On August 25th, 2024, Toncoin (TON) dropped over 20% following news about Pavel Durov, the founder and CEO of Telegram, being detained in France.

Key Details

TON serves as the native cryptocurrency for The Open Network, which Telegram initially developed but left behind in 2020 after an initial legal battle with the U.S. Securities and Exchange Commission (SEC). This latest incident underscores the strong connection between the blockchain project and Telegram itself, even though the messaging app has portrayed TON as an independent platform.

Durov was apprehended in France on Saturday evening, shortly after his private jet touched down at Bourget Airport near Paris, according to a recent Reuters report. The arrest, as reported by broadcasters BFMTV and TF1, was linked to a preliminary investigation concerning insufficient moderation on Telegram, which authorities argued facilitated criminal activities on the platform.

A Significant Impact

While formal charges against Durov have not been filed yet, the news has significantly impacted the TON ecosystem, with the value of the coin plummeting to $5.52 in just two hours. In light of these events, The Open Network reassured users via X, emphasizing that the ecosystem remains functional despite the arrest.

Telegram wants to assure everyone that the TON community remains strong and fully operational following the recent news concerning Pavel Durov. A post on X stated that Telegram users are being encouraged to stay calm, united, and continue building together.

Additionally, TON Ventures, a venture capital firm connected to the project, issued a statement suggesting that the arrest challenges the principles of free speech and decentralization. Others however believe that the situation is not that simple, and that Pavel was indeed involved in illicit activities.

Concerns are rising within the crypto community about the increasing centralization of Bitcoin (BTC), which some fear could undermine the fundamental principles of the flagship cryptocurrency. Recent data by BTC.com shows that two mining pools, Foundry USA and AntPool, now control about 57% of the total Bitcoin Network hashrate.

Growing Influence And Geopolitical Concerns

Bitcoin mining pools are collaborative networks where miners combine their processing power to increase their chances of mining a block, with rewards distributed based on contribution. These pools have become popular due to their stable income compared to solo mining. However, Foundry and AntPool now dominate the space, with Foundry contributing 215.79 EH/s and AntPool 153.55 EH/s out of a total network hashrate of 651 EH/s.

Experts also warn that the competition between Foundry and AntPool could have geopolitical implications. Foundry USA, part of Digital Currency Group (DCG), aligns with US interests, while AntPool, operated by Bitmain Technologies, represents Chinese influence.

Risks of Centralization

The centralization trend raises concerns about the future of Bitcoin and crypto as a whole. Developer Luke Dashjr has warned that large mining pools could compromise the decentralization aspect of BTC, potentially leading to issues like censorship. If a pool gained over 50% of the hashrate, it could execute a 51% attack. Although no pool currently holds such power, the concentration has led to instances of transaction censorship.

Additionally, mining pools must comply with economic sanctions. For example, in 2023, F2Pool censored transactions to adhere to the Office of Foreign Assets Control (OFAC) list but later reversed this decision after community backlash. There is also concern that other countries are entering the crypto mining sphere which could further contribute to increased centralization.

Nautilus Chain raised an undisclosed amount with the help of 3base. Nautilus Chain is a production-ready, modular chain built on Eclipse.

Ark Labs secured $2.50M in Pre-Seed funding with support by Draper Associates. Ark Labs is a Bitcoin Layer 2 payments network designed to simplify user experiences while maintaining self-custody.

Credbull raised $5.20M with Gnosis providing support. CredBull is a financial platform designed to help individuals and businesses access financing options quickly and efficiently.

vooi secured an undisclosed amount with support by Binance Labs. VOOI is an intent-based cross-chain perpetual DEX aggregator.

Arch Network secured $5M in Extended Seed funding with support by Castle Island Ventures. Arch Network is a Bitcoin native application platform that introduces smart contract functionality directly into Bitcoin through a novel architecture.

Fanton Fantasy Football raised $1M in Seed funding with help by Delphi Ventures. Fanton is a fantasy football game fully integrated into Telegram Messenger which features collectible cards of top football players that earn points according to their real-life performances.

g8keep secured $1.25M in Pre-Seed funding with support by Robot Ventures. g8keep addresses the flaws in token launching and trading by providing a secure and transparent platform that protects users from the inherent risks of the current systems.

Starfish Technologies raised an undisclosed amount in M&A funding with support by Humans.ai. Starfish Technologies is a company focused on building modular, scalable, and interoperable technology solutions. Their offerings include advanced frameworks and tools designed to enhance digital infrastructure, enabling efficient data management, system integration, and automation.

Skyfire obtained $8.50M in Seed funding with help by Circle. Skyfire is a financial stack designed for the AI economy, offering an instant, global payment system for AI Agents, LLMs, data platforms, service providers, and other goods and services. It enables autonomous transactions without human oversight, supported by the USDC stablecoin.

GenLayer raised $7.50M in Seed funding with support by North Island Ventures. GenLayer is a blockchain platform that extends the capabilities of traditional smart contracts by incorporating AI, transforming them into Intelligent Contracts.

Bitcoin (BTC) continued its positive price movements when it reached $65,000 for the first time since August 3rd. During the same period, several altcoins also saw significant gains, with SATS climbing 25%, FET rising 19%, and SUI increasing by 15%.

Ethereum (ETH) has gained over 3% in the past 24 hours, now sitting above $2,760. Ripple, Toncoin, Dogecoin, Tron, Cardano, Avalanche, Bitcoin Cash, and Polkadot have all experienced gains up to 5%. Among the larger-cap altcoins, Solana and Shiba Inu stand out. Both have risen approximately 6%, with SOL surpassing $150 and SHIB reaching $0.000015.

BTC On The $65K Path

The end of this business week differed notably to the previous one. BTC had dropped to $56,000 on Thursday but saw some recovery on Friday and through the weekend. Monday, however, began with a pullback as the asset fell to $58,000.

The bulls managed to step in and halt further declines, but the week remained relatively quiet until Friday evening, when positive news emerged which involved Fed Chair Jerome Powell pledging to start cutting interest rates. This news triggered a rally, causing BTC to surge to $64,000. Following a brief correction, it continued its upward trajectory, reaching $65,000 for the first time in over three weeks.

Even though BTC has retraced by around $800 since reaching $65,000, it remains 5% higher for the day, holding steady above $64,000. Its market capitalization has surged to $1.270 trillion, with its dominance over altcoins increasing to 53.8%. The overall crypto market cap has also increased by around $100 billion since yesterday, now totaling $2.360 trillion.

Other Markets

Traders on the NYSE floor are seeing gains in stocks and futures as the easing of the maturity wall, large amounts of debt maturing at once, mitigates default concerns. Central banks are aligning with Fed Chair Jerome Powell signaling potential rate cuts and a shift in focus toward improving employment rates. 

Elsewhere, Zimbabwe continues to adjust post-Mugabe, with warnings of increased blackouts due to power utility faults. Türkiye is investigating false social media claims about the resignation of its Finance Chief, and the Chinese Central Bank is cautioning against risks in bond trading while considering narrowing the rate corridor. Finally, although the African cocoa harvest may improve, factors like disease and low farmer pay are likely to keep chocolate prices stable.

Prometheum has angered nearly everyone in the crypto community, not merely due to their existence, but because of their approach to the industry. While other crypto firms are struggling to navigate tightening regulations, Prometheum has been aligning closely with regulators, causing controversy.

Why is it so despised?

The company began attracting negative attention in May 2023 when it became the first to obtain a special-purpose broker-dealer license by the SEC and FINRA. This license enables them to manage digital assets, a capability that major players like Coinbase and Robinhood have been striving to obtain for years without success. Unsurprisingly, the crypto community reacted negatively to this development.

The Blockchain Association criticized it as a sweetheart deal, and some Republican Congress members even called for a DOJ investigation to uncover how Prometheum achieved this. The situation was further aggravated because Coinbase and Robinhood had been repeatedly denied this license. Prometheum asserts they simply adhered to regulations, but many are skeptical.

Reading Between The Lines

Beyond acquiring the contentious license, Prometheum went on to classify major tokens such as ETH, UNI, and ARB as securities on their platform. This decision sparked outrage because the SEC has not yet clarified the status of Ethereum as a security. By labeling ETH, UNI, and ARB as securities, Prometheum appeared to overstep.

Critics noted the inconsistency, questioning how Prometheum could designate these tokens as securities when the SEC itself has yet to provide clarification. Despite the backlash, the company remained resolute. Ben Kaplan, CEO of Prometheum Capital, the subsidiary with the broker-dealer license, stated that their aim is to integrate the top 50 digital assets into the platform, and that Uniswap and Arbitrum are among them.

The timing is also noteworthy. As the SEC aggressively pursued legal action against various companies for selling unregistered securities, Prometheum managed to launch its services. Following Aaron Kaplan, Prometheum CEO, testifying before Congress, questions about who the early financial backers for the company, including a Chinese crypto firm, and its profitability have intensified.

Sony Group and Startale have unveiled their new joint blockchain venture, Soneium, which is their initial Ethereum Layer-2 solution designed to enhance scalability and user experience with the goal of mainstream adoption.

Last December, SBI Holdings, the primary cryptocurrency finance group of Japan, and Saudi Aramco, the second largest company in the entire world, disclosed a strategic collaboration. The partnership aimed to delve into mutual investment in their respective digital asset portfolios and the development of semiconductor facilities in both countries.

Supporting Web3 Applications

Upon its introduction, Soneium aims to support Web3 applications in various domains such as entertainment, gaming, and finance, according to Sony Block Solutions Labs. Sony Group has robust distribution networks across numerous industries and a large user base in everyday life, stated Sota Watanabe, Founder of Astar Network and Director of Sony Block Solutions Labs.

The venture is currently preparing for an upcoming testnet launch, although the specific date has not yet been announced. Technical details regarding the platform and its tools as well as developer requirements will be revealed in the coming weeks, according to Sony Block Solutions Labs.

Enhancing Liquidity

For the testnet phase, Astar Network will integrate its zkEVM assets and infrastructure with Soneium to enhance the initial liquidity of the new blockchain. Sony Block Solutions Labs mentioned that future applications of Soneium could include safeguarding creator rights and establishing new methods for equitable profit-sharing between creators and their audience.

Additionally, it was reported last month that Sony is working on launching a local cryptocurrency trading platform in Japan. The Asian country is quickly becoming a popular destination for crypto due to its advanced technological infrastructure, supportive regulatory environment, and high levels of public interest and adoption in digital currencies.

Recent reports indicate that Robert F. Kennedy Jr. is expected to no longer participate in the 2024 US Presidential Election. This news has caused PolitiFi tokens to increase by over 15% in the past 24 hours. While tokens related to RFK Jr. have decreased, Trump-themed meme coins have surged by 40%.

Moreover, it is becoming increasingly likely that Trump will end up winning the election and become United States President once again, especially since Kamala Harris has not done herself any favors by recently stating she will appoint SEC Chair Gary Gensler as Treasury Secretary if she wins.

Endorsing Trump

During this election cycle, meme coins have become a prominent narrative, with the crypto community closely tracking events through these tokens, including the forthcoming November US presidential elections.

Policies surrounding cryptocurrencies have become increasingly important among voters, especially since the Biden administration has often taken stringent regulatory actions against the industry. Consequently, candidates who support crypto have garnered substantial backing by the crypto community.

RFK Jr. has been a notable supporter of Bitcoin and blockchain technology throughout his campaign. However, recent reports suggest he will exit the race and endorse former President Donald Trump. Trump has recently engaged with the crypto industry and has begun accepting various cryptocurrencies for donations.

MAGA Skyrockets

Trump-themed meme coins have led the surge, with PolitiFi tokens rising by 15.5% in the last day.  The leading Trump-themed token, MAGA (TRUMP), experienced a significant increase. After a drop in value since late July, when it traded above $6, TRUMP had fallen to below $3 following market declines in August, marking a 41.5% decrease over the past month.

Nevertheless, TRUMP surged by 55.6% to approximately $4.14 on Thursday, currently trading at $3.70, reflecting a 40% rise in the last 24 hours. Other meme coins associated with Donald Trump also saw notable gains.

Exchange-traded funds (ETFs) are increasingly viewed as a crucial means for institutional investment in cryptocurrencies, providing a regulated channel for investors to engage with these digital assets. Typically, in many regions, including the United States, ETFs are primarily available for Bitcoin (BTC) and Ethereum (ETH).

However, there is optimism among Solana (SOL) investors that this might soon change, as Brazil has recently attracted attention with its active support for Solana ETFs. The country is set to list its first Solana-based ETF on the B3 exchange, with a second one receiving regulatory approval.

Furthermore, SOL enthusiasts are hopeful that ETF approvals can help the struggling project, especially after a lot of the meme coins on the platform were recently called scams by ZachXBT.

Advancements With Solana ETFs

On August 21st, 2024, a second Solana ETF managed by Hashdex was approved by the Brazilian Securities Commission (CVM). This ETF is now in the pre-operational stage, with further details regarding its public offering and listing to be revealed.

The move also follows the earlier approval of the inaugural Brazilian Solana ETF by the regulator. This initial fund, introduced by QR Assets and managed by Vortx, marks a significant step in the Brazilian government trying to integrate emerging technologies into its financial sector. For institutional investors, ETFs provide a more accessible route to crypto investments.

Why Institutions Prefer Crypto ETFs

Crypto ETFs may not be appealing to all investors, as their performance often lags behind the underlying assets and they incur management fees. For Solana ETFs, the trading value can exceed the actual asset value significantly, leading to potential market corrections. Despite these factors, ETFs offer considerable advantages for major institutional investors.

ETFs additionally reduce entry barriers for those interested in crypto but wary of managing digital assets directly. Institutional investors face regulatory and technical hurdles when dealing with exchanges, including risks of hacks and errors, and counterparty risks highlighted by events like the infamous FTX collapse.

Thus, ETFs enable firms, which hold most of the global capital, to invest in crypto more easily. This is why Solana investors are hopeful for a positive price impact due to these ETF approvals. Some institutions like BlackRock and VanEck have indicated that the approval of Solana ETFs may have a modest effect on the price of SOL.

The Shiba Inu (SHIB) ecosystem has advanced with the release of the Shiba Eternity closed beta, its first game on the Shibarium blockchain. Lucie, the Shiba Inu marketing lead, announced the update on X, marking a major shift towards a utility-focused ecosystem.

She also warned against scams and that users should only connect their wallet through official platforms and avoid links via unknown sources in addition to always verifying the official website address before connecting.

Making History

Lucie revealed that the latest version of Shiba Eternity is a complete overhaul rather than a simple update, before going on to claim that this is not just the old game with a few tweaks as it is instead a full transition to Web3 with major upgrades.

The game operates on the Shibarium mainnet and supports NFTs, allowing a decentralized gaming experience where inventory cards are NFTs, ensuring verifiable ownership and tradeability. The infrastructure of the game is also now built on the Shibarium blockchain, providing secure asset management and transactions. In addition, it features a ranked mode with 15 day tournaments, rewards based on performance, and exclusive events for top players.

Release Schedule

Significant improvements include an updated tutorial, refined menu, streamlined armory management, and enhanced performance. The new reward system offers better quests and faster progression, with special gifts for players who previously played the Web2 versions of the game.

The closed beta, accessible since August 21st, 2024, is available to LEASH token stakers who can connect their smart wallets via ShibaSwap. On September 5th, access will expand to holders of specific Shiba Inu NFTs, including The Shiboshis and The Shiba Eternity Lore collections. An open beta release will be announced later.

Despite recent price drops, Shiba Inu has shown notable improvements in key metrics, suggesting a potential price recovery after a period of decline.

Binance and its former CEO, Changpeng Zhao (CZ), are facing a class action lawsuit by three crypto investors who claim they could not recover their stolen assets because Binance failed to prevent money laundering. Previously, Binance.US had its license revoked by The North Dakota Department of Financial Institutions (DFI).

A Tough Spot

On August 16th, the plaintiffs filed their complaint in the U.S. District Court for the Western District of Washington. They argue that their stolen crypto was sent to Binance by thieves to hide its origin and make it untraceable. The lawsuit alleges that Binance played a key role in the laundering process, violating the Racketeer Influenced and Corrupt Organizations (RICO) Act.

Bill Hughes of ConsenSys expressed doubt about the lawsuit and its ability to prove its claims but acknowledged that it puts Binance in a tough spot. He noted that if the case advances, it could test the effectiveness of blockchain analytics and asset recovery.

No Confidence

CZ admitted guilt in November 2023 for violating U.S. money laundering laws, leading to his resignation and Binance agreeing to pay $4.3 billion in fines. CZ received a four-month prison sentence in April and began serving it in June.

Additionally, the SEC has sued Binance and CZ for misleading statements about market controls and inflated trading volumes, with most of the case allowed to proceed as of June 28th. In any case, trust in Binance has waned due to allegations of failing to prevent money laundering, misleading regulators, and inflating trading volumes, despite the exchange trying to help the industry in the past.

A federal judge in Texas has halted a new Federal Trade Commission (FTC) rule that would have simplified the process for employees to leave their jobs and join competing firms.

Overstepping Authority

On Tuesday, U.S. District Judge Ada Brown ruled in favor of a summary judgment request by the U.S. Chamber of Commerce and other plaintiffs, denying the request made by the FTC for a ruling in its favor. Judge Brown determined that the FTC had overstepped its legal authority with the rule, labeling it as arbitrary and capricious, and also found that it would result in significant, irreparable damage.

Consequently, the FTC will not be able to enforce the rule, which was scheduled to take effect on September 4th, as per the decision made by the judge. However, this ruling does not stop the agency when it comes to addressing non-compete agreements through individual enforcement actions, according to FTC spokesperson Victoria Graham.

Appealing The Decision

The FTC is also considering whether to appeal the decision, Graham noted. In April, the FTC decided to ban employers across the nation when it comes to entering into new non-compete agreements or enforcing existing ones, arguing that such agreements limit workers in terms of their freedom and overall wages.

Crypto remains to be very popular in Texas due to the favorable regulatory environment in the state alongside low energy costs, and strong tech infrastructure. These factors attract investors and companies looking for a supportive environment for digital currency ventures.

The Cardano Lace Wallet has now upgraded its paper wallet with Pretty Good Privacy (PGP) encryption to enhance security. To prove confidence in this advancement, Cardano Founder and Input Output (IO) CEO Charles Hoskinson has announced a $1 million reward for anyone who can breach the Lace paper wallet.

Crypto wallets are essential for managing digital assets and come in various forms, each with different benefits and risks. Paper wallets are simple but vulnerable to damage and theft, while hardware wallets offer added security through PIN codes or biometrics.

Hack The Paper Wallet for $1M

At the Rare Evo blockchain event in Las Vegas between August 15th to 17th, 2024, Hoskinson introduced the aforementioned new PGP encrypted paper wallet. This upgrade aims to resolve the issues of compromised private keys found in traditional paper wallets.

Public keys are openly shared for transactions, while private keys are usually secured by a seed phrase. The updated paper wallet features both keys as QR codes, with added PGP encryption for the private key.

Despite being shareable, unauthorized access is blocked by the encryption. The wallet includes an NFT, which will be exchanged for $1 million in USDM stablecoin if successfully hacked. This bounty is available until the end of 2024 or until the wallet is breached.

A Strong Security Record

Since its launch in 2017, Cardano has maintained a strong reputation for reliability and security, with no network breaches. Its decentralized, open-source platform uses scientifically validated technology to ensure reliable transactions and smart contract audits. This design helps reduce potential vulnerabilities and attack vectors.

In June, Cardano faced a spam attack that caused some network slowdowns but was otherwise managed effectively with minimal disruption. Regardless, PGP encryption is considered nearly unbreakable, and integrating it with blockchain technology shows the evolving security practices in crypto.

The expansion of Lace to support multiple assets and chains highlights an overall push by Cardano for greater interoperability. The $1 million bug bounty is impressive, but the real significance lies in the development of Lace as a secure and versatile alternative to MetaMask.