News Weekly | US Department of Justice prohibits CZ from leaving the United States before sentencing. Total assets under management of encrypted ETP have grown by 91% since the beginning of the year.

Breaking News US DOJ Bans CZ from Leaving Country Before Sentencing; Encrypted ETP's Assets Under Management Increase by 91% in 2021

LianGuai Weekly is a weekly summary column launched by LianGuai, covering key news, mining information, project updates, technological progress, and other industry dynamics in the blockchain industry. This article is the news weekly, giving you an overview of the major events in the blockchain industry this week.

Headlines

▌The U.S. Department of Justice proposes motion to prevent CZ from leaving the U.S. before sentencing

On November 23, former director of the U.S. SEC Internet Enforcement Office, John Reed Stark, wrote on X platform that this Tuesday, after CZ pleaded guilty, U.S. District Judge Brian A. Tsuchida allowed CZ to return to the United Arab Emirates before sentencing. However, the U.S. Department of Justice requested Judge Richard A. Jones to review this decision and ordered CZ to stay in the United States. According to the Department of Justice, the reasons for detaining CZ are: 1. CZ is very wealthy, a billionaire. 2. Most of CZ’s wealth may be beyond the reach of U.S. authorities. 3. CZ resides in the UAE, which has no extradition treaty with the United States. 4. Although CZ voluntarily appeared in court and pleaded guilty, with the increasing possibility of imprisonment, CZ is likely to choose not to come back for sentencing. According to the current terms of bail, CZ can leave the United States because he has deposited $15 million in a trust account, signed a $175 million personal recognizance bond, and found a guarantor to provide additional funds.

▌Cryptocurrency ETPs have grown 91% in managed assets since the beginning of the year

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According to Fineqia’s data, managed assets of cryptocurrency exchange-traded products (ETPs) have grown 91% since the beginning of the year, 30% higher than underlying assets. Fineqia’s research includes a total of 168 issued cryptocurrency ETPs, based on AUM data from sources such as 21Shares, Grayscale Investment, VanEck Associates, etc. According to Fineqia’s statistics, the AUM of cryptocurrency ETPs reached $38 billion in October, a 25% increase from the previous month, hitting the highest level since May 2022. The total market value of cryptocurrencies also rose 17% in October, from $1.15 trillion to $1.35 trillion.

▌CertiK: Private key leaks have caused over $800 million in losses by 2023

According to CertiK’s post on social media, based on the attack on HTX hot wallets and Heco Bridge yesterday, suspicious activities amounting to approximately $113.3 million have been identified. As of 2023, private key leaks have caused losses exceeding $800 million.

▌CZ’s lawyer proposes motion to allow CZ to return to the UAE

According to Bitcoin News, the lawyer for Binance’s former CEO, Zhao Changpeng (CZ), has proposed a motion to allow Zhao to return to the United Arab Emirates in response to the U.S. Department of Justice’s motion to review his current bail conditions.

Policy

▌Shanghai blockchain digital infrastructure “Pujiang Blockchain” goes online

Shanghai’s city-level blockchain digital infrastructure “Pujiang Blockchain” recently went live. Li Xiaoshan, Vice President of Shanghai Data Group, introduced that Pujiang Blockchain acts as the network operator, reducing the cost of data circulation and helping to solve the contradiction between data usage and data privacy protection through distributed digital identity, cross-chain, and smart contract technologies. It is reported that more than 80 enterprises have already settled in Pujiang Blockchain. Currently, Pujiang Blockchain is still under construction and application, with a focus on government public services, data element circulation, cross-border trade, shipping logistics, energy saving and carbon reduction, industrial internet, etc. Pujiang Blockchain can provide blockchain basic support for chain owner enterprises and scenario parties. Chain owner enterprises can build their own scenario chains through blockchain computing power basic services and chain management services, connect the information systems of all parties through Pujiang Blockchain, create an industry value network, and also communicate with other application chains and scenario chains through cross-chain technology to leverage the advantages of “chain alliance”.

▌Hong Kong Securities and Futures Commission includes “Hong Kong Digital Research Institute” in the list of suspicious virtual asset trading platforms

According to the website of the Hong Kong Securities and Futures Commission, the “Hong Kong Digital Research Institute” (hkdao) has been included in the list of suspicious virtual asset trading platforms today. The Hong Kong Securities and Futures Commission pointed out that the company appears to target Hong Kong investors and claims to have obtained a license from the Hong Kong Securities and Futures Commission, but this is not the case. So far, the Hong Kong Securities and Futures Commission has listed 9 suspicious virtual asset trading platforms.

▌Cambodia’s digital currency project Bakong cooperates with Alipay

Bakong is a digital currency project launched by the National Bank of Cambodia in 2020 and has now partnered with Alipay to further expand its coverage. In addition, Cambodians who have a KYC Bakong wallet fully associated with banks can make overseas payments at merchants associated with Alipay. Additionally, Bakong’s developer, Soramitsu, is developing the cross-border digital currency system Mukumi in Japan, which will be connected to Bakong. The goal is to enable Japanese merchants to use QR codes linked to Bakong for sales in Southeast Asia. The target countries include Malaysia, Thailand, and Vietnam, all of which accept Bakong.

▌Foreign media: Interactive Brokers Hong Kong obtains retail virtual asset trading license in Hong Kong

According to a post by David Friedland, Managing Director of Interactive Brokers Asia-Pacific, on LinkedIn, brokerage firm Interactive Brokers Hong Kong has obtained a license for retail customer virtual asset trading in Hong Kong. The post states that it allows for Bitcoin and Ethereum trading and an official announcement will be made soon. Cointelegraph has contacted Interactive Brokers for more information and comments on the development but has not yet received a response.

▌UK investment funds granted approval for tokenization

According to the UK Trade Association for Investment Funds, investment funds in the UK have been granted tokenization approval. The association stated in a declaration that tokenization of funds has the potential to improve efficiency, transparency, and international competitiveness in the investment management industry. The initial phase involves collaboration with the UK Treasury, the Financial Conduct Authority (FCA), and investment management companies such as BlackRock, as part of the government’s Asset Management Taskforce roadmap and technical working group released today. The “Tokenization of UK Funds – Implementation Blueprint” report outlines a benchmark model for tokenization that aims to operate within existing legal and regulatory frameworks, and businesses can implement the model immediately. This model allows FCA authorized funds to adopt tokenization in sales and redemption transactions, as long as they meet specific criteria, such as having portfolios that only consist of mainstream investment assets and maintaining traditional valuation and settlement processes.

▌Bank of Korea Governor: Does not want to issue central bank digital currency before the United States and European countries

Bank of Korea Governor Lee Chang-yeong said that the benefits of South Korea becoming a leader in issuing central bank digital currency are minimal. He does not want to issue central bank digital currency before the United States and European countries.

▌US Congressman: Congressional resources should be used to introduce more crypto activities and opportunities domestically to strengthen US national security

Following the settlement between the US Department of Justice and cryptocurrency exchange Binance and its CEO CZ, US Congressman and Majority Party Whip Tom Emmer of Minnesota shared his views on the role of Congress in shaping cryptocurrency legislation. Emmer stated that Congress does not need to rewrite laws applicable to the cryptocurrency industry. Yesterday’s successful prosecution demonstrates that existing laws are suitable for helping to eliminate bad actors. Instead, congressional resources should be used to introduce more crypto activities and opportunities domestically to strengthen US national security.

Blockchain Applications

▌Latest Ethereum execution layer meeting: Developers agree to launch Devnet 12 next week

On November 24th, Ethereum core developer Tim Beiko summarized the latest Ethereum core developer execution layer (ACDE) conference call. Devnet 11 is largely stable, and developers agreed to launch Devnet 12 next week, even if not all teams are ready. In addition, developers emphasized the Goerli shutdown issue. Once Dencun goes live on Goerli, all client teams and EF developers will shut down their validators on Goerli 3 months after mainnet upgrade or 1 month after.

▌Huang Renxun: Nvidia’s GPU supercomputing system, like ChatGPT that can generate valuable tokens

Nvidia co-founder and CEO Huang Renxun recently had a share of insights with Columbia Business School Dean Costis Maglaras. During the discussion, Huang Renxun talked about the development of Nvidia’s GPU in the era of cryptocurrency and mining killer applications. Huang said, “When Bitcoin first appeared, there were no Bitcoin ASICs yet. At that time, the supercomputers with the highest production yield were Nvidia’s GPUs. When you plugged them in, money started pouring out. That’s why so many people bought Bitcoin, which later led to the rise of Ethereum. But users would use a supercomputing system like Nvidia’s GPUs to encode or compress, or do something to extract data and turn it into valuable tokens. Do you know what this sounds like? ChatGPT that generates valuable tokens.” Nvidia released its Q3 financial report today, with revenue for the third quarter ending on October 29, 2023, reaching $18.12 billion, a year-on-year increase of 206%, and a quarter-on-quarter increase of 34%, with earnings per share nearly 6 times higher. Data center revenue from AI chip business doubled year-on-year, setting another record for a single quarter.

▌Cosmos Hub community voted in favor of the “ATOM Reduction: Setting the Maximum Inflation Rate to 10%” proposal

The Cosmos Hub community has voted in favor of the proposal “ATOM Reduction: Setting the Maximum Inflation Rate to 10%.” The support rate is 41.1%, while the opposition rate is 31.9%. The maximum inflation parameter for ATOM will be reduced from 20% to 10%, bringing the current inflation rate of ATOM to 10% and reducing the stake annual interest rate from 19% to 13.4%.

▌BA Labs proposes to lower DSR to 3.93% in the MakerDAO community

On November 24th, BA Labs team member Sean submitted the proposal “Changes to Stability Range Parameters” in MakerDAO, which involves lowering the Yield & Stability collateral revenue benchmark, removing GUSD, reducing the base interest rate, lowering DSR, EDSR, stability fees, reducing the debt ceiling of PSM-GUSD-A, and increasing the debt ceiling of RWA014-A (Coinbase Custody). The proposal suggests reducing DSR from 4.2% by 0.27% to 3.93%. Fhenix completed a $7 million financing round in September.

▌Lido: No keys leaked due to InfStones vulnerability, will begin rotating all related keys

An update was posted on the Lido governance forum stating that, after discussions with the affected node operator InfStones and related security researchers (dWallet Labs), Lido DAO contributors reached the following conclusions regarding the Ethereum node operator platform vulnerability: there is no evidence that any keys were leaked due to this vulnerability; as a precautionary measure, InfStones voluntarily withdraws all validators and starts rotating all keys related to InfStones. They will actively engage with the DAO in the forum to reach a consensus on future steps. All ETH from withdrawn validators will be returned to the Lido protocol through a withdrawal process and then re-staked with available keys. Looking ahead, Lido DAO contributors suggest initiating forum discussions on proposed subsequent steps related to the rotation of InfStones validator keys.

▌“Chang’an Chain” privacy computing technology receives national-level certification

The self-developed blockchain software and hardware technology system “Chang’an Chain” for high-performance integrated privacy computing in China has obtained national-level certification, providing strong security guarantees for the circulation of data in highly sensitive and high-value sectors such as finance and government affairs. According to the National Blockchain Technology Innovation Center, the trusted privacy computing technology product “Chang’an Chain Privacy Computing Open Platform” developed by the “Chang’an Chain” team has obtained national-level “FinTech Product Certification,” becoming the industry’s only certified solution that combines blockchain and privacy computing.

▌Ethereum Layer2 network Kinto migrates to the Arbitrum ecosystem

Following the launch of a testnet using Optimism’s OP Stack in May, Ethereum Layer2 Kinto has migrated to the Arbitrum ecosystem using the Arbitrum Nitro stack. According to a statement, this migration occurs after a structural change in the Arbitrum Orbit chain ecosystem, granting the Arbitrum Foundation greater autonomy in negotiating Layer 2 deployments. Kinto claims to support modern financial institutions and decentralized protocols by building a Layer 2 that complies with KYC standards, bridging the gap between traditional finance and decentralized finance. It also aims to mitigate risks of DeFi vulnerabilities by providing built-in insurance for all smart contracts.

Cryptocurrency

▌Ordinals Inscriptions cumulative revenue exceeds 3100 BTC

Dune’s latest data shows that the cumulative revenue from the Ordinals Inscriptions NFT protocol for Bitcoin has reached 3,108.72 BTC, equivalent to $117,989,112. The current total of inscriptions minted is 44,093,694.

▌Data: Blast network TVL exceeds $500 million

On November 25th, according to DeBank, the Layer 2 network Blast, launched by Blur founder LianGuaicman, currently holds assets worth more than $500 million. Among them, $439 million worth of ETH is deposited in the Lido protocol, and $61.81 million is deposited in the Maker protocol.

▌Hong Kong Police: HOUNAX virtual investment fraud case receives 131 reported cases, involving HK$110 million

According to Hong Kong Radio’s website, the Hong Kong police recently discovered scammers posing as investment experts, attracting citizens to invest through a virtual asset trading platform with high returns, but ultimately unable to withdraw funds. The police indicated that the company involved is named HOUNAX, and they have currently received 131 reports of victims, with a total amount involved exceeding HK$110 million, and each victim’s losses ranging from HK$12,000 to HK$4 million. Detective Chief Inspector Chan Wai-kee of the Commercial Crime Bureau stated that the company has been operating since earlier this year, the HOUNAX website is in traditional Chinese, and the login page is pre-set with the +852 area code, indicating that the target of the scam is Hong Kong citizens. The website is still operational and available for download as a mobile application.

▌Japan’s Okasan Securities issues $13.4 million digital bonds to retail investors

Okasan Securities, Japan, plans to issue digital bonds worth up to 2 billion yen ($13.4 million) to retail investors by the end of December. It will use the Progmat security token platform created by MUFG. Okasan Securities’ market value has just exceeded $1.1 billion and has a joint venture with SBI unrelated to digital securities. Consumers can subscribe to the one-year bond in units of 1 million yen ($6,700). The brokerage firm claims that this is the largest retail bond issuance to date. There are other consumer-centric security tokens, but most of them are based on real estate.

▌Raiffeisen Bank in Austria to launch cryptocurrency trading in January next year

Raiffeisen Bank International in Austria is set to launch cryptocurrency trading services to retail customers by the end of January 2024. The service will initially be available to customers in Vienna, where the bank’s headquarters, and will be provided in collaboration with the cryptocurrency exchange BitLianGuainda. BitLianGuainda signed an agreement of intent with the bank earlier this year. The bank has assets of approximately $215 billion in the European Union and Eastern Europe.

▌Santander Private Bank offers Bitcoin and Ethereum trading for Swiss clients

According to an internal announcement, Santander International Private Bank, a subsidiary of the Spanish financial services giant Santander Bank, is offering trading and investment services in the main cryptocurrencies Bitcoin and Ethereum for high-net-worth clients in Switzerland. The announcement states that Santander Bank will offer more cryptocurrencies that meet the bank’s screening criteria in the coming months. The bank states that this service is provided only upon customer request through relationship managers, and the assets are held in a regulated custody model with the bank storing the private keys in a secure environment.
Santander Bank has a history of over 160 years and serves over 166 million clients. The private bank caters to 210,000 affluent clients with assets and deposits totaling approximately $315 billion.

Important Economic Update:
▌Federal Reserve Meeting Minutes: Monetary policy will be further tightened if progress on inflation is insufficient

According to LianGuai’s report, the Federal Reserve meeting minutes show that if progress on inflation falls short, the Federal Reserve will further tighten its monetary policy. All FOMC members agree to “proceed cautiously” on the issue of interest rates, and all members believe that rates will remain restrictive for a period of time. Participants unanimously agree that policy decisions at each meeting will continue to be based on a “comprehensive assessment of all available information,” and that maintaining a tight stance will support further progress toward inflation targets while allowing sufficient time to gather more information.

Disclaimer: LianGuai, as a blockchain information platform, publishes articles for informational reference only and does not serve as actual investment advice. Please adopt correct investment principles and ensure to enhance risk awareness.

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