Author: Lucky Ebosele

Chainlink has recently announced the release of its Chainlink Cross-Chain Interoperability Protocol (CCIP). The protocol enables developers to transfer tokens, send messages, and combine data and value transfers across different blockchains without requiring permissions. 

CCIP will streamline the interoperability process between chains, making it easier for developers to integrate blockchain technology into their projects. Now developers can transfer ETH, USDC, and LINK coins across supported networks, including Arbitrum, Avalanche, and Ethereum.

Strategic Importance of CCIP

The interoperability feature of CCIP enhances liquidity and market connectivity for users. According to Chainlink, what sets CCIP apart is that it integrates with Chainlink’s decentralized Oracle network, which aims to ensure both data accuracy and security.

The CCIP system is supported by several blockchains, including Arbitrum, Avalanche, Base, BNB Chain, Ethereum, Kroma, Optimism, Polygon, and WEMIX, with plans to add more subsequently. This is a big leap forward for the blockchain industry as it enables better communication and sharing of data between different blockchain platforms, enhancing their interoperability.

Several platforms such as Aave, Metis, and WEMADE have incorporated CCIP. AAVE, one of the prominent players in the DeFi lending market, has employed CCIP for transferring its GHO stablecoin across different blockchains. Metis has adopted CCIP as its standard token bridge, while WEMADE has implemented it as the exclusive cross-chain infrastructure on its WEMIX3.0 mainnet.

Chainlink can integrate with existing back-office systems, messaging standards, and infrastructure used by institutions. This integration can significantly reduce the operational cost and complexity of tokenized assets.

Chainlink has already demonstrated that institutions can successfully interact with tokenized assets across all blockchains through CCIP’s blockchain abstraction layer. This has been seen in Swift’s blockchain interoperability collaboration and ANZ Bank’s cross-chain settlement case study.

The CCIP has undergone a series of improvements, leading to its general availability. These enhancements include the introduction of a highly secure bridging application called Transporter, expanded token transfer capabilities for USDC and native ETH, an updated pricing model, and a significant increase in usage. Reports indicate that there has been a 900% rise in cross-chain transactions and a 4,000% increase in transfer volume.

Crypto lender BlockFi is preparing to file for bankruptcy following crypto exchange FTX contagion, the Wall Street Journal (WSJ) reported on Tuesday, citing people familiar with the matter.

The report comes a few days after the crypto lender halted withdrawals on its platform citing a “lack of clarity” over the status of FTX and its sister company Alameda Research.

Possible Bankruptcy Filing

According to the report, BlockFi is planning to file for Chapter 11 as well as reduce its workforce.

BlockFi neared its liquidity crisis over the past few months following the downfall of crypto hedge fund Three Arrows Capital (3AC), which also filed for bankruptcy in July. The crypto lender’s exposure to 3AC reportedly led to losses of about $80 million.

BlockFi-FTX Connection

To deal with its liquidity crisis following 3AC’s contagion, BlockFi reached out to FTX for help. And in July, the crypto lender announced it has entered a deal with FTX. The deal included FTX giving a $400 million credit facility to BlockFi with an option to acquire the lending firm for up to $240 Million.

But with FTX recently filing for Chapter 11 bankruptcy, BlockFi’s financial health appears to have been negatively affected. 

Although the lender denied that the majority of its assets are held at FTX, it admitted having an undrawn line of credit and obligations with the crypto exchange.

“BlockFi has the necessary liquidity to explore all options and we have engaged experts and outside advisors that are helping us navigate BlockFi’s next steps,” the company said in a recent post.

The report stated that BlockFi has recently been working with Kenric Kattner, a bankruptcy partner at Haynes & Boone on its possible bankruptcy filing.

According to reports, BlockFi had between $14 billion and $20 billion of customer deposits as of last year but due to the bear market since mid-May following the downfall of several industry firms, that number has plummeted.

Meanwhile, BlockFi is just one of the many firms affected by the FTX fiasco. Just recently, Nestcoin, a Nigerian crypto startup that builds, operates, and invests in Web 3 applications, revealed it has part of its operational funds stuck on the FTX platform.

Polkadot’s decentralized finance (DeFi) hub Acala has suffered a major exploit. The hack caused the protocol’s stablecoin, aUSD, to lose 99% of its U.S. dollar peg.  The aUSD stablecoin is a core product of Acala that powers the Polkadot and Kusama ecosystem.

Acala Suffers Major Exploit

According to findings by Twitter user 0xTaysama, the hacker was able to gain access to the network by exploiting a flaw in the iBTC/AUSD pool.

Upon gaining access to the network, the hacker issued more than 1.2 billion aUSD, which led to the stablecoin losing its peg. The funds still sit in the hacker’s wallet and haven’t left the Acala chain.

The Acala team said that they identified a configuration issue with the Honzon protocol, which affected the stablecoin, and that they are passing an urgent vote to cease operations on the network to investigate the issue.

Acala Likely to Recover Funds

0xTaysama explained that, now that Acala has put the network in maintenance mode to prevent the hacker from transferring the funds, they will likely recover the funds as they did on Karura last year. At the time, Karura detected several suspicious XCM transactions that transferred KSM tokens out of its parachain account but were able to quickly recover the transferred funds through a referendum.

While Acala operates on the Polkadot ecosystem, Karura is Acala’s sister network built on Kusama.

DeFi Hacks on the Rise

Meanwhile, as the DeFi space continues to gain traction, one of its major challenges in the market remains the continued security threats. According to research conducted by blockchain analytics platform Chainalysis, 97% of the $1.7 billion worth of cryptocurrencies stolen in the first quarter of this year were taken from DeFi protocols, a 72% rise from 2021.

In June, decentralized lending platform Inverse Finance, suffered its second hack of the year, losing $1.26 million. 

Last week, DeFi protocol Curve Finance was hacked, with the attackers siphoning off $570,000 from the platform. However, the leading cryptocurrency exchange, Binance, later recovered most of the stolen funds.

Leading cryptocurrency exchange CryptoCom announced today it has signed pre-registration undertakings with the Ontario Securities Commission (OSC) in Canada. The pre-registration signed with OSC is acknowledged by all Canadian jurisdictions through a joint Canadian Securities Administration (CSA) initiative.

CryptoCom Secures Pre-Registration in Canada

According to the announcement, the agreement makes CryptoCom the first major crypto exchange to operate “in line with this regulatory undertaking in Canada.”

While the pre-registration undertaking is still under review, CryptoCom said it is committed to working with OSC to offer a full suite of services in compliance with Canadian regulations.

“Compliance underscores everything that we do at Crypto.com. The North American market, and Canada specifically, represent a significant area of potential growth for the crypto market, and we are proud to work with the OSC and the CSA in providing Canadian customers access to a safe, secure, and reliable global platform,” Kris Marszalek, CEO of CryptoCom, said.

The latest development adds to CryptoCom’s existing regulation in the country overseen by the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) and the Autorité des marchés financiers (AMF) of Quebec.

CryptoCom Continues Expanding

Meanwhile, CryptoCom has continued to aggressively expand into new markets in recent times. In June, the crypto exchange secured provisional approval from Dubai’s Virtual Assets Regulatory Authority (VARA) to offer its services to investors in the Emirate.

In July, CryptoCom received registration and regulatory approval from the Italian regulator, Organismo Agenti e Mediatori (OAM), to offer services in the country. That same month, CryptoCom received approval in Cyprus, Singapore, and Greece. Just recently, the exchange expanded into South Korea through new acquisitions. 

In a recent interview, CryptoCom CEO Marszalek discussed the company’s aggressive expansion in recent times, saying that the expansion is part of the company’s broader strategy. He noted that CryptoCom is working with regulators to comply with local laws in every market that is important for the crypto industry.

Anthony Scaramucci, the founder of global investment firm SkyBridge Capital, has predicted the price of Bitcoin (BTC) to reach $300,000 in the next six years. Speaking in an interview with CNBC’s Squawk Box on Friday, the financier stated that the cryptocurrency is a long-term investment and when it reaches that price, it won’t matter if anyone purchased the asset at $60,000.

Scaramucci Predicts $300K Per BTC

“In the next six years, if BTC goes to $300K a coin, it will not matter whether you bought it at $20K or $60K. And I am just cautioning people that the future is upon us. It’s happening sooner than I thought,” he said.

During the interview, Scaramucci also noted that when stuff such as investment banking giant BlackRock offering Bitcoin services to its institutional clients happens, it’s a good sign that Bitcoin is going to have such high value in the future.

According to the financier, Bitcoin is going to see more commercial activities due to the development of the lightning network, increase in applications, and ease of transactions on the network.

Scaramucci noted during the interview that although SkyBridge has its largest position in Bitcoin and Ethereum, the company is not only focusing on those two coins as it also has a position in other smaller coins including Algorand (ALGO). He also noted that SkyBridge is interested in Solana (SOL).

Scaramucci Cautions Users Over Ethereum Merge

Aside from his predictions on Bitcoin, Scaramucci also discussed the upcoming Ethereum Merge. 

The Merge is a major software upgrade that will shift Ethereum from a proof-of-work (PoW) consensus model to proof of stake (PoS), which is rumored to lower transaction fees on the network.

Scaramucci said a lot of people are probably buying that rumor, and that they’ll probably sell on the news of that Merge, which is scheduled to happen in mid-September. The financier said he would caution against selling as ETH is a great long-term investment.

As Russia continues to intensify its “unprovoked” attack on Ukraine, global regulators have imposed financial sanctions on the country to weaken its forces.

But Russia has been able to reduce the effect of the sanctions due to continued support from allies such as Belarus. 

EU Sanctions Russia’s Allies

However, the European Union (EU) has moved to impose its own sanctions on Russia and its allies, and has included crypto as part of the sanctions imposed on them. 

According to an official press release from the EU, the commission noted that cryptocurrencies fall under the category of “transferable securities” and that the asset class can be used to issue loans and credits.

In addition, the EU imposed other forms of financial sanctions, including prohibition of the Society for Worldwide Interbank Financial Telecommunication (SWIFT) services to Belarus’s Belagroprombank, Bank Dabrabyt, and its subsidiary, restriction of transaction with Central Bank of Belarus, banning the supply of euro denominated banknotes to Belarus and more.

Can Russia Use Crypto to Evade Sanctions? 

With crypto aiding the Ukrainian armed forces in their ongoing war against Russia, governments and regulators are viewing the asset class as a means for Russia to invade financial sanctions.

However, owners of the two largest crypto exchanges including Binance’s Changpeng Zhao (CZ) and Coinbase’s Brian Armstrong have clarified that the claims that crypto can be used to bypass sanctions are not true and more focus should be channeled to financial institutions instead.

“The truth is, crypto is too small for Russia. If we look at the crypto adoption today, there is probably about 3% of the global population with some kind of crypto exposure (ie, owning some crypto). Of those, most only have a small percentage of their net worth in crypto. Less than 10% on average. So, there is probably only less than 0.3% of the global net worth in crypto today. This percentage applies equally to Russia,” CZ said.

He added: 

“Another reason Russia would not want to use crypto is that it is too traceable. And governments around the world are already very adept at tracking it.” 

Armstrong also made similar statements to one of CZ, saying that trying to sneak large amounts of money via crypto is more detectable than the U.S. dollar and other asset classes.

Meanwhile, both exchanges, including Kraken, said they will not block Russian crypto users following the government and regulators’ call to do so, adding that crypto serves as a life saver for ordinary Russians in these tough times.

The Government of the United Kingdom (UK) has revealed its intention to strengthen regulatory guidelines for crypto advertisements.

According to a report published on Tuesday, a new regulatory framework will be set for crypto advertisements in a bid to protect investors against risks associated with investing in digital assets.

As per the proposed guidelines, the government plans to toughen its stance on misleading digital asset promotions, it will be placing crypto ads in the same category as other financial businesses – banks, investment companies – advertisements. In addition, the new rule will enhance investors protection while boosting innovation.

“The consultation response, published today, sets out the government’s plan to bring the promotion of cryptoassets within the scope of financial promotions legislation. This means the promotion of qualifying cryptoassets will be subject to FCA rules in line with the same high standards that other financial promotions such as stocks, shares, and insurance products are held to,” the report stated.

Chancellor of the Exchequer, Rishi Sunak, added that the government is making sure that investors are protected while still encouraging innovation in the crypto space.

The government stated that the new rule is introduced to reduce investment risk and to make sure investors have the right knowledge about digital assets before investing in them.

The new policy will be carried out through secondary legislation to amend the financial promotion rule which states that before financial promotions will be approved by the Financial Conduct Authority (FCA) or the Prudential Regulation Authority (PRA), they must be fair, clear and not misleading.

Meanwhile, most regulators around the world have largely criticized Bitcoin and cryptocurrencies.

There have been using strict measures in regulating crypto space. However, that has not stopped growing interest in digital assets by individuals and financial institutions.

For instance, just last month, business intelligence firm MicroStrategy announced the acquisition of 1,900 bitcoins bringing its Bitcoin holdings to a total of 124,391 bitcoins which is worth $3.75 billion.

Crypto exchange platform Crypto.com lost $15 million worth of Ethereum (ETH) to hackers a day after users complained of suspicious activities on their accounts.

According to findings by blockchain security firm, PeckShield, hackers have stolen $15 million worth of ETH from crypto.com users’ accounts in which 50% of the fund is currently being washed via Tornado Cash – a non-custodial privacy solution built on Ethereum.

The security firm revealed its discoveries via a tweet earlier today.

However, Crypto.com CEO Kris Marszalek still maintains the exchange’s earlier stance on the matter noting that users’ funds were not lost and a full report will be given after carrying out a proper investigation.

“Some thoughts from me on the last 24 hours: no customer funds were lost, thee downtime of withdrawal infra was ~14 hours, our team has hardened the infrastructure in response to the incident. We will share a full post mortem after the internal investigation is completed,” he tweeted.

Recall that yesterday Crypto.com announced it will be halting withdrawals on its platform – which lasted for 14 hours – to carry out an investigation of potential hacks after customers reported suspicious activities on their account.

Some users reported that large amounts of funds were being moved from their accounts while crypto enthusiast Ben Baller said that he has lost $14,000 worth of ETH.

Meanwhile, Crypto.com has in recent times been contributing largely to bringing crypto to a larger audience and driving it closer to mainstream adoption via sporting deals.

In November, the exchange struck one of the biggest naming rights deals in the history of the United States, with Anschutz Entertainment Group (AEG) to get Staples center – home to the Los Angeles Lakers renamed as Crypto.com.

In another development just a few days ago, Crypto.com entered a 5-year partnership deal with the Australian Football League (AFL).