Autor Cointelegraph By Savannah Fortis

Binance tops up SAFU fund at $1 billion amid price fluctuations

As the liquidity crisis and acquisition of cryptocurrency exchange FTX continues, Binance CEO Changpeng “CZ” Zhao assured his community of insurance of sufficient funds backing the network. In a tweet on Nov. 9, CZ said that the exchange has once again topped its Secure Asset Fund for Users (SAFU) at $1 billion equivalent in light of “recent price fluctuations.”To adjust to recent price fluctuations, #Binance has topped up the #SAFU insurance fund to $1 billion USD equivalent again.BUSD AND BNB address about 700m: https://t.co/OMoB6HeR6rBTC address 300m: https://t.co/6kOJ1MZhMMTransparency. 1/2— CZ Binance (@cz_binance) November 9, 2022The tweet included links to two reserve accounts, one of which holds both the Binance stablecoin (BUSD) and the native token of the network Binance Coin (BNB) with an equivalent worth of $700 million. The other wallet revealed Bitcoin (BTC) holdings worth around $300 million. Binance’s SAFU began in 2018 by allocating 10% of the trading fee into a fund that is solely dedicated to backing up user holdings in the case of an incident. In February of this year, the fund hit $1 billion for the first time. The crypto community on Twitter responded to the tweet with mostly positive reactions, applauding CZ for his action. One user said “all cryptocurrency firms should have a Secure Asset Fund for Users (SAFU) just like Binance.” While others had questions about the sufficiency of the cap for funds in the reserve:Does #Binance keep less than $1 Bil in users funds in hit wallets?Could there be any scenario where Binance needs more than the $1B?— Crypto King (@Cryptoking) November 9, 2022

These recent tweets regarding the balance of the SAFU, came after CZ pledged on Twitter the day before for a Proof-of-Reserve mechanism for a detailed disclosure of liquidity. The Binance CEO said the exchange will deploy a Proof-of-Reserve system which will utilize Merkle Trees for “full transparency” with the community. Merkle Trees are a mechanism for encoding blockchain data in a more efficient and secure manner.The most recent CZ tweets referring to Binance’s SAFU also ended with the one-word sentence: “transparency.”Related: Binance’s FTX acquisition seen as chess move by crypto communityThis is one of the latest moves in the back-and-forth between FTX and Binance, which has unfolded over the last few days.CZ has been active within the community during the entirety of the events. On Nov. 8, he tweeted his major takeaways from what has transpired thus far, which included not using a native token as collateral within the same network and keeping a large reserve.

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NFTs are the key to turning passive fandom into an active community

Nonfungible tokens (NFTs) are giving Web3 communities the tools to transform user participation.The Web3 world has been watching NFTs grow up. These digital assets have evolved from hype-centered digital art collections to utility-focused tools building the next generation of the internet. One of the most important utilities of NFTs is that they are increasingly used as the key to communities of the future – both digital and physical. This is also true when it comes to existing communities, be it fan clubs in sports and music or legacy brands. These incentivized digital assets can take passive fandoms and turn them into active communities, where members own and delegate activity in a living ecosystem. The inBetweeners project falls somewhere in the middle of this Web3-born phenomenon. It combines the digital art of artist GianPiero, who designed Justin Bieber’s iconic Drewhouse clothing line, and serves as a key to real-life hype-events like a VIP party at the Coachella music festival. Bear holders. Are you claiming your box or waiting? Milano, Italy = Luxury Brands = Gianpiero? Please advise. @inBetweenersNFT pic.twitter.com/YRvoYcTsn8— NFTMonday (@NFT_Mondayz) October 22, 2022Fans of the artist and big name figures involved with the project are now exposed to a new cosmos created through the NFTs, as is the case with many other similar projects in the space. Cointelegraph spoke with the co-founder and the community manager of inBetweeners, Ogden and Miana Lauren, on community building through NFTs and the purpose it gives to fans.Related: NFTs will be ‘as disruptive’ as Bitcoin was 10 years ago — Kraken execOgden commented that Miana started off as a fan of the collection and, through the engagement possible via NFTs, was able to take that fandom to another level. “We blindly trusted her because we saw how passionate she was,” he said.The inBetweeners co-founder said most of their team and partnerships came from within the Discord channel.“It’s a collective, but at the beginning, it was just a bunch of us sitting around a table. Now it’s people all over the world.”Miana said beginning as a holder and fan of the project has enriched her current role as a part of the core team. From starting from within the community, she said it’s easier to understand the core needs of the fan as a community manager. “We can really play to their needs and wants, and really all come into alignment in these decisions.”NFTs are often the gateway for many newbies to participate in the Web3 space, as are other avenues such as play-to-earn blockchain gaming. However, as Miana highlighted it’s all a big learning curve at the moment, especially for first time holders in the space.“Once we get over that hump, we can actually see how efficient these web three solutions are and how everyone will be able to integrate all of these solutions in their daily life.”This is already the case in many major industries around the world, such as the music industry which is increasingly using NFTs to transform audiences into communities. 

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FTX addresses user withdrawal complaints amid major token movement

Cryptocurrency exchange FTX took to Twitter to address user complaints surrounding sluggish withdrawals. FTX assured users that everything is running smoothly with the matching engine, although node throughput is limited for Bitcoin (BTC) withdrawals.In the series of tweets, the exchange also addressed stablecoin withdrawals, saying redemptions or creations might be slow until banks open for the week and wires clear.Meanwhile, the community on Twitter had mixed reactions regarding FTX’s response. Some users tweeted their support of the exchange while others expressed their skepticism:Telling everyone how fine you are is the first red flag you are not— dogterdogter (@dogterdogter) November 7, 2022Users on Reddit also expressed alarm toward the developments likening the situation to Celsius halting withdrawals and misleading its users prior to the platform’s collapse.These issues come as the exchange faces major liquidations of its native FTX token (FTT) as a result of an unspoken feud with rival exchange and blockchain developer Binance.Changpeng “CZ” Zhao, the CEO of Binance, said the company will liquidate the entirety of its holdings of FTT. In a tweet on Nov. 6, the CZ said the move came as a result of, “recent revelations that have came to light.”Follow-up tweets by CZ called the move a type of risk management with lessons taken from the Terra collapse earlier this year. He also commented on the recent actions of FTX founder and CEO Sam Bankman-Fried, who allegedly lobbied against centralized finance. In a tweet from CZ, he added:“We won’t support people who lobby against other industry players behind their backs.”According to on-chain analysis, around 23 million FTT, or $520 million at the time of writing, was transferred to Binance from an unknown wallet.Related: FTX exec revealed as big donor to Oregon Democrats following misidentificationBankman-Fried also tweeted his own response to the situation, in which he emphasized it being the time to build up the space. Also saying he respected the work of many in the industry, including CZ.5) Because I respect the hell out of what y’all have done to build the industry as we see it today, whether or not they reciprocate, and whether or not we use the same methods.Including CZ.Anyway — as always — it’s time to build.Make love (and blockchain), not war.— SBF (@SBF_FTX) November 6, 2022

In light of the liquidations and community buzz, market analysts speculate that FTT could face serious price plunges. At the time of writing, the price hovers around $22.60.

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Elrond rebrands as MultiversX, shifts focus to the metaverse

The blockchain technology developer Elrond announced it will redefine itself as a new brand with a focus on the metaverse.Formerly known as Elrond, the company will move forward under the new name MultiversX with the introduction of three new metaverse-forward products. xFabric, xPortal and xWorlds are the three new tools behind the rebrand, all of which aim to help metaverse creators and users. The tools include a metaverse portal, digital assets holder, creator utilities and a deployable blockchain module. Beniamin Mincu, the CEO of Elrond, commented to Cointelegraph saying that the new rebanding will benefit both digital and physical reality. “We are now in the position to create a larger path towards growth, adoption and utility, for the real world, and the metaverse.”MultiversX says it plans to continue to build off the community and groundwork the Elrond Network has already put in place such as existing technologies and the ecosystem. Mincu said the Elrond community has always been supportive of new developments.“In order to create a masterpiece, you have to look at the world differently and make bold strokes. The community has always appreciated when we’ve made giant leaps forward.”Earlier this year, the National Institute for Research and Development In Informatics in Bucharest, Romania, announced it will use the Elrond blockchain to develop a decentralized domain system and an NFT marketplace.Related: The Sandbox co-founder explains how the metaverse has evolved for brands: Web Summit 2022This new pivot towards the metaverse from Elrond comes as many brands, networks and even individuals are also shifting focus in the same direction. Despite recent refuted reports on low numbers of metaverse engagement, companies continue to pile in. Recently Meta and Microsoft brought Office 365 apps into the metaverse and a Norwegian tax agency opened an office in Decentraland to reach younger generations. A Q3 report from DappRadar revealed that blockchain games and metaverse projects combined raised $1.3 billion in venture capital investments in the July to September time frame. According to the same report metaverse infrastructure projects made up over 36% of investments for that quarter. Developers across the Web3 space have also upped their metaverse game with new technology rollouts in order to build better digital environments for users.

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IRS prepares for an increase in crypto cases in the upcoming tax season

The United States Internal Revenue Service (IRS) criminal investigation division is ramping up for tax season with its sights set on the crypto community.According to a report from Bloomberg Law, the division chief Jim Lee said they are preparing “hundreds” of crypto-involved cases, many of which will soon be available to the public.Lee said in the last three years, there has been a major shift in digital asset investigations conducted by the IRS. Previously these investigations were mostly money-laundering related, whereas now tax-related cases make up nearly half.This includes what is often called “off-ramping” transactions where digital assets are exchanged for a fiat currency, along with not reporting crypto payments.In a different report released by the agency on Nov. 3, the IRS reported that in 2022 the 2,077 special agents of the division spent nearly 70% of their time investigating tax-related crimes like tax evasion and tax fraud. While the other 30% was spent on money laundering and drug trafficking cases.The division chief said following the money is nothing new and they’re ready to pivot into new realms, including Web3.“We’ve been doing it for more than 100 years, and we’ve followed criminals into the dark web and now into the metaverse.”The report cited a crypto-related case as an example, which involved tracing billions of dollars in Bitcoin stolen from Bitfinex after its 2016 hack and led to the arrest of two individuals.Related: 74% of public agencies feel under-equipped for crypto investigations: ReportThis comes after the IRS introduced a broader ‘Digital Assets’ category ahead of upcoming tax season. It grouped cryptocurrencies, stablecoins and nonfungible tokens (NFTs) all together under a new “Digital Asset ” category.As decentralized financial technologies and assets become more mainstream, regulators are reacting, therefore enforcing more reporting requirements.Binance has been actively holding workshops for global regulators to better understand digital assets and their implications. These activities increased after the exchange hired a prominent IRS cybercrime investigator to lead its anti-crime unit.

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