"Welcome to Web3 with FTC For February 10th by Fintech Confidential, the place where we keep you up-to-date on the latest developments in the world of Web3, Crypto, Blockchain, NFTs, and Fintech.

"Get ready for some fresh and thrilling insights on the crypto and blockchain world right here on Web3 with FTC! No more stale, regurgitated stories. We've got the hottest and newest updates for you."

Top stories for today.

1️⃣ Neal Mohan Wows with NFTs & Metaverse While New YouTube Integrates Web3 Services

2️⃣ Google and Tezos is Making Web3 Easy for Corporate Customers

3️⃣ Huobi Global: Jumping on the Bandwagon in Hong Kong's Race to Become Crypto Hub of Asia

4️⃣ Retail Crypto Trading Spikes After Epic 2022 Debacles: What the BIS Reports

5️⃣ Coinbase's Rollercoaster Year: 4th Q Revenue Smashes Estimates

6️⃣ Illinois Blockchain Bill: Florida Lawyer Calls it 'Most Unworkable' - Drew Hinkes Baffles Senate!

7️⃣ Paxos in Talks with SEC After Misclassification of the Binance Stablecoin

8️⃣ Zambia Joins the Party! - Digital Economies, Cryptocurrencies Get Greenlight!

9️⃣ CTO Resigns After Wildly Unsubstantiated Allegations at Composable Finance

🔟 Solana Spaces: RIP

Links:

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This is a production of Diamond D3 Media, with All Rights Reserved. This is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice. We strive to provide accurate and up-to-date information but will not be responsible for any missing facts or inaccurate information. You comply and understand that you should use any of this information at your own risk. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.

ABOUT:

Tedd Huff: President & Founder of Diamond D3, a professional services consulting firm focused on global payments and marketing. He is also a video podcast host and producer of Fintech Confidential and Head of Corporate Strategy at Corvia. 

Over the past 24 years, he has contributed to FinTech startups as an Advisory Board Member, Co-Founder, and Chief Experience Officer, providing strategic and tactical direction for Global Payments OpenEdge, Heartland Payments, Nuvei, and TSYS, among others, focusing on growth while delivering innovation, process improvements and user experience-driven value to simplify the complexity of payments.

Diamond D3, Media: A media creation, management, and production company delivering engaging content globally

: 00:00:02

Welcome to Web3 with FTC by Fintech Confidential for

: 00:00:06

Thursday February 23rd, 2023

: 00:00:09

2023.

: 00:00:09

"Get ready for some fresh and thrilling insights on the world of Web3,

: 00:00:13

Crypto, Blockchain, NFTs, and Fintech world, right here on Web3 with FTC!

: 00:00:19

No more stale, regurgitated stories, we've got the hottest

: 00:00:23

and newest updates for you."

: 00:00:24

Today we've got a jam-packed show, from Hong Kong's bid to become the crypto hub

: 00:00:29

of Asia to YouTube's appointment of Neal Mohan as CEO and Web3 Technology advocate.

: 00:00:34

We'll also be covering everything from the Bank for International

: 00:00:38

Settlements' analysis of crypto investments to Zambia's pioneering

: 00:00:41

move to test technology and pave the way for cryptocurrency regulations.

: 00:00:46

Let's get started with today's Highlights!

: 00:00:49

Neal Mohan's appointment as YouTube's CEO and Web3 Technology advocate

: 00:00:53

has got the industry buzzing.

: 00:00:55

With a focus on revolutionizing content creation, ownership, and distribution,

: 00:01:00

YouTube is set to become the leader of the Metaverse, and we can't

: 00:01:03

wait to see what the future holds."

: 00:01:05

Google's agreement with Tezos to become a validator is a

: 00:01:08

game-changer for Web3 applications.

: 00:01:11

With access to Google Cloud specific features, developers can now build

: 00:01:15

more innovative and secure apps on the Tezos network, setting the standard

: 00:01:20

for Web3 development and growth."

: 00:01:22

Hong Kong is vying to become the crypto hub of Asia and Huobi Global, led by

: 00:01:26

Justin Sun, is seeking to jump on the bandwagon by applying for a crypto trading

: 00:01:31

license and setting up a local exchange.

: 00:01:34

With Hong Kong regulators easing crypto rules, Huobi Global is

: 00:01:38

positioning itself as a trusted and secure platform for investors in Asia

: 00:01:42

who want to join the crypto market.

: 00:01:44

The Bank for International Settlements' analysis reveals the inherent deception

: 00:01:49

in crypto investments, as retail investors chasing the market's highs can lose up to

: 00:01:53

80% of their investments, highlighting the need for a sustainable investment model

: 00:01:58

to protect investors and their funds.

: 00:02:01

Focusing on long-term growth and stability with a clear understanding

: 00:02:05

and appreciation of potential risks is essential to balance crypto investments.

: 00:02:09

Coinbase weathered the ups and downs of the cryptocurrency market throughout

: 00:02:13

2021 with preparation and flexibility, including targeting attractive users

: 00:02:18

and implementing cost-saving strategies.

: 00:02:21

Their efforts paid off, resulting in a fourth-quarter revenue that

: 00:02:24

beat expectations, illustrating the importance of resilience and

: 00:02:28

agility in times of uncertainty.

: 00:02:30

The Illinois proposed bill to ban smart contracts from having immutable records

: 00:02:35

on the blockchain is unworkable, bad public policy, and runs counter to

: 00:02:39

the core principles of the technology.

: 00:02:41

It threatens to stifle innovation, reduce confidence in decentralized

: 00:02:45

networks, and undermine law enforcement's ability to keep accurate records

: 00:02:49

of blockchain-based transactions.

: 00:02:51

Paxos's stablecoin, BUSD, has been told by the S E C that it should

: 00:02:56

have been registered as a security, potentially requiring Paxos to

: 00:03:00

submit registration documents to the securities and Exchange Commission.

: 00:03:04

While this move could enhance transparency and trust in the digital asset space,

: 00:03:08

it also highlights the need for businesses to navigate the changing

: 00:03:12

regulatory landscape and be on the lookout for potential security risks.

: 00:03:17

Zambia is taking the lead in Africa's adoption of the digital economy, as

: 00:03:21

the government tests technology to pave the way for cryptocurrency regulations.

: 00:03:26

This move could revolutionize peer-to-peer transactions, promote economic

: 00:03:30

development, and provide financial security, while demonstrating Africa's

: 00:03:34

commitment to technology and innovation.

: 00:03:37

The recent resignation of Composable Finance's CTO, Karel Kubat, amid

: 00:03:41

allegations of legal violations involving the company's CEO, Ciaran

: 00:03:46

Gaffney, has created a tense situation.

: 00:03:48

While Gaffney denies the accusations, the legal and ethical considerations of

: 00:03:53

the situation could have a significant impact on the future of the company.

: 00:03:57

Solana Spaces' innovative approach to onboarding the world to Solana

: 00:04:01

may have come to an end with the closure of their flagship stores, but

: 00:04:04

it was a successful experiment that introduced thousands of people to

: 00:04:08

the world of blockchain and provided physical infrastructure for the Solana

: 00:04:12

network to support other businesses.

: 00:04:14

The lessons learned from this experience will no doubt be

: 00:04:17

applied to future projects, moving the web3 ecosystem forward.

: 00:04:21

Those are the highlights for February 22, 2023 so stay here for the rest

: 00:04:26

of the story, on Web3 with FTC."

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Let's jump back in to todays stories starting with our first stories on

: 00:05:21

the adoption of Web3 by corporations is changing the game and enabling

: 00:05:25

developers to build more innovative and secure apps, setting the standard

: 00:05:29

for Web3 development and growth.

: 00:05:31

Recently, YouTube made the news official, announcing Mohan as

: 00:05:35

their new Chief Product Officer and Web3 Technology advocate.

: 00:05:39

The tech giant stated, “We are confident in Neal’s ability to lead us into a

: 00:05:43

new era of innovation and technology, with a strong focus on the emerging

: 00:05:47

Web3 and Metaverse technology.”2

: 00:05:50

Mohan has big plans for YouTube, and has declared ambitious goals

: 00:05:54

to integrate Web3, blockchain and metaverse technology into the platform.

: 00:05:58

As he said in his initial press release,

: 00:06:01

“It is time to revolutionize digital content creation, ownership and

: 00:06:05

distribution and to empower artists by focusing on new technologies and

: 00:06:09

business models in the digital space.

: 00:06:11

My team and I are working to deliver on YouTube’s ambitious vision of a

: 00:06:15

metaverse that blurs the boundaries of the real and virtual worlds.”

: 00:06:19

This is a major turning point for YouTube, which has been innovatively

: 00:06:23

integrating Web3 technology into its existing platform for a few years now.

: 00:06:28

The list of Web3-driven features that YouTube has already started to

: 00:06:32

integrate encompasses Blockchain IDs, NFTs, metaverse content and streaming

: 00:06:37

services for video game developers.

: 00:06:39

The first step that YouTube has taken with Mohan on board is the formalization

: 00:06:44

of their virtual world initiative, which was first announced in June.

: 00:06:48

This initiative is designed to bring communities of creators,

: 00:06:51

gamers, and general users into a metaverse-style 3D environment,

: 00:06:55

where users can create and manage their own digital world and presence.

: 00:06:59

The virtual world initiative brings with it a host of new possibilities not just

: 00:07:04

for YouTube, but for other companies which plan to use Web3 technology in their

: 00:07:08

media and content creation businesses.

: 00:07:11

YouTube is open to collaborating with app developers and content

: 00:07:15

creators, who can create virtual worlds powered by the YouTube platform and

: 00:07:19

promote them on their own channels.6

: 00:07:21

Mohan is also looking at developing NFTs, which can be used by content

: 00:07:26

creators to store digital content, as well as monetize their work.

: 00:07:30

The YouTube team has been working closely with the developers of the Cryptovoxels

: 00:07:34

platform to create NFTs that could be used to grant access to special

: 00:07:39

content, or even grant ownership of digital objects within the metaverse.

: 00:07:43

As YouTube goes forward on the NFT front, the team is keen to ensure user safety

: 00:07:48

and identify potential abuse cases.

: 00:07:51

The team is also talking to game developers on how they could

: 00:07:54

use their game worlds to act as incentives for content creators

: 00:07:58

on their platform, or even create monetization opportunities using NFTs.

: 00:08:02

It is clear that YouTube is now looking to be the leading player in the Web3 space,

: 00:08:07

and they believe that having Mohan as their new CEO is the best way forward.

: 00:08:11

He is an innovative and experienced technologist who understands the potential

: 00:08:16

of this new technology, and has already had a proven track record of success.

: 00:08:20

Introducing Web3 and metaverse technology is proving to be a savvy

: 00:08:24

move for YouTube, as it's currently one of the most difficult and

: 00:08:28

misunderstood technologies to use.

: 00:08:30

Mohan is the perfect person to bridge the gap between traditional

: 00:08:34

and modern technology, spurring innovation and transformation in

: 00:08:37

the way content is produced, owned, distributed and consumed via the Web.10

: 00:08:42

Neal Mohan’s appointment as YouTube’s CEO and being a Web3 Technology

: 00:08:47

advocate is a sign of things to come.

: 00:08:49

With his vision of web3 and metaverse technology, he hopes to

: 00:08:53

revolutionize content creation, ownership and distribution to

: 00:08:57

empower artists around the world.

: 00:08:59

Thanks to Mohan’s extensive experience in this space, YouTube is on

: 00:09:03

track to become the leader of the Metaverse, and will no doubt be at

: 00:09:06

the forefront of Web3 technology.

: 00:09:08

Google Cloud continues to make waves in the cryptocurrency world by

: 00:09:12

announcing their agreement to become a validator on the Tezos network.

: 00:09:16

This move is seen as a another major step forward in the development

: 00:09:19

of Web3 applications and will undoubtedly have an impact on the

: 00:09:23

way people use blockchain technology.

: 00:09:25

With this agreement, Google Cloud customers will now be able

: 00:09:29

to deploy Tezos nodes and build applications on the network.

: 00:09:33

So, what Does the New Agreement Mean?

: 00:09:35

The new agreement is an indication of Google’s belief that Tezos is the

: 00:09:39

blockchain of choice for businesses looking to develop Web3 applications

: 00:09:43

that support a wide variety of use cases.

: 00:09:46

It also demonstrates the commitment of Google Cloud to the development

: 00:09:49

and growth of the Tezos network.

: 00:09:51

This agreement will expand the number of validators on the network,

: 00:09:55

making it easier for developers to build and deploy applications.

: 00:09:59

It also means that Google Cloud customers will have access to Google

: 00:10:03

Cloud specific features when deploying and managing their applications.

: 00:10:07

You might be asking; Why is this Important for Web3?

: 00:10:10

The integration of Google Cloud with the Tezos network signifies

: 00:10:14

an important step forward in the development of Web3 applications.

: 00:10:18

We use Web3 as a term to describe the next generation of decentralized,

: 00:10:23

innovative applications that are supported by blockchain technology.

: 00:10:27

The arrival of Google Cloud onto the Tezos network enables developers

: 00:10:31

to build apps more securely and efficiently than ever before with robust

: 00:10:35

tools that allows them to target a large and established customer base.

: 00:10:39

It will be interesting to see how this and the Solana partnerships with the

: 00:10:43

Google Cloud team play out One thing seems to be clear, by adding the Tezos

: 00:10:47

network, Google works towards setting the standard for Web3 development.

: 00:10:51

Developers can take advantage of Google Cloud's expertise and resources to create

: 00:10:56

innovative and secure applications.

: 00:10:58

This agreement will certainly provide a major boost to the development

: 00:11:02

of Web3 applications and the growth of the web3 ecosystem as a whole.

: 00:11:07

Next we tackle some of the stories revolving around the Crypto Market and

: 00:11:11

Regulations highlighting the need for businesses to navigate the changing

: 00:11:15

regulatory landscape and be on the lookout for potential security risks.

: 00:11:19

Justin Sun's Huobi Global Seeks Crypto Trading License and Plans to Set up Local

: 00:11:24

Exchange in Hong Kong as the regulators are easing crypto rules, and market

: 00:11:29

players are making moves to establish the region as the crypto hub of Asia.

: 00:11:33

In this latest development, Justin Sun's Huobi Global has applied for a

: 00:11:37

crypto trading license and plans to set up a local exchange in Hong Kong.

: 00:11:42

The new exchange will comply with local regulations, cater to institutional

: 00:11:46

investors and high-net individuals, and position itself as a trusted and

: 00:11:50

secure platform for investors in Asia willing to join the crypto market.

: 00:11:55

The Securities and Futures Commission (SFC) of Hong Kong recently released

: 00:11:59

a consultation paper that notes retail investors could trade larger crypto

: 00:12:03

coins on licensed crypto exchanges.

: 00:12:06

This move would allow exchanges to provide safeguards such as risk

: 00:12:09

profiles, knowledge tests, and reasonable limits on exposure.

: 00:12:13

Huobi Global's announcement of its application for a crypto trading

: 00:12:17

license comes just an hour after the Bloomberg report that Hong Kong

: 00:12:21

regulators are planning to allow retail investors to trade larger crypto coins.

: 00:12:26

While the agency hasn't explicitly mentioned which crypto coins retail

: 00:12:30

players could trade, it has said that the objective is to allow retail

: 00:12:34

trading in the new licensing regime for crypto exchanges due on June 1.

: 00:12:39

An SFC spokesperson said that two of the largest crypto assets are likely

: 00:12:43

to be listed on Hong Kong platforms.

: 00:12:46

Justin Sun, the founder of Tron and CEO of BitTorrent, has written that

: 00:12:50

with the new license, Huobi Global will be able to expand its services

: 00:12:54

and offerings to customers in Hong Kong, providing a wider range of

: 00:12:58

crypto trading and investment options.

: 00:13:01

This is great news for traders and investors who are looking for a

: 00:13:04

trusted and reliable platform to buy, sell, and store digital assets.

: 00:13:09

Huobi Global is positioning itself as a trusted and secure platform for investors

: 00:13:14

in Asia willing to join the crypto market.

: 00:13:16

The new exchange from Huobi will comply with all local regulations

: 00:13:20

while offering a range of trading pairs and services to customers.

: 00:13:24

The exchange will cater to offering trading services for

: 00:13:28

institutional investors as well as high-net individuals in Hong Kong.

: 00:13:32

Other traditional market players are also seeking licensing for

: 00:13:36

crypto customers in Hong Kong.

: 00:13:38

The move by Justin Sun's Huobi Global to apply for a crypto trading license

: 00:13:42

in Hong Kong and set up a local exchange comes at a time when Hong Kong

: 00:13:46

regulators are easing crypto rules.

: 00:13:49

The move will expand Huobi Global's services and offerings to customers in

: 00:13:53

Hong Kong, providing a wider range of crypto trading and investment options.

: 00:13:58

The exchange will cater to offering trading services for institutional

: 00:14:02

investors as well as high-net individuals in Hong Kong, positioning itself as a

: 00:14:07

trusted and secure platform for investors in Asia willing to join the crypto market.

: 00:14:13

The BIS, known as Bank for International Settlements, compared the seven years

: 00:14:17

prior to 2022 to the period since then, showing that retail investors chasing

: 00:14:22

the crypto market’s highs in some cases lost up to 80% of their investments.

: 00:14:27

Cryptocurrency has caused waves in the financial markets for over

: 00:14:30

a decade, but what hasn't been discussed as much is the deception

: 00:14:34

inherent in this new asset class.

: 00:14:36

Crypto investments – and even the most reliable ones – could almost never

: 00:14:40

guarantee the financial returns that many investors have been promised.

: 00:14:44

As such, it’s not surprising to learn that retail investors have

: 00:14:48

collectively lost a huge portion of their capital to crypto investments.

: 00:14:52

Just like stocks and other monetary vehicles.

: 00:14:55

By diving into the data from seven years prior to 2022, retail investors

: 00:15:00

chasing bitcoin's stratospheric highs saw some significant losses.

: 00:15:04

According to data from the Bank for International Settlements,

: 00:15:07

these losses sometimes were as high as 80% when purchasing at

: 00:15:11

the all time highs of the market.

: 00:15:13

The analysis also found that the majority of retail investors in the short term were

: 00:15:18

losing money overall, regardless of the price performance of their chosen asset.

: 00:15:22

The patterns of risky trading behavior can be easily spotted.

: 00:15:26

Investors would often buy into a cryptocurrency, expecting quick gains and

: 00:15:31

overly relying on wishful thinking, only to find out that the asset was no longer

: 00:15:35

profitable and may even have declined.

: 00:15:38

It is important to note that we should always be reinforcing

: 00:15:41

a sustainable investing model.

: 00:15:43

Financial institutions, investors and regulators are looking for ways to

: 00:15:47

protect retail investors and ensure that their funds remain secure even

: 00:15:52

through the volatility of the market.

: 00:15:53

The report suggests a low risk approach of focusing on encouraging

: 00:15:57

financial institutions to direct clients to sustainable investments

: 00:16:02

that are focused on traditional long-term perceived stabile

: 00:16:05

growth assets with less volatility.

: 00:16:07

When you look at it the, pursuit of crypto gains through leverage

: 00:16:10

has been a dangerous game.

: 00:16:12

While we all need to protect retail investors from becoming victims of

: 00:16:16

the devastating effects of crypto fraud, we also have to remember that

: 00:16:20

a long-term investment strategy is the key to growing one's capital,

: 00:16:23

both digitally and off-line.

: 00:16:25

The latest analysis from the Bank for International Settlements communicates

: 00:16:30

their position on how they view crypto today as a risky investment and that

: 00:16:34

retail investors should lean toward and more traditionally stable investments.

: 00:16:38

It is never good when one leverages themselves to the

: 00:16:41

hilt in a world of physical or digital assets, is not the answer.

: 00:16:45

Instead, focusing on long-term growth and stability is a

: 00:16:49

much better course of action.

: 00:16:50

Crypto investments can be beneficial, but only when they are balanced

: 00:16:54

with a clear understanding and appreciation of the potential risks.

: 00:16:58

By having such an understanding is important for retail investors to protect

: 00:17:02

their funds, both digitally and off-line.

: 00:17:06

Cryptocurrency exchange Coinbase has certainly endured

: 00:17:09

a rollercoaster of a year.

: 00:17:10

Despite the core elements of the industry remaining strong, the

: 00:17:14

cryptocurrency market endured several swings throughout 2022.

: 00:17:18

In a time of market volatility, Coinbase's fourth-quarter revenue beat

: 00:17:22

estimates, with revenue of $604.9 million.

: 00:17:26

Despite a 57% drop in year-on-year revenue, the firm and the industry

: 00:17:31

have shown resilience and long-term fundamentals remain strong.

: 00:17:35

Coinbase has reported revenue of 604.9 million dollars for the fourth

: 00:17:40

quarter of 2022, beating FactSet estimates of 589 million dollars.

: 00:17:45

Although full year revenue came in 57% lower than 2021 levels, at 3.1 billion

: 00:17:52

dollars from over 7.3 billion dollars, the exchange has proven resilient in a market

: 00:17:57

that has seen major shocks to the system.

: 00:17:59

In a call with The Block, Coinbase VP of Investor Relations Anil Gupta

: 00:18:04

attributed the drop in trading volumes to retail holders "stepping back and

: 00:18:08

Hodl-ing" as well as lower volatility.

: 00:18:10

Coinbase's adjusted EeBidDa for the fourth quarter came in at negative

: 00:18:14

$124 million, in line with estimates, with the full year's adjusted EeBidDa

: 00:18:20

of negative 371 million dollars , down from over 4 billion dollars in 2021.

: 00:18:26

Although blockchain rewards, mostly made up of staking revenue, came in at 62.4

: 00:18:31

million dollars, slightly below estimates of 63 million dollars, staking based

: 00:18:36

revenue increased to 275.5 million dollars in 2022 from 223 million idollarsn 2021.

: 00:18:45

Shares in Coin fluctuated in after-hours trading before

: 00:18:48

rising by 2.7% on TradingView.

: 00:18:51

The company discussed its outlook for the year, stating that it is prepared to

: 00:18:55

manage the business through a range of transaction revenue scenarios in 2023,

: 00:19:00

including possible increases, decreases, or stabilization of crypto market

: 00:19:05

capitalization and crypto asset volatility compared to levels at the end of 2022.

: 00:19:10

Coinbase's fourth-quarter revenue beating estimates highlights the resilience of

: 00:19:15

the firm and the industry as a whole.

: 00:19:17

The drop in year-on-year revenue indicates that the market is still

: 00:19:20

experiencing volatility, but the exchange's ability to manage the

: 00:19:24

business through a range of scenarios is a positive sign for the future.

: 00:19:28

Although blockchain rewards were slightly below estimates, staking based revenue

: 00:19:33

increased from the previous year, showing a positive trend for Coinbase.

: 00:19:37

The company's outlook for the year shows that they are prepared for

: 00:19:40

whatever the market may bring.

: 00:19:43

Recently, a Senate Bill in the Illinois legislature was introduced to ban smart

: 00:19:47

contracts from having immutable records of stored data on the blockchain.

: 00:19:51

While this bill was well-intentioned, it is unworkable and could lead

: 00:19:55

to a chilling effect if enacted.

: 00:19:57

Today we will outline why this proposed legislation is bad public policy

: 00:20:01

and what the consequences could be.

: 00:20:03

The proposed bill was intended to create a safeguard to prevent bad

: 00:20:07

actors from using the immutable nature of the blockchain to their advantage.

: 00:20:11

However, Drew Hinkes, a Florida-based lawyer specializing in blockchain,

: 00:20:15

described the bill as “the most unworkable state law” related to blockchain and

: 00:20:19

cryptocurrency that he has ever seen.

: 00:20:22

In its current form, the bill would essentially ban the entire concept

: 00:20:26

of blockchain immutability by preventing smart contracts from having

: 00:20:29

immutable records of stored data.

: 00:20:31

The goal of preventing immutable data from being kept on the blockchain

: 00:20:35

is misguided, as the technology simply cannot operate without it.

: 00:20:39

By eliminating immutable data, decentralized networks would be forced

: 00:20:43

to rely on a centralized system for data storage, which runs counter to

: 00:20:47

the basic principles that make the blockchain so secure and reliable.

: 00:20:52

Immutability is a vital aspect of decentralized network security,

: 00:20:56

as it provides trust and assurance that all data stored on the

: 00:20:59

blockchain is safe and secure.

: 00:21:01

Furthermore, these immutable records are essential for government and

: 00:21:05

law enforcement, as they ensure that records of all transactions are securely

: 00:21:09

stored, making it easier to track and trace illicit activities, such

: 00:21:13

as money laundering and terrorism.

: 00:21:16

Finally, the proposed legislation threatens to undermine the role of

: 00:21:19

regulators looking to capitalize on the guaranteed transparency of the

: 00:21:23

blockchain for fraud prevention and to increase financial transparency.

: 00:21:28

By prohibiting immutable records, the Illinois legislature would be sending

: 00:21:32

a chilling message to innovators and entrepreneurs who view the blockchain as

: 00:21:36

a key asset to help them stay competitive in the increasingly complex digital world.

: 00:21:41

Wrapping this crazy story up.

: 00:21:43

The Illinois legislature has proposed a bill that would ban smart contracts from

: 00:21:47

having immutable records of stored data on the blockchain is unworkable and counter

: 00:21:52

to the core principles of the technology.

: 00:21:54

Not only is it facing serious opposition from legal experts, but it runs the risk

: 00:21:59

of stifling innovation, undermining the confidence in decentralized networks,

: 00:22:03

and reducing the ability of law enforcement to keep an accurate record

: 00:22:07

of all blockchain-based transactions.

: 00:22:10

Ultimately, this proposed ban is bad public policy, and by rejecting it,

: 00:22:14

we can ensure that the blockchain remains a safe and secure tool for

: 00:22:18

those looking for a secure, immutable, and transparent digital asset.

: 00:22:23

Businesses have long looked for innovative ways to use—and secure—emerging

: 00:22:27

technologies, and the demand for cryptocurrency-based products and

: 00:22:31

services has never been higher.

: 00:22:33

Paxos, the firm behind some of the Binance stablecoins, recently found

: 00:22:37

itself in the spotlight after the U.S.

: 00:22:40

Securities and Exchange Commission (SEC) told the company it should have

: 00:22:43

registered the token as a security.

: 00:22:45

Let’s find out what this could mean for both Paxos and the broader

: 00:22:48

industry, and explore how the changing regulatory landscape might affect

: 00:22:52

the future of digital currency.

: 00:22:54

With the global cryptocurrency market estimated to be worth $1.2 trillion,2

: 00:23:00

it’s no surprise that the U.S.

: 00:23:01

securities and exchange commission has increasingly been monitoring

: 00:23:05

the use of digital currencies and digital asset offerings.

: 00:23:09

According to an internal email from Paxos CEO Charles Cascarilla, the

: 00:23:13

regulator recently notified Paxos that its stablecoin, Binance U S

: 00:23:18

D also referred to as BUSD, should have been registered as a security.

: 00:23:22

This means that Paxos must submit registration documents to the S

: 00:23:26

E C to sell and issue BUSD, or otherwise face potential legal action.

: 00:23:31

But what does registering BUSD as a security actually mean?

: 00:23:35

Well, According to the S E C, securities are “investment contracts” that

: 00:23:39

enable “ownership rights in assets.

: 00:23:42

This can mean anything from stocks and bonds to stocks, notes, investments

: 00:23:46

contracts, and even digital assets.

: 00:23:48

By registering B U S D as a security, the S E C is essentially allowing companies

: 00:23:53

to offer products and services backed by digital assets; an important distinction

: 00:23:58

given how digital assets are typically not registered like stocks and bonds.

: 00:24:03

The news of Paxos’s potential security registration could have implications

: 00:24:07

not only for the future of the stablecoin but for the broader industry.

: 00:24:11

Increasing regulations could lead to greater investor confidence, as

: 00:24:15

they know they are purchasing and trading digital assets in compliance

: 00:24:19

with US laws and regulations.

: 00:24:21

It could also enhance transparency and trust, both of which are the

: 00:24:25

cornerstone of web3 and digital assets

: 00:24:27

. As, this move by the regulator

: 00:24:31

the use of digital currencies.

: 00:24:33

As major financial institutions and companies increasingly enter the

: 00:24:37

space, a trusted regulatory body helps ensure that cryptocurrency is used as

: 00:24:42

a vehicle for responsible investments.

: 00:24:44

Additionally, as more companies jump on board, it could help to foster competition

: 00:24:49

and ultimately, drive innovation forward.

: 00:24:51

We will continue to see digital assets like cryptocurrencies become more

: 00:24:55

widespread, the regulations surrounding them are likely to continue to evolve.

: 00:25:00

With Paxos’s potential registration as a security is a prime example of how

: 00:25:05

businesses must navigate the changing regulatory landscape and be on the

: 00:25:09

lookout for potential security risks.

: 00:25:11

By working with the U.S.

: 00:25:13

Securities and Exchange Commission on establishing compliance , Paxos and

: 00:25:17

other businesses have the opportunity to foster investor confidence

: 00:25:21

and help to ensure that digital assets are made available safely.

: 00:25:26

As the industry continues to evolve and change,  Global Innovation and

: 00:25:30

Ethics considerations are at the forefront of the digital assest industry.

: 00:25:34

Zambia's decision to embrace the digital economy through cryptocurrency regulation

: 00:25:39

is a bold move that could revolutionize the region's peer-to-peer transactions

: 00:25:43

and promote economic development.

: 00:25:45

The African continent has taken the first steps to establish a crypto technology

: 00:25:50

hub with Zambia at the forefront.

: 00:25:52

The government has announced testing of technology that will pave the way for

: 00:25:56

cryptocurrency regulations, demonstrating their commitment to remain at the

: 00:26:00

forefront of technology and innovation.

: 00:26:03

This is a huge first step to showing the world that Africa is serious about

: 00:26:07

adapting to the digital economy as a legitimate source of value and currency.

: 00:26:11

Zambia’s Minister of Finance, Ngandu Mangaliso reportedly said, “We are

: 00:26:16

ready to join in the efforts and enhance legislation and encourage the

: 00:26:20

development of cryptocurrency innovation”.

: 00:26:22

He has been praised for his forward thinking by many in the sector who,

: 00:26:26

in a continent where infrastructure and banking services are woefully

: 00:26:30

inadequate, the use of cryptocurrencies could prove revolutionary.

: 00:26:34

It is no secret that Zambia, like other African countries, has had to face

: 00:26:38

its fair share of economic problems.

: 00:26:40

From abysmally low unemployment rates to extreme poverty, the

: 00:26:44

introduction of a technology like cryptocurrencies to Zambia could be

: 00:26:48

the silver bullet to end these woes.

: 00:26:50

Cryptocurrency provides an efficient and secure way to simplify peer-to-peer

: 00:26:54

transactions and to send digital money, with fewer overheads.

: 00:26:58

The technology enables users to digitally sign their transactions

: 00:27:02

instead of using the traditional paper and ink method of signing.

: 00:27:05

This reduces the number of transactions costs involving the exchange of

: 00:27:10

currency, whilst expanding the cost of sending the money globally.

: 00:27:14

In addition, cryptocurrencies allow for transactions to take

: 00:27:17

place swiftly and securely.

: 00:27:19

Blockchain technology, the core of virtual currency Bitcoin, makes

: 00:27:23

transactions traceable and detectible.

: 00:27:25

This removes the possibility of fraud as every transaction is

: 00:27:29

cryptographically secure as it is monitored and recorded in the blockchain.

: 00:27:33

As a result, crypto users can trust that their transactions

: 00:27:37

are truly anonymous and private.

: 00:27:39

The move to support cryptocurrency in Zambia follows similar moves in South

: 00:27:44

Africa, Kenya, Rwanda and Uganda – all of which recognize the power of virtual

: 00:27:48

currency and the opportunities it brings.

: 00:27:51

The embrace of cryptocurrencies could simultaneously promote economic

: 00:27:55

development and financial inclusion, while also providing financial security.

: 00:28:00

The continent is leaping forward thanks to Zambia's bold decision to

: 00:28:04

embrace the digital economy through cryptocurrency regulation is a promising

: 00:28:08

sign for the future of Africa, and a welcome sign for the crypto sector.

: 00:28:12

It shows that the government is committed to remaining at the forefront

: 00:28:15

of technology and innovation, and that it is fully aware of the potential

: 00:28:19

blockchain technology and cryptocurrencies have to help turn the economy around.

: 00:28:24

Through this move, Zambia will provide its citizens access to the global digital

: 00:28:29

economy, and just maybe, open the door for other African nations to follow suit

: 00:28:34

and benefit from this digital revolution.

: 00:28:37

The recent allegations and subsequent resignation at Composable Finance

: 00:28:41

highlight the ethical considerations involved in blockchain technology.

: 00:28:45

Allegations have surfaced that Composable and its CEO, Ciaran

: 00:28:49

Gaffney, had violated numerous legal regulations while operating the company.

: 00:28:54

The recent news that the CTO of Composable Finance, Karel Kubat,

: 00:28:58

resigned from the DeeFi-focused infrastructure firm amid allegations of

: 00:29:02

legal violations involving the company’s CEO, Ciaran Gaffney, has been met with

: 00:29:07

intense scrutiny and disagreement.

: 00:29:09

Kubat has accused Gaffney of knowingly violating regulations in a March 2020

: 00:29:14

Deefi campaign, while Gaffney has maintained that any issues were related to

: 00:29:18

a compliance matter and not a legal one.

: 00:29:21

We will explore the backgrounds of both positions, presenting the evidence

: 00:29:25

from both sides and taking a deep dive into the ethical considerations at

: 00:29:29

play in order to help inform you of the situation and draw your own conclusions.

: 00:29:33

Karel Kubat levied allegations of legal violations against Gaffney after

: 00:29:38

stepping down from Composable Finance.

: 00:29:40

In a Feb.

: 00:29:41

20th in a Twitter post, accused Gaffney of knowingly violating regulations.

: 00:29:46

"When our temporary legal counsel recommended that Composable Finance

: 00:29:50

use an unregistered broker-dealer for our $150,000 Defi campaign

: 00:29:55

launch - rather than an S E C -regulated one - Gaffney chose to

: 00:29:59

ignore their advice," ; Kubat wrote.

: 00:30:01

This accusation that Gaffney knowingly violated regulations related to the

: 00:30:05

company’s $150,000 Deefi campaign launch.

: 00:30:09

According to Kubat, Composable was recommended by their legal counsel

: 00:30:13

to use an unregistered broker-dealer instead of one regulated by the

: 00:30:17

Securities and Exchange Commission (SEC).

: 00:30:19

Kubat has refused to back down from his claims, asserting that Gaffney knew the

: 00:30:23

regulations and chose to ignore them.

: 00:30:26

Gaffney’s Response has been to vehemently denying Kubat’s accusations,

: 00:30:30

maintaining that any perceived violations were related to a compliance

: 00:30:34

issue rather than legal ones.

: 00:30:35

In a statement released on Feb.

: 00:30:37

20th, Gaffney noted that Composable had directly reported the incident to

: 00:30:41

the S E C as soon as they had become aware of it, and had taken steps

: 00:30:45

to ensure their current compliance with the applicable regulations.

: 00:30:49

He has insisted that Kubat’s accusations are “baseless” and “unsubstantiated”.

: 00:30:54

The main legal considerations at play in this situation have to do with

: 00:30:58

whether or not Composable actually violated any regulations when conducting

: 00:31:02

the 150,000 dollar Deefi campaign.

: 00:31:06

If they did, then the S E C may take action and impose penalties.

: 00:31:09

On the other hand, if they were not in violation of any laws, then Gaffney

: 00:31:13

will be cleared of any wrongdoing.

: 00:31:15

The legal considerations also go beyond just the laws themselves.

: 00:31:19

It is possible that Gaffney and Kubat may soon be in a situation where they are both

: 00:31:24

taking legal action against one another.

: 00:31:26

If Gaffney believes Kubat’s claims to be untrue, then he may

: 00:31:30

take legal action against him.

: 00:31:31

Kubat may respond in kind if he believes that Gaffney did

: 00:31:35

actually violate regulations.

: 00:31:37

This is going to be something to watch and see how The accusations levied against

: 00:31:41

Ciaran Gaffney, the CEO of Composable Finance, and the subsequent response

: 00:31:45

from both parties will bring forward some important ethical considerations.

: 00:31:50

There’s no denying that the potential legal repercussions of the incident

: 00:31:53

could have a significant impact on the company’s future, regardless of who is

: 00:31:57

ultimately proven to be in the right.

: 00:32:00

For our last story of the day Solana Spaces' experimental approach to

: 00:32:04

onboarding the world to Solana provided valuable lessons that will shape

: 00:32:08

future projects in the Web3 ecosystem.

: 00:32:11

Solana Spaces launched seven months ago with a bold ambition – to

: 00:32:15

onboard the world to Solana.

: 00:32:17

But with ambitious dreams come risky endeavors, and today that

: 00:32:20

daring experiment comes to a close.

: 00:32:22

On February 21st , Solana announced the closure of their flagship

: 00:32:27

stores in New York City and Miami.

: 00:32:29

It was a brave move that resulted in some big successes and valuable lessons.

: 00:32:33

When the Solana Spaces rental shops opened in both cities last year, it was designed

: 00:32:38

to show users an immersive experience with the Solana crypto ecosystem.

: 00:32:43

The point was to educate the masses on a technology that is often

: 00:32:46

seen as too complex or alien.

: 00:32:49

To do this, the stores turned a ledger into a library, an asset into art

: 00:32:53

and a blockchain into a bookstore.

: 00:32:55

Solana CEO Anatoliy Knyazev admitted that the footprint of the stores was too large

: 00:33:00

for the short amount of time they were aiming for: “We aimed to onboard more

: 00:33:03

users over this period, but the reality is that we weren’t able to meet our targets.”

: 00:33:08

Knyazev stressed that the experiment was part of the company’s efforts to

: 00:33:12

onboard more people onto Solana, and that the goal wasn’t just to make a buck.

: 00:33:16

While it’s true the flagship stores didn’t draw in as many people as

: 00:33:20

anticipated, it’s also worth noting that there were some big successes.

: 00:33:24

The flagship stores educated and connected thousands of people to the

: 00:33:28

Solana network, introducing them to a revolutionary new technology that has

: 00:33:32

been transforming the world of money, art, and technology over the past decade.

: 00:33:37

Knyazev added, “The response we got from the market was overwhelming

: 00:33:41

– people were excited to learn more and be part of the Solana community.

: 00:33:44

We’ll be taking what we learned and applying it to different

: 00:33:47

projects we’re working on and are optimistic about the future.”

: 00:33:51

The experience also resulted in some much-needed physical infrastructure for

: 00:33:55

the Solana network which can be used to support and promote other businesses,

: 00:34:00

including by catering for payment for goods and services with Sole tokens.

: 00:34:04

It is great to see that Solana Spaces pushed the boundaries of

: 00:34:07

ambitious innovation, designing an immersive experience to bring

: 00:34:11

users into the Solana network.

: 00:34:13

The initial targets they set out to achieve may not have been

: 00:34:16

accomplished, but the experiment was successful in other ways.

: 00:34:20

It introduced thousands of people to the concept of blockchain, how it works and

: 00:34:24

how it powers the Solana network, and it provided physical infrastructure for

: 00:34:29

the Solana network that can be used to support and promote other businesses.

: 00:34:33

The journey of Solana Space may have reached its final destination

: 00:34:37

temporarily, but this is certainly not the end of the road.

: 00:34:40

The lessons learned from the Solana Spaces experience will no doubt be

: 00:34:44

applied to better shape future projects and move the web3 ecosystem forward.

: 00:34:50

As, we wrap up today's episode of Web3 with FTC by Fintech Confidential.

: 00:34:55

Today we've covered some of the biggest stories that are shaking up the Web3

: 00:34:59

world and what they mean for you.

: 00:35:01

Today we talked about, the adoption of Web3 by corporations is rapidly

: 00:35:05

changing the game, with Neal Mohan leading YouTube's mission to become

: 00:35:09

the leader of the Metaverse and Google Cloud integrating with Tezos to set

: 00:35:13

the standard for Web3 development.

: 00:35:15

The cryptocurrency market is full of surprises, with Coinbase

: 00:35:19

smashing Q4 revenue expectations and Paxos's misclassification of

: 00:35:23

BUSD as a non-security emphasizing the need for businesses to navigate

: 00:35:28

the changing regulatory landscape.

: 00:35:30

Finally, ethical considerations and innovation are at the forefront of

: 00:35:34

the industry, highlighted by Zambia's bold decision to embrace the digital

: 00:35:38

economy, the recent allegations and resignation at Composable Finance,

: 00:35:42

and the valuable lessons learned from Solana Spaces' experimental approach to

: 00:35:47

onboarding users to the Solana network.

: 00:35:49

The future of the Web3 ecosystem is bright, and we

: 00:35:52

can't wait to see what's next.

: 00:35:54

Thanks for tuning into “Web3 with FTC”, where we cover what’s behind the

: 00:35:59

disruptive and innovative world of Web3, Blockchain, Crypto, NFTs and Fintech.

: 00:36:04

And remember to follow us on our Telegram Channel, Linkedin, Facebook,

: 00:36:09

and Instagram, and sign up for the latest news delivered straight to your inbox at

: 00:36:13

access dot fintech confidential dot com.

: 00:36:15

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Cryptocurrencies are highly volatile financial assets, so research and