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| 1 | | Tesla CEO and Twitter owner Elon Musk has been accused of insider trading and crypto market manipulation in a $258B Dogecoin class-action suit. In a court document filed in the U.S. District Court for the Southern District of New York, the plaintiffs requested to amend the lawsuit's scope for the third time to include new complaints. More: - In the amended complaint, Dogecoin (DOGE) investors have claimed that Musk was able to trade the popular cryptocurrency profitably with several Dogecoin wallets controlled by him or Tesla through his Twitter posts, payments to online influencers, and his appearance on Saturday Night Live in 2021.
- The amendment added the brief shift of the Twitter logo to the DOGE symbol in early April to these actions.
- The plaintiffs said Musk sold around $124M of DOGE in April after he shifted Twitter's blue bird logo to the Dogecoin icon, leading to a 30% increase in the popular cryptocurrency's value.
- The investors have also reiterated their claims that Dogecoin is a security subject to the standards of the U.S. Securities and Exchange Commission (SEC).
- Following the latest filing, U.S. District Judge Alvin Hellerstein said he would probably accept the third amended complaint.
Zoom Out: - The initial complaint was filed in June 2022, accusing Musk and his companies, including Tesla, SpaceX, and The Boring Company, of conducting a Ponzi scheme to support Dogecoin.
- The class-action lawsuit mainly claims that Musk deliberately caused Dogecoin's price to jump over 36,000% in two years before allowing it to plummet, seeking a $258B compensation.
- In April, Musk requested the dismissal of the $258B Dogecoin lawsuit, saying that the statements in his tweets were too vague to support fraud and that supporting a legal cryptocurrency with a $10B market cap through tweets or funny pictures is not unlawful.
- The famous CEO also most recently said he is not advising anyone to buy crypto or bet the farm on Dogecoin, contradicting his renowned commitment to the popular cryptocurrency.
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What happened: Bitcoin (BTC) mining difficulty hit its all-time high, reaching 51.23 trillion as of the end of May. The figure has surpassed the 50-trillion level for the first time in its history. The 51.23 trillion difficulty accounted for a 3.4% increase from the previous measure. The difficulty has shown a steady increase since the beginning of the year. In early January, it was at the 34-trillion level. Bitcoin miners' monthly revenue also experienced a similar steady rise since the beginning of 2023. The total revenue reached $919.2M in May, hitting the highest level over the last 12 months, with a 13.7% monthly increase from the previous month. In January, the figure was reported as $601.2M. Why it matters: The mining difficulty refers to how difficult it is to mine a Bitcoin block. When the difficulty hits higher levels, miners require more hash rates, or computing power in a sense, to validate transactions and create new coins. Thus, the record-breaking difficulty level means that it has never been more difficult and time-consuming to mine the leading cryptocurrency, Bitcoin, for crypto miners. This increase forces many miners to leave the network, raising the revenue per miner since they receive a larger share of the cake. Where to see the impact: On the other hand, the rise in revenue is expected to encourage more miners to join the Bitcoin network with a higher earnings promise. However, analysts expect the increased difficulty to cause the miner revenue to decline since their expenses would involve the costs related to rising hash rate, and hence, the need for more electricity. This could pave the way for more miners to leave the network again, creating a vicious cycle effect. | | | |
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| 3 | | The U.S.-based crypto exchange Coinbase has announced that its U.S. Commodity Futures Trading Commission (CFTC)-regulated Coinbase Derivatives Exchange would start offering Bitcoin (BTC) and Ether (ETH) futures contracts as of June 5. The products will be available only for institutional investors. More: - The contracts will have a size of 1 Bitcoin and 10 Ether.
- Coinbase said the sizing is intended to allow institutional clients to effectively manage market exposure.
- The firm cited increased institutional demand following the introduction of its nano Bitcoin futures (BIT) and nano Ether futures (ETI) contracts last year.
- In May, Coinbase also launched a new Bermuda-based international derivatives exchange for institutional crypto traders outside the U.S.
- At the time, the company stated that Coinbase International Exchange would list Bitcoin (BTC) and Ether (ETH) perpetual futures, and all trading activities in the platform would be settled in USD Coin (USDC) stablecoin as part of the partnership with the issuer Circle.
- The launch of the international exchange followed the increased tension between Coinbase and the U.S. Securities and Exchange Commission (SEC).
Zoom Out: - The company is currently in a legal battle with the SEC in which the U.S. regulator claims that Coinbase could violate the securities laws through its exchange and staking services, while the popular crypto exchange complains about the lack of regulatory clarity that it holds the agency responsible for.
- Over the last several months, many crypto exchanges, including Coinbase, Kraken, Bittrex, and Binance, came under increased scrutiny by the U.S. regulators, such as the SEC, the Internal Revenue Service (IRS), and the Commodity Futures Trading Commission (CFTC).
- Another U.S.-based crypto exchange Gemini made a similar move in May, launching a crypto derivatives platform dubbed Gemini Foundation that would only cater to users outside the U.S.
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| 4 | | Crypto exchange Gate.io recently saw an outflow of $142.2M of funds following the claims that users experienced withdrawal issues. The platform's total assets declined to around $1.61B on June 1, down from $1.88B within the previous day. More: - The firm denied the rumors of withdrawal issues, saying that its operations are running healthily.
- The exchange pointed out that the alleged issues could have stemmed from the troubles at Multichain, a decentralized finance (DeFi) platform allowing users to transfer cryptocurrencies between different blockchains.
- Multichain recently stated that it is unable to reach its CEO.
- Gate.io's native token, GateToken, also saw a brief decrease in value by as much as 8% within the first 24 hours of the withdrawal issues claims before experiencing a slight recovery.
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| 5 | | Popular sportswear brand Nike has announced its NFT platform .Swoosh's virtual creations will be integrated into Electronic Arts (EA) Sports games in the upcoming months. The move is expected to see Nike's virtual footwear and apparel appearing in EA Sports video games as wearable virtual products, allowing players to customize their in-game avatars by purchasing. More: - The pair has yet to announce the games that would include Nike's virtual products.
- EA Sports' portfolio includes popular games with millions of players, such as FIFA, the Madden NFL series, and the NBA Live series.
- Through the move, Nike aims to make its Web3 initiatives one step closer to becoming mainstream.
- Ron Faris, general manager of Nike Virtual Studios, said the collaboration will allow the company to offer new incredible experiences for .Swoosh community and EA Sports fans.
Zoom Out: - Nike launched the beta version of the Web3 community platform, .Swoosh, in November 2022.
- At the time, the company said the items sold on the platform could be worn in video games and metaverse experiences.
- The sportswear giant released .Swoosh's first NFT sneaker collection, dubbed Our Force 1 (OF1), in May as attribution to its iconic Air Force 1 sneaker.
- Nike has two other Web3 initiatives, including virtual sneakers and collectibles brand RTFKT, which it acquired in 2021, and the virtual world Nikeland.
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| 6 | | China's Ministry of Industry and Information Technology (MIIT) has released its first national blockchain regulation to standardize the country's blockchain industry. The new standards also aim to guide and accelerate the industry's development in the country. More: - The guideline standardizes blockchain technology's architecture and core elements.
- The MIIT said the new regulation would serve as a guide for China's blockchain industry to better understand, adopt, and utilize the emerging technology.
- The standards have already started being applied in more than a hundred blockchain companies.
- In May, China also launched a national blockchain research center to allow universities, developers, and blockchain businesses to contact each other, accelerating the industry's growth.
- Also, China's capital city, Beijing, recently published a white paper to support the innovation and development of the Web3 industry in the country.
- The white paper outlined the city's plans to become a leader in the Web3 and metaverse industry by 2025, fostering innovation.
Zoom Out: - Despite its anti-crypto approach, China is currently piloting its central bank digital currency (CBDC), or the digital yuan, in 26 regions within 17 of its 23 provinces.
- Crypto exchanges and cryptocurrencies have been forbidden in China for several years.
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- Sustainability-focused crypto mining firm CleanSpark has bought another 12,500 Bitcoin mining machines for $40.5M.
- A senior associate from independent law firm Lander & Rogers, Claire Walczak, said the number of divorce proceedings involving digital assets has significantly increased.
- The Commodity Futures Trading Commission (CFTC) has proposed to amend its rules and standards to include risk management regarding evolving technologies like cryptocurrency and AI.
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Term of the Day Vesting: Vesting is the process of granting employees the right to keep employee-provided benefits, such as stock options, after a specified period of time. Question of the Week Should companies take steps to avoid employee burnout, or should it be the individual's responsibility to manage it themselves? Join the conversation |
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 | Staff Writer | | Doga is a tech and science editor who has been writing news for nearly 10 years. She worked for leading tech platforms and mainstrem media channels as an editor and presenter throughout his career. Then, she carried her know-how to more than one platform. She is a part-time cat lover and binge-watcher, and also fond of science, space, and emerging tech. She always has a story to tell. She is a bit addict to the laughter and -unfortunately- the '90s culture. | | This newsletter was edited by Aaron Crutchfield | |
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