Longtime MarginFi leader Edgar Pavlovsky has stepped down amidst various reports of internal discord at mrgn, which is the builder of the protocol. The former CEO of MarginFi resigned on Wednesday as internal fissures at the major Solana DeFi project became public.

Pavlovsky cited disagreements with internal and external practices as reasons for his resignation. MarginFi experienced a tumultuous day with significant capital outflows following the departure of Pavlovsky.

 

The Pressure Is Mounting

The protocol is under intense pressure to launch a new crypto asset for its users. The pressure stems via Telegram, X, and various other sources. In addition, a lot of individuals feel as if they have been farmed for TVL without actually receiving the airdrop which they would have expected through a points program.

MarginFi, MacBrennan, and mrgn had little to say about when, if at all, they would launch a governance token that decentralizes decision-making. Such an asset would theoretically allow holders to vote on operations concerning MarginFi. If it were airdropped to users, it would most likely result in a windfall for the thousands of point earners who have farmed MarginFi since July 2023.

 

Damage Control

The company assured users that operations would continue unaffected despite the leadership transition. MarginFi had faced issues with its withdrawal function and a lack of communication regarding reward payouts, leading to dissatisfaction among some users. Pavlovsky acknowledged organizational shortcomings as a primary issue.

Now that Edgar has stepped down, the future of MarginFi is uncertain, with potential successors like MacBrennan Peet emerging. Solend, a competitor, capitalized on these struggles by offering an airdrop to users who switched to their platform. Moreover, the future plans of MarginFi regarding a governance token remain unclear. Despite the upheaval, the collaborative event between MarginFi and Cypher, mtnDAO, will proceed as scheduled. Pavlovsky expressed a willingness to reflect and evolve following his resignation.

 

The SEC recently initiated legal proceedings against UniSwap (UNI) with the aim of impeding the rapid expansion of the DeFi sector. The US Securities and Exchange Commission (SEC) has served a Wells Notice to Uniswap, the primary platform in decentralized finance (DeFi), notifying the company of its intention to initiate legal action.

 

Another Investigation

Uniswap is currently under investigation by the SEC. The specific allegations against Uniswap Labs, the entity behind the Uniswap protocol but lacking control over it, remain unclear. However, drawing on recent lawsuits against other cryptocurrency firms such as Coinbase, it is possible that the SEC may assert that Uniswap Labs is offering unregistered securities to the public or operating without registration as a broker or exchange.

Recently, Uniswap announced that its protocol has facilitated over $2 trillion in transactions, indicating the increasing interest from mainstream finance in this technology. Sources close to Uniswap Labs informed Fortune that the company is gearing up for a legal battle in court, asserting that its decision to operate transparently in New York rather than offshore underscores its legitimacy.

 

Fighting Back

In response to the litigation threat by the SEC, UniSwap founder Hayden Adams confirmed that Uniswap Labs indeed received a Wells notice courtesy of the SEC. Hayden went on to say that he is not taken aback, but rather, he is simply infuriated, frustrated, and ready to defend both Uniswap and its community.

However, the founder continued, it has become evident over time that the SEC has opted to target reputable organizations like Uniswap and Coinbase instead of establishing clear and informed regulations. Meanwhile, entities like FTX have been overlooked. This legal battle will likely extend over years, possibly reaching the Supreme Court, with the future of financial technology and the crypto sector hanging in the balance.

Hayden concluded his statement by stating that together, the community can emerge victorious and that the pursuit of freedom is indeed worth fighting for.

 

The recent prohibition imposed by the Philippines Securities and Exchange Commission (SEC) on Binance has sparked concern among Filipino crypto investors regarding the status of their digital assets. According to Attorney Paolo Ong, representing the SEC, the ban forms part of broader regulatory measures aimed at ensuring compliance, encompassing not only Binance but also other platforms operating without adherence to regulations.

 

A Major Crackdown

The situation surrounding Binance reflects the wider regulatory crackdown on crypto exchanges in the Philippines, with about 14 platforms barred in 2023 for similar non-compliance issues. Ong stressed that the SEC is not solely targeting Binance, indicating a uniform approach to safeguarding investors.

In a similar context, eToro received warnings for lacking necessary registrations and licenses, echoing regulatory challenges faced by Binance. Both platforms were flagged for operating without SEC approval, underscoring the importance of adhering to regulatory standards in the region. Regarding concerns of Binance users regarding accessing their funds, Ong mentioned the existence of a grace period initiated through a November advisory, providing ample time for users to transfer their assets from the platform.

 

Mixed Opinions

The SEC is in the process of drafting regulations to regulate the burgeoning crypto transactions in the Philippines, which amounted to $80 billion in 2023. The establishment of the Innovation Office aims to educate the public on the risks and opportunities associated with new financial technologies, while finalizing the regulatory framework.

Despite the clear stance of the SEC, neither Binance nor eToro has sought a license to operate in the Philippines, indicating a gap in efforts to comply with local financial regulations. While some would claim that this situation underscores the commitment by the SEC to protecting investors and ensuring that financial platforms operate within the confines of the legal framework, others believe that this is simply another attempt by the authorities to curb freedom and financial independence, two aspects which the cryptocurrency community deem crucial.

 

Harvest Fund Management, along with several prominent Chinese equity funds, has reportedly filed requests for spot BTC ETFs. Chinese mainland-based equity funds are said to have submitted applications for introducing spot Bitcoin exchange-traded funds (ETFs) via their Hong Kong subsidiaries. This development coincides with a month-long upsurge in cryptocurrency prices and heightened endeavors by Hong Kong to position itself as a global fintech center.

 

Chinese Equity Funds Seek Bitcoin ETFs

As per Security Times, a Chinese state-owned newspaper, not all the applying companies have been disclosed. Nonetheless, it is confirmed that the Hong Kong branch of Harvest Fund Management is among those seeking approval by the Securities & Futures Commission (SFC) of Hong Kong since January. In December 2022, the branch launched futures crypto ETFs, marking the inaugural futures crypto ETF development in Asia. The SFC had authorized virtual asset futures ETFs for public offering on October 31st, 2022.

In the meantime, the Hong Kong division of China Asset Management, a major Chinese asset management company, has purportedly engaged in a cooperation agreement with HashKey, a licensed crypto exchange in Hong Kong. This partnership aims to jointly promote and advance initiatives related to Web3 within the country. Although a concrete timeline for spot Bitcoin ETFs in Asia has not been announced, industry insiders suggest that relevant applications could emerge as early as this quarter.

 

Growth In Hong Kong

In December, the Hong Kong Monetary Authority and the SFC announced their readiness to consider applications for spot crypto ETFs. Subsequently, the U.S. Securities and Exchange Commission approved the first spot Bitcoin ETF in January of this year. Furthermore, the largest Bitcoin futures ETF in Hong Kong, namely the CSOP Bitcoin Futures ETF, saw a fivefold increase in assets under management over the past five months, reaching just over $100 million.

Hong Kong is striving to position itself as a leading global crypto hub. At the opening ceremony of the 2024 Hong Kong Web3 Carnival, Edmond Huang, Deputy Secretary of the Financial Services and the Treasury Bureau of Hong Kong, emphasized renewed commitment by local authorities toward amending relevant laws to subject over-the-counter (OTC) trading of virtual assets to formal regulatory oversight. Additionally, the city aims to empower intermediary institutions to provide various virtual asset services, including futures and ETF trading, highlighting its efforts to embrace and regulate the growing virtual asset sector.

 

Although the price movement for ADA, the native token for Cardano, has remained relatively stagnant, founder and CEO Charles Hoskinson remains optimistic. Still, critics suggest that investors have shifted their focus elsewhere. According to Charles, individuals who emerge successful concentrate on the long run, and that is exactly what Cardano plans to do.

While Hoskinson shrugged off the criticisms, skeptics argue that his continued emphasis on principles and technical prowess is not sufficient in an industry dominated by memes and flashy projects. Charles, on the other hand, believes that there is more to a viable project in this industry than just blindly following current trends and copying others.

 

Is Cardano Facing Extinction?

Influencer Ben Armstrong spearheaded the concerns in a recent video pondering whether Cardano is obsolete. Despite expressing admiration for both the project and its founder, Armstrong acknowledged that other layer 1 blockchains, such as Solana and Avalanche, are advancing in terms of price gains and user adoption.

Although Armstrong clarified that he has not abandoned Cardano, he suggested that the new wave of retail investors are attracted to more trendy and unconventional projects, which Cardano does not necessarily represent. Similarly, Cyber Capital founder Justin Bons argued that Cardano lacks significant advantages, even failing to uphold the decentralization narrative it clings to. Rather than succumbing to criticism, Hoskinson appeared optimistic about Cardano, stating that the project holds all the cards concerning scalability, governance, and innovation.

 

Time For Upgrades

Hoskinson highlighted several eagerly anticipated upgrades on the Cardano roadmap as evidence of continued progression. Among them is the forthcoming Chang hard fork, which will introduce on-chain community governance, and Ouroboros Leios, representing a significant step forward in addressing the blockchain trilemma, according to Hoskinson.

In essence, Hoskinson argued that successful projects are built on solid fundamentals, supported by a respectful community. Despite his optimism, discontent among Cardano supporters continues to grow, with many feeling that the project is falling behind rival layer 1 blockchains. While the exact reasons remain unclear, many attribute the issue to perceived deficiencies in marketing efforts.

Regardless, whether one is a staunch ADA supporter or views the project skeptically, Hoskinson evidently believes in Cardano and anticipates the market recognizing its value in the long term. The upcoming Chang hard fork, marking the Voltaire era, introduces community governance, allowing ADA holders to vote on critical proposals.

 

Mezo and Monad Labs both made waves with their recent funding rounds, raising $21,000,000 and $225,000,000 respectively, showcasing growing investor confidence in blockchain projects. For Mezo, Multicoin Capital and Draper Associates were the main investors, with Pantera Capital leading the charge. Paradigm was the lead investor for Monad Labs.

 

Yield Guild Games (YGG) secured strategic backing, reflecting the rising prominence of GameFi ventures in the market. Elsewhere, Lumoz and Ritual raised $6,000,000 and $2,000,000 respectively, underlining the continued interest in blockchain infrastructure and services.

 

QuantAMM garnered $1,850,000 in pre-seed funding, emphasizing the burgeoning potential of decentralized finance initiatives. Elsewhere, both Spotlight and Cellula raised $2,000,000 each, indicating a diverse range of investments across social and gaming sectors.

 

Other notable names included Zulu Network which raised $3,000,000, Zeus Network which raised $8,000,000, IoTeX which raised a whopping $50,000,000, and LightLink which raised $1,700,000.

 

These investments signal a promising future for blockchain innovation across various sectors. Excited to witness the continued growth and evolution of these projects! Be sure to follow CryptoWeekly for all the latest information on crypto, blockchain, AI, and more.

As per recent filings, three prominent cryptocurrency advocacy entities have affirmed their backing of Roman Storm, the developer behind the cryptocurrency mixer Tornado Cash, who is currently facing allegations by the US Department of Justice (DOJ). The Blockchain Association and Coin Center DeFi Education Fund both submitted amicus briefs on April 5th in support of Storm's motion to dismiss the charges leveled against him.

Storm, an American national and one of the creators of the platform, was indicted alongside Roman Semenov, who is currently missing. Moreover, the co-founder of the crypto mixer, Alexey Pertsev, is undergoing trial in the Netherlands. Storm was arrested by US authorities for his involvement with Tornado Cash, and along with other individuals, he was charged with operating an illicit money transfer business and conspiracy to commit money laundering.

 

Clarity Is Key

The Blockchain Association criticized the characterization of Tornado Cash by the DOJ as an illicit money transmission operation. They argue that the platform lacks control over the assets of their users, as required by FinCEN regulations, and therefore should not be classified as such. This perspective challenges the legal basis of one of the main charges against Storm and his associates.

On the other hand, the DeFi Education Fund questioned the invocation by the DOJ concerning the International Emergency Economic Powers Act (IEEPA) in the case of Storm. They argue that such an interpretation could unfairly hold developers accountable for how others use their software and potentially stifle innovation in the software development sector. The Fund warned that this interpretation of the IEEPA could have severe consequences.

 

Defending Tornado Cash Devs

Addressing the charge of conspiracy to commit money laundering, the amicus brief by Coin Center argued that Tornado Cash primarily serves as a privacy tool rather than a conduit for illicit activities. They draw an analogy between the use of cars by criminals and the use of computers by individuals, asserting that developers cannot be held responsible for all user actions.

Furthermore, Coin Center highlighted the efforts by Tornado Cash developers to block known espionage actors when it comes to accessing the service. They argue that this demonstrates a commitment to responsible oversight and contradicts allegations that the developers were indifferent to any and all malicious usage of the platform.

 

Nayib Bukele, the President of El Salvador, revealed a strategy to provide 5,000 complimentary passports to highly skilled professionals globally, highlighting its potential impact on the future of the nation. The development unfolded when Bukele announced via X that El Salvador aims to offer 5,000 free passports, valued at $5 billion in their passport program, to proficient scientists, engineers, doctors, artists, and thinkers via international locations.

 

The Perks Of Relocating

The President stressed that this accounts for less than 0.1% of the El Salvador population, assuring no complications in granting them full citizenship, including voting rights. Additionally, he pledged zero taxes and tariffs on relocating families and assets, encompassing items of commercial value such as equipment, software, and intellectual property.

This initiative is significant considering the fact that the El Salvador passport currently stands at 38th in the Henley Passport Index, providing visa-free access to 136 destinations all over the world, including numerous countries across both Western Europe as well as South America.

 

Becoming A Global Destination

The decision aligns with the recent endeavors made by President Bukele to attract foreign investment and talent. Previously, the local Congress passed a migration law facilitating expedited citizenship for foreigners who contribute Bitcoin to various social and economic development projects in the country.

Moreover, El Salvador made history by becoming the first country to adopt Bitcoin as a legal tender, a move which sent shockwaves reverberating across the globe. Now, the latest announcement by President Bukele is being viewed as a continuation of these efforts to position El Salvador as a global center for innovation and talent.

 

Bitcoin experienced a contentious week regarding its price movements. It dropped to a ten-day low at one point, only to surge nearly five thousand dollars the following day, though it could not maintain this momentum. NEAR and STX, along with TON and AVAX, have shown notable gains among the larger-cap altcoins.

The altcoins also faced weekly setbacks but have mostly recovered after recent retracements. Dogecoin stands out as the most significant gainer among larger-cap altcoins, jumping by 5% and reclaiming the $0.18 level. The total crypto market cap has risen by about $30 billion since yesterday, reaching $2.665 trillion on CoinGecko.

 

The Volatility Continues

In pursuit of $68K, Bitcoin encountered a volatile week. It failed to surpass $71,000, leading to a two-thousand-dollar price drop. Despite briefly reaching $70,000 on Tuesday, bears drove another downward leg, resulting in a sharper decline to $66,000. The pressure persisted, pushing Bitcoin to a ten-day low around $64,500. This coincided with reports of the US government transferring 2,000 BTC to Coinbase, confiscated via Silk Road, fueling fears of a significant sale and contributing to the price decline.

However, Bitcoin rebounded after the crash, jumping by nearly five thousand dollars the next day, reaching just over $69,000. Yet, it fell back to $66,000 yesterday. Currently, Bitcoin is hovering around $69,000 after bulls regained control. Its market cap has risen to $1.340 trillion, with dominance over altcoins at 50.3%. Most altcoins saw declines in recent days but have now turned positive, with minor gains. ETH, BNB, SOL, XRP, ADA, SHIB, and DOT have all risen by 1-2% in a 24 hour period.

 

Other Markets

Investors exhibiting boldness in the stock market are now taking precautionary measures by initiating hedging strategies, as the Federal Reserve appears to have paused its policy pivot. A gradual slowdown in inflation is prompting the Fed to exercise caution regarding potential rate cuts. In Europe, investors are avoiding the riskiest high-yield bonds due to increasing concerns about defaults. Meanwhile, there is a quest to uncover the true secret behind successful art investments which have burst onto the scene as of late.

Elsewhere, New Zealand has implemented stricter regulations on worker visas, citing concerns over unsustainable migration, while Xcel Energy is announcing power cuts in parts of Colorado due to high winds. Market mogul Lemann is expressing efforts to salvage Americanas following a $5 billion fraud scandal, and there is ongoing intervention by the Hong Kong Monetary Authority impacting various currencies. Lastly, preparations for the eclipse in New York range include adventurous activities like skydiving to more serene options like wine tasting, while Puig Group SL in Spain is reportedly gearing up for an IPO filing as early as Monday.

Blockchain investigator ZachXBT claims that the Criminal Investigation (CI) Unit of the United States Internal Revenue Service (IRS) has engaged in what he perceives as borderline harassment in their attempts to enlist his help in blockchain investigations.

In a post dated March 6th on X, ZachXBT stated that while he has been willing to assist victims and support law enforcement with necessary information, he believes that the U.S. law enforcement agency has violated his personal boundaries in their pursuit of his assistance in solving blockchain-related crimes.

 

Personal Boundaries

ZachXBT alleged that the Fed have appeared in person at previous addresses, contacted personal email addresses using private data, and sent mail despite his availability through public contact methods.

One of the images shared by ZachXBT included an email via an IRS-CI special agent seeking his assistance and commending his impressive work in blockchain tracing. The email acknowledged the limited expertise of the agent in the blockchain industry and expressed a desire to learn more through ZachXBT. Still, the blockchain investigator criticized the multiple forms of contact as a blatant disregard for professionalism.

 

Reorganizing Priorities

The incident follows continued refusal by ZachXBT to aid holders of the Complex (SIMPLE) meme coin, minted on the Base blockchain after its developers abruptly terminated the project on April 4th. He expressed discontent with spending significant time helping individuals who choose to invest in speculative meme coins rather than assisting genuine victims.

In contrast, the IRS has been strengthening its partnerships with prominent figures and companies in the blockchain tracing field. In May 2023, it was reported that IRS-CI Chief Jim Lee emphasized the importance of continued collaboration with blockchain analytics firm Chainalysis, stating that their partnership has become indispensable for investigating crypto-related crimes. Lee highlighted that without the infrastructure and tools provided by Chainalysis, any efforts by the unit to combat crypto-related crimes would be significantly hindered.

During that time, the IRS-CI estimated that it had seized cryptocurrency assets worth $10 billion since the inception of its investigations into a wide range of crimes involving digital assets.

 

PayPal has unveiled a fresh service enabling U.S. customers to conduct international money transfers utilizing its USD-pegged stablecoin, PYUSD. Accessible via the cross-border payments platform Xoom, the aim is to provide a more economical option for individuals seeking to send funds overseas.

U.S. clients now have the capability to convert PYUSD to USD and send money to individuals in around 160 countries without incurring transaction charges. This strategic move aligns with an overall objective of broadening the adoption of its stablecoin, launched last year, while solidifying its position as a reputable entity in the digital assets arena.

 

Becoming More Streamlined

Fernandez da Ponte, SVP for Blockchain and Crypto at PayPal, remarked that facilitating U.S. Xoom users with the choice to finance cross-border money transfers using PYUSD aligns with our mission to promote widespread acceptance of cryptocurrencies, alongside providing a convenient means to securely transfer funds to loved ones at a reduced expense.

This introduction of a novel funding avenue arrives at a juncture where consumers are increasingly pursuing cost-effective alternatives for cross-border transactions. According to a World Bank report referenced by PayPal, the average global cost of transmitting $200 stands slightly above 6%. By presenting fee-free transactions for transfers funded through USD converted via PYUSD, Xoom aims to furnish a more economical option.

 

The Rise Of Stablecoins

To utilize the aforementioned innovative service, U.S. Xoom users maintaining a sufficient balance of PYUSD in their PayPal Cryptocurrency Hub can designate PYUSD as their funding source when initiating a money transfer. Xoom will subsequently convert the PYUSD to USD without any cryptocurrency sale fees, with recipients receiving the funds in the fiat currency chosen by the sender.

The announcement by PayPal coincides with a potential upsurge in the stablecoin domain. Ripple, another prominent entity in the digital payments sphere, recently rolled out its stablecoin primarily tailored for corporate clients. Ripple anticipates the stablecoin market could hit $2.8 trillion by 2028.

 

SushiSwap is currently embroiled in a significant dispute over proposed alterations to its governance system. Concerns have arisen among users and a former associate regarding the suggested changes. The contentious proposal seeks to move assets via the Decentralized Autonomous Organization (DAO)-controlled treasury to a newly formed entity named Sushi Labs. Additionally, it intends to redirect all future airdrops to Sushi Labs rather than the DAO. These developments have sparked worries about community engagement and transparency within SushiSwap.

 

Competency Is Needed

The proposed governance modifications entail granting 25 million Sushi tokens to Sushi Labs, sourced through various channels like the Arbitrum (ARB) airdrop, business development, partner grants, Kanpai 2.0, Sushi 2.0, rewards, stablecoins, and Sushi House funds. Future airdrops to Sushi by protocols and partners would exclusively benefit Sushi Labs. However, discrepancies regarding the mentioned wallet holdings in the proposal have led to additional scrutiny.

Previously, the Sushi DAO had approved a ballot window to establish a foundational legal entity structure. Proponents of the proposal argue that updating the organizational framework is imperative as the project evolves. They stress the need for competent legal guidance to effectively represent the global presence of SushiSwap. Moreover, the proposal seeks to empower Sushi Labs with full operational responsibility for core product development to streamline decision-making processes.

 

Mounting Accusations

In response to these developments, Naïm Boubziz, a former member of SushiSwap, has accused the company of executing a genuine hostile takeover. Through scathing social media posts, Boubziz criticizes Head Chef Jared Grey alleging his intention to kill the community and the DAO while aiming to seize the entire treasury. Boubziz claims to have issued warnings for months, which were ignored under false pretenses. He further alleges deletion of snapshots without appropriate reaction and accuses the community of ignoring the truth.

Boubziz contends that the current governance structure of SushiSwap necessitates updates and emphasizes the importance of community involvement. His accusations intensify the rift between advocates for community involvement and supporters of the proposed changes, posing a critical juncture for SushiSwap. The ongoing signal vote on the controversial governance proposal has seen about 93% of participants voting no. Despite this opposition, a second vote is scheduled for April 9th to determine the fate of the proposal.