Blockchain has become a major industry and seems to be on the verge of widespread acceptance.
The promise of benefits such as easier access to financial products and services, improved resilience and security, and increased competition and innovation remains attractive. And the cryptocurrency industry, the historic pioneer of blockchain technology, is working to put its past scandals and bad reputation behind it.
However, much remains to be done, from technological advances to clearer regulatory frameworks, more comprehensive market education and a more stable market environment.
That’s why each week PYMNTS summarizes the most important crypto and Web3 news, updates and announcements for our readers, tracking the key data points as the sector moves toward meaningful and sustainable advances in global payments and commerce.
Capturing on-chain utility in different use cases
While blockchain has remained a constant presence, its Web3 counterpart – the metaverse – may no longer be living up to the lofty promises that captured the attention of enthusiasts. Designed as an interconnected system of digital worlds based on blockchain technology and digital tokens, the metaverse is, as reported last Wednesday (August 7), declining. This includes the prices of non-fungible tokens (NFTs) and other platform-related tokens.
But blockchain does not seem to suffer the fate of the metaverse.
Instead, public blockchains, known for their decentralized nature, are gaining traction in meeting business needs, as highlighted by a new report from PYMNTS Intelligence titled “The Benefits of Blockchain for Regulated Industries.”
On Tuesday (August 13), DBS and Ant International launched a pilot project for a blockchain-based treasury and liquidity management solution that will enable Ant International to shorten the processing of intra-group transactions from days to seconds.
The solution, DBS Treasury Tokens, will enable Ant International, a digital payment and financial services solutions provider, to leverage the digital form factor to achieve instant, multi-currency treasury and liquidity management on the DBS-authorized blockchain for its entities across multiple markets, the companies said.
And on Wednesday (August 14), Mastercard launched a crypto-to-fiat card alongside Web3/blockchain platform MetaMask and cryptocurrency payments company Baanx.
The MetaMask Card allows MetaMask wallet customers to use cryptocurrencies for everyday fiat currency purchases anywhere Mastercard is accepted. The card is being tested on a limited basis – with a few thousand digital-only cards – for users in the European Union and the UK.
Elsewhere, aelf and ChainGPT have partnered to add chatbots, non-fungible tokens (NFTs) and smart contract generators, as well as other artificial intelligence (AI) technologies to aelf’s blockchain network.
The first phase of the partnership will focus on integrating ChainGPT’s AI chatbots on aelf’s website and Telegram and Discord platforms, according to a press release. These chatbots will be trained on aelf’s developer documentation and strategic initiatives, serve both technical and consumer users, and handle everything from simple user queries to complex development questions.
Crypto seeks regulatory clarity
It was a big week in terms of regulation and enforcement, as one of the longest-running legal cases affecting the regulatory future of cryptocurrencies was partially resolved last Wednesday (August 7).
In the case between the cryptocurrency company Ripple Labs and the US Securities and Exchange Commission (SEC), the scales of justice were partially in Ripple’s favor. A federal judge ordered the company to pay a civil penalty of $125 million and an injunction against future violations of securities law. The SEC demanded fines and penalties totaling $2 billion.
Nevertheless, the SEC was also able to record successes this week.
The agency on Monday (August 12) charged NovaTech Ltd, its operators Cynthia and Eddy Petion, and the company’s key promoters with operating a fraudulent scheme involving crypto assets.
The SEC complaint states that the Petions told investors NovaTech would invest their funds in crypto-asset and foreign exchange markets, but instead used the majority of those funds for payments to other investors, commissions to promoters, or for takeovers by the Petions, while only a fraction of the funds were used for trading. The complaint also states that most investors suffered significant losses when NovaTech collapsed because they were unable to withdraw their funds, the press release said.
The company has raised over $650 million worth of crypto assets from more than 200,000 investors around the world.
Read more: California puts car titles on the blockchain to promote blockchain usability
And elsewhere, one of the most high-profile crypto scams came close to its own solution when it was announced last Wednesday that FTX and its sister company Alameda Research have agreed to pay their creditors $12.7 billion as part of a settlement between the bankrupt cryptocurrency platform and the Commodity Futures Trading Commission (CFTC).
Under the agreement, FTX and Alameda will repay $8.7 billion to investors defrauded by Sam Bankman-Fried, FTX’s now-jailed founder. The companies must also pay $4 billion in “disgorgement” for “profits related to the violations” mentioned in the CFTC’s complaint against the defendants.
And despite the decentralized nature of cryptocurrencies and other digital assets, Web3 companies need banking partners. But on Thursday (August 8), news broke that Pennsylvania-based Customers Bank, one of the few crypto-friendly banks in the U.S., has been hit with a 13-page regulatory action from the Federal Reserve related to its digital asset and dollar token activities, underscoring the need for financial institutions (FIs) to balance innovation and compliance.
