PayPal has launched its own dollar stablecoin. We tell you why it is necessary and what it means for the cryptosphere. As well as what prospects the new instrument has on the global financial market

After two years of development and portability, PayPal has launched its own dollar-stablecoin. And actually became one of the first major payment companies that were able to bring their crypto product to the mass market.

The stablecoin from the payment service was named PayPal USD and the stock ticker PYUSD. Its issuer is Paxos and it will be fully backed by dollar deposits, short-term treasuries and similar financial instruments. Its exchange rate is pegged to the U.S. dollar exchange rate. And the company will initially gradually make it available to PayPal customers in the US.

Stablecoin from PayPal will be exchangeable for dollars or other cryptocurrencies available in PayPal wallets. The company will set an exchange rate that includes the service’s commission on each conversion. PayPal USD will also be able to be used to pay for purchases through a wallet in Venmo, a popular payment app from PayPal. In addition, it will be possible to transfer the token to compatible third-party wallets that are not part of the PayPal network. At an early stage, PayPal expects that PYUSD will be used mainly in the cryptocurrency and Web3 sectors, for example, to exchange for other crypto-assets or for payments in blockchain games. Even then, steiblcoin will gradually gain traction in areas such as money transfers and micropayments.

Stablecoin from PayPal has every chance to join the list of the most popular stablecoins in the future.

PayPal itself has a developed infrastructure and is represented in many countries. It greatly facilitates cross-border payments and speeds them up.

PayPal is actively used by freelancers and developers with international customers. Our experts believe that PYUSD will be a convenient way for them to get paid. It is also interesting that PayPal by the readiness of its infrastructure bypasses many central banks that are just trying to develop digital national currencies (CBDC). In other words, we are witnessing the emergence of a corporate currency that has a chance to become a significant player in the currency market, displacing central banks.

PayPal is one of the global payment giants, so we would like to believe that the future of PYUSD is very bright. At least due to the support of 430 million users of the platform.

Pay Pal and cryptocurrencies

PayPal has been supporting transactions with cryptocurrencies for some time now. And allows users to store such of them as Bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH) and Litecoin (LTC). In its earnings report for the first quarter of this year, the company said it stores about $1 billion worth of cryptocurrencies for its customers.

Since last year, users have been able to transfer cryptocurrency from PayPal accounts to third-party wallets. The company also invests in blockchain startups. And that includes recently leading a $52 million investment round for Magic. Which provides infrastructure for integrating digital wallets into online services and enterprise projects.

PayPal co-founder Peter Thiel’s Founders Fund venture capital fund began investing in Bitcoin back in early 2014. Shortly before the collapse of the crypto market in the spring of 2022, the fund sold almost all cryptocurrency assets, earning about $1.8 billion.

In 2021, it first became known that PayPal began looking for developers to create its own dollar-stablecoin. Despite regulatory scrutiny, problems over the BUSD issue, Paxos remained PayPal’s launch partner for the steblecoin. The company said the partnership was a milestone for the entire industry.

“PYUSD is a first-of-its-kind currency that represents the next stage in the evolution of the U.S. dollar on blockchain,” Paxos said.

And calling PayPal USD “the world’s most secure dollar-backed digital asset.” On the day of the announcement of the stablecoin, the U.S. House of Representatives issued a press release. And where it says that with proper regulation, stablecoins “could become the basis for a 21st century payment system in the United States.”

The PYUSD stablecoin is not yet available on cryptocurrency exchanges. And to purchase it, you must be verified on PayPal’s website.

The Bitcoin market is in a long period of quiet. Our experts have analyzed this situation and made conclusions.

The cryptocurrency market is experiencing one of the least volatile periods in its history. And this raises doubts that noticeable jumps in the price of Bitcoin at all will take place in the future. This is what Glassnode analysts wrote in their weekly market report.

Bitcoin’s realized volatility in various month-to-year intervals has declined significantly this year, reaching multi-year lows. Volatility in the year-to-date range is at levels not seen since December 2016. According to the company’s metrics, this is the fourth such period.

The first time there was such a prolonged lull was during the bear market period in late 2015 and early 2016. The bear market of early 2018 was also accompanied by a lack of significant price swings. And in November of that year, it experienced a 50% collapse. However, this was followed by an upswing in April 2019, when Bitcoin’s price rose from $4k to $14k in three months. A prolonged consolidation also took place after March 2020, when the world adapted to the COVID-19 epidemic. Then there was a brief period of stability at the end of 2022.

Bitcoin volatility chart by Glassnode

The price range separating the seven-day high and low price is only 3.6%. In the history of the market, less than 5% of trading days have ever had a narrower weekly trading range. The 30-day price range is even narrower. Periods of consolidation and narrowing of a price range of this magnitude are extremely rare for Bitcoin.

Weekly lows and highs for the bitcoin price. Source: Glassnode

At the same time, Glassnode notes that the number of long-term Bitcoin holders has reached an all-time high, accounting for about 15.6 million BTC (75% of coins in circulation).

What’s next for the Bitcoin price, our experts’ opinions

In general, the technical picture on the daily charts “looks positive for the “bulls”. According to our experts’ estimates, the beginning of fall will be the starting point for a new growth phase. However, now the cyclic analysis points to the advantage of “bears”. And that in conditions of low volatility constrains the market.

Last week, the BTC/USDt pair declined on the background of strong statistics on US GDP. And which gives the Fed grounds for further tightening of monetary policy in the fight against inflation. This raises concerns for investors trading risky assets.

For now, uncertainty and regulatory risks remain amid tough statements from the head of the SEC. Low trading volumes increase the probability of BTC’s decline to the levels of $27,700 – $27,900. But in case of passing the $31,800 mark, the “bulls” will be able to regain the leading position.

Our experts told about opportunities to invest in crypto-assets with a link to the price of gold

It’s been more than 35 years since The Economist magazine published a cover story titled “Get ready for a world currency” with the name Phoenix and the year 2018 minted on the coin. This magazine partly influenced the credibility of bitcoin and cryptocurrencies, but many people don’t know about the story until now. The first notable hype around cryptocurrencies happened just in 2017-2018. And the top of the cryptocurrency market capitalization of that period was formed on January 8, 2018. The magazine was published on January 9, 1988, it said that in 30 years people will buy goods online and all price tags will be indicated in the new world currency.

Fiat currencies aren’t going anywhere. And it will be easier for states to manage their economies. It is possible that this is what the market maker took advantage of. And after all, thanks to this magazine, many people believed that in 2018 there was a new world currency, and bought cryptocurrencies at the peak of the price.

The main Bitcoin network was launched on January 3, 2009. And today it’s 2023, and settlements are still predominantly in dollars, some continue to believe that Bitcoin will eventually become the world currency that it is. But there is another option. Our experts allow varianto that under the new world currency hides ordinary gold. But in digitized or tokenized form.

In this variant it can be divided into dust and instantly make payment. And the proof of its originality will be recorded in the blockchain. We, on the other hand, believe in the value of the Tether USD (USDT) stablecoin today. And which is issued in this way, on the blockchain and backed by real financial instruments.

News is emerging that the BRICS countries are going to launch their own currency.

And some sources believe that it will be pegged to the value of gold or backed by gold reserves. In such a case BRICS comes to exchange of goods and resources. And it is practically a barter system of settlements between the countries. Gold will act as a unit of measurement in mutual settlements. Thus, everything will return to the original idea, when the dollar was backed by the gold reserve.

The blockchain organization with DPoS (Delegated Proof-of-Stake) consensus is most suitable for building such a payment system. This consensus algorithm was first developed by Dan Larimer in 2013 for his BitShares project. The DPoS protocol is also referred to as a form of “digital democracy”. The difference between DPoS and the Proof-of-Stake (PoS) algorithm. And on which Ethereum (ETH) or Cardano (ADA) operate, is the separation of network participants into block producers and voters. If we project this idea into the form of a supranational digital currency. And it will turn out that citizens of countries choose the government. And the government sets up a node to validate transactions. Sooner or later, elections will also take place on the blockchain, and such a consensus will become more transparent.

For such a payment network, for example, the architecture of the EOS cryptocurrency would fit well. But it is clear that the government will not use the blockchains of existing cryptocurrencies.

The new currency will probably be backed by commodities or raw materials. Not the growth of any one country’s economy. It will be a separate network where each BRICS member will hold a node (node) of the network. When the consensus will be that even if one participant (node) of the network confirms a transaction (without considering the sender). And all others are against it, and such a transaction goes through, it will be called a multipolar world. In such a network, money will not be frozen by the decision of just one party, as in the case of the dollar or the euro. This would be the creation of a new model, where the old one would simply become obsolete and cease to be popular.

Investment option

Since the 2008 crisis, central banks have been actively buying gold. This has only happened once in history, before the dollar was decoupled from gold.

Today, you can buy tokenized gold, such as PAX Gold (PAXG). Each token is backed by one troy ounce of London gold in 400 ounce bars stored in Brink’s vaults. If you own PAXG, you own the underlying physical gold. And held in the custody of the Paxos Trust Company. Tether also issues tokenized Tether Gold (XAUt), but it is less trusted.

Our experts believe that gold is a more promising instrument for value saving in the coming years.

Gold is trading at $1930 an ounce today. Short-term we expect growth up to $2390.

Cryptocurrency exchange HashKey Exchange has been authorized to provide services to retail investors in Hong Kong

Cryptocurrency exchange HashKey Exchange has become the first company in Hong Kong. Which has been licensed under the region’s new licensing regime. And which allows cryptocurrencies to offer retail services.

HashKey has been granted Type 1 (securities transactions) and Type 7 (automated trading services) licenses. And can now serve retail investors in the region, the company said in a statement.

On April 27, the Hong Kong Monetary Authority (HKMA) issued a circular to banks to clarify the rules for opening accounts for cryptocurrency companies. The document clarifies how banks should conduct customer due diligence (CDD).

On June 1, 2023, Hong Kong introduced a new licensing regime for companies providing cryptocurrency trading services.

Our experts note that at the end of June, the Hong Kong unit of British bank HSBC allowed clients to trade shares of cryptocurrency ETFs. It was noted that the purchase of shares of four cryptocurrency exchange traded funds will be available to users through official trading applications.

Hong Kong’s first official crypto exchange HashKey Exchange will not provide services to users from 34 countries. Also including Russia, Iran, South Africa and Myanmar

The exchange does not restrict access to clients from the USA, Japan, China and a number of other countries. But on condition that they live in the territory of states where the circulation of digital assets is not restricted. They will have to confirm their location address and phone number during the verification procedure.

From the user agreement also became known that the processing of payments for the HashKey Exchange is engaged in the Asian division of the bank JPMorgan Chase. And one more partner bank will become ZA Bank in the future.

Today, let’s consider the idea of investing in four altcoins. Each of the presented options has a fairly high capitalization.

And volatile technical model and are real active projects. The assets are also traded on large centralized exchanges. So why invest in altcoins. And not to buy Bitcoin  or ETH? There are quite a lot of reasons, let’s highlight the main ones:

• Moving away from the classic concept of buying market leaders;
• Achieving more meaningful financial results due to volatile asset models;
• Portfolio diversification;
• Striving to “beat the market” in terms of returns;
• Some altcoins are near historical lows, which increases the calculated mathematical expectation of the transaction.

All of the above points lead to one goal – to increase portfolio returns by acquiring volatile assets.

Filecoin (FIL)

30th place by market capitalization. Up to 40% of the crypto portfolio. In 2023, the price approached the $2.3 multi-year lows twice. Each test of the level resulted in creation of trend source – market maker’s position to buy. The source consolidation level is $4.3 and is equal to current prices. From a technical point of view, this is a great time to buy the asset.

After the breakdown of the $9 level, the price will move into the global growth phase with the aim of reaching the locked volume (market maker’s position to sell) – $24. And then to the range of $35 – $41.5, where it is necessary to close the position.

Thus, the trade would look as follows:

• Buying at current prices ($4.4)
• Take Profit (TP) $35 – $41.5
• Stop Loss (SL) $2.2
• Expectation up to x10

VEChain (VET)

38th place by capitalization. This is one of the altcoins that is suggested to buy up to 20% of a cryptocurrency portfolio.
This technical combination is the basis for the formation of a position in the asset with the main goal of reaching the locked volume of $0.076. Based on which, we can plan the trade as follows:

• Buying at current prices ($0.0186)
• TP $0.076
• SL $0.013
• Expectation x4

EOS (EOS)

52nd place in Crypto Market Capitalization. This is one of the altcoins that is suggested to buy up to 20% of a cryptocurrency portfolio.
The technical picture of the asset differs from the previous ones. Mainly by the fact that the source of the trend is just forming in the market. And as a consequence, it is possible to form a position at the beginning of a growing cycle.

It is possible to enter the deal both at current prices ($0.744). And in case of decrease to the level of $0.69. It is also possible to consider a combined option – to enter the deal at current prices. And on the part of the capital allocated for this asset, and after the decrease to gain on the rest. Thus, it will be possible to utilize all allocated funds for this asset. And form a position with a low average purchase price.

After exceeding the level of $0.832, the source will be considered fixed. And the asset will move into the growth phase with the targets of $1.36, $2.75, $5.

The trade will be as follows:

• Buy at current prices
• Extra at the decrease to $0.69
• TP $1.36, $2.75, $5
• SL $0.48
• Expectation up to x6.7

Dash (DASH)

93rd place in capitalization. This is one of the altcoins that is suggested to buy up to 20% of a cryptocurrency portfolio.
At the moment, a trend source is being created. At this stage, a position with a low average purchase price can be formed.

Transaction structure:

• Purchases at current $31
• Additional at the decrease to $28.6.
• TP: $68, $126, $215
• SL: $20

Disclaimer:

Crypto-Upvotes does not provide investment advice. This material is for information purposes only. Cryptocurrency is a volatile asset that can lead to financial losses.

Our experts talk about the new trend in the crypto market and the associated risks of trading through Telegram bots

Trading bots in the Telegram messenger have quickly gained popularity among cryptocurrency traders. And those who prefer trading assets on decentralized exchanges (DEX). They are easier to use for quick and more precise trades. And skipping not the most user-friendly interface of blockchain-based trading platforms. However, the convenience of bots comes at the cost of trusting such bots with access to investors’ wallets.

Based on predetermined rules, having received a message, bots can recognize trading commands. And interpret them and then promptly execute trades on decentralized exchanges such as Uniswap. When first launched, the bot creates a wallet for the user. And providing him with access keys, after which funds need to be deposited into that wallet to start trading.

Bots also give a set of useful tools such as limit orders. And copy-trading (automatic copying of trades of given addresses) and so-called token sniping – tracking the appearance of new tokens on the Ethereum blockchain with automatic purchase. The bots have their own tokens, and rising prices are creating a speculative frenzy around them.

Unibot, launched in May this year, is considered the obvious leader in terms of the number of users and trading volumes

Its own token, UNIBOT, rose in value by more than 50% over the past week. And since its launch, it has increased in value almost 50 times. The demand for the token is supported by the fact that it must be held to pay trading commissions. However, 40% of these commissions are returned to users and are distributed proportionally to the number of tokens held by all owners.

The daily trading volume of the UNIBOT token at the time of publication exceeds $10.5 million, according to the aggregator CoinGecko. The site has a separate section for tokens of Telegram bots. And their list already numbers in the dozens – the developers are obviously trying to repeat the success of the pioneer and capitalize on the new market narrative.

Other popular bots include Swipe, WagieBot, Bolt and others. According to Dune Analytics, since May, more than 63,000 users have made transactions totaling about $193.7 million using bots, with Unibot accounting for the vast majority of the transactions. And more than $1 million in commission refunds have been distributed to bot token holders.

When making transactions on decentralized exchanges, users have to constantly log into their wallet. And check the correctness of information about tokens and face high commissions. At the same time, they still have full control over their own assets and do not need to entrust their wallet keys to a third party.

The appeal of trading bots is likely due to their ease of use compared to platforms. And which run on smart contracts. That said, users are forced to trust the wallets. And which are created inside the bots, with the condition that the bots have full access to them.

Safety and risks of Telegram bots

Despite the surge in popularity of trading bots. Security experts are critical of their approach to user assets.

In a comment to The Block, former Microsoft security chief Christian Seifert calls the emergence of trading bots in Telegram a “scary development.” And at the same time referring to their closed source code and the need to share wallet keys with them. In his opinion, this can be more dangerous than transferring funds to dubious crypto exchanges or to the addresses of unverified smart contracts. “In the second case, at least you can limit the level of access to funds. With bots, you are essentially just trusting them with your funds and hoping they won’t misappropriate them,” the expert cautions.

Yajin Zhou, co-founder of BlockSec, a blockchain security company. Similarly expressed similar concerns about the growing trend of bots on Telegram in a comment to reporters. He also talks about possible risks associated with the transfer of tokens to third-party wallets created by applications.

The high speed and ease of use of bots often comes at the cost of reduced security.

When such services automatically create a wallet for the user. There is a risk associated with permanently storing private keys inside the bot. If there is a data leak or a hack, it can turn into a disaster for bot users. After all, the bot developers themselves, often anonymous, can misappropriate user funds.

When a bot creates a wallet, it essentially creates a cryptographic key pair. The public key represents the address for incoming funds. The private key, gives access to those funds. This is what could potentially be the primary target of attackers. And who can easily withdraw assets from the wallet if it is compromised. On the other hand, if a user loses the private key without a backup, they will lose access to their assets.

Since private keys for wallets are not generated by users themselves. And their security is not always guaranteed, and this opens the door to abuse. He confidently says that in the future, unscrupulous bot developers will steal users’ funds.

Our experts note that if we draw parallels with past periods of excitement around memcoins or DeFi-tokens promising quick profits. Most of them turned out to be outright fraudulent projects. And that “countless investors” suffered.

Cyber scammers have increased their use of hidden mining due to increased law enforcement activity and heavy regulation

Over the past 12 months, the number of hidden mining (cryptojacking) cases worldwide has increased by 399%. This is according to data from the SonicWall report.

Cybercriminals are increasingly resorting to remote hacking of servers. And cryptocurrency mining devices. Recent data suggests that cybercriminals have become more likely to use this method due to increased law enforcement activity and strict regulation.

Hidden mining, or cryptojacking, is a cybercrime involving the unauthorized use of someone else’s devices (computers, smartphones, tablets, or servers) to mine cryptocurrency. It is often conducted through vulnerabilities in mobile apps, web browsers and their permissions and remains unnoticed by the victim.

In the UK, cryptojacking incidents have increased by 479% since 2022. In the US, there were 214 million such attacks in 2023 alone. And that’s a 340% increase from the year before.

Our experts note that in June, Google Cloud launched a program to compensate customers for up to $1 million in losses from hidden mining. If an attacker bypasses the cloud service’s built-in defenses. Users with special subscriptions will be able to get compensation for their losses. A subscription to Security Command Center Premium includes specialized hidden mining detection capabilities built into the Google Cloud infrastructure. The service scans virtual machine memory for malware. It can also detect compromised identities. And which allow attackers to access cloud accounts and quickly inject malware.

The Aave project has launched a GHO token with a peg to the dollar exchange rate. We tell you how it works and how it can help popularize the sphere of decentralized finance

The Aave lending platform eliminates traditional intermediaries such as banks. And the service runs on the Ethereum blockchain and uses software smart contracts to automate lending and borrowing operations. Aave was founded in 2017 by Stani Kulechov, a Finnish entrepreneur with a legal and financial background.

A user-friendly interface and a number of innovative functional solutions have made Aave one of the leading DeFi platforms. The protocol allows users to earn interest on their crypto assets. And by investing them in so-called liquidity pools. From these pools, borrowers get loans. They pay interest on the funds. And that is shared between the lending users and the platform itself. Interest rates depend on market conditions and are set on the basis of supply and demand.

To work with Aave it is enough to have a cryptocurrency wallet with the function of signing transactions, such as MetaMask, and cryptocurrency to deposit into the protocol. Once deposited, there is an immediate opportunity to either lend the funds. And at the same time receiving interest, or to borrow some assets against their collateral. Borrowers have access to many assets, including the cryptocurrencies bitcoin (BTC) and Ethereum (ETH). As well as the largest by capitalization stablecoins – Tether USD (USDT) and USD Coin (USDC). Aave is now entering the territory of the latter, but is taking a slightly different approach.

Stablecoins linked to the dollar exchange rate are some of the most popular assets on Aave and other similar platforms

The most capitalized stablecoins are USDT and USDC, issued by Tether and Circle, respectively. Both coins are managed by centralized organizations. And which maintain reserves for their “stablecoins” in fiat currencies, gold, securities, and other assets. These reserves provide stability to the exchange rate. And the loss of that stability, even short-term, is considered an abnormal event for the market.

However, Aave’s own stablecoin, issued under the ticker GHO, is backed by assets backed on Aave. And is programmed so that its value on the Aave network is always exactly $1. This is another attempt by the crypto market to create less volatile cryptocurrencies that are not dependent on a centralized issuer.

Borrowers often pledge cryptocurrencies on Aave to borrow specifically stablecoins. Due to the lack of exchange rate volatility, they can be more convenient for payments than, for example, the same bitcoin.

There are already several decentralized (algorithmic) stablecoins on the market. The most capitalized of these is Dai (DAI), operated by MakerDAO, a credit DeFi platform that competes with Aave. Like Dai, GHO will not be issued by a single issuer. It will be managed by a decentralized autonomous organization (DAO) known as AaveDAO. And its issuance will take place in transactions on the lending platform. To oversimplify somewhat, it will actually be collateralized by collateral.

GHO platform stablecoin

The platform’s native stablecoin helps diversify [traditional] stablecoins. And that includes in the Aave protocol itself. As well as the GHO revenue generated by the interest. And charged to borrowers in the Aave protocol, will allow AaveDAO to allocate more funds to community participants. And including risk managers, developers and security experts.

Our experts say that GHO in its own way will help popularize DeFi as a non-volatile crypto asset. The company is also developing a social protocol called Lens. And it needs a network effect and interested users. On the basis of this protocol it is possible to build full-fledged analogs of existing social networks.

In July, two venture capital funds raised more than $350 million to invest in cryptocurrency and blockchain startups.

The volume of investments in crypto startups has fallen for five consecutive quarters. But some venture capitalists are still making multi-million dollar bets on blockchain projects.

Fortune’s source said Polychain Capital, one of the most prominent venture capital firms in the cryptocurrency space. And has raised about $200 million in its fourth fund. This fundraising can be considered a positive signal for the industry. The event indicates continued investor interest, despite a period when the volume of funding has decreased for both startups and venture capital firms.

The event indicates the continuing interest of investors. And despite the period when the volume of funding has decreased for both startups. As well as for venture capital firms.

Founded in 2016 by Olaf Carlson-Wee – one of the first employees of the Coinbase exchange – Polychain Capital has quickly joined the list of leaders in the cryptocurrency venture capital market. The firm has invested in Coinbase, Uniswap, CoilnList, dYdX, Matrixport, Scroll and dozens of others.

According to Pitchbook, Polychain has raised three funds with $2.6 billion in assets under management, and while this amount is volatile due to the fact that some of the Polychain funds are held directly in a few liquid crypto stocks. Several services, such as CoinMarketCap or Messari, separately highlight Polychain’s portfolio. According to them, the company invests in bitcoin (BTC), Ethereum (ETH), Polkadot (DOT), Avalanche (AVAX), Cosmos (ATOM), Filecoin (FIL), Maker (MKR), Tezos (XTZ), Compound (COMP) and other assets.

Polychain has deployed most of the previously raised capital in 2022 and 2023, according to a Fortune interviewee.

And before starting to raise a fourth $400 million fund, which reporters have now learned about. As for the $200 million already raised, Polychain has signed new agreements with investors or partners to begin placing those funds. At the same time, the company will continue to attract new investors in order to raise the full amount.

The attraction of new financing was accompanied by a reorganization of Polychain’s team of about 25 people, about 15 of whom are engaged in market research. According to the interlocutor of the publication, three employees from the research group were dismissed. And another with a background in data science was hired. One of the general partners also left the company to start his own project.

According to Fortune’s source, Polychain will primarily consider Ethereum-based “second-tier” infrastructure solutions for investment. And such as Arbitrum or Scroll, as well as in projects such as EigenLayer.

According to Pitchbook, global cryptocurrency VCs raised just $1.7 billion in 12 funds in the first half of 2023.

In comparison, they raised $22.5 billion in 91 funds over the course of 2022. On the same day as the new fund raising from Polychain was announced. And Bloomberg reported that another cryptocurrency venture capital firm, CoinFund, raised $158 million to support early-stage crypto startups.

According to the company’s CEO Jake Bruchman. That for the new fund managed to attract more funds than originally planned. Investor interest in the fund was higher than expected.

The last year and a half in the cryptoindustry was held in the crisis. But during this time CoinFund managed to raise $550 million, Brukhman told reporters. The year 2022 was “extremely challenging,” he said. Part of the problem was that major players in the market became interested in cryptocurrencies at the stage of their growth. But they changed their minds about investing when they saw prices fall sharply.

The new investment fund CoinFund is also the fourth for the company. Under the previous funds, the company supported startups such as, for example, Dapper Labs (creators of the FLOW blockchain). Or the blockchain infrastructure service Blockdaemon. Funds from the new fund have already been partially invested in the startup Giza. And which deals with the implementation of artificial intelligence in smart contracts. And in the company Superstate, which plans to combine decentralized finance (DeFi) with mutual funds.

More investments

CoinFund plans to invest the raised funds in startups. Which are at the intersection of cryptocurrencies and artificial intelligence. Previously popular areas such as NFT are now not interesting to investors due to the market lull and capitalization decline of the largest projects.

Our experts note that CoinFund will also continue to invest directly in cryptocurrencies and tokens. And the company has an advantage here. When it comes to crypto market regulation in the US, there is uncertainty over whether cryptocurrency tokens are considered securities. And that was vividly demonstrated in the recent ruling by a judge in the US Securities and Exchange Commission’s (SEC) lawsuit against Ripple Labs. However, CoinFund is a registered investment adviser. And can make investments in securities, so even equating their portfolio crypto assets with securities shouldn’t pose a problem.

According to Alex Felix, CoinFund’s chief investment officer. That now about 90% of the company’s transactions are directly related to the purchase of cryptocurrencies and tokens. According to him, the company still believes that this industry can coexist with traditional finance in a regulated manner.

Our experts tell you what you need to know about Sam Altman’s blockchain project Worldcoin. And who supports it financially, and when it will have its own token

In addition to leading the development of ChatGPT and GPT-4. Sam Altman, head of OpenAI, is also a co-founder of Tools for Humanity. It creates technologies for the blockchain project Worldcoin. And its tokens will be distributed among users in a rather unusual way.

According to the developers’ plans, the future WLD token will be issued to those who will be identified by iris scanning. The company’s own device called Orb scans the eye. And based on that, creates a digital World ID for the user. And which can be used “in a wide range of everyday applications without revealing identity.”

About 2 million people are already expecting to receive their share from this airdrop of Worldcoin tokens

Airdrop was planned back in the first quarter of this year, but was later postponed. However, this project has big ambitions.

“Once launched, we will begin to rapidly expand market by market, connecting more and more people,” reads a presentation distributed to potential investors in the project late last year.

In May, the project said it had raised $115 million in an investment round. Which was led by Blockchain Capital, a venture capital firm focused on the crypto market. For it, this is the second largest investment package, second only to investments in Matter Labs, the developer of the zkSync solution.

Worldcoin as a project consists of several components

First is Tools for Humanity, co-founded in 2020 by Alex Blania, Max Novendstern and Sam Altman. Acting as the lead developer of the Worldcoin project. Tho the company has raised over $240 million to date from venture capital funds including Andreessen Horowitz (a16z), Tiger Global, Khosla Ventures and the venture capital arm of the Coinbase exchange.

Worldcoin is now valued at $3 billion at the end of its latest fundraising. This is the same amount as in March 2022, when the company raised the first $100 million. Previously, the project was funded by Khosla Ventures, crypto fund Andreessen Horowitz (a16z crypto) and the founder of the bankrupt FTX exchange Sam Bankman-Fried. Spencer Bogart of Blockchain Capital joined the board of directors of Tools for Humanity after the new investment round closed. And a16z crypto managing partner Chris Dixon has joined as an observer.

Sam Altman is the co-founder of Worldcoin. His main contribution to the project is to create a strategy for how best to scale it.

“Internally, we call it the Sam Altman effect,” Blockchain Capital’s Bogart wrote in a comment to The Block. “Focus on scaling. Everything else is irrelevant,” he quoted Altman as saying.

Structure and products of Worldcoin

Worldcoin also has a non-profit foundation, the Worldcoin Foundation, registered in the Cayman Islands. According to its website. It is engaged in “protocol support and development of the Worldcoin community until the community becomes self-sufficient”. The foundation is a step toward creating a decentralized autonomous organization (DAO) under Worldcoin. Worldcoin’s website states that the foundation is designed to “enable prioritization of the protocol based on DAO decisions.” Next steps, according to the description, include transferring intellectual property to the fund. And a grant program for developers.

As for the product, there’s World ID, an identification protocol. And with which people can prove their identity on the Web. It’s also a proprietary software creation package, the World app. Which allows you to manage the confirmed ID and a number of cryptocurrencies and, the actual token Worldcoin. All of these tools, with the exception of the token, appeared earlier this year.

A company called Tools for Humanity is responsible for the app. And it is likely that in the future it will earn on commissions on transactions or exchanges within the wallet. According to the company, by May this year, more than 500,000 people used the app at least once a month.

Black market accounts

Worldcoin’s chosen method of token distribution is that. People are asked to prove their identity by scanning their retinas with an Orb device. In March, Worldcoin struck a deal with manufacturer Jabil to ramp up production of its devices. According to The Block’s sources, Worldcoin could produce up to 400 Orb per month.

Worldcoin has an operator program where companies are paid in stablecoins. For performing eye scanning procedures on volunteers. So far, about 2 million people have joined the program. And mostly in Latin America, Africa, Southeast Asia and Europe. For example, in Kenya, by December last year, about 250 thousand people were registered. And only 45 devices were in circulation among operators in the country.

However, Worldcoin faced a black market of verified accounts. In May, there were reports that in China, where it is still impossible to register in Worldcoin. People are now buying iris scans taken in Cambodia and Africa for as little as $30. The buyers were probably expecting to get airdrop tokens. Which, when released on crypto exchanges, could return on their investment many times over.

The company then took a number of steps to try and address this issue. And including “adjusting the initial in-person registration process” and introducing dynamic and static QR codes.

Token and Airdrop

The token launch is a watershed moment for the project. Airdrop has already been postponed multiple times. A Worldcoin spokesperson told The Block that the exact launch date will be chosen by the Worldcoin Foundation. According to his other source of the publication, the launch is expected soon. And possibly as early as the third quarter of this year.

In exchange for eyeball scans, registered users will receive Worldcoin tokens. In investor documents published last December, it is assumed. That users will be able to request tokens every week. And their total number will decrease over time.

The same document reveals more details about the future tokenization of the project. Our experts note that the total number of WLD tokens will be 10 billion pieces. And of which 80% will be intended for users, operators and ecosystem. And 20% – for the Worldcoin team and investors. The tokens of team members and investors will be unlocked gradually over three years. The developers also intend to make WLD a governance token. That is, to give holders the ability to vote on proposals in the DAO. WLD tokens will not be available in the US and other countries.