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Is Block About To Change Bitcoin’s Self-Custody, Hardware Wallet Game? Probably

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Exciting times at the Block headquarters. In today’s world, self-custody of your coins is one of the most important things there is. And Jack Dorsey’s bitcoin-focused company knows this. That’s why Block’s team is building a hardware wallet, even though Nick Slaney, Product Design Engineer, thinks it’s “so much more.” 

In a recent Twitter thread, Slaney said, “The self-custody product we’re working on Block is one of the most exciting things I’ve worked on at any company.” And then he elaborated, “Jack started out calling what we’re working on a hardware wallet, but even though we’re developing a hardware device the name barely does it justice. It’s so much more.”

What’s this device Block is working on? Will it change the self-custody game as they believe? How advanced is it? When will we see it? How much will it cost? In the following text, we’ll answer some of those questions. Not all of them, though. 

What Will Block‘s Product Bring To The Self-Custody Table?

According to the Block/ Square team’s mailing list, “our aim is to bring simple self-custody to a global audience.” Simple words for an extremely ambitious goal. However, Nick Slaney seems confident that the company will pull it off. “If we do our job the way I think we’re going to, explaining seed phrases to your dad is going to be a thing of the past.”

According to Jesse Dorogusker, the company’s head of hardware, a summary of the product direction could be:

  • “Bitcoin first,” so it might not be a bitcoin-only product.
  • “Global distribution,” so it’s not going to be for the so-called first-world countries alone.
  • Natively multisig, “to achieve “assisted-self-custody.”
  • “Prioritizing mobile use.”

The second edition of Block’s quoted mailing list elaborates on the hardware part:

“We’re currently designing the product, with a focus on the hardware component – we’re working through the industrial design (how it looks and feels), the user experience (how people use it), and the technical architecture (what internals make it work). We’re approaching the many choices involved with a focus on keeping costs low.”

So, we could add to the product direction:

  • Low cost, so everyone can afford self-custody.

BTCUSD price chart for 02/24/2022 - TradingView

BTC price chart for 02/24/2022 on Bitstamp | Source: BTC/USD on TradingView.com

What Does “Native Multisig” Mean For The User?

Self-custody comes with risk. One mistake and you could lose your funds forever. That’s where multisig and “assisted-self-custody” come in. In the first number of Block/Square self-custody mailing list, they explain how the three keys system works: 

“In our solution, we’ll have three keys: one in the hardware wallet, one in the mobile application, and one in Square’s servers, protected by the same world-class security we bring to the rest of our ecosystem.”

In the second number, Block/Square explains how that would protect the user:

“Alongside designing the hardware, we’re also diving into how we’ll build an intuitive, forgiving recovery experience that people can use when they lose their phone, hardware wallet, or both. With our underlying use of a multisignature wallet, people will be able to recover easily from losing just one item, but there are some big design and implementation questions on the best ways to get there and how to handle loss of more than one item.”

So, the product design is already in motion, but far from ready. Nick Slaney has high hopes, though. “Being native multisig, and developing all of the (open source) software and hardware under one product vision is going to enable a entirely new experience,” he tweeted. And then, he stated the product’s value proposition:

“We’re combining the security of cold storage, the peace of mind of shared custody, and the convenience of a custodial app all into one easy to use solution that puts you in control of your own keys (and by extension your financial security)”

Block Answers: Why Self-Custody? Why Global? What Does ‘Simple’ Mean?

In the first number of the newsletter, Block answered these three questions:

  1. “Self-custody is a fundamental component of decentralization, one of the underlying principles of what makes bitcoin compelling.” Also, “If people don’t have a realistic option for self-custody, we should expect more and more of the limited global bitcoin supply to end up governed by a short list of custodial service providers.” And the Canada story tells us how that situation can end up.
  2. “We want to enable everyone to access the growing crypto-enabled economy – not just wealthy residents of a handful of countries.”
  3.  “In order for self-custody to be a realistic option for everyone, we need tools that are easy to use, safe, and inexpensive.” 

For the grand finale, we bring back Nick Slaney. He promises: “The end result will be a product that lets anyone custody their own keys easily and securely, making hodling and transacting as intuitive as possible and opening the future of financial sovereignty up to much wider audience.”

Will Block/ Square deliver? Can they achieve their ambitious goals? And, when can we expect the product? Low cost is what price exactly? Where do I sign? Those are the question we can’t yet answer.

Featured Image by FeeLoona on Pixabay | Charts by TradingView

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Crypto Corner: The Sports Slice

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The NFL is approaching crypto sports deals with caution, but the abundance of potential revenue is keeping the league engaged. Meanwhile, one storied football club across the pond is looking to build the first-ever ‘metaverse stadium.’ And a popular NBA player is shutting down shop on his NFT project, leaving many with a bad taste in their mouth.

It’s all in a week’s worth of action when it comes to sports and crypto. Let’s review the past seven days of activity.

The Sports Slice

De’Aaron Fox Abandons NFT Project

De’Aaron Fox is arguably the most talented player on the admittedly lowly Sacramento Kings, and has been a long-time fan favorite for the Bay Area-adjacent club. Fox was one of the first NBA players to release their own NFT projects, titled SwipaTheFox, and despite roughly $1.5M in NFT sales, it’s all coming to a screeching halt this past week.

It’s another NFT project to join a long list of celebrity-started or sponsored mints that provided a detailed roadmap, but failed to deliver. Below is a screenshot from the project’s Discord that shows Fox’s announcement of discontinuing the project:

FTX Launching Gaming Unit, Expanding Marketing Push Beyond Sports

A new report from Front Office Sports has unveiled that crypto exchange FTX is launching a dedicated gaming unit focused on blockchain network and NFT integration. The full scope of the unit is yet to be disclosed, however the move is certainly on par with FTX’s positioning. The exchange has partnered with powerhouse esports org TSM in a first-ever naming rights deal, and has spent substantial funds around GameFi and related areas.

Meanwhile, the exchange also brought on a new head of global luxury partnerships as FTX looks to build outside of it’s current sports-sponsorship heavy strategy. Lauren Remington Platt will fill the role and has a resume tailored in fashion and business development that will be tough to top. Platt previously built her own beauty service and established premiere partners such as Saks Fifth Avenue and Vogue.

Nielsen Report: Blockchain Sports Sponsorship To Hit $5B By 2026

A new global sports sponsorship report from Nielsen that was released this week reveals that the analytics and data firm is projecting massive spend from crypto competitors to continue to flood in to the sports sponsorship space. Nielsen is forecasting sports sponsorship deals from blockchain players to amass to $5B by 2026, a nearly 8-fold increase over last year’s spend. The report cites ‘legitimacy’ and ‘fan engagement’ as the two key factors to contribute to future deal’s success in sport.

We’ll have a deep dive on the Nielsen report in the days to come.

MLS: DC United Finds New Blockchain Partner

MLS club DC United has found a new blockchain technology partner this week in XDC Network, who have signed a three-year deal and will find brand assets on United’s home and away jerseys and training tops.

The XDC Foundation’s Executive Director Billy Sebell said in a release:

“This partnership is about bringing the value of blockchain to the D.C. United fanbase to elevate their experience, drive deeper engagement, and connect the growing crypto ecosystem to the club.”

Related Reading | NFTs In A Nutshell: A Weekly Review

XDC Network is the latest blockchain technology firm to find a partner in the MLS. | Source: XDC-USD on TradingView.com

The NFL’s Latest Perspective On Crypto Sponsorship Deals 

Last week’s Sports Slice highlighted the NFL’s latest lobbying efforts with the SEC and other U.S. federal agencies. This week, a new report from the Sports Business Journal states that the NFL is still proceeding with care; despite massive success in the Super Bowl commercial execution from crypto companies like Coinbase, the league isn’t ready to go all-in quite yet.

League representatives told SBJ that they are “hopeful” that a league-wide crypto policy can come into place in the next 30 days, admitting that it realistically “may or may not happen.” The league’s current hesitance lies within the lack of current regulatory framework, and SBJ reports that the league is “is more confident in products based on the blockchain that don’t require cryptocurrencies to function,” citing the deal with Ticketmaster to produce NFTs. In present day, the league is certainly more prone to revenue-driving opportunities that don’t require the league to take on the level of risk that current hands-on crypto engagement is exposing.

The First-Ever Metaverse Stadium?

Manchester City has been one of the more aggressive Premier Club teams, and now the club is working with Sony’s VR team to build a “virtual duplicate of the Etihad Stadium” that will serve as the team’s virtual HQ. The club already has a fan token established with Chiliz, and despite rocky relationships at times with potential blockchain partners, it’s bullish to see Man City still pursuing new avenues to engage with fans.

Featured image from Pexels, Charts from TradingView.com
The writer of this content is not associated or affiliated with any of the parties mentioned in this article. This is not financial advice.
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Ponzi Scam: BitConnect’s Indian Founder Charged In $2.4 Billion Bogus Scheme

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A federal grand jury in San Diego charged the founder of a cryptocurrency startup Friday in a broad indictment that claims he cheated investors of more than $2.4 billion in a Ponzi scam.

Prosecutors say the fraud is the largest of its sort ever prosecuted criminally.

Satish Kumbhani, 36, of Hemal in Gujarat, India, swindled investors regarding BitConnect’s “Lending Program,” according to court filings.

Based on the indictment, Kumbhani founded BitConnect in 2016 as a “classic Ponzi scam.” he US Department of Justice said the exchange reached a peak market valuation of $3.4 billion.

Prosecutors allege that BitConnect’s proprietary technology made misleading promises about returns based on phony “volatility software” that monitored bitcoin exchange markets.

Another Major Ponzi Scam

According to court filings, the program was allegedly created to trade automatically and successfully by buying and selling Bitcoin’s volatility.

However, a large portion of the technology remained unknown to investors. When someone requested a demo at a 2017 event, Kumbhani was evasive:

“So you’re asking me a pretty difficult question,” he explained to one journalist. Later, as described by the Los Angeles Times, he stated, “We are not sharing anything for privacy concerns.”

BitConnect halted operations in January 2018 after receiving cease-and-desist letters from North Carolina and Texas state regulators.

Total crypto market cap at $1.766 trillion in the daily chart | Source: TradingView.com

The global repercussions was fast, with South Korean investors becoming “paranoid” and one promoter informing Kumbhani that people were discussing suicide in chat rooms, the indictment stated.

The US Securities and Exchange Commission filed charges against Kumbhani on September 1 for securing more than $2 billion in an unregistered offering.

Glenn Arcaro, BitConnect’s main promoter in North America, pleaded guilty that day.

Long Prison Time

Kumbhani is facing charges for conspiracy to commit price manipulation and wire fraud, as well as operating an unregulated money transfer business and conspiracy to launder money in foreign shores.

Kumbhani also violated US financial industry regulations, including those imposed by the US Financial Crimes Enforcement Network.

For instance, despite the fact that BitConnect transacted money through its digital currency exchange, BitConnect never registered with FinCEN, as required by the US Bank Secrecy Act.

As bitcoin grows in popularity and encouraging foreign investors from all over the world, “alleged fraudsters like Kumbhani are deploying increasingly complicated methods to deceive investors,” Ryan Korner, special agent in charge of the IRS Criminal Investigation Office in Los Angeles, disclosed.

Kumbhani, who is still at large, faces a maximum sentence of 70 years behind bars if convicted on all charges.

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Russian Politicians’ Crypto Wallets Targeted By Ukraine – Hefty Reward Up For Grabs

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Ukraine is exploring more means of thwarting Russia’s onslaught on their country by running after government official’s crypto wallets.

Ukrainian authorities are attempting to stay ahead of crypto-savvy Russian officials who may shift to digital currency in order to evade rising efforts to financially isolate the Kremlin and its allies.

Wars can be waged on numerous fronts, as few stones are left unturned in the pursuit of the most effective techniques for gaining the upper hand.

Ukraine demonstrates resourcefulness in this aspect, as it fights Russia’s recent unprovoked invasion with conventional military techniques.

The country – which is unparalleled in terms of military capacity – is now hellbent on crippling Russian political figures by actively pursuing information about any digital wallets they may possess.

Ukraine Dangles Reward For Crypto Wallets Info

Vice Premier Mykhailo Fedorov announced on Saturday that the Ukrainian crypto community will reward those who give information.

The government has already begun soliciting cryptocurrency donations via social media and has advertised in online hacker forums that it is seeking assistance in defending against cyberattacks.

Federov also indicated that Ukraine is assembling an “IT army.”

Russia’s policy of combating adversaries using digital assets and online means has been in place for a long time, and the Ukrainian hope is that it may be turned around on them in a significant way.

Total crypto market cap at $1.731 trillion | Source: TradingView.com

Sanctions are among the most potent measures available to the United States and its Western allies for influencing the behavior of states they regard as threats.

And in this instance, a bounty for anyone who can provide information about crypto wallets belonging to Russian and Belarusian politicians can be a very effective instrument.

Bounty To Be Paid By Private Donors

According to Artem Afian, a Ukrainian attorney in charge of the project, the incentives for politicians’ crypto wallet information will be paid by private donations rather than by the Ukrainian government.

Afian did not disclose the total amount raised thus far, but said that donations were made primarily in Ether (ETH), but also in Bitcoin (BTC) and other cryptocurrencies.

Ukraine’s actions demonstrate how cryptocurrencies can cross borders and be used by both those seeking assistance and those attempting to evade the law.

Afian said he intends to publish a list of politicians’ addresses over the next two to three days and distribute it to major cryptocurrency exchanges.

Putin May Not Fall Into The Trap

The primary goal is to flag these addresses as “unsafe” and to deter individuals and businesses from transacting with them.

However, it is unlikely that Russian President Vladimir Putin will fall victim to this dragnet.

According to credible grapevines, Putin is notoriously averse to technology and reportedly does not own a cellphone.

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