The Only Direction Is...UP!

Never a dull moment in sight in crypto! The market has undergone a dramatic transformation, barely recognizable compared to just three or six months ago.

With the departure of CZ and the subsequent regulatory changes impacting Binance, the crypto market is undoubtedly entering a new era. These developments signal a significant shift, marking a permanent change. Let’s dive into today’s updates!

ICYMI

• U.S. prosecutors contend that CZ could potentially face a maximum of 10 years in prison 

• Judge decides that CZ must stay within the U.S. for the time being

• The SEC continues to seek evidence of potential fraudulent activities at Binance.US.

• Montenegro Court approves extradition of Do Kwon

• Justin Sun pledges an 'impressive airdrop' to Poloniex and HTX users affected by $238M in hacks

• SEC faces challenges in serving lawsuit to Hex founder Richard Heart

Narrative Of The Week: A Brave New World

Let’s do a brief recap of some recent major events for context

• Binance agreed to a staggering $4.3B settlement with the US government, admitting to operating as an unregistered money services business and failing to report suspicious transactions

•  Zhao's subsequent step-down has marked a significant moment in crypto history, bringing a sense of finality to a long-standing legal drama​​​​​​. If that wasn’t enough…

• Following in the footsteps of its US counterpart, Bittrex Global is winding down operations. Starting December 4th, all trading on the platform will be disabled, signaling an end to a once-prominent player in the crypto exchange arena 

• Adding to the exchange drama, Kraken is currently embroiled in a legal battle with the SEC over serious allegations of commingling customer funds and operating without necessary licenses 

Amidst these events, the crypto market has shown a surprising level of stability. The reaction to Binance's news, in particular, was notably muted with only minor fluctuations in market values. 

As for the broader implications, the crackdown on major exchanges like Binance, Kraken, and Bittrex could shift significant power to institutional players entering the space, such as BlackRock. The path for the approval of spot ETFs appears clearer, removing a major cloud of uncertainty that hung over the industry

In summary: The US government has effectively reined in every major crypto exchange. Across the board, exchanges have either shut down or fully complied with regulatory demands.

While some argue this regulatory oversight is beneficial, it potentially centralizes power in the hands of large institutional players like BlackRock entering the space. Despite these concerns, in the near term, it seems all hindrances have vanished and the path is clear…the only direction is UP! 

Industry

Binance faces more regulatory challenges as the Philippines Securities and Exchange Commission issues a warning about the exchange operating without a license within the country, potentially leading to its blockage. The regulator highlights the potential criminal liability for those promoting crypto trading in the Philippines. Meanwhile, in the UK, investment managers have received approval to explore tokenized funds, signaling a growing trend towards tokenized assets in major financial developments. Across the Atlantic, the U.S. SEC is actively seeking public feedback on spot BTC ETFs, including proposals from Franklin Templeton and Hashdex. Some speculate that the SEC's deliberate delays may culminate in the simultaneous approval of multiple ETFs early next year

• Jump Crypto allowed to submit certain info confidentially in SEC’s case against Terraform Labs

• Kronos Research has offered a 10% white hat bounty to a hacker who stole $25M from the firm's treasury via authorised access to their API keys

• DCG negotiates new repayment deal with bankrupt unit Genesis to end $620M suit

• The SEC has delayed both the Hashdex and Franklin Templeton spot BTC ETFs. Their next deadlines both lie on the 31st of March 2024 

• During Devconnect in Turkey, Vitalik Buterin revealed his intention to revamp Ethereum's staking system, aiming to address performance issues

• South Korea to invite 100K citizens to test CBDC in 2024

• Apple sued for blocking crypto tech for P2P payments

• Jack Dorsey leads $6.2M Investment in decentralized Bitcoin mining pool OCEAN

Projects

Ongoing significant hacks continue to plague the crypto space, with Velodrome being the latest victim of a well-planned attack. Both Velodrome and Aerodrome have fallen prey to website compromises stemming from DNS attacks, prompting users to steer clear of their platforms for now. On a different note, the Kyber hack has taken an increasingly intriguing turn, with the hacker adopting a somewhat amusing tone, expressing a willingness to negotiate despite facing threats and unfriendly exchanges with the executive team. In more positive news, Magic Eden is making waves with its innovative wallet, offering cross-chain functionality for NFTs and crypto like Btc, Eth, Sol, and Matic

• Neon Machine founders file lawsuit against CEO and directors over share dispute and mismanagement

• Six founders of blockchain gaming studio Neon Machine have filed a lawsuit in Delaware, aiming to halt actions by controlling stockholder and new CEO Cort Javarone, accusing him of jeopardizing the company

• Circle’s Cross Chain Transfer Protocol for USDC is now live on Noble

• Google Cloud confirms participation in EigenLayer testnet 

• Jito Introduces governance token 

• Azuki DAO rebrands to ‘Bean' and abandons its lawsuit against founder Zagabond

• A new KAVA non-custodial lending protocol - Hover - is opening their $ATOM, $KAVA, and $USDt genesis pools today, promising an increased yield until the TGE in Q1 2024

Emperor Osmo shares some alpha on the latest trends emerging. Track them with Dune

Emil does a great job at summarizing the changes coming to Polkadot. Polkadot is set to transition its Parachain Auction model to the Coretime Lease system in 2024. This change addresses previous limitations like auction complexity, locked capital and limited parachain slots