Weekly Report | EU investigates Telegram over user numbers; South Korean crypto exchange Aprobit announces closure; Trump: US Department of Justice violates its policies, interferes in elections
Interviewing 18 insiders, a lengthy article reveals the rise and fall of OpenSea and the SEC dispute; Is BTCFi the biggest trend in the second half of the year? A detailed explanation of the Babylon ecosystem's re-staking agreement Lombard; A quick overview of the Ethereum MEV tool Sorella led by Paradigm.Organizer: Luan Peng, ChainCatcher
"What Important Events Happened This Week (8.26-9.1)"
1、EU Investigates Telegram Over User Count Issues
According to the Financial Times, Brussels is investigating whether Telegram has violated EU digital regulations by failing to provide accurate user numbers, with officials pushing to place the controversial messaging app under stricter regulation.
EU legal and data experts suspect that the app has underreported its user count in the EU to keep its numbers below the 45 million threshold, above which large online platforms are subject to a series of regulations from Brussels aimed at limiting their influence.
The EU investigation coincides with a broader inquiry by France into alleged criminal activities on Telegram, which led to the arrest of its founder, Russian-born billionaire Pavel Durov, on Saturday. A magistrate will decide on Wednesday night whether to press charges or release him.
Telegram stated that Durov "has nothing to hide." Durov now holds citizenship in France and the UAE.
In February, Telegram claimed it had 41 million users in the EU. Under the EU's Digital Services Act (DSA), Telegram was supposed to provide updated figures this month, but it did not, only announcing that its "average monthly active user count in the EU is well below 45 million."
Two EU officials stated that the failure to provide new data constitutes a violation of the DSA, adding that the investigation may reveal the actual numbers to be above the threshold set for "very large online platforms."
Such designation brings greater compliance and content moderation obligations, third-party audits, and mandatory data sharing with the European Commission.
OKX CEO Star responded to questions about the OKX lending mechanism on the X platform.
He stated:
OKX's spot collateral borrowing is a C2C market between users, and OKX only provides a platform to help users with borrowing and earning needs match.
100% reserve is a fundamental responsibility of OKX, and when the borrowing limit exceeds the depositing limit, the platform's automatic currency exchange mechanism will be triggered due to the 100% reserve requirement.
OKX has limited the maximum borrowing amount, not allowing it to exceed 100%.
Due to market activities of the Floki token, there was a large redemption from depositors at that time, causing the borrowing limit to exceed 100%, thus triggering the automatic currency exchange.
The OKX team will review the underlying design mechanism of the collateral borrowing platform to see if there are optimization solutions, and they welcome feedback from everyone.
A gang in South Korea that defrauded about 16 billion won (approximately 11.96 million USD) from over 150 victims has been arrested by the police. To evade police tracking, these individuals underwent facial contour surgeries and wore wigs.
From November 2021 to June 2022, the Financial Crime Investigation Team of the Seoul Metropolitan Police Agency deceived 158 victims and collected about 16 billion won, with the gang leader, A, being arrested on charges of fraud, violation of the Receipt Law, and violation of the Electronic Law, having misappropriated about 4.5 billion won.
A employed various escape tactics. He underwent double eyelid, nose, and facial contour surgeries worth about 21 million won and wore wigs. A also frequently changed residences with the help of acquaintances, using fake phones and fake bank accounts. The police seized and confiscated 100 million won from A's hideout and confiscated 1.3 billion won in assets from A and others before prosecution.
4、Trump: DOJ Violated Its Policy, Interfered in Elections
Trump posted on X, stating: "The DOJ's policy states that the DOJ should not take any action that could affect the election within 60 days of the election------but they just took such action. Voting will begin on September 6, so the DOJ has violated its own policy, which is election interference. All these 'pranks' by Kamala or Biden should be immediately rescinded."
During the "Preventing North Korean Virtual Asset Money Laundering U.S.-Korea Joint Civilian Seminar," U.S. State Department Special Representative for North Korea Seth Bailey stated that stealing virtual currency is a relatively new source of income for North Korea. It is estimated that over 40% of the funding for North Korea's weapons of mass destruction (WMD) and ballistic missile development programs is raised through virtual currency.
Bailey cited a report from blockchain research firm TRM Labs, indicating that last year, about one-third of global virtual asset thefts were carried out by North Korean hackers, with the amount stolen expected to increase further this year.
Bailey emphasized, "We are working closely with like-minded countries such as South Korea and Japan to develop government policies and procedures that have a direct impact on North Korean behavior."
6、UAE Investment Company Plans to Launch $500 Million Fund to Invest in Blockchain, DePIN, and More
According to Bitcoin.com, UAE-based investment firms Hodler Investments and Gewan Holding plan to launch a $500 million Digital Energy Infrastructure (DEI) fund. The fund aims to invest in energy infrastructure projects that support the growth of the digital economy, including power generation, data mining, blockchain, decentralized physical infrastructure, and artificial intelligence. It will also support startups and software development related to these fields.
According to a statement, the fund has already received soft commitments from major investors, physical donations, and subscription partners, seeking energy and connectivity for AI and digital asset mining businesses.
According to Bitcoinist, Yang Bin, who was once second on China's rich list, was sentenced to six years in prison in Singapore for running a Ponzi scheme disguised as a cryptocurrency investment business, defrauding millions of dollars.
On August 26, the 61-year-old Dutch-Chinese Yang admitted to eight charges, including conspiracy to participate in a fraudulent scheme and operating without a valid work permit, and was fined 16,000 Singapore dollars (12,200 USD).
Local media reported that Yang defrauded over 700 investors under the name A&A Blockchain Innovation, who invested 6.7 million Singapore dollars between May 2021 and February 2022, but lost about 1.1 million Singapore dollars.
The company claimed to own 300,000 cryptocurrency mining machines, generating a daily return of 0.5% for investors. However, such machines did not exist. Instead, Yang used funds from new investors to pay returns to early investors, a hallmark of a Ponzi scheme.
It is reported that in 2001, Yang was ranked second on Forbes' list of China's richest people and was seen as a model of rapid wealth during China's economic boom. In 2003, he was sentenced to 18 years in prison for tax evasion by a Chinese court and was released in 2016 after serving his sentence.
8、South Korean Crypto Exchange Aprobit Announces Closure, Trading to Stop on September 23
South Korean crypto exchange Aprobit announced its closure, with trading set to stop on September 23, and withdrawals will be available before December 23.
Aprobit stated, "Due to changes in the business environment, we have decided to terminate trading support, and we will do our utmost to ensure that all users do not encounter any inconvenience when refunding their assets deposited on the exchange, even after trading support ends."
It is reported that only half of the 22 crypto exchanges registered as virtual asset operators in South Korea are currently operational.
9、Vitalik: Supports RWA, Hopes to See More Diversity on Chain
Ethereum co-founder Vitalik posted on X, stating: "I support RWA, and I hope to see more diversity on-chain so that applications can use them without being affected by systemic risks from a single issuer or asset class."
According to Decrypt, El Salvador President Nayib Bukele now acknowledges that his Bitcoin experiment has not gone entirely as planned.
Nayib Bukele stated, "Bitcoin has not reached the widespread adoption we expected. Many Salvadorans are using it, and most large businesses in El Salvador accept it. You can pay with Bitcoin at McDonald's, supermarkets, or hotels. But it has not reached the level of adoption we anticipated. The positive side is that it is voluntary; we have never forced anyone to adopt it. We present it as an option, and those who choose to use it have benefited from Bitcoin's rise."
"What Exciting Articles Are Worth Reading This Week (8.26-9.1)"
1、Interview with 18 Insiders Reveals the Rise and Fall of OpenSea and SEC Disputes
The rise and fall of NFTs have written the story of OpenSea, once the largest NFT marketplace. This article interviews 18 insiders from the company before the SEC issued a Wells notice to Opensea, revealing OpenSea's chaotic work environment, internal and external challenges, and the cat-and-mouse game with regulators in 10,000 words. After reading this article, you will believe that NFTs will not die with OpenSea.
2、Why SOON, Invested by Solana Foundation Chair, Chooses to Build SVM Rollup?
SOON (Solana Optimistic Network) is a general-purpose Ethereum Layer 2 that is about to launch its mainnet. Notably, SOON will incentivize new developers (especially from the Asia-Pacific region) developing on SVM through tokens.
Currently, Lombard is implementing a phased rollout strategy, with LBTC launching on the Ethereum mainnet, and the next step plans to expand LBTC to Ethereum L2, eventually extending to innovative Bitcoin L2 and next-generation blockchain networks.
4、Overview of Sorella, the Ethereum MEV Tool Led by Paradigm
MEV (Maximum Extractable Value) refers to the additional value that miners or validators gain by manipulating the order and selection of transactions. In simple terms, MEV reflects the extra profits miners can obtain by adjusting transaction order. As smart contract platforms like Ethereum become increasingly popular, MEV has gradually become an important research area, driving the development of various new solutions and protocols aimed at reducing its negative impact on users.
Recently, the crypto startup Sorella Labs, aimed at addressing the Ethereum MEV issue, announced a $7.5 million seed funding round led by Paradigm, with participation from Uniswap Ventures, Bankless Ventures, Robot Ventures, and Nascent. However, this funding round was completed last September. Along with the funding announcement, Sorella Labs also announced the launch of its product Brontes, and another tool, Angstrom, is expected to be released later this year after the mainnet launch on Uniswap V4.
5、Behind MakerDAO's Name Change to Sky, Is Scale More Important Than Decentralization?
Yesterday, the Maker protocol announced a brand upgrade to Sky, and the Maker ecosystem is undergoing a major overhaul.
The decentralized stablecoin Dai (DAI) will be upgraded to USDS at a 1:1 ratio, and the native governance token MKR will be upgraded to SKY at a ratio of 1:24,000. Maker SubDAO will be renamed Sky Stars.
This is not just a simple name change but a significant strategic shift.
Rune Christensen, co-founder of Sky (formerly Maker), stated that this brand transformation is an important step in leading "the next evolution of DeFi," aiming to increase protocol accessibility and focus on building usability, which will help attract more mainstream users from centralized exchanges.
However, after the upgrade, Spark Protocol CEO Sam MacPherson stated that USDS introduces a freezing feature. The Sky website also added a function to prohibit VPN logins.
Many crypto users question Sky's departure from its decentralization goals.
PleasrDAO's @Lumbergdoteth posted on X: "DAI is currently migrating to USDS, a censorable stablecoin, which goes against its original vision. RIP DAI, 2017-2024."
DefiLlama's @Oxngmi also posted: "Rip, it seems the Maker rebranding has introduced a VPN blocker (makerdao.com will not block)."
6、In Support of Telegram Founder, Musk's Long-term and Short-term Concerns
The arrest of Telegram founder Pavel Durov on the evening of August 24 (local time in France) has recently attracted widespread attention from the market, sparking discussions among notable figures from the investment, business, and political sectors, including Tesla founder Elon Musk, Sequoia Capital partner Shaun Maguire, and Ethereum founder Vitalik Buterin.
The keywords of support focus on "EU" and "freedom of speech." Elon Musk has repeatedly expressed his views on Durov's arrest on X, and Nigel Farage, leader of the Reform Party in the UK, commented on X, stating: "Pavel Durov's arrest is concerning. Telegram is a secure free speech application. There may be some bad actors on it, but any platform has them. What's next… Elon Musk being arrested?"
Elon Musk's support for Pavel Durov may reflect a sense of shared fate. When Musk initially acquired Twitter (the predecessor of X) for $44 billion, he touted himself as a "free speech" advocate and has criticized the U.S. government and the EU for "lack of free speech" on multiple occasions.
In December 2023, the committee initiated a formal lawsuit against X, assessing whether X might have violated the Digital Services Act (DSA) in areas related to risk management, content moderation, dark patterns, advertising transparency, and researcher data access, and informed X of its DSA violations on July 12 this year.
With the arrest of the Telegram founder, a new debate has begun surrounding freedom of speech on the internet.
As the owner of X, Musk, who is unwilling to cooperate with EU regulations, clearly has greater concerns.
For social media leaders, arrests like this set a dangerous precedent. The EU and U.S. government have previously summoned and questioned leaders of other social media companies, but very few leaders of large tech companies have been arrested for events occurring on their platforms.
7、Gavin Wood: How to Prevent Witch Attacks for Effective Airdrops?
Gavin has recently been focused on the issue of witch attacks (civil resistance). PolkaWorld reviewed Dr. Gavin Wood's keynote speech at Polkadot Decoded 2024 to explore his insights on preventing witch attacks.
8、Vitalik's Thoughts on DeFi Debate: The Communication Gap Between 1% Developers and 90% Traders
This article is divided into three parts:
1. The importance of correct communication, including communication with ordinary users and partners. The introduction uses a general example and sets the background for the topic.
2. 1-9-90: The second part discusses the 1-9-90 guideline and my interpretation of it. This can be widely applied to the self-launch of any community.
3. The difficulty of maintaining consistent communication in large groups, and potential situations where it may no longer be needed later (today's Ethereum). You can view the third part as an engaging overview of the Ethereum debates from the past week, which are also part of the same issue. Whether 1-9-90 applies to Ethereum is one of the questions discussed in this section.
9、Former Goldman Sachs VP Matt Levine: How Can Stablecoins Solve the Bank Run Problem?
In the future, as financial markets become further digitized and transparent, traditional banks may also face similar challenges. The asset risks of banks and market confidence may be reflected more directly in market prices than relying on internal safeguards within the banking system.
10、End of August On-Chain Data Analysis: Is a Big Volatility Coming?
Currently, market speculation activities for Bitcoin are relatively subdued------in recent times, not only have investors been able to lock in meager marginal profits, but the perpetual swap market has also returned to calm. However, historically, such calmness is temporary and often heralds greater volatility to come.
