oblige exchanges to register themselves with the Financial Intelligence Unit, obtain a security certificate from the internet security agency and partner with any registered bank in the country.

Crypto lending company Celsius — which provides users with interest-bearing accounts — is now under scrutiny from regulators in Texas, Alabama, and New Jersey. Earlier this year, another American company with similar services, BlockFi, faced accusation of violating state security laws.

Central Bank of Russia is reportedly working with commercial banks to delay transactions to crypto exchanges in order to protect “unqualified” investors from “emotional” purchases, citing high risks of investing in crypto assets.

The Turkish president emphasized that the country is at war with cryptocurrencies during the recent meeting with students. Earlier in April, the Turkish central bank imposed a ban on cryptocurrency payments.

While many governments tighten their regulatory grip over cryptos, El Salvador has become the third country in the world by the number of cryptocurrency ATMs on its soil, following the recognition of Bitcoin as legal tender. The Central American nation has also installed its commission-free Chivo ATMs in major US cities where local legislation permits them, including Houston, Dallas, Chicago, Los Angeles, and San Francisco.

Ten days after the landmark law came into force, 1.1 million of Salvadorans - or 16% of country’s population - has reportedly downloaded government-developed Bitcoin wallet Chivo, which requires KYC verification and airdrops US $30 in bitcoins to newly registered users.

DeFi

Solana shuts down for a few hours due to high load

While traditional media was focused on China’s growing real estate crisis that has already impacted markets across the globe, the biggest news story in the DeFi space was about massive outage of the Solana blockchain, which resulted in a temporary shut down of the network.

Solana - the emerging Ethereum competitor that hosts many smart contracts - experienced a large increase in transactions, peaking at 400,000 transactions per second (TPS). To put it in perspective, the Bitcoin network processes a little over 3 TPS on average, while the Ethereum blockchain handles around 13-14 TPS, according to BitInfoCharts.

The spike in transactions was attributed to the initial DEX offering (IDO) on Solana-based protocol Raydium. During congestion the network began forking into different paths, overwhelming the memory of some nodes, which eventually forced them to go offline. After the whole network was shut down for nearly 18 hours, the Solana validator community successfully completed a full restart of Mainnet Beta and upgraded to version 1.6.25.

In other news

  • Crypto exchange Coinbase signed a millionaire contract with another US government agency. The Immigration and Customs Enforcement (ICE) - a branch of the U.S. Department of Homeland Security - paid $1.36 million for the license to use Coinbase’s blockchain analytics software for undisclosed purposes.

  • SushiSwap’s fundraising platform MISO suffered a supply chain attack, resulting in a loss of nearly $3 million. A rogue contractor was able to inject malicious code with his personal Ethereum address into the MISO front end. After being exposed by the Sushi team and threatened with legal action, the attacker returned all the stolen funds. Earlier this month, security researcher Sam Sun discovered and fixed a critical vulnerability in the MISO Dutch auction contract.

  • 0xMaki, a pseudonymous co-founder and project lead of DeFi platform SushiSwap, is set to leave his position in the project, while still remaining an advisory. 0xMaki’s address has been removed from the operations multisig.

  • OpenSea, the largest NFT marketplace by trading volume, confirms the allegations of insider trading by its Head of Product Nate Chastain. The employee was using insider information to buy NFTs before they were promoted on the platform’s front page and then sold them for profit. Chastain tried to obfuscated his actions by using secret Ethereum addresses, but then transferred the profits to his main address. While being illegal in the fiat world, the insider trading is more common and somewhat more tolerated in the crypto space.

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