This Week in Web3: Wells Notices, Crypto Payments and Usability

bitcoin, crypto, btc-3890350.jpg

Crypto goes up, and crypto goes down. Then, often, crypto goes back up.

It can be a dizzying and volatile cycle.

Just collapsed cryptocurrency exchange FTX’s customers, who, having once feared they’d lost their collective billions, can now take solace from the news Tuesday (May 7) that FTX’s bankruptcy team is ready to repay them in full, with interest.

That’s because eighteen months after its collapse, the cryptocurrency exchange now says it has pulled together assets worth between $14.5 and $16.3 billion, enough to pay back 98% of its creditors 118% of what they are owed.

Of course, that “repay in full” refers to the valuation of customer assets at the time of FTX’s November 2022 collapse, when crypto was suffering a bear market, not those assets’ current valuations, leaving many to feel cheated. For example, bitcoin holders will be owed $16,871 for each of their former coins — which are now worth more than 400% more, or around $62,000, as of reporting.

But FTX’s turning back the clock isn’t the only crypto news to hit the industry this week. And from U.S. Securities and Exchange Commission (SEC) scrutiny to new exchanges, earnings announcements, and even hints of the elusive real-world utility for crypto assets, these are the top stories around the Web3 landscape that PYMNTS has been tracking for the past week.

Crypto Payments Look to Unlock Scalable, Real-World Usability

“The internet will have a native currency; it’s just a matter of time. Artificial intelligence systems and agents will have to transact, and the most efficient way to do so will be a common protocol for money movement,” Jack DorseyBlock head, Square head, chairman and cofounder of Block, said Thursday (May 2) during his company’s first quarter 2024 earnings results.

Dorsey emphasized that, in his view, bitcoin would be that common protocol for the internet’s native currency.

And he wasn’t alone in using a company earnings call as a platform for crypto payments evangelism.

Also on Thursday, Brian Armstrong, the co-founder and CEO of the largest U.S.-based crypto exchange, Coinbase, told investors that crypto payments were emerging as a key opportunity area.

“[We’re] driving utility in crypto. We’re doing this through … building a better payments experience on crypto rails … getting us closer to our goal of having the average crypto transaction take less than one second and cost less than $0.01 anywhere in the world,” Armstrong said on the call.

“It still boggles my mind that every time you swipe your credit card, the merchant is losing 2%,” Armstrong added. “It’s really just moving bits of data, kind of like sending a WhatsApp message, which is free. And so … why does that still exist as a 2% tax on every transaction in the economy?”

Coinbase stores over 12% of total crypto market cap on its platform, and the exchange is working to introduce a smart wallet for crypto this summer.

Elsewhere, the Swiss National Bank is conducting a pilot project that has used wholesale central bank digital currency (CBDC) and successfully settled four tokenized bond issuances and one secondary market transaction.

And with the news Friday (May 3) that telecommunications giant Vodafone is planning to integrate cryptocurrency wallets and blockchain-based payment solutions directly into mobile phone SIM cards, innovative Web3 solutions that can streamline the ease of use for crypto payments are increasingly top of mind for both merchants and consumers.

The timeline across which they’ll make it over to real world usability, however, could be a different matter.

Crypto’s Ongoing Regulatory Troubles

Crypto’s calling card — at least during its early years — was that it was the “Wild West.” But as the industry matures, regulators are taking some of the sector’s cowboys to court.

As PYMNTS reported, on Monday (May 6) Robinhood’s cryptocurrency business could become the latest target of regulatory action, with the trading platform receiving a Wells Notice from the SEC indicating they will recommend that the commission take enforcement action against the company.

“After years of good faith attempts to work with the SEC for regulatory clarity including our well-known attempt to ‘come in and register,’ we are disappointed that the agency has decided to issue a Wells Notice related to our U.S. crypto business,” Dan Gallagher, the company’s chief legal, compliance and corporate affairs officer, said in a blog post.

At the same time, news broke on Tuesday that Nigeria is reportedly stepping up its cryptocurrency crackdown with a proposed ban on peer-to-peer (P2P) trading. The move is the latest effort by the West African country to place tighter controls on the crypto sector, which it blames for the decline of its national currency.

It isn’t just regulatory struggles — crypto firms are subject to run-of-the-mill operational struggles, too. As reported hereBakkt is cutting staff after warning earlier this year about the future of the company. The cryptocurrency platform said in an April 29 securities filing that it is laying off 13% of its non-call center staff.

Web3 Marketplace Moves

Regulatory struggles aside, the crypto space continues to push forward.

On Tuesday, British FinTech Revolut unveiled a stand-alone cryptocurrency exchange for professional crypto traders. Called Revolut X, the platform designed to compete with other top exchanges by offering easy on and off ramping, and low fees.

And PYMNTS covered Sunday (May 5) how cryptocurrency startups are reportedly engaging in aggressive fundraising as the digital asset space recovers, as well as how Crypto.com wants to increase its sports sponsorships to reach a wider audience.

Image by: Pixabay

Shopping Cart

Media Kit

    Data Protection

    Personal Data (“Data”) submitted for Media Kit (“Media Kit”), and/or collected in the form of first name, last name, email address and other contact details may be used for the purposes of inviting you to future events and for reaching out to you with content which may be of interest to you. For these purposes, The Digital Banker will share the Data with our associate companies (including event and content sponsors) to promote their products and services. You will also be automatically subscribed as a user on www.thedigitalbanker.com. If you would like to opt-out, email us at [email protected].

    By clicking Submit, you acknowledge that you consent/ have sufficient informed consent to the collection, use and disclosure of Data as set out above.

    The Digital Banker Summit

    Moving on from FTX: is 2023 the year of CBDCs?

    Indonesia, Jakarta

    Thailand, Bangkok

    Philippines, Manila

    Contact Us

      Data Protection

      The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

      Request Nomination Pack

        Data Protection

        The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

        Registration Form

          Data Protection

          The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

          Registration Form

            Data Protection

            The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

            Registration Form

              Data Protection

              The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

              Registration Form

                Data Protection

                The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

                Registration Form

                  Data Protection

                  The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

                  The world’s preeminent Private Banks and Wealth Managers are demonstrating a committed drive in innovation, advisory, new products and services to meet the sophisticated needs of their clients.

                  COVID-19
                  Amid economic activity revival on the back of the Covid-19 vaccine program, organisations moving from business continuity plans to stable working environments, together with the slightest improvement in unemployment numbers, forced the world to adjust to new realities. Coming to terms with the “new normal”, global investors are now on the look-out for attractive and stable investment opportunities.

                  Needs of Private Wealth customers and families worldwide have drastically changed due to the pandemic and banks have had to accelerate efforts to deploy a multi-channel service strategy and safeguard clients’ businesses and wealth against negative impacts of economic uncertainly.

                  The Global Private Banking Innovation Awards will recognise the world’s best private banks, wealth managers and asset managers that are championing innovation across advisory, service, products, customer experience and more.

                  Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugiat nulla pariatur. 

                  Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugiat nulla pariatur. Excepteur sint occaecat cupidatat non proident, sunt in culpa qui officia deserunt mollit anim id est laborum.

                  Request Nomination Pack

                  Error: Contact form not found.