A lot is happening in the crypto world and is talked about on social media. The hottest topics in the crypto world last week were Ethereum’s The Merge, recent inflation numbers, crypto billionaires, hacks, and tornados.
This is what the crypto world is talking about right now.
Bloomberg: Crypto billionaires in talks with Huobi for a massive crypto deal
According to a report published by Bloomberg on Friday, two well-known figures in the crypto world, Sam Bankman-Fried and Justin Sun have negotiated with the founder of crypto exchange Huobi Global about a possible sale of the company. The deal would be worth at least $3 billion, which, if successful, would make it one of the biggest crypto deals of all time.
Leon Li, the founder of Huobi Global, plans to sell a majority stake in the company — nearly 60 percent — and has allegedly held preliminary talks with Tron founder Justin Sun and FTX founder Sam Bankman-Fried. Justin Sun, however, denied his involvement in a tweet.
The downturn in the crypto market has forced many of the largest companies to cut costs and lay off employees. That’s why this Huobi deal would be great news to crypto investors.
SBF seems to be building a crypto empire. His crypto exchange FTX has recently made several significant moves and purchases across the market. Fortune magazine has named Bankman-Fried the next Warren Buffett.
Ethereum The Merge confirmed – transition to Proof of Stake will take place in September
The most anticipated event in the entire crypto world is just around the corner. On Thursday, Ethereum completed its last dress rehearsal, i.e. the testing of The Merge in the Goerli testnet. Ethereum developers agreed that the testing was successful and there were no problems in the network.
The test was the third and last of its kind before the actual The Merge. The first test was done in June when the Ropsten testnet successfully merged to Proof of Stake. The second testing was in July, and then the Sepolia testnet also worked without problems.
Read more: Blockchain Consensus Protocols | PoW & PoS
Ethereum founder Vitalik Buterin tweeted that the actual The Merge is expected to take place on September 15, but the exact date is not clear, as it depends on the hash rate of the network.
What is The Merge?
The Merge is Ethereum’s historic and long-awaited transition from proof of work (PoW) to proof of stake (PoS) consensus mechanism. The possibility for transition was already mentioned in Ethereum’s original whitepaper in 2013, but due to numerous challenges, it has been delayed.
Now, after years of waiting, The Merge is finally coming to fruition. A consensus mechanism change of this magnitude has never been seen in the history of cryptocurrency.
By moving to proof of stake, Ethereum aims to solve the scaling and gas fee issues that have plagued its ecosystem for a long time. The Merge should significantly reduce the often sky-high transaction fees and make Ethereum more environmentally friendly. According to the Ethereum Foundation, Proof of Stake makes Ethereum 99% more environmentally friendly. This remains debatable in the eyes of many.
Inflation lower than expected – Bitcoin and Ethereum powering micro-bullrun
Bitcoin rose to nearly $25,000 and Ethereum took a step towards the $2,000 mark as news of slightly easing inflation reached crypto investors.
US officials announced on Wednesday that inflation in July was 8.5 percent, slightly lower compared to 9,1 percent a month earlier. Lower-than-expected inflation caused an immediate surge in the crypto market. However, the price is paid by the US dollar; although analysts were expecting higher inflation, 8.5 percent is still incredibly high. Purchasing power decreases every day.
However, it gives cryptocurrency investors small relief – at least momentarily. Along with the stock market, the speculative crypto market has suffered from significantly high inflation. The prices of the world’s two largest cryptocurrencies are now at their 2-month high. The recent upward trend strengthens the belief that the bottom is in.
What causes inflation?
The record-high inflation is due to the excessive money “printing” by the FED and European Central Bank. More than 80 percent of all dollars in circulation have been printed during 2020 and 2021 to address the economic challenges caused by the corona pandemic. In two years, the dollar reserve has thus increased fivefold. The effects are now visible and will be for a long time. Supply chain problems, Russia’s offensive war against Ukraine, and the resulting energy crisis have stirred the soup even more.
US dollar reserves (M1) in 2018-2022. The vertical axis represents trillions of dollars. After the economic crisis caused by the corona pandemic, dollar reserves have increased by more than 16 trillion dollars.
Crypto-mixing service Tornado Cash blacklisted in the US due to money laundering charges
The US Department of Treasury has imposed sanctions on Tornado Cash, a popular cryptocurrency mixing service. It allegedly helped launder more than 7 billion dollars. Americans are not allowed to use the service anymore after the blacklisting. Another popular service, Blender.io, was hit with similar sanctions in May 2022.
One of Tornado Cash’s developers was arrested in Amsterdam on Friday. The topic sparked a lot of discussion on Twitter and many defended the developer citing that the service was based on open source code and the developer had nothing to do directly with money laundering.
What are cryptocurrency mixing services?
The purpose of the crypto mixer is to cover the traces of funds by connecting the user’s tokens to the platform’s cryptocurrency pool, which also contains other users’ funds. The services hide the user’s identity.
For most users, these services are a legal way to protect their own privacy, but they can also be a tool for crimes, such as robbery, fraud, and money laundering. Crypto mixing services that help criminals are a threat to US national security, according to the Department of Treasury.
Internet troll distributed money from Tornado Cash to celebrities
After the ban, an anonymous user of the service sent 0.1 ETH to many known wallets. Among the recipients were Linkin Park, Steve Aoki, Logan Paul, Ukraine’s crypto donation wallet, sports brand Puma, Jimmy Fallon, and Snoop Dogg. The event sparked a lot of discussion on social media.
It was a mischievous prank; since Tornado Cash is a service prohibited by law in the United States, those dealing with it may be subject to investigation and prosecution. However, it is clear that the people who received Ether did not do it on purpose, so they will most likely get away without sanctions. Using the service appropriately can result in fines of over $300,000 or even a prison sentence.
Bitcoin maximalist Michael Saylor quits as CEO to focus more on crypto
The well-known Bitcoin advocate Michael Saylor is stepping down as CEO of MicroStrategy to become chairman of the management team. Saylor will hand over the duties of CEO to CFO Phuong Le, and he himself will become the company’s chairman, who is in charge of their Bitcoin strategy. The news caused MicroStrategy’s stock to increase in price.
Saylor’s new job looks a lot like his old: adding Bitcoin to MicroStrategy’s balance sheet with a religious spirit. Saylor told Forbes in an interview that he is a Bitcoin maximalist who believes that Bitcoin is a tool for economic empowerment that will benefit 8 billion people. In Saylor’s view, Bitcoin is a superior asset class.
MicroStrategy, a software company focused on business intelligence, founded by Saylor, owns the most Bitcoin in the world among all companies. The company has nearly 130,000 Bitcoin, worth $3.12 billion at the current exchange rate. That’s more than twice as much as the next two companies on the list, Elon Musk’s Tesla and Michael Novogratz’s Galaxy Digital. Saylor himself is known in the crypto community for his almost poetic tweets in favor of Bitcoin.
Hackers hit again – this time Curve Finance was the target
Last week, we reported about the hacks of crypto bridge Nomad and Solana wallets, from which a total of almost 200 million dollars worth of crypto were stolen. Now the latest hack victim is the popular Curve Finance, which lost 570 thousand dollars to the hackers.
Shortly after the hack was discovered, the protocol’s developers said on Telegram that they had found the source of the problem and fixed it. They urged investors to cancel the contracts made during the previous hours immediately and to avoid using the service until the situation returns to normal.
The hacker was believed to have changed the protocol’s DNS entry, redirecting users to a fake copy of the Curve service website and accepting malicious contracts. Cryptocurrency exchange Binance managed to return 80 percent of the funds taken by the hacker.
The views, thoughts, and opinions expressed in the text belong to the author and not necessarily to the author’s employer, organization, committee, or other group or individual.