The Web3 Rewind

A handful of the most interesting and current stories in the blockchain/web3 world not published on DeCential this past week in case you missed them

Hello and welcome back to the Web3 Rewind! Per usual with the industry, lots has happened this past week so without further adieu, let’s dive into this week’s news.

The Latest

Welcome back to the Web3 Rewind - we hope everyone had a great holiday season. While the new year is typically thought of as a time of hope and new starts, the crypto markets are struggling to match that sentiment. But, all is not lost as with experience comes wisdom, and this year market participants are much more likely to have grown wiser due to the hard times and (hopefully) lessons learned of 2022.

Yet, it’s clear the shadow of 2022 still looms (see: the possible specter of a global recession, layoffs, regulatory scrutiny, the continued contagion of the FTX downfall, etc). Despite this, developers and projects don’t seem to be halting apace. As eclectic as some of last year’s themes may be, they touch on all areas of life and the market, and show that while there are still a lot of growing pains, there’s also still plenty of hope and good people looking to build this industry into what we believe it can be.

Now is the time for the community at large to dig deep for resilience and remember that one day we will be able to look back on these times with the wisdom gained from trials. Stay the course and learn, learn, learn. — Parker Dresdow, DeCential Media

Regulators are coming dept.

With the implosion of FTX and the accusations about Binance CEO CZ’s role in it, the questions becomes whether the federal probe carried out by the DOJ, US Attorney’s Office of Seattle, and the National Crypto Enforcement Team (NCET) will be concluded after more than four years or whether they will attempt to dredge up new information, per Decrypt reporting.

While subpoenas are issued, and the Feds try to poke holes in Binance’s business dealings, key figures from CZ to Tigran Gambaryan (the exchange’s intelligence and investigations head) maintain that Binance has a solid footing and is not going to allow itself to fall into a similar position as FTX. It is unclear when the Feds will be satiated; CZ’s previously close ties to SBF and FTX have not gone unnoticed.

It should also be noted that Binance has potentially seen $12 billion in assets withdrawn from its platform over the last several months. If FTX and other CeFi implosions have shown anything, it’s that large withdrawals are warning lights for further chaos. — PD

Quick Bits

Russia to begin work on CBDC settlement system as sanctions endure

• In a move to circumvent its precarious global position, Russia has indicated its interest in establishing railways for partnerships with its pending digital ruble. The CBDC will present the country with the opportunity to trade and perform cross-border transactions amidst mounting sanctions.

• China has been indicated as one of the first nations that will transact in digital rubles, according to CoinTelegraph. There will reportedly be two methods of integration for Russia’s CBDC, with one option functioning as a contract with fixed exchange rates, and the other establishing a closed economy where Russia and partners in the system can raise and lower exchange rates in real-time.

DCG’s Barry Silbert is Dodging the Hard Questions, Sources Say

• Two words: crypto drama. In what almost feels like a “he said, she said” turn of events, DCG’s Barry Silbert is at the center of questions for his company and its subsidiary Genesis, with allegations primarily coming from Gemini’s co-founder Cameron Winklevoss. The TLDR is that Genesis, a DCG subsidiary that backed Gemini’s Earn program, had to suspend withdrawals (following FTX fallout), leaving over 30,000 Gemini customers locked out of their funds.

• Winklevoss claims Silbert “conspired to make false statements and misrepresentations to Gemini" and has since asked for Silbert to be removed from DCG as CEO. Silbert’s defense? First, while he may oversee subsidiaries from a high level, he doesn’t call the shots, and second, the promissory note made to Genesis was at “at arm’s length” thereby proving his distance from the company. To add fuel to the fire, breaking news yesterday indicates that Genesis owes creditors over $3 billion and may pursue divestitures to repay this debt.

Coinbase Cuts Around 20% of Workforce as Crypto Winter Rages

• There’s a bitter cold looming around Coinbase this crypto winter. The company announced on Tuesday it will be cutting its workforce by 20 percent, the equivalent of about 950 employees. Coinbase CEO Brian Armstrong said the decision came as the company has been conducting stress tests for company revenue and found in all outcomes it was clear expenses needed to be reduced in order for the company to succeed.

• This, however, is the not first cutback the company has made. Between June and November last year, Coinbase cut over 1,000 roles to account for what Armstrong noted was a result of growing too quickly during the crypto bull market. Coindesk noted that “...since last April 27,000 have been lost across the crypto industry.”

EIP-5988 Poised To Improve ZK-Rollups’ Compatibility With Ethereum

• As the Core Devs for Ethereum march tirelessly onward a new milestone for the EVM (Ethereum Virtual Machine) is in sight. This new milestone is packaged in the form of EIP-5988.

• The core function of this new upgrade would be to alter the EVM to use the Poseidon hashing function to, “optimize the efficiency of ZK-proof-based systems,” according to The Defiant. As the next major upgrade in the coming years will be on sharding and the further decentralization of the network, this new proposal looks to be a step in the right direction.

Latest Podcast

DeCent People Podcast With ENS Founder Nick Johnson

On the latest DeCent People podcast, we sit down with Nick Johnson, the founder and lead developer of the Ethereum Name Service, or ENS, which allows a digital wallet or website to be managed by a simple name rather than a long string of characters. We talk about his childhood in New Zealand, how he came up with a solution for the Y2K problem in 1997 and how he is a certified rat tickler.

You can download and subscribe to the podcast here on Spotify, Apple Podcasts or Amazon Music and Audible.

DeCential’s newest podcast!

Check out our newest podcast with the irreverent and hilarious Karsen Daily. In this episode she talks “2022 year in review,” including a crash course on what's "in" and what's "out" for 2023 in the world of crypto and web3.

Twitter: @karsendaily

Instagram: @karsendaily @karsendailyshow

Listen and follow on Apple Podcasts or Spotify.

And last but not least

Sources claim FTX investigation could exhaust the SDNY court

While it may have been easy to slap a litany of charges on SBF, gathering and maintaining the resources to pursue all of the charges has proven “exhaust[ive]” for the Southern District”. According to FOX correspondent Charles Gasparino’s tweet, “...the case is so sprawling that it could exhaust the resources of the southern district…” This news is reportedly based on feedback between prosecutors and the lawyers who are working on the case.

CryptoSlate also notes that the DCG and Genesis debacle could contribute to the strain as Gemini Earn and other business the two companies partook in comes under the microscope of regulatory scrutiny. — PD

Out of the Ether: Special NFT Edition

Have you read the definitive history of Ethereum? No? Well then get your special edition of Out of the Ether while you can. There are only 1,000 that were printed and each copy is an NFT that can be registered on the Lukso blockchain’s Universal Profile protocol.