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‘Pay more attention’ Ethereum co-founder says of crypto crash

Souvenir tokens representing cryptocurrency networks Bitcoin, Ethereum, Dogecoin and Ripple plunge into water in this illustration taken May 17, 2022. REUTERS/Dado Ruvic/Illustration

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DAVOS, Switzerland, May 25 (Reuters) – Ethereum’s co-founder Gavin Wood said cryptocurrency investors need to be more aware of what is backing their holdings after a market rout which wiped more than $800 billion off their value.

“I would hope that people pay more attention to what is belying the currency name when they get involved in a community, ecosystem, economy,” Wood told Reuters on the sidelines of the World Economic Forum in the Swiss Alpine resort of Davos.

Crypto and blockchain firms have been highly visible at this year’s gathering of business and political leaders, despite the market plummeting in value in the weeks leading up to the event, with the eighth-largest coin Luna becoming virtually worthless.

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British computer scientist Wood was attending for the first time to talk about a new partnership between his blockchain project Polkadot with American billionaire Frank McCourt’s Project Liberty.

Blockchains are public ledgers that keep records of transactions on networks of computers, and, along with cryptocurrencies, are largely unregulated.

“The internet has no real concept of legality, because legality is something that is determined by sovereign nations,” Wood said in an interview.

The new partnership is aimed at decentralizing control of the web and giving users more control of their data, Wood said.

“The technology cannot prevent people from making mistakes but can help those who want to understand better the facts of the world, what they’re buying,” said Wood.

The 42-year-old, who also coined the term Web3, also founded the Web3 Foundation, which backs the reorganization of the web away from big companies such as Google owner Alphabet (GOOGL.O) to individual users.

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Reporting by Jessica DiNapoli; Editing by Alexander Smith

Our Standards: The Thomson Reuters Trust Principles.


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Bored Ape NFT company raises around $285 million of crypto in virtual land sale

A representation of cryptocurrency Ethereum is seen next to non-fungible tokens (NFTs) of Yuga Labs “Bored Ape Yacht Club” collection displayed on its website, in this illustration picture taken March 24, 2022. REUTERS/Florence Lo/Illustration/File Photo

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LONDON, May 1 (Reuters) – The company behind the “Bored Ape” series of NFTs has raised around $285 million worth of cryptocurrency by selling tokens which represent land in a virtual world game it says it is building.

Last year, U.S. start-up Yuga Labs created the Bored Ape Yacht Club NFTs, blockchain-based tokens representing a set of 10,000 computer-generated cartoon apes.

As non-fungible tokens (NFTs) – crypto assets that represent digital files such as images, video, or items in an online game – exploded in popularity, Bored Ape prices surged to fetch hundreds of thousands of dollars each. read more

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They became one of the most prominent NFT brands, with Apes sold at top auction houses and owned by celebrities including Paris Hilton and Madonna. read more

Now, Yuga Labs – which raised $450 million in March in a funding round led by Andreessen Horowitz – has set its sights on the so-called “metaverse”. read more

In an online sale on April 30, Yuga Labs sold NFTs called “Otherdeeds”, which it said could be exchanged as plots of virtual land in a future Bored Ape-themed online environment called “Otherside.”

The “Otherdeeds” could only be bought using the project’s associated cryptocurrency, called ApeCoin, which launched in March.

There were 55,000 Otherdeeds for sale, priced at 305 ApeCoin each, and the company wrote on Twitter that these had sold out.

This means the sale raked in 16,775,000 ApeCoin, worth around $285 million as of Sunday, according to Reuters calculations based on the price of ApeCoin on cryptocurrency exchange Coinbase at 1210 GMT.

It was not clear how the funds would be distributed, although the company said the ApeCoin would be “locked up” for one year.

The sale indicates the continued high demand for speculative, high-risk crypto assets related to online virtual worlds. NFTs are largely unregulated, and reports of scams, fakes and market manipulation are common. read more

While many are baffled by the idea of paying real money for land which does not physically exist, some virtual land NFTs have already fetched millions of dollars. read more

The Otherside metaverse will be a multi-player gaming environment, according to its website, which says it is currently under development.

Yuga Labs declined to say how many people were working on building Otherside or when it would be launched.

Yuga Labs’ Otherdeeds sale comes shortly after the Bored Ape Yacht Club official Instagram account was hacked and a phishing link posted, allowing scammers to steal victims’ NFTs.

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Reporting by Elizabeth Howcroft; Editing by Hugh Lawson

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Cryptoverse: Ether prepares for epic ‘merge’ in quest to eclipse bitcoin

April 26 (Reuters) – Ether has promised to do better. It has promised to go to the next level, edging out crypto rivals and even outshining the godfather, bitcoin. But the clock’s ticking.

The No.2 cryptocurrency was supposed to be weeks away from the “merge”, a transformative June upgrade of its blockchain Ethereum to make it faster, cheaper and less power hungry, holding out the prospect of a meaner and cleaner crypto future.

The anticipation had supported ether this year, even as inflation and monetary tightening shackled bitcoin. But that merge – which would see ether mining transition away from the energy-intensive proof-of-work method to proof-of-stake – has been delayed, frustrating investors.

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“The timeline for seeing this launch continues to extend,” said Brendan Playford, founder and CEO of decentralized financial data platform Masa Finance.

“It’s certainly plausible that Ethereum’s highly anticipated upgrade to a proof-of-stake system could be delayed again given that this transition is highly complicated and still uncertain as to whether it can actually deliver on its promise of lowering costs and increasing transaction speeds.”

Ether fell 8% from $3,215 to $2,947 on April 11, the day Ethereum lead developer Tim Beiko said on Twitter that the June rollout had been pushed back as tests continued. It is down 13% this month, at $2,844.

“It won’t be June, but likely in the few months after,” Beiko wrote in his tweet. “No firm date yet, but we’re definitely in the final chapter.”

The timing of the merge – Ethereum’s EH1 chain will meld with a new chain to create ETH2 – remains unclear, although many crypto watchers expect it to happen some time this year. Beiko didn’t reply to a request for comment via Twitter and LinkedIn.

Ether’s market capitalization of $363 billion is less than half bitcoin’s , and together the two make up 60% of the crypto market.

Yet bitcoin remains just an investment without any real ability to be used for contracts in decentralized finance applications. For this reason, many investors believe a flipping of the market is inevitable – dubbed “the flippening” in crypto circles – with the merge acting as a catalyst for Ethereum becoming the dominant platform.

“We are seeing funds rotate into Ethereum in preparation for the merge, even though we don’t know when it’s going to be,” said Noelle Acheson, head of market insights at Genesis Trading. The buying interest, she said, did “hint that more funds seem to be appreciating that (Ethereum) is perhaps undervalued at this stage”.

Both bitcoin and ether are mined, or produced, using a proof-of-work (POW) method, where thousands of miners, or network nodes, compete to solve complex mathematical puzzles.

This is a massively power-thirsty process that’s estimated to cause more pollution than a small country every year, fostering fears about crypto in a low-carbon world.

The alternate proof-of-stake (POS) method uses much less power because, rather than have millions of computers race to process puzzles, it allows nodes that stake the most coins to validate transactions.

Ethereum has long been hobbled by issues of speed and processing costs. It only processes 30 transactions per second as a proof-of-work blockchain, but expects to process as many as 100,000 transactions per second once it moves to POS.

That will allow it to compete with other, smaller altcoins such as Solana and Cardano , which use POS partly or entirely, for decentralized finance applications such as trading, investing, borrowing and even non-fungible tokens.

That’s provided Ethereum gets its upgrade.

“Ethereum maxis, people who believe in ‘the flippening’, believe it will come very soon,” said Acheson at Genesis Trading. “But it is only a theory and it remains to be seen.”

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Reporting by Medha Singh and Lisa Pauline Mattackal in Bengaluru
Editing by Vidya Ranganathan and Pravin Char

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Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.


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Facebook’s cryptocurrency venture to wind down and sell tech assets – WSJ

A 3D printed Facebook’s new rebrand logo Meta is placed on laptop keyboard in this illustration taken on November 2, 2021. REUTERS/Dado Ruvic/Illustration/File Photo

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Jan 26 (Reuters) – Meta Platforms Inc’s digital currency venture (FB.O) Diem Association is winding down and selling its technology to California-based Silvergate Capital Corp (SI.N) for about $200 million, the Wall Street Journal reported on Wednesday, citing a person familiar with the matter.

Meta, formerly Facebook Inc, first unveiled plans for Diem, known as Libra earlier, in June 2019, as part of an effort to expand beyond social networking into e-commerce and global payments.

The project immediately ran into fierce opposition from policymakers globally, who worried it could erode their control over the money system, enable crime, and harm users’ privacy.

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In the quest for regulatory approvals, Facebook then renamed its digital coin to ‘Diem’ and scaled down its global ambition to focus on the United States by announcing the launch of a U.S. dollar stablecoin, which are cryptocurrencies pegged to a traditional currency. read more

A much recent blow came when Facebook’s financial technology executive David Marcus, who was overseeing its efforts to develop Diem, left the company to start working on something new. read more

Meta and Silvergate did not immediately respond to a Reuters’ request for comment outside business hours.

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Reporting by Rachna Dhanrajani and Shivam Patel in Bengaluru; Editing by Rashmi Aich

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