Market Update: November 19, 2022

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Three months after the US government blacklisted the Ethereum mixing tool, Tornado Cash, Edward Snowden called it a “do or die moment.” He said people in the crypto community are not taking it seriously enough. Tornado Cash is a blockchain protocol launched in 2019 that helps users pool and “mix” coins so as to mask the origin and destination of their transactions. Snowden in a camp said that tornado cash is just a tool that does nothing without human provocation, comparing it to a water fountain in a public park. Snowden blasted the US government for targeting Tornado Cash and claimed that the Ethereum network’s approach, which makes each wallet’s transaction history public, is contributing to the problem. After Tornado Cash was shut down, some wallet providers started to create their own mixer-like tools.

Kunji research Market Update

Solana, which just weeks ago used to rank within the top 5 cryptocurrencies as per market cap, ranks 16th by market cap at the time of writing, post-FTX fiasco. It is down by 25.4% in the last seven days. The same chain lost $1 billion USDT to Ethereum chain as Tether swapped the same from solana to ethereum. A “chain swap” is the process of moving cryptocurrencies from one blockchain to another. Tether has done this in the past when demand to use its stablecoins shifted from one blockchain to another. Every major cryptocurrency, like bitcoin and ethereum, experienced a downfall after the FTX collapse, but solana has been hit hard. The solana foundation that helps grow the solana blockchain claimed that it had $1 million in cash or equivalent assets stuck in FTX. Binance announced a few days ago that it had temporarily suspended deposits of Tether (USDT) and the major stablecoin USD Coin (USDC) that run on Solana’s blockchain. Tether is the world’s biggest stablecoin issuer, and one can use its digital dollar (and euro or yen) tokens on a number of blockchains, such as Ethereum, Tron, or Polygon.

Ripple’s lawyer, Stuart Alderoty, told CNBC that the company operates outside of the US and is now hoping to set up shop in Ireland. According to Alderoty, Ripple is attempting to obtain a virtual asset service provider (VASP) licence from the Irish central bank in order to accomplish this. This would enable it to use an organisation located in the European Union to “passport” its services there. Ripple Labs founders also created a cryptocurrency called XRP, which is the seventh largest and is still in battle with the SEC in a lawsuit from 2020. In December 2020, the SEC accused Ripple of misleading investors by raising $1.3 billion in unregistered securities offerings since 2013. Ripple claims its XRP token is not a security. Ripple was launched with the intention of helping banks and other financial institutions move money quickly and without fees. Its public blockchain, XRP Ledger, has also been used for transparency purposes—and not just for finance.

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