New Plan Announced For Stablecoin Regulation In The UK

Over the weekend, a major controversy erupted surrounding Binance and Coinbase, two of the largest centralized cryptocurrency exchanges, after accusations that they were demanding excessive listing fees.

The issue came to light when Simon Dedic, CEO of Moonrock Capital, questioned the listing practices of these exchanges. Dedic claimed that a Tier 1 project, which had raised nearly nine figures in capital, faced difficulties when trying to list on Binance.

The Controversy Continues

According to Dedic, after a lengthy due diligence process, Binance allegedly requested that the project give up 15% of its token supply in exchange for a listing. This fee, which could range anywhere between $50 million to $100 million, sparked significant debate within the crypto community, with many questioning whether such high charges were warranted.

The controversy intensified when Coinbase CEO, Brian Armstrong, responded to Dedic by asserting that Coinbase did not charge listing fees. This statement prompted a quick rebuttal by Andre Cronje, founder of Sonic Labs, who alleged that Coinbase had demanded up to $300 million in listing fees by his company.

Cronje also pointed out that Binance did not impose any fees on Sonic Labs. Supporting Cronje, Tron founder Justin Sun shared his own experience, revealing that Coinbase had requested 500 million TRX tokens (worth around $80 million) and a $250 million deposit in BTC for Coinbase Custody. These revelations raised concerns about potential inconsistencies in how different projects were treated.

Call For Unity

On Monday, former Binance CEO Changpeng Zhao (CZ) responded, expressing appreciation for what Sun had to say but advising against fueling public disputes within the industry. He stressed that projects should focus on development rather than prioritizing exchange listings, citing Bitcoin as an example, as it never paid any listing fees. Sun agreed, reinforcing that building strong projects was the key to success.

Binance co-founder Yi He also addressed the accusations, dismissing them as unfounded and urging the community to rely on factual research rather than rumors. She emphasized that the listing criteria for Binance are transparent and clear before outright rejecting the notion of a 20% listing fee.

On Wednesday morning, Bitcoin (BTC) surged to an all-time high (ATH), surpassing the $75,000 mark on CoinGecko, reflecting a robust 10% gain within just 24 hours. This impressive rally has been attributed to a wave of optimism sparked by early results in the U.S. Presidential Election, which has ignited hope among crypto investors about the potential for former President Donald Trump to once again secure victory.

The Trump Card

The new ATH marks the second record-setting milestone of the year for the flagship crypto, following a similar peak in March. The earlier rally was seen as the end of the prolonged crypto winter, a period of stagnation that had kept digital asset prices in check for several years. With this latest surge, Bitcoin is signaling continued strength and resilience, building on the momentum of its earlier recovery.

Investor excitement around this sharp rise has been closely tied to Donald Trump and his vocal support for cryptocurrencies. As part of his campaign platform, Trump has made it clear that he sees cryptocurrencies, particularly Bitcoin, as a powerful tool for the future of the U.S. economy.

His stance has resonated with many in the crypto space, who have grown frustrated with the U.S. Securities and Exchange Commission (SEC) under Chairman Gary Gensler. Trump has even pledged to replace Gensler, whose stringent regulatory approach has often been seen as a hindrance to the growth of the industry.

Politics And Crypto

In addition to his criticisms of the SEC, Trump has also proposed the creation of a national Bitcoin reserve, a bold idea that has captured the imagination of crypto enthusiasts. Such a move would undoubtedly be seen as a major win for the digital asset ecosystem, providing institutional legitimacy and potentially boosting the value of BTC even further.

The positive sentiment surrounding Bitcoin has also had a ripple effect on the broader cryptocurrency market, lifting the prices of various altcoins and tokens. However, after peaking above $75,000, Bitcoin has seen a slight pullback.

Overall, this recent surge highlights the growing influence of political events on the crypto market, as well as the increasing recognition of Bitcoin and other cryptocurrencies as key players in the financial landscape.

A group of companies spanning traditional finance and the crypto sector, including Robinhood, Galaxy Digital, Kraken, and Paxos, have come together to support a new stablecoin pegged to the U.S. dollar. Other countries such as the United Kingdom have also previously gotten involved with stablecoin regulation.

In a statement on November 5th, 2024, Paxos, a blockchain infrastructure provider, revealed that the newly established open network aims to boost the global adoption and usage of stablecoins. The network is intended to foster worldwide adoption of the new USDG stablecoin, which was launched on November 1st by Paxos.

A Disruptive Initiative

Kraken co-CEO Arjun Sethi commented that the absence of competition in the regulated stablecoin market has held back the industry and its potential. USDG disrupts this by offering a fairer model that will attract mainstream participants and spur new stablecoin use cases, he added.

Initially available only on the Ethereum (ETH) blockchain, Paxos intends to expand USDG to other networks as regulatory landscapes evolve. Paxos will issue USDG out of Singapore, with the firm stating that it fully complies with the stablecoin regulatory framework provided by the Monetary Authority of Singapore. Eligible participants, including custodians, exchanges, and fintech companies, will be able to join the Global Dollar Network by invitation.

Enabling Broader Adoption

The backing of the stablecoin with the U.S dollar will be managed by DBS Bank, the largest financial institution in Singapore. USDG will be fully backed on a 1:1 basis with USD, held in deposits, short-term U.S. government securities, and other liquid assets, ensuring that tokens can be redeemed for fiat currency when needed.

Ronak Daya, who serves as the Head of Product at Paxos, emphasized that the partnership with DBS will enable broader enterprise-level adoption of the stablecoin. In addition to USDG, Paxos offers other digital assets such as PayPal USD (PYUSD), Pax Dollar (USDP), and Pax Gold (PAXG).

The launch of USDG and its Global Dollar Network will introduce competition in a market largely dominated by two main stablecoin issuers, namely USDT and USDC, which together account for 56% and 27% of the stablecoin supply on Ethereum, according to DefiLlama.

This year, crypto has seemingly finally found its political champion, Donald Trump. For years, the industry struggled to find a figure who could speak to its values of freedom and innovation. Now, Trump is stepping into that role, with promises like a Bitcoin Strategic Reserve, freeing Ross Ulbricht, and even launching his own DeFi project.

His actions and words align with the crypto crowd, drawing millions in donations and support. Trump has displayed a sense of political flexibility that makes him the ideal ally, especially as the crypto community seeks a friend in Washington. But as much as crypto might be excited about this new alliance, there are serious reasons to be cautious.

A Certain Risk

Trump has a history of changing his stance on key issues and this raises doubts about his commitment to crypto. His unprincipled nature is well documented, and he has also been criticized for undermining Constitutional norms to suit his needs. Given his track record and history of going back on his word, it is hard to believe he will follow through on his crypto promises.

Moreover, while crypto has aligned itself with the Republican Party, this can alienate potential supporters on the left. Many in the industry back conservative candidates, and inflammatory comments by crypto advocates only widen the divide. If crypto wants to grow beyond its current base, it needs to avoid divisive rhetoric that turns away key groups, especially liberals and the LGBTQ community, both of which despise Trump.

Controversial Policies

Supporting Trump means supporting more than just crypto-friendly policies. If the industry backs him, it could also be endorsing his stances on immigration, abortion, and other divisive issues. Indeed, associating with Trump and his broader political agenda could damage the crypto industry and its desire to appeal to a wider audience.

In short, while supporting Trump might seem like a win for crypto, it comes with certain risks, both in terms of his reliability and the broader political baggage he brings. Crypto should be careful what it wishes for, as this alliance could have unintended consequences.

As part of an ongoing detailed investigation, several digital analysts have accused YouTuber Jimmy Donaldson, better known as MrBeast, of amassing wealth through various cryptocurrency scams and exploiting his fanbase.

A Troublesome History

The team behind the website Loock.io claims to have uncovered connections to over 50 wallets tied to MrBeast, suggesting a history of insider trading, misleading investors, and promoting tokens only to sell them later. They assert that his public ties to crypto promoters indicate he was tipped off about projects before their values surged.

With alleged involvement in questionable ventures, MrBeast is said to have earned $23 million in digital currencies, a staggering amount given his existing wealth. Jimmy is not the only YouTuber to get in trouble for promoting crypto-based scams, as others like KSI and Logan Paul have found themselves in similar hot waters.

Hard To Digest

The Loock team, including analysts Kasper Vanderloock and others with cryptic handles, has tracked a significant network of wallets all linked to Jimmy for years, starting with his NFT purchases in 2021, when those assets still had value.

While this investigation is intriguing, Gizmodo notes that it can be difficult to digest, even for crypto-savvy individuals. The allegations are not surprising, considering the fact that Donaldson has a history of controversies, including misleading children in giveaways and creating a toxic workplace environment on his Beast Game show.

Meme coins inspired by the beloved pet squirrel and social media star Peanut have recently emerged as exciting new opportunities for cryptocurrency enthusiasts looking to capitalize on trends.

Notable Surges

In a striking development, a token named PEANUT on the decentralized exchange (DEX) Uniswap saw an impressive surge of over 58% in just 24 hours, elevating its market capitalization to around $2.2 million, as reported by CoinMarketCap.

Meanwhile, a similarly named coin launched on the Solana SOL/USD-based DEX Raydium skyrocketed by a remarkable 336% during the same period, though it holds a much smaller market cap of $33,790.

However, it is crucial to note that the liquidity of these tokens remains very low. They are not listed on major cryptocurrency exchanges and are only available on DEXs, leaving them vulnerable to dramatic price fluctuations. Think of it like a rare collectible, as while the excitement can drive up its value, the limited market can lead to significant swings.

Elon Chimes In

The significance of this trend has been amplified by recent events surrounding Peanut, whose untimely death has ignited passionate discussions just ahead of the U.S. Presidential Elections. New York state officials confiscated and euthanized Peanut, along with a raccoon named Fred, citing concerns about potential rabies exposure. This decision triggered an outpouring of outrage across social media, with influential figures and fans expressing their sorrow.

Notably, tech mogul and Republican supporter Elon Musk weighed in, tweeting that President Donald Trump will save the squirrels, along with a heartfelt message of condolence. His post resonated with many, highlighting the emotional connection people have formed with Peanut, who had amassed 666,000 followers on Instagram.

As the conversation surrounding Peanut continues to unfold, it serves as a poignant reminder of the intersection between digital culture and real-world events, reflecting how a small creature can capture hearts and influence trends in unexpected ways.

Delabs Games raised an undisclosed amount in Strategic Funding with assistance by TON Ventures. Delabs Games is a Web3 game studio whose development principle is to build interesting Web3 games from the ground up.

Citrea obtained $14M in Series A Funding with help by Founders Fund. Citrea is a rollup that utilizes Bitcoin but enhanced by zero-knowledge technology, enabling the development of applications directly on Bitcoin without altering its consensus rules.

Triangle secured an undisclosed amount in M&A Funding with support by Bridge. Triangle is a multi-chain Web3 infrastructure platform offering a robust API for wallet, payment, DeFi, NFT, and gaming integrations.

Axal raised $2.50M in Pre-Seed Funding with assistance by CMT Digital. Axal is a platform that makes agents usable and verifiable for tasks across the Internet. Axal allows users to specify tasks through simple natural language or programmatic interfaces.

Gunzilla Games obtained an undisclosed amount with help by VanEck. Gunzilla Games is a AAA game studio focused on creating their new platform called GunZ, empowering players by granting them complete ownership over their in-game possessions.

Alliance Games acquired $5M in Series A Funding with assistance by Animoca Brands. Alliance Games offers decentralized infrastructure for community-owned gaming, providing chain-agnostic hosting, data storage, and AI-powered game creation.

Ellipsis Labs secured $21M in Extended Series A Funding with help by Haun Ventures. Ellipsis Labs builds sustainable and efficient DeFi protocols on high-throughput decentralized infrastructure.

OpenOrigins raised $4.50M in Seed Funding with support by Galaxy. OpenOrigins is a blockchain content verification platform that combats fake media by using blockchain technology to verify the authenticity of photos, videos, and other digital content.

MagmaDAO acquired $3.90M in Seed Funding with assistance by Animoca Brands. MagmaDAO is a DAO-owned liquid staking protocol built on the Monad blockchain, offering equitable token distribution through its Points Programs.

Sapien obtained $10.50M in Seed Funding with help by Variant. Sapien leverages blockchain rewards to gamify data labeling, a crucial process for enhancing AI-powered language learning models such as ChatGPT.

Bitcoin (BTC) saw its price rebound recently which brought it to $71,500 yesterday, but bears stepped in and pushed it down by about $2,000 to its current price of around $68,000. Most altcoins are also showing little movement today, which is somewhat anticipated, except for ADA, which has emerged as the standout performer.

BTC Peaks At $71.5K
The week started positively for Bitcoin, which rose above $70,000 on Tuesday, reaching a multi-month high of $73,600. This was just $150 shy of its March all-time high of $73,740. However, it could not surpass this level, and as expectations built, it gradually declined. A significant drop occurred Friday morning when it fell below $69,000, losing $3,000 in just a few hours.

The bulls rallied later in the day, driving Bitcoin back up to $71,500 following a disappointing U.S. jobs report for October. However, it struggled again at that level and now sits about $2,000 lower. Currently, the market capitalization for Bitcoin has fallen back to $1.375 trillion, while its dominance over altcoins remains strong at over 56%.

ADA Stands Out
Today, most major altcoins have remained stable, showing only minor fluctuations. ETH, BNB, SOL, XRP, TRX, AVAX, and LINK have all experienced slight declines of around 1-2%, while DOGE, SHIB, and TON have recorded similar gains.

As previously mentioned, ADA is the only major altcoin making significant gains, rising by 6% to trade above $0.35. Other notable gainers include RAY (14%), XMR (5%), and MEW (5%). Overall, the total cryptocurrency market cap has stayed relatively steady, just under $2.450 trillion.

Other Markets

Global markets are seeing significant fluctuations as investors respond to uncertainties following both the Japanese elections and the upcoming U.S elections. However, Wall Street is experiencing a rebound driven by dip-buying activity. Federal Reserve Chair Jerome Powell is at a crucial juncture, with the upcoming Jackson Hole symposium in focus. The Fed and other central banks plan to implement rate cuts after either Kamala Harris or Donald Trump become President.

In Europe, German banks are reducing their exposure to U.S. office loans, which have contributed to recent bond market turmoil. Concerns are mounting on Wall Street as the market braces for potential negative news. In the United Kingdom, Thames Water is preparing for its results and a regulatory report, while reports indicate that KKR is interested in acquiring a stake in the company.

In the tech sector, the Microsoft Experience Center awaits earnings announcements, but tech earnings have so far failed to meet high expectations. As the Farnborough International Airshow opens, Boeing bankers are expected to earn up to $300 million in capital raise fees.

Finally, Nvidia is set to replace Intel in the Dow Jones Industrial Average, and the London Stock Exchange is celebrating the 40th anniversary of the FTSE 100. Meanwhile, a significant reshuffle is on the horizon for $7 trillion in funds due to changes in the Russell Index, highlighting the dynamic nature of contemporary financial markets.

UBS, the largest private bank in the world, has officially announced the introduction of uMINT, which stands for UBS USD Money Market Investment Fund Token, a tokenized investment fund utilizing the Ethereum (ETH) blockchain.

High Quality Offerings

While UBS did not specify the financial instruments included in the fund, it mentioned that it offers investors access to high-quality money market instruments within a conservative, risk-managed framework, as stated in their press release.

Thomas Kaegi, co-head of the UBS Asian division, noted that the bank has observed an increasing interest among investors for tokenized financial assets across various asset classes. Currently, Ethereum is recognized as the leading blockchain for real-world asset tokenization, according to RWA.xyz, which reports over $3 billion in tokenized assets on the platform.

A Steady Increase

Approximately $3.9 billion in assets have been tokenized on-chain, excluding private credit, with U.S. Treasury Debt comprising the largest portion. Moreover, the value of tokenized assets on Ethereum has risen nearly 4% over the past month.

$BUIDL (by BlackRock) holds the highest market cap for U.S. Treasury products at over $523 million, while $FOBXX (by Franklin Templeton) has a market cap of around $408 million. Earlier on in 2024, Ethereum demonstrated notable progress in the percentage of investors maintaining their assets for over a year, marking a significant milestone for the blockchain.

During a recent appearance at the Chainlink SmartCon at Hong Kong Fintech Week, Tron founder Justin Sun shared his insights into various topics, including the fairness of meme coins compared to venture-capital-backed tokens and what kind of role Chainlink has in integrating traditional finance (TradFi) within the Tron ecosystem.

The Case For Meme Coins

Sun articulated a strong case for meme coins, emphasizing the concept of a fair launch as a key advantage. He noted that the transparency of meme coins allows the community to track movements, which serves as a safeguard against sudden price drops that can occur when large amounts of assets are moved without community knowledge.

Sun has witnessed the fallout via rug pulls in the crypto space, where developers abandon projects, leaving investors in the lurch. He believes that a commitment to fair distribution is essential for any meme coin developer aiming for success.

He also briefly talked about the evolving market structure, where major cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) coexist with meme coins and venture-capital-backed tokens. Sun expressed confidence in a trend that favors community engagement, citing recent launches on the HTX platform that have yielded impressive returns, often exceeding 100%.

In contrast, tokens listed on Binance have faced disappointing performance, with some declining by as much as 50%. Sun highlighted that while getting listed on Binance can take up to six months, HTX prioritizes tokens backed by strong communities, enabling returns as high as 500x.

Future Aspirations

Looking ahead, Sun is focused on enhancing USDD, a fully decentralized stablecoin by Tron. Justin sees USDD as a necessary alternative to many stablecoins currently on the market, especially DAI. By the end of the year, he aims to upgrade the USDD smart contract system to bolster its functionality and decentralization.

In tandem with the Chainlink collaboration, Tron plans to engage with DeFi developers and industry leaders like Aave to explore new opportunities. Additionally, the Tron team is set to launch various innovative meme coin projects, including those themed around artificial intelligence, by early next year.

Coinbase recently saw its shares experience their largest single-day drop in over two years after the company released its latest earnings report, which fell short of expectations and coincided with a significant downturn in the stock market.

Despite this setback, traders remain optimistic about a recovery for the stock in 2025. On October 31st, 2024, COIN closed at $179.25, marking a 15.34% decrease, the steepest intraday decline since July 26th, 2022, when it dropped 21% during an SEC investigation. After hours, COIN experienced a slight rebound of 1.43%.

Falling Short

Crypto trader Pickle, who has 16,100 followers on X, expressed confidence in the company and its future earnings, predicting a strong performance in Q1 and Q2 of the following year, and suggested that the current market reaction to the earnings call is exaggerated. 

It was reported on October 30th that the Q3 2024 earnings for Coinbase were approximately 11% below what Wall Street had estimated. Still, confidence in COIN remains strong, with Pickle highlighting that the summer months tend to be quieter for all markets, and he anticipates a rise to $600 for COIN. The exchange reported a 27% quarter-over-quarter decline in transaction revenue, totaling $573 million, yet this still represents a more than 98% increase compared to Q3 2023.

Room For Improvement

Market analyst Geert Leysen noted that COIN still holds plenty of potential for growth, especially in relation to Bitcoin (BTC) and its  performance. Traders are also closely monitoring the upcoming U.S. elections on November 5th, which could introduce increased market volatility.

Meanwhile, crypto trader Cable remarked on the surprising fact that COIN is still trading below its IPO price of $250 which was reached in April 2021. Overall, October 31st proved challenging for the stock market, with analyst Andrew Lokenauth reporting that over $950 billion was lost.

In the midst of this volatility, traders noted that MicroStrategy (MSTR), led by Michael Saylor, has surpassed Coinbase in market capitalization, with MicroStrategy now valued at $49.5 billion. In related news, Coinbase recently integrated support for the Bitcoin Lightning Network, a solution facilitating faster and more affordable BTC transactions.

On Wednesday, Kraken announced it will be laying off 15% of its workforce, equating to 400 jobs, as part of a corporate restructuring that includes a leadership change. Arjun Sethi has been appointed co-CEO alongside Dave Ripley, who took over after the founder, Jesse Powell, gave up the position in 2023.

As part of its efforts to work alongside regulatory authorities, Kraken previously hinted at potentially delisting the USDT stablecoin. Since then though, the crypto exchange has reassured users that it does not intend to remove USDT in Europe and will continue adhering to all legal obligations.

Key Departures

The layoffs will see significant departures as far as the leadership team is concerned, notably Chief Operating Officer Gilles BianRosa and Chief Technology Officer Vishnu Patankar. The new co-CEOs explained that streamlining operations is aimed at creating a more agile and competitive organization, with the goal of becoming the largest cryptocurrency platform globally.

In a blog post, they stated that Kraken remains fully committed to making organizational discipline decisions in order to effectively eliminate layers while simultaneously improving on pre-existing features and services and adding new ones.

A Leaner Approach

Kraken has faced various challenges, including divisive internal policies under Powell, which led to a culture clash within the company and a federal investigation for potential sanction violations, resulting in his resignation later that year. In 2022, Kraken also cut 30% of its staff following the collapse of the FTX exchange, marking this latest round of layoffs as its second major cut in under two years.

Despite a partial recovery in the cryptocurrency market and Bitcoin (BTC) reaching new highs this year, Kraken is opting for a leaner approach. The company reported over $1 billion in net revenue, but the co-CEOs believe that a simplified management structure will allow employees to prioritize building over managing.