#27 Britain aims to become a global crypto assets hub. Crypto is changing philanthropy.
Disclaimer: Everything we write in "The Crypto Insider Report" is an x-ray of the industry as we see it, through the lens of publicly available information. We are not financial advisors.
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Another Field Touched by Crypto - Philanthropy
We always read about how Crypto is affecting the financial system, collectibles and even the job market. Coindesk provides another angle: how Crypto is changing philanthropy.
Data from Fidelity Charitable shows that cryptocurrency investors are more likely to donate than traditional investors - 45% vs 33%. In addition to that, the total amount of Crypto donations is rapidly growing - 331 million USD received by Fidelity Charitable in 2021, compared to 28 million USD in 2020. According to the article, there are a few reasons for this trend.
First of all, the transactions themselves are cheaper. Traditional card payment processors take a few percentage points from each transaction, whereas with Crypto there is no intermediary, helping causes earn more. Then, the ever appealing tax deductions still apply. If a Crypto investor had a good year, they can donate appreciated tokens, avoiding the taxable event of converting to fiat, while also being able to deduct the amount of the donation. Furthermore, Crypto donations help with preserving anonymity, since donors can simply create a new address for each transaction. Finally, Blockchain’s traceability enables nonprofit organizations to reach new levels of transparency.
All in all, Crypto is improving philanthropy by getting more people involved and by enabling fast, cheap and transparent transactions.
Mihnea
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Bail-outs: trade-offs of investing in crypto
Contingency planning may become the norm for VCs interested in deploying capital into the crypto industry.
More than $1 billion worth of funds have been stolen from bridge-related hacks in little over a year, with two high-profile attacks including the $320 million (120,000 ETH) Wormhole exploit and the $625 million Ronin bridge hack. In both instances, VCs contributed to make all the participants whole. In the Wormhole case, Jump Crypto acquired 120,000 ETH from the market and injected it in the smart contract, while in the second case, Sky Mavis, the company behind Axie Infinity, raised $150 million in a financing round from the likes of Binance, Paradigm, a16z or Accel. The rest of the funds in the latter case would come from Sky Mavis.
Speaking on Bloomberg’s “What Goes Up” podcast, Dave Olsen, president and CIO at Jump Trading Group, noted that these events are part of how complex software evolves. It hardens over time while its vulnerabilities are being identified. Such a space is not dystopian, but pragmatic and these realities are part of day-to-day operations everywhere, including in tradFi. “You are hopeful you do not do a lot of them”. He also mentioned that Jump did not have a contractual responsibility to do anything, nor did they have any liability, but decided to act given that Wormhole is crucial for how they perceive the multi-chain future. Part of the bigger picture and beyond being only an investment with a possible return attached to it. In this case, the project is working with government (Dave mentioned these are very well resourced) and private agencies. All eyes are on the hacker’s wallet: within minutes every exchange and every stablecoin provider responded to their plea and blacklisted the address.
There are also other preemptive measures that VCs are employing. One example are white hackers bounties to find flaws on platforms (Jump has issued several $10 million bounties in the past). Yat Siu, Animoca Brands’ co-founder, said that VC firms should audit the code and security protocols before making investment decisions. Hard to say the majority do not do that already: in Jump Crypto’s case, it even wrote part of the code and had a high share of the early work in the Wormhole project.
Given the amount of funding entering the space, but also on the sidelines, VCs become (financially) motivated to roll up their sleeves and play a deeper role on the coding front while also opening their cheque books when cases like these arise. It may set up a new standard in crypto dealmaking.
Razvan
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Britain sets goal to become a ‘global hub’ for crypto
The UK government has announced on Monday, 4th of April, its plans to become a ‘global hub’ for the crypto industry. In its speech, John Glen, Economic Secretary to the Treasury, has made it clear that “ the UK is open for business and for crypto businesses”. Stating that they see “enormous potential in crypto”, John’s speech marks a shift from the stringent regulatory approach and indifference shown from the government so far.
The government is currently studying the possibility of issuing government debt using distributed ledger technology and released plans to regulate issuers of stablecoins. Additionally, Rishi Sunak had commissioned the Royal Mint to issue a NFT by this summer as an emblem of the forward looking approach the government is willing to take.
This move comes as a result of significant pressure on governments and regulators from industry participants, who request clearer rules and regulations of digital assets. The authorities hostility towards crypto shown until recently, had sparked concerns about Britain's ability to remain competitive at a time when the government is meant to boost the financial technology industry after Brexit.
Part of the suite of measures announced was the formation of an engagement group chaired by Glen, where regulators would meet crypto business executives. The Financial Conduct Authority is also set to organize “crypto sprints” with private sector players to allow their input to be captured. Some of the topics included on their agenda are the legal status of decentralized autonomous organizations and taxation rules, with Glen suggesting that an aim is to remove disincentives for UK fund managers to hold crypto in their portfolios.
Evelyne
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Did you get on the Vee Friends List?
As I wrote in our last newsletter, the time for the Friends List Mint has come. For every owned Book Game, we had one chance in the raffle, and, as Gary stated, "the total entries for Friends List included 23,781 unique wallet addresses holding 114,886 tokens. All entries are then randomized to select 32,000 total Friends List entries."
If you didn't have the chance to check if you're amongst the winners, all you'll have to do is connect your wallet here: https://series2.veefriends.com/friends-list
(make sure is the official link, lots of scams going on) and press the Check Eligibility button.
If you're in luck, it should look like this:
So, starting April 12th, you will have 12 and a half days to mint the NFTs on Opensea at 999$ + Gas fees (equivalent price in ETH).
This is such a release, to be honest, because on the same evening with the Series 2 raffle, Vayner Sports NFTs were launched at 0.15ETH each. But people panicked, and this happened:
7652.06ETH was spent on gas to purchase the 10k NFTs worth 2411.02ET. Crazy, right? Especially now that the floor price is 0.45ETH.
After 12 and a half days of minting, on the 25th of April, the public mint will be on. 10.000 pieces available. But more on that another time.
Keep in mind that the Book Games you own can still help you. You can sell them (the floor price is now 0.26ETH) or use them for the Burn Sale, a daily raffle drawing for qualifying sets of book tokens, as you can see here. And the cool thing is that if you participate in this raffle and don't win, you don't have to burn your tokens.
There is a whole article about the burning process; I suggest you give it a good read because some rare NFTs can come out of this.
More to come shortly.
Cosmin
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StakeborgDAO Quarterly Reports: https://docs.stakeborgdao.com/reports/dao-quarterly-reports
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