TORN No More

GM. Happy Friday! Before we get into our regularly scheduled weekend activities, let’s have a look at what’s going on in the crypto world. The United States caused a huge stir in the crypto world by blacklisting Tornado Cash, while Reddit and FTX hook up. Oh, and Ethereum takes a critical step before its upgrade.

Plenty to talk about, so let’s get to it.

Today’s Topics:

• Tornado Cash blacklisted

• Are Reddit and FTX doing a thing?

• Ethereum takes final steps before upgrade

• Quick Links

Tornado Cash Blacklisted

Earlier this week the United States Treasury Department blacklisted Tornado Cash, stating that the coin is used to launder money. Tornado Coin (TORN) has been “used to launder more than $7 billion worth of virtual currency since its creation in 2019,” stated the agency.

Tornado Cash was added to the Specially Designated Nationals and Blocked Persons List (SDN), which means that all transactions on the platform are prohibited in the United States. The announcement caused the price of Tornado Cash to drop significantly.

Unsurprisingly, the crypto community was quick to criticize the move. Many point out that the US Treasury Department is punishing the tool instead of the people using it. Tornado Cash uses smart contracts, which means it's neutral by nature. Like any other technology, the platform can be used for good or bad.

The same sentiment was echoed by Tornado Cash when it defended its system. “One of the many value use cases for privacy protocols,” the platform wrote, “is donating to a cause that might get you into trouble if done publicly.”

Privacy coins like Tornado Cash are intended to provide crypto investors with a form of “digital cash.” Crypto portfolios are visible to the public, which means anyone can see how much you’re holding. With a legitimate digital cash, you can perform transactions anonymously, just like you would with fiat cash.

We’re curious to know where you stand with this type of behavior by the US government. Are they right to blacklist Tornado Cash because of the amount of money laundering that takes place and the threat it poses to the US financial system?

Are Reddit and FTX doing a thing?

A few years ago, Reddit moved away from allowing Bitcoin payments on its platform, but it would appear that it may have had a change of heart. Reports indicate that FTX and Reddit are working together to form a partnership that would allow for crypto payments.

The partnership integrates FTX Pay as a crypto exchange solution and form of payment to the community. With this new integration, Reddit users will be able to purchase ETH through the FTX payment system.

FTX CEO Sam Bankman-Fried noted that the partnership shows how much the exchange is dedicated to online communities and their ability to harness blockchain technology. “FTX Pay’s payment and exchange infrastructure integrates with Reddit Community Points, making the customer experience a more seamless process.”

This move shouldn’t come as a surprise, as Reddit has been involved with blockchain and cryptocurrency in one form or another for many years. Plus, its co-founder, Alexis Ohanian, has been heavily involved with crypto, having launched a $10 million Web3 investment fund just last year.

Ethereum takes final steps before upgrade

We’ve been holding our breath for months and now we’re a step closer to Ethereum’s Proof-of-Stake upgrade. The network just ran a final dress rehearsal in anticipation of an upgrade that has been touted by many as one of the most important events to take place in blockchain’s history.

Since the coin was launched, it has been a Proof-of-Work network, just like its counterpart, Bitcoin. This is how the network is secured, but the PoW method requires massive amounts of energy to mine just a single block.

Now, Ethereum is switching to Proof-of-Stake as its consensus mechanism. With PoS, the network will be able to verify transactions much faster while using much less energy. The final test occurred Wednesday evening at 9:45 pm EST. While it appears there may have been a few small hiccups with the test, overall, the Merge worked.

Previous suggestions by core developers have suggested that the official Merge should take place mid-September, but no final determination has been made to this point. Still, it’s refreshing to know that we’re finally going to get the Merge we’ve all been waiting for, especially given all the delays Ethereum has gone through.

While we appreciate the thoroughness and lengths to which the network has gone to ensure a successful Merge, we’re ready for the next step in the process to take place. Hopefully we’re only a few short weeks away.

Quick Links

Hey there, sports fans! - It’s a perfect storm of growth. Crypto and esports are helping each other climb the ladder.

Crypto Punks go commercial - Everybody’s favorite delinquents have a new owner, and he plans to expand the utility in order to grow the brand.

The battle continues - Which is better: proof-of-work or proof-of-stake? We may never know, but we’re still bound to get to the bottom of it.

No mail for you - Mailchimp is going out of its way to ban crypto-content creators and newsletters from using its services.

Hacks:

How safe is your Ethereum? - It’s a scary world out there, and if you have a Metaask wallet, you may want to beware. Twitter users are reporting vulnerabilities.

You’re under arrest - Hotbit transactions have been suspended as law enforcement officials investigate a former employee.

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Disclosure: We are a newsletter for information only. We are not financial advisors nor do we claim to be. Consult your legal, investment or tax advisor. Crypto is risky. Do you own research.