BTCX Crypto News November 2022
There seems to be no end to the story with FTX where "many small streams" ended up being a tangled and messy story and the question is whether the story of FTX ends here or if there will be more surprises over time in addition to the ones we already know. The owner Sam Bankman-Fried (SBF) has been under fire in recent weeks over the clumsy procedures that the stock exchange FTX carried out with its customers assets as well as SBF's connections to Alameda research, a subsidiary of FTX whose assets largely consisted of FTX's own token FTT and which lost almost all value with the fall of FTX and they also seemed to have advantages in trading on the stock exchange FTX which meant greater risk-taking.
All the problems finally caused the major exchange to file for bankruptcy and the very next day, FTX was exposed to a breach which resulted in somewhere between 477 and 555 million dollars being siphoned out of the already hard-pressed platform's liquidity. The majority of that amount (280M USD) is currently in Ether and according to reports from anonymous cryptoanalyst ZachXBT, the hacker has started to "launder" 360 BTC via a pureBTC bridge "Chipmixer".
If you want to follow the history and the transactions online, you can follow ZachXBT on twitter where he shows the course of events. I don't think we have heard the last word in the story of FTX yet, but if something positive is to be found in this, it could be what will be the next point, namely Proof-Of-Reserves.
PoR or Proof of reserves
The term was on everyone's lips with FTX's ongoing tangle that led Binance owner CZ to come out and recommend that all exchanges be transparent with their customers' held assets. No one can deny that security and credibility in crypto took a serious hit as users became very tired of these recurring hacks or mismanaged platforms where customers lose their assets time and time again.
Proof of reserves is something that would increase the credibility of the major established exchange platforms somewhat CZ believes and told that the exchange Binance does not mix its customers' assets with its own liquidity even though the two parts use the same infrastructure for wallets. According to their own statement, Binance will also use Merkletree PoR to ensure the data integrity of their assets, but that they will also use a third party to verify that their assets are what they say they are. At the present moment, their Proof of reserves regarding Bitcoin should be live on the platform's website so that anyone can see the status.
In response, Coinbase revealed that they are holding 2,000,000 bitcoins! Almost 10% of the total number that will ever be produced and to the total value of close to 40 Billion USD. However, they manage 635,000 of these Bitcoins for Grayscale Bitcoin Trust, a company that helps its clients invest in Bitcoin and other digital assets.
However, Kraken's CEO Jesse Powell was critical in his statement regarding Proof of reserves and stated that responsibility for debts must also be made clear where even accounts with negative balances must also be reported openly and that all user accounts must be verified via audits. We can probably be sure that this is just the beginning of a new transparency in the industry with tougher regulations coming in the future. The big question is how much of its customers the established market of centralized exchanges will lose to the Defi jungle of decentralized exchanges such as UniSwap, ApeSwap, SushiSwap, PancakeSwap and more.
Defi had its happy wild west period in 2019-2020/2021 depending on if you stuck to platforms/protocols on Ethereum or BnB Smartchain. Hundreds of platforms popped up like mushrooms from the ground where one farm or pool had even more amazing APR% than the other and people flocked to these money machines. However, the crypto winter came and many protocols died out or were hacked and the few that survived did so with significantly less resources and users than before. The point was probably missed in this gold rush which was that a decentralized marketplace and financial platform actually worked really well.
After the uproar with FTX, you started to see an increase in users towards Dex and Defi instead of the traditional Cex platforms. Could it be that we are only now mature enough to understand the benefits of a secure and functioning decentralized solution when we realize that no centralized platform is really safe in the end because we humans can always be considered a risk due to carelessness, corruption, ignorance, etc.
The future is both uncertain and uncertain, but one thing can still be sure, and that is that innovation and creativity are not lacking in the crypto industry and as long as there are people who build, the development will continue. It is only in bad times that the greatest innovations are born and see the light of day so I have a positive outlook on the future and look forward to looking back at the amazing products created during the 2020-2023 dip.
NFT and Metaverse
It comes with some nice news even though many have lost big money on their NFT purchases in the dip. Bored Apes BAYC are probably the ones that got the most attention when the floor (Floor price, lowest price) went from 144.9 ETH to about 48 ETH and celebrities like Justin Bieber have lost big money on their purchases.
However, not everything is gray in the sky and demand is still high for NFTs with rare properties. Adidas released its Adidas virtual gear collection now which is based on the collaboration with BAYC and Mutant Ape Yard Club and means you can equip your NFT with Adidas accessories.
Sony has taken out a patent to track "in-game assets" using block chain technology and they have stated that they want to introduce the technology into their games which is probably only a matter of time considering how fast the technology for web3, NFT and metaverse is growing now which in turn attracts a lot of interest and audiences. It has even resulted in Prince Harry and Meghan Markle being well advanced in the process of creating their own Metaverse via the pax.world platform. The name Meg-averse has been on everyone's lips following the news as Meghan is believed to be the driving force behind the digital project for the former royal couple. However, we can agree that interest is growing explosively regardless of whether the market is running like a bull or sleeping like a bear.