Argo Blockchain Avoids Bankruptcy with $100 Million Deal with Galaxy Digital

• Argo Blockchain (ARBK) has avoided filing for bankruptcy protection after agreeing to sell its Helios mining facility in Dickens Country, Texas to Galaxy Digital for $65 million.
• The miner will also get a new $35 million loan from investor Michael Novogratz’s crypto-focused financial-services firm, which will be secured by Argo’s mining equipment.
• Argo’s shares have more than doubled in early London Stock Exchange trading.

Argo Blockchain (ARBK) has successfully avoided filing for bankruptcy protection after agreeing to sell its Helios mining facility in Dickens Country, Texas to Galaxy Digital for $65 million. The miner will also be receiving a new $35 million loan from investor Michael Novogratz’s crypto-focused financial-services firm, which will be secured by Argo’s mining equipment. This transaction will help Argo bolster its balance sheet and avoid bankruptcy after a deal for $27 million in funding fell through in October.

The miner had found itself in a precarious situation and was in advanced negotiations to sell some of its assets and carry out an equipment financing transaction to avoid filing for Chapter 11 bankruptcy. However, with the help of Galaxy Digital, Argo will be able to continue mining through the bear market, reduce its debt load and maintain access to the unique power grid in Texas.

Chris Ferraro, president and chief investment officer at Galaxy, noted that the deal was structured to boost Argo’s balance sheet and capital structure. When the miner kicked off its process, “we were in a position to solve the problem completely for Argo, while accelerating the expansion of our own mining capabilities,” he added.

Additionally, the two companies have also entered into a two-year hosting agreement with Galaxy, securing a place for Argo’s computers to keep mining at the Helios facility.

The news of the deal was welcomed by the markets as Argo’s shares more than doubled in early London Stock Exchange trading. On Tuesday, the company requested a 24-hour suspension of trading in its Nasdaq-listed stock to discuss further details.

All in all, the deal with Galaxy Digital comes as a much needed lifeline for Argo Blockchain and its shareholders. The miner will now be able to reduce its debt load and continue mining in the bear market, while Galaxy Digital will be able to expand its own mining capabilities.

Crypto Payments to Ransomware Hackers Plummet: Regs and AML Win the War

• Cryptocurrency payments to ransomware hackers totaled a mere $16 million in 2022, compared to nearly $74 million USD in 2021.
• Analysis of on-chain activity shows that crypto services with a high money laundering risk score are seeing a drop in popularity.
• Crypto exchanges and services that manage to keep “dirty” crypto out have been further tightening anti-money laundering policies, effectively scaring away criminal actors.

The prevalence of ransomware attacks has increased in recent years, with the notorious Conti ransomware gang terrorizing U.S. hospitals during the COVID-19 pandemic. Despite this, blockchain intelligence firm Crystal Blockchain has reported that cryptocurrency payments to ransomware hackers totaled a mere $16 million in 2022, compared to nearly $74 million USD in 2021.

Nick Smart, Crystal’s director of blockchain intelligence, noted that it may be too early to conclude that ransomware attacks are in permanent decline. He further explained that due to the way ransoms generally work, it’s not possible to tell what happened now as many companies don’t disclose payment information publicly.

In order to combat the rise of cybercrime, an analysis of on-chain activity has been conducted, which has revealed that crypto services with a high money laundering risk score – meaning they receive funds from scams and cybercrime more often than others – are seeing a drop in popularity. This is likely due to increased regulation, registration and client expectations.

In addition, to keep “dirty” crypto out, crypto exchanges and services have been further tightening anti-money laundering policies. This has effectively scared away criminal actors, with the volume of funds sent to low-risk exchanges from scams having fallen by 24% in 2022 compared to 2021.

Overall, the combination of heightened regulation and anti-money laundering policies, as well as a decrease in the number of services willing to accept funds from cybercrime, appears to have had a significant impact on the amount of cryptocurrency payments to ransomware hackers. This could be a sign that the world is slowly winning the battle against cyber criminals.

810 Active Users in Decentraland: CoinDesk and Atlas Corp. Count Metaverse Population

•CoinDesk worked with Atlas Corp. to determine an accurate count of active players in Decentraland, which was estimated at 810 users on an average day.
•At the Metaverse Music Festival, 3,668 active users with a non-fungible token (NFT) in their wallet were identified.
•The challenge of sorting bots from real people, and then even real people can be inactive or AFK, is a difficult task in determining the population of Decentraland.

As the world of virtual reality continues to shape our global landscape, more and more people are turning to metaverse platforms like Decentraland for an immersive, unique experience. With a growing population that’s difficult to measure, CoinDesk decided to work with data company Atlas Corp. to try to determine how many active players are in Decentraland on an average day.

The challenge of conducting a census of the metaverse is rooted in sorting real people from bots, as well as the fact that many users can be inactive or AFK (away from keyboard) for hours, days, or even weeks. In order to filter out bots, Atlas Corp. decided to focus on users who had a non-fungible token (NFT) in their wallet. This also weeds out „tourists“ who simply pop in and out of Decentraland without engaging in meaningful interaction.

At the end of their research, Atlas Corp. determined that an average of 810 users were active in Decentraland on an average day. This number is likely to grow as the platform continues to gain popularity and its users become more invested in the platform’s success. At the Metaverse Music Festival, the active user count was even higher, with 3,668 users being identified with an NFT in their wallet.

Although the task of providing an accurate count of active players in Decentraland is challenging, the efforts of CoinDesk and Atlas Corp. have gone a long way in providing a number that reflects the true population of this metaverse. This number is a valuable resource for anyone interested in understanding the growth of Decentraland and the impact of its users on the platform’s success.

: The Possibilities of DeFi Derivatives Trading Are Substantial

• The derivatives market, and in particular options trading, has seen exponential growth in the DeFi sector and is expected to see further growth in 2023.
• Options provide traders with the ability to tailor trades and risk tolerance, allowing them to express investment views that incorporate new elements.
• The growth of DeFi options trading is hindered by the lack of knowledge about external events and how they affect the crypto market, however the use of data to analyze trends and events will help to increase adoption.

The past few years have seen a massive influx of investors into the cryptocurrency space. This influx has been driven by the promise of decentralization and self-custody, as well as the potential for economic empowerment for all. This promise has been realized in the form of decentralized finance (DeFi). DeFi has given rise to a diverse range of investment opportunities, with one sector in particular poised for exponential growth in 2023: derivatives.

Derivatives, and more specifically options trading, offer investors the ability to customize their trades and risk tolerance. Options allow investors to express investment views that incorporate elements such as price, timeframe, and velocity. The DeFi options market currently has a combined total value locked (TVL) of over $180 million, and has plenty of room to grow. If the crypto options market were to match traditional finance levels, it would need to see a 30 to 35 times increase.

So what is preventing the options market from achieving this growth? The main difference between crypto options and traditional finance (TradFi) options is that we are still learning how external events affect the crypto market. In TradFi, investors have access to earning reports or substantial company news covered by the media to inform their trades. However, crypto is still trying to figure out what is important. When someone tweeted that Vitalik Buterin had died, ether (ETH) temporarily “crashed” on the “news” before swinging right back, which shows how quickly the crypto market can move.

Fortunately, trading strategies like options provide us with ways to mitigate losses and customize risk levels. Our underlying blockchains also provide us with access to an enormous amount of consistently-generated, granular data such as spot data, which can be used to analyze trends and movements. The more DeFi is used, the more data we have and the more we learn.

DeFi options trading will continue to see exponential growth due to its dynamic nature, massive investment prospects, and soon, ease of access and use. Once the barriers to entry are reduced and more investors start to see DeFi for the evolution in our economy that it truly is, options trading will help drive adoption. With data-backed strategies and the right tools, DeFi options trading could become one of the most popular investment strategies of 2023.

: ZK Rollups are helping to make Ethereum’s decentralized vision a reality.

• Zero-knowledge (ZK) technology is a cryptographic tool that allows blockchain networks to prove the authenticity of their operations in the most efficient way.
• ZK tech is expected to revolutionize sectors from gaming to payments, and from digital identity to enterprise solutions.
• ZK rollups and zkEVMs are bringing Ethereum’s vision of a decentralized web into focus.

In 2015, the Ethereum protocol proposed a vision for a decentralized world computer capable of rearchitecting a free and open internet – removed from the whims and constraints of centralized entities. With the goal of realizing its full potential, Ethereum has been the foundation for the development of Web3. Among the most promising solutions to scale the network for mass adoption are systems using zero-knowledge (ZK) technologies.

ZK tech is an innovative cryptographic tool that allows blockchain networks to prove the authenticity of their operations, using the fewest possible steps, all while reducing costs, increasing throughput capacity, and expanding potential use cases far beyond what is currently possible. The advantages of ZK technology have not gone unnoticed, with many industry participants projecting that it would take more than a decade to build a performant, EVM-compatible ZK rollup. Fortunately, it took considerably less time than that.

The Ethereum Merge in 2022 was instrumental in transitioning the network from proof-of-work (PoW) to the more efficient proof-of-stake (PoS), and the development of ZK tech is a part of Ethereum’s longer-term vision. In order to truly trust the outputs of a ZK-powered tool, source-available code for every component is required to verify its inputs. This, in turn, will allow the application of ZK tech to be transformational for Web3 development.

Given the potential of ZK technology, it is expected to revolutionize myriad sectors, from gaming to payments, and from digital identity to enterprise solutions. In the payments industry, for example, ZK’s ability to increase throughput and security, while reducing fees, could take DeFi and consumer payments to the next level. Similarly, for blockchain gaming applications to match the volume of users seen in the mainstream gaming sector, ZK rollups will be essential for processing the hundreds of thousands, if not millions, of micro-transactions that a typical blockchain game would require.

In addition, enterprise users have been wary of the security issues presented by decentralized networks and their perceived lack of oversight and accountability. Zero-knowledge technology is the very thing that will deliver accountability to decentralized networks without submitting to arbitrary oversight. Its implementation will provide the kind of security that enterprises need to interact with decentralized blockchains, while also being applied to digital identity, providing a decentralized, privacy-first means for users to verify their credentials and identity without ever revealing personal information.

In response to the collapse of the FTX exchange, Vitalik proposed a ZK-based solution for preventing future FTXs. A cryptocurrency exchange could use Zero-Knowledge proofs to demonstrate solvency by publishing a proof of reserves. This would allow an exchange to confirm it has the liquidity to cover customer withdrawals without revealing the sensitive business information contained therein.

The potential of ZK technology is vast, and with its ability to increase throughput and security, reduce fees, and expand potential use cases, its adoption is likely to be widespread. This is especially true as the development and application of ZK tech adheres to the core ideals of Web3, with transparency chief among them. With its growing potential, 2023 promises to be the year ZK tech truly starts to take off.

The International Chess Federation Integrates With Avalanche on the Web3 Platform

• FIDE, the International Chess Federation, is partnering with the Avalanche blockchain to bring their competitions into Web3.
• This collaboration will allow for operational efficiencies for players, federations and game integrity, as well as AVAX-hosted tournament prize pools.
• This is not the first time chess has crossed paths with crypto, as chess legend Garry Kasparov launched his first collection of NFTs earlier this month.

The International Chess Federation (FIDE) has taken a major leap forward in utilizing the capabilities of Web3 and blockchain technology. On Friday, FIDE announced its partnership with the Avalanche blockchain, which will bring its competitions into a digital platform.

This collaboration with the Avalanche blockchain will provide a wide range of benefits to both players and federations. For players, this partnership will create operational efficiencies, such as publishing tournament data and player rankings on-chain. It will also introduce AVAX-hosted tournament prize pools, giving players the opportunity to earn rewards for their chess prowess.

FIDE is also introducing Core, a self-custody crypto wallet, as a featured sponsor for physical chess tournaments around the world, including the World Chess Championship and Chess Olympiad. This will help to unify the chess community and bring players, clubs, federations and FIDE closer together.

This is not the first time chess has crossed paths with crypto. Earlier this month, chess legend Garry Kasparov launched his first collection of NFTs. Play-to-earn chess games such as MetaChess have also been popular for much of the past year.

The partnership between FIDE and AVAX is a major step forward in the integration of Web3 and blockchain technology into the world of chess. FIDE’s move follows alongside the gradual embrace of digital mediums by the chess world, with more than 100 million people playing online chess regularly and competing in over 25 million virtual chess matches each day. The governing body of table tennis launched a similar Web3 campaign last August, further showcasing the potential of blockchain and Web3 in sports.

The benefits of this collaboration are clear. Not only will it create operational efficiencies and improve game integrity, but it will also provide players with the opportunity to earn rewards for their chess prowess. With FIDE’s move, the world of chess is now one step closer to entering the Web3 and blockchain world.

VC Leader Predicts Opportunities for Crypto Funding in 2023 Despite Plunge in 2022

• Blockchain startups received a record $25.2 billion in venture capital investments in 2021, with a surge in funding for NFTs and DeFi projects.
• Funding slowed dramatically in 2022, with major companies like Three Arrows Capital, Celsius and FTX collapsing.
• David Pakman of CoinFund predicts that in 2023, investments will focus on layer 1 and layer 2 blockchains, NFTs, gaming and Web3 development, as well as risk management and conservative use of leverage.

The blockchain industry has seen a huge surge in venture capital investments in 2021, with a total of $25.2 billion invested in startups utilizing the technology. The investments were driven by optimism surrounding non-fungible tokens (NFTs) and decentralized finance (DeFi) projects. However, in 2022, funding slowed significantly after a wave of major companies, such as hedge fund Three Arrows Capital, lending platform Celsius, and exchange giant FTX, collapsed.

In order to gain insight into the investment landscape of 2023, CoinDesk interviewed David Pakman, managing partner and venture investing head at crypto-focused venture capital firm CoinFund. Pakman discussed how the crypto industry can move forward in a post-FTX world, and what he believes the investment focus will be in the coming year.

Pakman explained that CoinFund had a small amount of equity in FTX before its collapse, which has now been written to zero. He noted that the downfall of FTX was due to human behavior, not technological failure, and expressed hope that the industry will weed out the scammers and unethical actors that are damaging the reputation of the crypto space.

When asked about CoinFund’s own fundraising efforts, Pakman said that they were nervous even at the beginning of 2021, but that they had lucky enough to have limited partners who preferred to invest during the current pricing environment. He also mentioned that bear markets can benefit venture capital firms, as shakier markets lead to lower valuations and more attractive entry points for potential investors.

Looking forward to 2023, Pakman predicted that investments will continue to focus on areas that were in progress before the turbulence, such as layer 1 and layer 2 blockchains, NFTs, gaming, and the Web3 development stack. The collapse of a centralized exchange has also put more emphasis on DeFi, and Pakman believes that there will be renewed interest in productizing DeFi in a way that is easier to access by both institutions and individuals.

In terms of risk management, Pakman advised startups to avoid using leverage altogether and to retire risk as they move on. He concluded the interview by noting that creating a startup is one of the riskiest things that can be done, and that it almost never works, so companies should focus on minimizing risk, rather than increasing it.

: The SEC is Examining Crypto Audits and SBF Has Received Bailout Funds

• Former FTX CEO Sam Bankman-Fried was released on bail after appearing in U.S. federal court in New York.
• The U.S. Securities and Exchange Commission (SEC) is increasing its scrutiny of audits of cryptocurrency companies.
• Documents show that Tron founder Justin Sun was a top client of crypto asset manager Valkyrie Investments, responsible for the vast majority of a key Valkyrie division’s assets under management.

The crypto markets have been volatile and unpredictable in recent months, with bitcoin having tanked 63% year-to-date. Crypto stocks, often seen as a proxy for digital assets, have suffered bigger losses than bitcoin. This has led investors to seek other ways to gain exposure to the crypto markets.

One such avenue was the recent news that former FTX CEO Sam Bankman-Fried had appeared in U.S. federal court in New York. Bankman-Fried was released on bail, with his release coming with a long list of requirements for him to remain free while he faces charges. These included not making financial transactions of more than $1,000, not opening new lines of credit, staying at home except to exercise, and going through substance abuse and mental health treatment.

In order to protect investors, the U.S. Securities and Exchange Commission (SEC) also announced that it was increasing its scrutiny of audits of cryptocurrency companies. Paul Munter, the SEC’s acting chief accountant, commented that investors “should not place too much confidence in the mere fact a company says it’s got a proof-of-reserves from an audit firm.” He added that having such a report “is not enough information for an investor to assess whether the company has sufficient assets to cover its liabilities.”

One of the most successful investors in crypto is Justin Sun, the founder of Tron. Documents recently revealed that Sun was a top client of crypto asset manager Valkyrie Investments, responsible for the vast majority of a key Valkyrie division’s assets under management. At one point in August, Sun had more than $580 million of bitcoin stashed with the asset manager.

Overall, investors interested in gaining exposure to the crypto markets must be extra vigilant when considering the various options available. While investing in bitcoin is still seen as a viable option, the SEC’s increased scrutiny of crypto audits must be taken into account when making any decisions. Investors should also be aware of the impressive track record of Justin Sun and other major crypto investors, but must do their own research to ensure they are making the right decisions for their portfolio.

: On the Eve of Retirement, One of Crypto’s Most Beloved U.S. Senators Proposes Last Bill

• The headline crimes and failures of 2023 have largely been attempts to use financial engineering to turn the future value of cryptocurrency into present-day U.S. dollars.
• Too often, the finance bros have used fragile, nested and interlocking leverage and outright fraud to take advantage of genuine public interest in crypto.
• 2023 in the crypto space will be a different year than in previous years, with hedge fund gamblers and token-shilling hype men relegated to supporting roles and super-coders taking the spotlight.

The crypto space has been in a state of flux over the past year, with collapses in the space being attributed to crypto itself. However, the truth of the matter is that these collapses had very little to do with crypto itself.

The vast majority of these collapses were caused by financial engineering attempts to turn the future value of cryptocurrency into present-day U.S. dollars. This type of financial engineering is not unique to the crypto space, with similar practices having been used to disastrous effect during the 2008 financial crisis.

In the crypto space, these financial engineering attempts have been carried out by financial brokers, often referred to as „finance bros“. These finance bros have leveraged the genuine public interest in crypto to their own advantage, often using fragile, nested and interlocking leverage and outright fraud to make a quick buck.

The year 2023 will be a different one for the crypto space. Hedge fund gamblers and token-shilling hype men will be relegated to supporting roles, with the real builders of the crypto space taking the spotlight. These super-coders are the ones who are developing and advancing the technology, and they will be the ones to drive the space forward in 2023.

The future of the crypto space is uncertain, but the focus in 2023 will be largely on the advancements of the technology itself. With the finance bros taken out of the equation, the crypto space will be one that is driven by innovation, creativity and genuine progress. This will be the year that crypto comes into its own and establishes itself as a viable and innovative technology.

: The Price of Popsicle’s ICE Token Triples Following the Return of the Controversial Founder of the DeFi Project Wonderland.

• Popsicle Finance’s native token ICE has quadrupled in price after hitting an all-time low of 9 cents two days before.
• The sudden surge came after blockchain developer Daniele Sestagalli said he was returning to the project.
• Popsicle Finance has had an atrocious 2022, with its total value locked deflating to $1 million from $120 million in November 2021.

The recent surge in the price of Popsicle Finance’s native token ICE has been nothing short of remarkable. The token, which was trading at an all-time low of 9 cents just two days ago, has now quadrupled in price and is currently trading at 36 U.S. cents.

The sudden surge has been credited to the return of controversial yet prolific blockchain developer Daniele Sestagalli to the project. Sestagalli had gone silent on Twitter for four months before announcing his return to Popsicle Finance on Wednesday. He had previously been involved with a loose conglomerate of DeFi projects known as “Frog Nation” that included Abracadabra.money and the since-failed Wonderland.

Unfortunately, Popsicle Finance has had an atrocious year in 2022. The project’s total value locked – a widely used DeFi metric to gauge activity and usage of any protocol – has deflated to $1 million from $120 million in November 2021, according to DefiLlama. Despite the recent surge in the token’s price, it is still down some 98% in a year.

In an effort to turn the project’s fortunes around, Popsicle Finance has recently deployed a yield optimizer service between blockchains called Limone in test mode on the Avalanche blockchain. The yield optimizer is designed to bring more users to the platform and create more liquidity.

The crypto community is hoping that with Sestagalli back in the fold, the project will be able to turn its fortunes around and recapture its former glory. Sestagalli himself has been vocal about his intention to focus on rebuilding the OG Popsicle Finance, and the community appears to have welcomed his return with open arms. Time will tell if he can succeed in reviving the project.