Algofi, the largest decentralized finance protocol on layer 1 blockchain Algorand, is shutting down following a “confluence of events,” a blog post said. The lending platform, which plans to move into “withdrawal-only mode” soon, was founded during the peak of the last bull market and at times accounted for more than half of the value held on Algorand. In recent enforcement actions against Coinbase and Binance, the U.S. Securities and Exchange Commission (SEC) stated that algorand (ALGO) was an unregistered security. In other news, MetaMask creator ConsenSys is ready to deploy a new layer 2 for Ethereum called Linea. The rollup will use zero knowledge-based cryptography to offer cheaper and faster blockchain transactions.
China’s Controls
CEO of stablecoin issuer Circle Jeremy Allaire said China should pursue yuan-backed (CNY) stablecoins rather than a central bank digital currency (CBDC), if it wants to internationalize its currency. In an interview with the South China Morning Post, Allaire said blockchain technology offers new innovations for central banks looking “upgrade their own systems to move away from legacy technology.” Authorities in China keep strict capital controls over the yuan as part of the country’s macroeconomic policy, and are piloting a CBDC. The creators of an offshore version of the yuan called CNHC were arrested earlier this year in Shanghai. Separately, in a recent report sent to finance ministers of the world’s twenty largest economies (aka the G-20), the Bank for International Settlements said crypto is not suitable as a monetary tool due to “inherent structural flaws.”
App Store Backdoor
Bitcoin developers behind the Lightning Network self-custodial Mutiny wallet Ben Carman and Paul Miller recently released the Zapple Pay tool, which enables users to send bitcoin (BTC) tips on popular decentralized social network Damus despite recent restrictions imposed by Apple. Last month, Apple threatened to remove Damus from the App Store for allowing users to tip (aka “zap”) each other with bitcoin on in-app posts, which Apple said violated its user agreement. Damus creator William Casari then froze the feature. Zapple Pay, which does not have an official affiliation with Damus, can reportedly be added to “any social network” and gets around Apple’s prohibition as a third-party provider, the co-founders said.
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Presidential candidate Robert F. Kennedy has been caught in a lie about bitcoin (BTC), apparently. According to a recent CNBC report, the Kennedy family scion previously stated publicly he “was not an investor” in bitcoin though reported he held downwards of $250,000 in the cryptocurrency in a financial disclosure form.
RFK has made waves in the crypto community, including a pit stop at the largest annual industry conference Bitcoin Miami where he told the crowd he’d “defend the right of self-custody of bitcoin and other digital assets.” He also said his campaign is accepting BTC donations, though he personally did not own any of the cryptocurrency.
“I am not here to give investment advice,” he stated, echoing a popular refrain in online investment communities. Apparently, however, the good old boy took some advice himself while in Florida and invested at least $100,001 in crypto between the date of the conference and the end of June, according to a filing CNBC obtained.
RFK’s campaign confirmed the purchase. But because this is CRYPTO and because this is POLITICS, of course there is a debate. Virginia Canter, principal counsel for Citizens for Responsibility and Ethics in Washington, a Washington D.C.-based ethics organization, said Kennedy’s investment is a potential conflict of interest, a claim Kennedy campaign manager Dennis Kucinich denied.
Canter’s claim is that, if a politician endorses an investment he or his family members hold, it shows bias, and can be perceived as untoward. When the report first came out, the Kennedy campaign said the bitcoin belonged to Robert’s wife and “Curb Your Enthusiasm” star Cheryl Hines, and later corrected the record.
The filing shows the “crypto” holdings returned less than $201 in income.
Versions of this same debate about potential conflicts have long followed crypto, which makes sense given blockchains are semi-anonymous and allow anyone to buy into a network bypassing traditional guardrails around investment decisions. In the media, especially, there are concerns that journalists on the crypto beat can hold digital assets without disclosure and potentially influence markets.
Thankfully, for bitcoin, at least, we need not be too concerned. Yes, a high-profile presidential challenger could likely tilt the scales if they endorse an asset while campaigning. But so could any number of world events. Bitcoin is almost assuredly a commodity under U.S. law, meaning there can be stakeholders in the asset but no single party would benefit most from its adoption.
Just like how there are buyers, miners, builders, architects, sculptors, etc. who use a metal like copper and may be exposed to its long and short term price fluctuations, there is a massive pool of bitcoin users who hold stake. That pool would include sitting elected representatives like Senators Ted Cruz (R-TX) and Cynthia Lummis (R-WY).
Kennedy, who has been accused of spreading anti-vaxxer disinformation, has garnered support among a number of bitcoiners including Block CEO Jack Dorsey.
His bitcoin buy is suggestive of a lot: that he puts his money where his mouth is, that he’s easily influenced by gungho conference goers or even that he buys into the “digital gold” narrative. (Being honest, Kennedy strikes me as the type of boomer who would be hawking gold investments on talk radio, if his family wasn’t already political royalty.)
No one knows Kennedy’s true state of mind or motivations here, but what should be clear enough is that there is no inconsistency in defending the rights of bitcoiners and holding the asset. Further, .000033 BTC is almost certainly enough to make a rich man rich, but it’s probably enough to hold him to his promises.
