May 12, 2022       /       Unchained Daily       /       Laura Shin

Daily Bits ✍️✍️✍️

• UST’s de-peg continues and LUNA plunges 98%.

• Do Kwon struggles to find investors to save UST.

• The Financial Accounting Standards Board (FASB) began a project to review how publicly traded companies account for digital assets such as bitcoin on their balance sheets.

• FTX.US applied with the New York Department of Financial Services for a trust charter.

Today in Crypto Adoption…

• The city of Mobile, Alabama, announced a new Bitcoin mining project.

• Brazil’s largest digital bank, Nubank now allows its customers to buy BTC and ETH
• Grayscale and the SEC met to discuss a bitcoin ETF.

The $$$ Corner…

• Crypto Exchange Kucoin Raises $150 Million At $10 Billion Valuation.

• Moralis, a crypto startup, raises $40 Million.

• Fasanara Capital, a London-based asset manager, is raising $350 million for a venture capital fund to invest in crypto companies.

What Do You Meme?

What’s Poppin’?

Coinbase Warns Users They Could Lose Their Assets

Coinbase, the largest cryptocurrency exchange in the United States by trading volume, warned its customers that any assets held on exchange by users could be at risk if the company were to file for bankruptcy.

Coinbase released this disclosure in its first-quarter earnings report, in which Coinbase reported a loss of $430 million and a 19% drop in monthly users. It was included as one of the risk factors of using the platform.

“Because custodially held crypto assets may be considered to be the property of a bankruptcy estate, in the event of a bankruptcy, the crypto assets we hold in custody on behalf of our customers could be subject to bankruptcy proceedings and such customers could be treated as our general unsecured creditors,” the company explained.

Brian Armstrong, Coinbase’s CEO, took to Twitter to clarify the situation and bring calm to the millions of people that use the exchange. “Your funds are safe at Coinbase, just as they’ve always been,” he said. “We believe our Prime and Custody customers have strong legal protections in their terms of service that protects their assets, even in a black swan event like this,” he added.
He went on to clarify that Coinbase has “no risk of bankruptcy.”

The company stock, COIN, which closed at $103.74 last Friday, closed at $53.72 yesterday, according to Yahoo Finance. This accounts for almost a 50% drawdown in less than a week, as crypto markets continue to bleed

Recommended Reads

1. Placeholder VC’s Chris Burniske on the bear market.

2. EThe Defiant on how NFTs will revolutionize intellectual property.

3. Joakim Book on understanding the monetary system.

On The Pod…

Will Optimism’s OP Token Draw People Back to Layer 2s on Ethereum?

Kain Warwick, founder of Synthetix, and Ben Jones, cofounder and chief scientist at Optimism Foundation, discuss the current state of Ethereum Layer 2s, Optimism’s new governance structure, why Synthetix chose to build on Optimism, and more. Show topics:

• what Optimism and Synthetix are

• how zero-knowledge rollups differ from optimistic rollups

• why Synthetix decided to build on Optimism

• what makes L2s more enticing to build on than other L1s

• how Optimism’s governance is going to change with the launch of the Optimism Collective and OP token

• what issues Synthetix has had with Discord governance and early token voting, and how they have now solved this by forcing users to consolidate wallet addresses

• what retroactive public goods funding is and how it could create a “flywheel” of development on Optimism

• why whales might be excluded from Optimism’s token grant to Synthetix

• why Ben thinks the future is about the “superchain” rather than multi-chain

• what Kain and Ben think about bridging between L2s and Mainnet

• why Optimism is a staunch backer of EIP 4844

• how the merge could affect Optimism and Synthetix

Book Update

You can purchase it here: http://bit.ly/cryptopians