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Bitcoin lead developer’s departure and the banks’ connection to the digital ruble.  Main events of the week



12 min

Bitcoin has fallen by 9,48% over the past seven days. The asset reached the highest values on August 15, when 1 BTC was trading at $25 211, the lowest values were registered on August 19 — $21 447 per one coin. As of August 19, 10:00 UTC, the bitcoin exchange rate is $21 766 (according to Binance).

The value of the second most capitalized cryptocurrency, Ethereum, has declined 6,43% over the past seven days to $1737. The native token of the cryptocurrency exchange Binance (BNB) is down 8,08% and is trading at $284,2.

The total capitalization of the crypto market has fallen from $1,196 trillion to $1,144 trillion over the week, with bitcoin dominating at 38,29%. Ethereum's share is 19,04%.

Resignation of bitcoin's lead developer

Bitcoin lead developer Wladimir van der Laan announced that he would soon resign. He announced his decision under a tweet by Samson Mow, the former head of blockchain technology company Blockstream, who pointed out a bug in the network’s code that “could have killed Bitcoin.” After a lengthy discussion, Van der Laan wrote that “it’s soon time for me to move on to other things.” However, he never appointed a successor.

Van der Laan wrote in his blog that the management of is better left to an organization rather than an individual. He also promoted the idea that bitcoin should become “more decentralized.” Van der Laan covered in detail the relevant amendments to the network’s code for future developers.

In a Twitter correspondence, Van der Laan noted that he was “burnt out” and “tired of the same discussions.” “I changed, the world changed, and I feel it’s time for something else,” he added.

Banks' connection to the digital ruble

The Bank of Russia said that in 2024, all banks will begin to connect to the digital ruble platform in stages. This will increase the number of available payment options and transactions using smart contracts. The regulator assumes that as the Federal Treasury is ready, payments using digital rubles between the state and individuals/businesses will be available.

In 2023, the Bank of Russia intends to test settlements “in real money” between individuals (C2C), as well as individuals and businesses (C2B/B2C). The regulator also noted that a limited number of participants will be able to enter into and execute smart contracts on the digital ruble platform. The Central Bank plans to implement the offline mode of the digital ruble with subsequent connection of non-banking financial intermediaries and exchange infrastructure to the platform by 2025.

At the same time, according to the Central Bank, there is no reason to expect that the introduction of the digital ruble will be followed by a large-scale outflow of funds from bank deposits, because the latter will remain attractive for depositors due to the interest income and bonus programs.

Integration of cryptocurrencies into the PayPal application

PayPal completed a full integration of cryptocurrencies into the payment system’s mobile app. Now bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH), and Litecoin (LTC) are available for the app’s users to buy, sell, store and transfer.

The minimum amount for the purchase of cryptocurrency is $1. The app offers custodial services as well as educational materials. To use cryptocurrency as a payment method for purchases, one must complete a W-9 tax form in the app. The app will then convert the digital assets into US dollars or any other currency on its own, if necessary, with no additional fee.

The development of the Tornado Cash situation

Aave, a decentralized protocol, blocked TRON blockchain founder Justin Sun over a deposit from the Tornado Cash cryptocurrency mixer of 0,1 ETH received from an unknown user. Representatives of Curve.Finance, a DeFi protocol, under Sun’s Twitter post suggested sending the same funds to Aave’s founder Stani Kulechov “so that he can forward it to relevant authorities.” On August 14, Justin Sun reported that his access to the protocol had been restored.

According to cybersecurity company PeckShield, after the US authorities banned Tornado Cash, an unknown person with the service sent 0,1 ETH each to more than 440 addresses. In addition to Sun, the head of cryptocurrency exchange Coinbase, Brian Armstrong, and NFT artist Mike Winkelmann, known under the pseudonym Beeple, received the asset. Similar amounts were sent to centralized crypto exchanges such as Binance and FTX.

Entrepreneur and investor Kevin O'Leary supported the ban of the mixer. He believes that the digital asset sector needs more regulation and fewer “crypto cowboys,” such as Tornado Cash creator Alexey Pertsev. In his opinion, such services prevent the inflow of real institutional capital. O'Leary said regulation should root out such protocols that allow users to conduct anonymous transactions and therefore potentially engage in criminal activity.

Lawyers of Coin Center are preparing to challenge the decision by US authorities to put Tornado Cash on the sanctions list. Human rights activists argue that the ruling contradicts the US Constitution by violating the free speech amendment.

On August 14, a blockchain developer under the pseudonym banteg reported on his Twitter account that all five signatories of the Tornado Cash Community Fund multisignature wallet withdrew from management and transferred their rights to a decentralized autonomous organization (DAO).

The CEO of cryptocurrency exchange Kraken Jesse Powell criticized the sanctions against cryptocurrency mixer Tornado Cash. Powell noted that users “have a right to financial privacy” and that many use Tornado Cash for legitimate purposes. He also expressed doubt that the sanctions comply with the constitution. The head of Kraken suggested that the restrictions were a “hasty response” to the collapse of the Terra ecosystem, and regulators overreacted to protect users. He added that despite his stance, Kraken will block transactions with addresses associated with Tornado Cash.

According to a report by blockchain security firm SlowMist, a total of 74,7% of the total amount of criminal funds on the Ethereum network, 300 160 ETH, were laundered through the Tornado Cash cryptocurrency mixer. Of the remaining funds, about 24% (95 570 ETH) are still in hackers’ wallets, while 1,5% (6 250 ETH) were sent to exchanges. The research also found that Tornado Cash accounted for the largest part of the initial funding of money laundering incidents on the Ethereum and Bitcoin networks.

Stablecoin problems

On August 14, Acala, a DeFi platform, was subjected to a hacker attack, after which the stablecoin Acala Dollar (aUSD) lost its peg to the US dollar. The rate of stablecoin collapsed by 95%, from $1,02 to $0,05. The developers determined that the problem was a misconfiguration of the iBTC/aUSD liquidity pool (which was launched on August 14), which allowed attackers to issue 1,27 billion of the project’s stablecoin. This amount represents more than 99% of the issued aUSD. As of August 19, 13:00 Moscow time, the price of the asset has recovered only to $0,75 (CoinGecko data).

The stablecoin of cryptocurrency exchange Huobi (HUSD) also lost its peg to the US dollar. On August 17, the rate of the asset began to decline, and by the morning of August 18, it fell by almost 9%, to $0,91. At the time of writing this article the value of HUSD has recovered to $1.

NFT news

Truth in Advertising, a non-profit consumer advocacy organization, claimed that 19 celebrities, including rappers Eminem and Snoop Dogg, are engaged in advertising and promoting non-fungible tokens (NFTs) on social media without disclosing their connections to the projects. According to the non-profit organization’s representatives, this could violate the US Federal Trade Commission (FTC) rules.

In addition to Eminem and Snoop Dogg, involved in shilling were Justin Bieber and Paris Hilton, sports stars Floyd Mayweather and Tom Brady, and several actresses including Gwyneth Paltrow and Reese Witherspoon. Letters were sent to all of them urging them to immediately disclose any connections to NFT companies or brands.

From the world of mining

According to, bitcoin mining revenue for the month increased by 68,63%, from $13,92 million on July 13 to $23,48 million on August 12. The network’s hashrate fell by almost 10% over the past month, from 231 TH/s to 209 TH/s. Also during this period, the difficulty of mining the first cryptocurrency decreased by 3%, from 29,11 TH to 28,17 TH. At the time of writing, the mining difficulty is 28.35 TH and the hashrate is 199.12 EH/s.

Norwegian mining company Kryptovault announced the move of capacity beyond the Arctic Circle, to the town of Stokmarknes on Hadsel Island. The decision was made due to the growth of electricity prices in the southern regions of the country, caused by drought and shallowing of the rivers. The difference in rates per kW can be up to 160 times, depending on the region.

The Bitfarms mining company posted a loss of $142 million in the second quarter of 2022, up from $4 million in the previous reporting period. Between April and June, Bitfarms mined 1 257 bitcoins and sold 3 357 BTC worth $69 million. Some of the funds were used to reduce debt to investment firm Galaxy Digital to $38 million. Bitfarms also closed a $37 million funding round to buy new equipment.

The amount of electricity consumption for mining in Russia increased almost 20 times in 5 years: from 64,05 MW in 2017 to 1245,34 MW in 2021. The growth of energy consumption with proper regulation and legalization of cryptocurrency mining will allow the development of related industries and further digitalization of the economy, experts from mining equipment importer Intelion Data Systems said.

During the second quarter of 2022, the three largest publicly traded bitcoin mining companies in the United States collectively lost more than $1 billion due to declining cryptocurrency prices. Core Scientific, Riot Blockchain, and Marathon Digital Holdings reported net losses of $862 million, $366 million, and $192 million, respectively, in their reports. Arcane Crypto analyst Jarand Mellerud said that a record 6200 coins were sold during July.

The Irkutsk Region and the Republic of Khakassia will be the first in Russia to introduce a differentiated payment system for electricity for individuals. The tariff will be set under a new methodology of the Federal Anti-monopoly Service (FAS) based on the principle “the more you consume, the more expensive each kilowatt hour.” It is reported that the new payment system is aimed to combat gray miners and will not affect regular consumers.

Profits of Chinese cryptocurrency manufacturer Canaan increased by 117% in the second quarter compared to the same period of the previous year, despite the ban on mining in the country. Company representatives noted that profits amounted to 930 million yuan (about $139 million).

Metaverses news

Experts at Bank of England Owen Lock and Teresa Cascino said that the widespread use of crypto assets in the metaverse could pose a systemic risk to financial stability and will require ‘strong consumer protection.” The threat is that large volumes of “real economic transactions” in cryptocurrencies will go through decentralized platforms. An important step for regulators is to address the risks of cryptocurrencies in the metaverse before digital assets reach systemic status, the experts stressed.

Two popular Spanish football clubs, Real Madrid and Barcelona, filed a joint trademark application in the metaverse. According to the trademark attorney Mike Kondoudis, the teams intend to record their ownership of virtual clothing and footwear, gaming, and crypto transaction management software.

Chef, winner of seven Michelin stars, and TV host Gordon Ramsay will bring his show Hell’s Kitchen to The Sandbox metaverse. According to the announcement, the metaverse community will be able to “create new dishes, win competitions, collect recipes & compete for your chance to make it to Head Chef.” The show Hell’s Kitchen has been produced by ITV Studios since 2005 and has been nominated five times for the Emmy Awards.

New predictions for the bitcoin rate

Mark Yusko, head of venture capital firm Morgan Creek Capital, stated that bitcoin has already reached the bottom and a major rally awaits the asset in less than a year. Yusko said that after months of decline in the crypto market, the crypto winter is finally over and BTC is ready for a “parabolic move up in six to nine months.” The head of the venture capital firm also called the first cryptocurrency a perfect store of value, comparing it to gold.

Peter Schiff, head of the brokerage firm Euro Pacific Capital, believes that the rate of bitcoin will not be able to reach new highs, and probably will continue to fall to the $10 000 mark and below. In his opinion, the current growth of the crypto market, including Ethereum’s 70% rise in price, is not sustainable. He added that the market will continue to fall, so investors should take advantage of the rally they have now. Schiff noted that there is a bubble in the crypto market, even though bitcoin is down about 65% from its all-time high (ATH).

Anthony Scaramucci, head of investment firm SkyBridge Capital, suggested that the launch of a spot bitcoin trust by investment firm BlackRock would contribute to a sharp jump in demand for the first cryptocurrency and lead to an increase in the price of the asset. According to Scaramucci, BTC will reach the $300 000 mark within a few years. He also noted a revival of investors’ interest in the cryptocurrency market.

New materials in GetBlock Magazine's knowledge base

Eight myths about Ethereum's migration to Proof-of-Stake

How much does it cost to bring a token to the top? Highlights from the CNBC investigation

“This is our present.” What awaits DeFi projects after sanctions against Tornado Cash

Big capital entry. What awaits the market after the launch of the bitcoin trust from BlackRock

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