"Ownership is just one property of Web3, and while interesting, it is not the most interesting nor the most valuable aspect of these technologies. Web3 enables a technical enforcement of a social contract, and that's only possible because of verifiability. While we're still in the depths of a bear market, we have the space to reassess our values. Personally, I'd like to see a vision of Web3 that's less about fiefdoms and more about freedom."
The Federal Reserve Bank of Atlanta published a paper by the University of California, Berkeley's Christine Parlour that describes the elements of Web3 including blockchains and tokens. ("Web3" is used to describe the next iteration of the internet in which decentralized services are automated on blockchains.) It describes the largest decentralized finance (DeFi) protocols and some specific services where blockchain and tokens can be used. The paper concludes with a brief discussion of some regulatory challenges.
"I think it is entirely consistent with the evidence to remain sceptical about the impact of cryptocurrency on the wider economy, while at the same time being excited about tokenisation and the transition to that web3 world of decentralised finance protocols exchanging digital assets backed by regulated institutions with digital currencies, similarly backed by regulated institutions. In this respect, PayPal's move will I am sure be seen in hindsight as a cusp moment and a vote of confidence in the web3 world. "
"Mastercard has completed the Hong Kong Monetary Authority's (HKMA) e-HKD Pilot Programme, which demonstrated the efficacy of the Mastercard Multi-Token Network solution to settle Web3 transactions involving decentralized applications and digital assets, such as NFTs. The pilot also showcased the potential for seamless funding and settlement in and out of Web3 marketplaces via a retail central bank digital currency (CBDC), such as e-HKD in the future.
"MiamiCoin is the first in what CityCoins, a Delaware-based company with a mailing address in a Los Angeles strip mall, has promised will be a series of US city-branded cryptocurrencies. New York City mayor Eric Adams tweeted his approval of NYCCoin on Nov. 8, shortly after his election, welcoming CityCoins to "the global home of Web3" (Web3 is a crypto-optimist idea of a decentralized internet built on blockchains and cryptocurrencies). But Adams hasn't spoken of NYCCoin since taking office on Jan. 1 of this year, and the coin has fallen 68% since then. Meanwhile, Philadelphia's government has explored the CityCoins idea, but announced in April it would not proceed."
Polkadot is a blockchain protocol connecting multiple specialized blockchains into one unified network. Polkadot is built to connect and secure unique blockchains, whether they be public, permission-less networks, private consortium chains, or oracles and other Web3 technologies. It enables an internet where independent blockchains can exchange information under common security guarantees. The network has an advanced suite of governance tools and, using the WebAssembly standard as a "meta-protocol", can autonomously deploy network upgrades. https://wiki.polkadot.network/docs/en/getting-started
Aggarwal, Chainlink, Web3 Foundation and Hashed say their names were used without their permission on the OpenLibra slide deck presented at Devcon. The OpenLibra project aims to ensure that access to the Libra stablecoin and its technology remains free from corporate control.
Etonec and Mina Foundation will roll out a new zero-knowledge (ZK) proof-powered regulatory compliance tool for the decentralized finance (DeFi) and Web3 space. It will address gaps within the privacy and compliance space by providing know-your-customer (KYC) and anti-money-laundering (AML) services on the Lumina DEX when it goes live later this year. The prototype is powered by zkApps, which enables private and compliant transactions. https://www.etonec.com/post/etonec-partners-with-mina-to-address-trade-offs-between-privacy-compliance-and-decentralization
"Visa's CBDC Payments Module is a proof-of-concept (POC) that envisions bringing web3 assets into a web2 user experience by providing an on-ramp for individuals, business owners, governments, and users of all kinds. The POC is designed to be a bridge connecting a CBDC system with existing forms of payment products and outlets. In linking CBDC with card payments-whether in the form of prepaid or debit cards-CBDC becomes a fast and nearly ubiquitous alternative payment choice users can easily adopt alongside existing forms of money, all while benefiting from economies of scale derived from today's mature payment networks. The illustration below captures the flow of a payment transaction that integrates Visa's scale and messaging protocols with a participating central bank's ledger technology. Importantly, all this is designed to happen at the backend without major disruption for users, businesses, and financial intermediaries."
The Hong Kong Monetary Authority (HKMA) today announced the commencement of the e-HKD central bank digital currency (CBDC) pilot programme. A total of 16 firms from the financial, payment and technology sectors have been selected to participate in the first round of pilots. The pilots will take deep dives into potential use cases in six categories, including full-fledged payments, programmable payments, offline payments, tokenised deposits, settlement of Web3 transactions and settlement of tokenised assets. https://www.hkma.gov.hk/media/eng/doc/key-information/press-release/2023/20230518e4a1.pdf
Mastercard has completed a central bank digital currency (CBDC) proof-of-concept (PoC) with the Reserve Bank of Australia (RBA) and the Digital Finance Cooperative Research Centre. (The MasterCard press release calls it a "pilot" but it's unclear whether live users were involved, a requirement for the "pilot" label.) It tested how authorized parties, who have gone through know-your-customer (KYC) protocols, could hold, use and redeem CBDCs. In addition, the project tested how a holder could purchase an Ethereum-based nohttps://www.mastercard.com/news/ap/en/newsroom/press-releases/en/2023/mastercard-demonstrates-interoperable-cbdc-for-trusted-web3-commerce-in-australia-and-beyond/n-fungible token (NFT) by locking the pilot CBDC and minting an equivalent amount of Ethereum-based wrapped coins.
"I just wrote my first story for MIT Tech Review. It is an explainer piece on Ethereum's move to proof of stake. What follows are notes from the story - along with additional ramblings and quotes from your favorite crypto skeptics."
The entire crypto space has been a Jenga stack of interconnected time bombs for months now, as the companies find new ways to prop each other up. Headlines talked about millions, billions, trillions of dollars in crypto being made or lost - but that's all virtual money that never existed. With a serious shortage of actual dollars, the crypto economy had to keep coming up with more and more elaborate schemes to try to extract real money from retail investors. Venture capitalists frantically promoted NFTs and Web3, trying to lure in precious dollars. The 2021 bubble brought forth a wave of "investment firms" offering interest rates on the order of 20%. This is just not possible in the present economy. If anyone offers 20%, your first thought should be: "what's wrong here?"
"Fiat-crypto onramps are essential to reaching mass adoption for crypto and the broader web3 industry. However, our proprietary data analytics show that currently 50% of users that try to buy crypto still run into failed transactions. The performance of individual onramps differs widely based on a range of factors, such as location, trading pairs, payment methods, transaction amounts and/or the specific crypto-fiat onramp being used."
The Reserve Bank of Australia (RBA) and Digital Finance Cooperative Research Centre (DFCRC) announced 14 use case proposals, along with their providers, that will participate in RBA/DFCRC central bank digital currency (CBDC) pilots. The cases include offline payments, tax automation and a CBDC for "trusted Web3 commerce," with participants ranging from banks - such as Commonwealth Bank and Australia and New Zealand (ANZ) bank - to payment providers like Mastercard. According to the September 2022 RBA white paper, use case end users will be selected by the use case providers. A report on the project is expected to be published around the middle of the year.
"One of the technologies that will undoubtedly change Web3 is zero-knowledge (ZK) cryptography. ZK has long been considered a potential game-changer for ensuring the privacy, security and integrity of blockchain applications. The rapid investment and development of zero-knowledge proofs is an important signal that the technology is getting ready for prime time."
"It would, however, be a mistake of historic proportions if society stopped using public money and threw away 'trust' as a concept. The challenge for central banks and other actors in the existing financial architecture is to create a form of public money on a blockchain that can deliver the promises of a decentralised digital economy. Just as at the beginning of the internet, it can be hard to envisage how the Web 3 world of non-fungible tokens, decentralised finance and cryptocurrencies can be anything more than just a niche fad, but the promise is real and the changes will be far-reaching."
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