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The biggest crypto news and ideas of the day |
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Welcome to The Node. This is Daniel Kuhn and Xinyi Luo, here to take you through the latest in crypto news and why it matters. In today's newsletter: |
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Ex-FTX CEO Sam Bankman-Fried, who was extradited to the U.S. from the Bahamas on Wednesday, was released from police custody on Thursday. A New York judge set bail at $250 million, which was met in part by securing his parent's Palo Alto, California, home – where he will remain under house arrest. Meanwhile, SBF, FTX and an FTX creditor are all claiming ownership of $450 million in Robinhood stock SBF bought and put in a Bahamian shell company. |
Tron founder Justin Sun, at least at one point this summer, according to documents revealed to CoinDesk, held more than $580 million in BTC at Valkyrie Investments – amounting to over 90% of the crypto asset manager's money under management. This raises questions about Valkyrie's reliance on a single client for growth. Separately, Peter Thiel-backed crypto exchange Bullish has called off its SPAC deal, because it was "taking longer than expected." |
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The Takeaway: Zero Knowledge
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In 2015, the Ethereum protocol proposed a vision for a decentralized world computer capable of rearchitecting a free and open internet – removed from the whims and constraints of centralized entities. While Ethereum has become the foundation for Web3 as we know it, its growth was underscored by the upgrades that would be required to realize its full potential. As a result, layer 2 has emerged as clear frontrunners in the race to scale the network for mass adoption. Systems using zero-knowledge (ZK) technologies are among the most promising – and their potential isn't limited to scaling. ZK-powered technology is expected to revolutionize myriad sectors from gaming to payments, and from digital identity to enterprise solutions. Zero-knowledge technology refers to tools that use cryptography to prove that something is true without revealing any additional information other than the fact that it is true. The value of such a tool for crypto is that it greatly reduces the costs of processing data (such as transaction data on a blockchain) without compromising the security or decentralization that make these monetary networks unique. The application of ZK tech allows blockchain networks to prove the authenticity of their operations in the most efficient way, using the fewest possible steps. This is transformational for Web3 development because it reduces costs, increases throughput capacity and expands potential use cases far beyond what is currently possible. Ethereum co-founder Vitalik Buterin has stated outright that ZK rollups are the solution to scaling Ethereum and even proposed a ZK-based solution for preventing future FTXs. Until recently, ZK-based scaling was limited by its incompatibility with the Ethereum Virtual Machine (EVM). It's not strictly incompatible, of course, but perhaps unfriendly. In fact, many industry participants projected that it would take more than a decade to build a performant, EVM-compatible ZK rollup. It took considerably less time than that. Given the tech is so new and so broadly applicable – (despite the name, it has almost nothing to do with privacy but could be a way to scale Ethereum to support robust gaming, payments and other industries) – it's likely is that the most useful, groundbreaking application of ZK doesn't yet exist. – Mihailo Bjelic, co-founder of Polygon |
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The crypto market is at a critical juncture - we need strong players to act and lead.
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- FTX US auditor Armanino defends work for failed crypto exchange (FT – paywalled)
- Ren to mint 180 million tokens to fund transition to new version (The Block)
- The Biggest NFT Collections of 2022 (Decrypt)
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The World Cup and Digital Assets are a Global Phenomenon Following the collapse of FTX, user trust in crypto exchanges' transparency, security and liquidity have proven to be critical to the continued adoption of crypto. The 2022 World Cup is therefore a unique opportunity to showcase to over 4 billion potential viewers how crypto firms are prioritizing security and risk management, facilitating the adoption of crypto even during the crypto winter. We've already seen a few Web3 and crypto players leverage FIFA as a chance to pave the way for the global adoption of Web3 technologies. Continue here. *This is sponsored content from Bitget. |
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