The Russia Risk-Off

Terraform Labs, the company behind the Terra blockchain, and its‘s well-documented tussle with the Securities and Exchange Commission (SEC) does not seem to be coming to an end anytime soon. The United States District Court in New York has ordered Terraform Labs and its CEO Do Kwon, to comply with subpoenas issued by the financial regulator. 

The subpoenas – which requires named parties to appear or produce documents in court – were issued in connection with the ongoing SEC investigation of a decentralized finance project built on Terra called Mirror Protocol.

Last September, the SEC served a subpoena to Kwon at the Messari Mainnet crypto conference in New York. The SEC acted after learning about Mirror Protocol, a project launched by Terraform Labs last year that allows users to buy and sell synthetic versions of U.S. stocks and other assets. In short, it takes assets you can buy on the stock market and lets you buy them on the blockchain. However, it is not without its risks – and it is highly unregulated.

Located in South Korea, Terraform Labs is known for its stablecoin-focused blockchain, the algorithmic stablecoin $UST, and the chain’s native $LUNA.X token. As of this writing, $LUNA.X is the 10th largest cryptocurrency by market capitalization; $UST was among the top-five issued stablecoins. The SEC’s action baffled Kwon, who filed a lawsuit against the regulator claiming that the move violated the agency’s rules and was intended to intimidate or stir up media interest in its crackdown on cryptocurrency.

After filing the lawsuit, he said at Yahoo Finance’s All Markets Summit, “Regardless of what regulators think of the issue, there’s no change I can make to the Mirror Protocol. So when we say that Mirror is decentralized, it is fully decentralized. There is nothing that the creator can do to sort of cap the growth of the protocol.”

Now that the U.S. has intervened and ordered the crypto firm and its CEO to comply with subpoenas, they cannot simply walk away. The CEO was philosophical in his latest tweet, saying that life’s lessons can all be solved if one is courageous.

Ross Nicoll’s surprise departure from their role as a core developer of Dogecoin ($DOGE.X) has awakened some discord in the world of memecoins – rivals such as Shiba Inu and Floki are now asking if this is their time to shine.

Nicoll indicated in his resignation letter that this wouldn’t be the end of his relationship with Dogecoin – he indicated that he would remain as an advisor – however, the crypto community is suspicious about Dogecoin’s next phase. Some even expressed their anxiety on Twitter, suggesting people should stop buying the memecoin. 

Dogecoin started a new foundation to support its development in August. Its re-establishment came mere months after the crypto “went to the moon” after a retail-driven fervor for the dog-inspired memecoin. A foundational goal of the foundation was to promote Dogecoin’s growth through advocacy, governance, and trademark protection. It also rounded up some high-quality board members – including, most notably, Ethereum co-founder Vitalik Buterin. However, Dogecoin has struggled to stay above water since the fervor started to wear.

Today, $DOGE.X was trading at $0.13, an 81% decline from its all-time high price of $0.731578 in May 2021.

The downfall of $DOGE.X has given plagiarisms of the popular memecoin a lot of runways to work with. For instance, one of the top 1,000 investors on Binance Smart Chain purchased 140 billion Shiba Inu tokens ($SHIB.X). Shiba Inu, which takes after Dogecoin in many ways, has many technical improvements over its contemporary – it has launched NFTs collections, and its core team reportedly plans to launch its metaverse museum. And even more copies of the Dogecoin copy, Baby Doge Coin ($BABYDOGE.X) and Floki Inu ($FLOKI.X) have aspirations to enter the metaverse with new play-to-earn games. 

We’ll have to see just how much these crypto projects can accomplish – after all, many NFT and cryptos promise and fail to execute. However, given the rigor of these meme-loving audiences, there’s a better chance than not that we’ll start seeing results from these inspired communities.

That means that Dogecoin will have to bring it to stay in the game – it can no longer rely on celebrity endorsements from people like Elon Musk. It needs a new shtick. 

Oasis Network is one of the emerging blockchain networks that focus on privacy and data security. A key development of the network in the past month has been the launch of its decentralized exchange YuzuSwap, resulting in the token $ROSE.X reaching its all-time high. To understand more about privacy and data security, we spoke to Linda Lu, the Head of Ecosystem at Oasis: 

ST: Oasis focuses on a privacy-enabled blockchain platform and a responsible data economy. Why do we need that?

LL: Data is the new oil, so it’s particularly important to develop technologies that can utilize data in a privacy-preserving way. In the 21st century, our data is collected at almost every point in the journey of being an internet user. Every time we go on a website or app and click “accept,” our data is being collected and stored, removing our direct ownership. It is important that we take ownership of our data, especially as we move into web3. As we begin to operate more actively on the internet and the metaverse, our data footprints will expand drastically.

We believe that people can have a direct revenue stream from their data. We want to empower a new data economy to enable more responsible use of data, in order to maximize social welfare and economic efficiency while protecting users’ data rights and enabling fair distribution of value. On the Oasis Network, data tokenization and privacy-preserving computation functionality are built-in. Data would never be stored in one centralized database, vulnerable to attack. Users retain complete control and visibility over who is using their data and what they are using it for at any one time. 

In the near future, we believe everyone will have their own digital identity, secured and stored on the blockchain. That identity will be yours to market and sell; you could give partial, full, or private access to interested parties. From your medical data to healthcare companies, your credit and financial records to credit reference agencies, your internet usage data to advertising companies, there is a universal basic data income to be earned by all. 

ST: Data breaches have happened recently despite DeFi’s anonymity. How can Oasis prevent these breaches?

LL: Oasis Network is a privacy-first layer-1 blockchain with built-in features designed to support confidential smart contracts. Since data is never leaked to the node operator or application developer, sensitive information (social security numbers, health records) can be safely used by blockchain apps on the Oasis Network. 

On Oasis, data is never stored in one centralized database, therefore it is not vulnerable to attacks and is never revealed to anyone. Users can retain complete control and visibility over who is using their data and what they are using it for at any given time. Your data token would be in your wallet, in your complete custody.

ST: Has Oasis Network been working on a “DeFi 2.0”, where data yields are shared among entities and revenue is based on them?

LL: DeFi 2.0 is critical to the overall DeFi ecosystem, as it solves a lot of issues plaguing DeFi 1.0. We have a few DeFi 2.0 projects in the pipeline, and we’ll share more as those teams are ready to unveil their projects.

ST: Oasis’s DEX YuzuSwap is in the initial stage and its features are not yet stable. What’s the plan for its development? 

The $200M Oasis Ecosystem Fund is dedicated to building the next generation of DeFi apps on Oasis that will improve Oasis technology at large. YuzuSwap is the first DEX on the Oasis network and it is built by our community. The team behind it is constantly working to add new features and recently they exceeded $1B in trading volume in less than one month. YuzuSwap has received support from the Oasis Ecosystem Fund to further develop its features, UX, and usability. Our engineers are also constantly working on improving Oasis Emerald with direct feedback from developers, projects, and the community at large.

ST: Binance Labs now contributes to Oasis Foundation’s $200 million ecosystem development fund. How will you maintain this momentum and explain the Oasis ecosystem to investors?

LL: The most important part of maintaining a project’s momentum is strengthening and growing its community, which we are doing every single day at Oasis. We provide funding to teams who want to build on the Oasis Network, via a lot of programs such as the $200 Million Ecosystem Fund, our Grants Program, The DappRadar Accelerator, the MetaMind Accelerator, and several more.  We are partnering with several projects in 2022 and expanding the Oasis ecosystem with comprehensive community, marketing, and content initiatives. We are forming several collaborations with other web3 projects and accelerator programs, alongside vetting, onboarding, and supporting new developers and entrepreneurs in the Oasis Network. 

While the cryptocurrency market has cooled off with Bitcoin dropping below $40,000, bitcoin mining difficulty has gone up to its all-time high. With Bitcoin miners competing more fiercely to verify transactions, the number of hashes has reached 27.97 trillion according to an on-chain analysis by BTC.com. In addition, an analysis by YCharts shows that Bitcoin’s hash rate last week increased to 248 EH/s, its highest level ever.

A hash rate is a measure of the amount of processing power required to mine blocks on the blockchain network. As the hash rate increases, it becomes more difficult to mine blocks. The recent hash rate number stunned many crypto enthusiasts, including Dylan LeClair, who described it as “going nuts.”

As this statistic illustrates, Bitcoin mining has never been more popular – or more widely distributed – than it is right now. Nevertheless, it does also mean it takes more computational power to perform mining, which has become a staple concern of crypto skeptics. 

Twitter was buzzing with debate about how Bitcoin’s newfound difficulty record will contribute to environmental deterioration. According to some sources, if Bitcoin were a country, it would consume a comparable amount of electricity to the country of Finland every year. 

It will take some time to reach the final verdict. However, one noteworthy thing is that the latest Bitcoin mining difficulty numbers rebounded like clockwork – speaking to the robust demand for mining on the world’s largest blockchain. Last year, when China clamped down on crypto mining, the network’s mining difficulty dropped to around 69 EH/s. That means it has gone up by 72% since then. The data also shows how the mining industry is no longer isolated in China.

Around 91 terawatt-hours of electricity are indeed consumed by Bitcoin mining annually, which is more than the annual electricity consumption of Finland – a country of 5.5 million people. But it is also true that miners are now looking to renewable energy for their energy needs. It will take time to determine what effect current Bitcoin mining has on the environment since the Cambridge University mining map has not been updated since August 2021, and a lot has changed since then.