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Last week we talked about a new $ 4.5 billion cryptocurrency from a16z. This week we’ll talk about arrests that make everyone in the NFT space sweaty.
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Future crime
Cryptographic spaces have moved so rapidly over the last two years that builders generally seem to believe that existing rules have not been applied. Now, after years of snail-paced legal action, US prosecutors seem to be beginning to feel it’s time to challenge that perception.
This week, a US law firm in Southern New York arrested and prosecuted a former OpenSea executive who used his position on the front run of an NFT project that was to be posted on the market homepage. Members of the community discovered his behavior by tracking his activity on the public blockchain.
I wanted to yell at this during the podcast, but the news broke during the recording, so I’ll leave a few thoughts here.
The arrest was a significant shock to the people of the NFT Space, who generally believed that Nate Chastain acted unethically, but because NFTs were not securities, they could not be “insider trading.” This is a framing held by many, including OpenSea’s Chastain’s boss who fired him.
“I think there was a misunderstanding as insider trading. NFTs aren’t considered financial assets and don’t apply. This is a very specific term for something very specific,” said OpenSea Devin Finzer. I am. Decryption In September.
Very many people read the SDNY press release very well, saying that they “specifically accused Chastain of wire fraud and money laundering in connection with plans to conduct insider trading of non-fungible tokens.” I am. In particular, we describe NFTs as “digital assets” later in the release. It’s also worth repeating what DOJ is claiming him, not the SEC, but it’s the US Securities and Exchange Commission’s fraudulent task force that handles this case.
So why don’t cryptocurrency people want to classify NFTs as securities? Well, there’s a lot of existing regulatory guidance out there, and most people feel that if an NFT unilaterally submits to securities law, it would basically confuse the industry. It will certainly raise the barriers to entry for the creation of NFTs and reduce many of the experiments currently underway in space.
Another big reason why NFTs are badly treated as securities is that it means that so many people have been doing illegal things for a very long time.
NFT Space has passed the execution of this latest cryptocurrency without the application of meaningful regulations. As the amount of NFTs begins to show signs of slowing, there are concerns that regulations may be imminent.
Latest pod
What’s wrong, here Anita provides a preview of the latest episode of the Chain Reaction Podcast. Here, for those who are interested in cryptocurrencies, we will unzip the latest web3 news block by block.
This week we talked about Coinbase’s new approach to performance reviews, one of the most disturbing aspects of corporate life. Our colleague, Amanda, I wrote about how crypto exchanges are trying to emulate Ray Dalio’s hedge funds, Bridgewater Associates enables employees to provide real-time feedback and ratings to each other. Is this the part where technology has fallen into the reality of Black Mirror style? Adjust to hear our thoughts.
We also reaffirmed the two recent cryptocurrency comeback stories. One is from the founder and CEO of OnlyFans, who left the company after trying to ban sexually explicit content from the platform, and the other is Terra, a highly volatile stablecoin architect. It is from.
This week’s guest was Ty Honey, the founder of Outdoor Voices. He shared details about the athleisure-to-crypt pivot with a new venture, TryYourBest. Haney reported in our podcast that the startup has begun raising funds for a second institutional investor.
Subscribe to chain reaction Apple, Spotify Or an alternative podcast platform of choice to catch up with us every week.
Follow the money
Where startup money is moving in the crypto world:
- New York-based enterprise blockchain startup Digital assets Undertook a private-scale strategic investment from Japanese banking giant SBI Holdings.
- Inf StonesThe blockchain infrastructure provider won $ 66 million in a round led by SoftBank and GGV.
- Indian Music NFT Startup FanTiger Earn $ 5.5 million in a seed round led by Multicoin Capital.
- Living CitiesThe Metaverse-focused social startup, co-founded by Foursquare founder Dennis Crowley, has deposited $ 4 million in early funding led by DCVC in banks.
- Zimbabwe FlexID Received private funding from Algorand for a blockchain-based identity system for underbanks.
- Web3 Augmented Reality Game Company Jadu Raised $ 36 million for Series A, led by BainCapital Crypto.
- VillageStudio Raised $ 2.3 million in a round led by Animoca Brands for NFT-based Playken avatars.
- Web3 Payment API merge Earned $ 9.5 million in seed funding led by Octopus Ventures.
- GoSatsThe India-based Bitcoin rewards platform has raised $ 4 million in pre-Series A funding rounds from investors such as Y Combinator, Accel and Gossamer Capital.
- DAO management platform Utopia Lab Finished the $ 23 million Series A, led by Paradigm.
web3 week
web3 was a very quiet week. US team members took a little time to enjoy a rare, peaceful long weekend. Still, some big personalities, for better or for worse, have caused waves in space.
- OnlyFans founder Tim Stokely has moved to cryptocurrencies after leaving the company last December following a controversy over his push to ban sexually explicit content from the platform. increase.Anita Wrote about The new “family-friendly” NFT startup he launched is working with another former OnlyFans executive who will be able to buy, sell and trade virtual cards featuring influencers and celebrities.
- The NFT platform OpenSea fired product manager Nate Chastain in September after being accused of front-running transactions on the platform. He is currently arrested and charged with insider trading.Lucas There are details..
Added analysis
Here are some of this week’s cryptanalysis that you can read on the subscription service TC + (created by TC’s Jacquelyn Melinek):
VC funding for crypto projects fell in May, but many investors are still bullish
Cryptocurrency VC funds fell month-on-month from April to May, but many investors aren’t worried. “For investors like us, it’s time to buy,” Stan Miroshnik, partner and co-founder of 10T Holdings, told TechCrunch. The pace of capital development may be better measured as investors and founders are calculated in the same way, according to Miloshnick, but VCs are still doing a solid amount of activity. Saurabh Sharma, Head of Investment at JumpCrypt, told TechCrunch that while the digital asset market may be pessimistic, true crypto native funds will continue to invest heavily.
As cryptography becomes more mainstream, can it remain decentralized?
Whether it’s the first buyer of cryptocurrencies or those who learn more about NFTs, Bitcoin, and the general crypto ecosystem, crypto awareness is rising worldwide. But as momentum gains, regulators around the world continue to monitor space more closely, but the headlines speak for themselves: what does this mean for the future of crypto? Many founders and executives in the industry have contributed to their ideas.
Long-time bitcoiner Dan Held says this “winter of cryptography” will not be as harsh as others.
The crypto market remains bearish, so long-time market participants like Dan Held, Growth Marketing Director of Crypto Exchange Kraken, aren’t worried. There’s a lot of talk about cryptocurrency winters spreading throughout the community, but Held said his feelings about this current market cycle are different. He (and many others) has been through a major market cycle for years, but the story has changed dramatically thanks to the entry of more prominent institutional investors and huge amounts of capital into the field. Did.
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