Coinbase tracks 6% rise in info requests from law, government agencies

The requests are increasing in number and coming from more jurisdictions every year.

Crypto exchange Coinbase says it recorded a 6% rise in requests from law enforcement and government agencies compared to 2022, with the number of jurisdictions issuing requests jumping by 19, according to the exchange’s annual transparency report.

Four countries — the United States, Germany, the United Kingdom and Spain — made up nearly three-quarters (73%) of the 13,079 agency requests to Coinbase for information between Q4 2022 and Q3 2023.

The United States made 5,686 requests to Coinbase, up from 5,304 last year, with 90.4% of those from criminal enforcement agencies.

Meanwhile, Australia sent 262% more requests to Coinbase compared to the previous year, placing it in sixth place at 453.

Countries that sent Coinbase more information requests compared to the previous year. Source: Coinbase

The report covered the final quarter of 2022 and the first three of 2023.

“Our obligation is to respond to these requests if they are valid under financial regulations and other applicable laws. […] Under certain circumstances, we may ask the government or law enforcement agency to narrow their request.”

Coinbase said in a blog post in September that 83% of “G20 members and major financial hubs” have crypto regulations in force or passed legislation on crypto.

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Lack of regulatory clarity on payment solutions could undermine US sanctions, says expert

Anja Manuel said U.S. sanctions generally work with “responsible” blockchain firms but not when there are fintech solutions available to individuals looking to circumvent them.

According to former Department of State official Anja Manuel, if the United States isn’t able to maintain its dominance in financial innovation and payments, it could affect its national security policy, specifically on sanctions.

Speaking to Coinbase CEO Brian Armstrong and listeners in an April 21 Twitter Spaces discussion, Manuel said that because the U.S. was one of the biggest global leaders in payments, it allowed the government to enforce sanctions on “bad actors” like Iran or North Korea. According to Manuel, letting the country lead in innovation under clear rules reinforced U.S. national security controls, but China seemed to be catching up on dominance in mobile payments “both in sophistication and scale.”

“While we’re hemming and hawing here and not having a thoughtful regulatory framework in the U.S., China is marching forward, lots of other people are marching forward,” said Manuel. “If Chinese payments solutions, for example, gained a dominant foothold in the developing world, [sanctions are] going to become much, much harder.”

The U.S. enforces sanctions through the Office of Foreign Assets Control of the Treasury Department, which has announced several actions against Russian nationals and groups related to their involvement in the war on Ukraine — including sanctions on crypto wallets. The former Department of State official said sanctions generally worked “in a world of traditional banks” and “responsible” blockchain firms, but not when there existed financial technology firms available to individuals looking to circumvent restrictions.

Manuel added:

“Other thoughtful countries are getting their act together, from Singapore to the U.K. to the EU. This is not impossible — it just hasn’t happened in the U.S. In the U.S., regulation has been almost entirely by enforcement actions from the SEC.”

The Twitter Spaces discussion was part of Coinbase’s “Crypto435” campaign, aimed at promoting pro-crypto policies and candidates in the United States. Armstrong has reiterated calls for action among pro-crypto U.S. voters following the exchange receiving a Wells notice in March — suggesting a potential enforcement action from the Securities and Exchange Commission.

Related: What new EU sanctions mean for crypto exchanges and their Russian clients

“Countries aren’t going to wait for the United States to get this right,” Tomicah Tillemann, a former senior adviser to two U.S. Secretaries of State, said in regard to regulation. “At the moment, there are 114 different governments that are in pretty advanced stages of investigating their own central bank digital currencies. More than half of those are very far along in the process.”

Armstrong has been one of the more vocal critics among major U.S. digital asset exchange leaders in saying the SEC needs to provide “clear rules to regulate the crypto industry.” Amid the looming Wells notice, the Coinbase CEO said he met with SEC officials and U.S. lawmakers this week to push for regulatory clarity.

Magazine: The FBI’s takedown of Virgil Griffith for breaking sanctions, firsthand

Coinbase to help UK on Web3 hub as Treasury reportedly revives blockchain taskforce

Brian Armstrong will give suggestions to the U.K. on regulations, taxes and ensuring collaboration between the banking and FinTech sectors.

The United Kingdom could “turbocharge” its crypto sector and be an “innovation hub for the Web3 economy” as part of a vision laid out by cryptocurrency exchange Coinbase.

The comments by the exchange coincide with an April 17 Sky News report that the U.K. Treasury is set to revive the Asset Management Taskforce with a focus on developing crypto regulation in collaboration with the private sector.

In an April 16 blog post, Coinbase emphasized the firm is working “seriously” in the U.K. and Europe. It praised the progressive regulatory efforts taking place in the region and added that its CEO, Brian Armstrong, would speak at a London fintech conference and provide nine recommendations on how the U.K. can “cement its place” as a Web3 hub.

“The U.K. has been one of our fastest-growing user markets, and the E.U. is this week set to adopt the Markets in Crypto Assets (MiCA) regulation, which will bring in a new licensing regime across the 27 member states,” the post reads. It added:

“In short, things are happening in Europe that are edging the region ahead and, when it comes to embracing the digital economy, the region is preparing for a seismic change in how it uses and thinks about money.”

The post also included a brief rundown of Armstrong’s nine recommendations for the U.K. government.

The list includes ensuring collaboration between the banking and fintech sectors, developing a cross-departmental strategy for tech innovation and economy digitization along with quickly establishing a regulatory framework for crypto.

Additionally, topics such as developing “a regulatory framework that promotes stablecoins,” providing clarity on tax treatment for crypto assets and creating a plan to “bring de-centralized ID (DiD) to fruition,” were also outlined by Coinbase

Leading up to his April 18 speech, Armstrong revealed via Twitter on April 16 that he met with the U.K.’s economic secretary and city minister, Andrew Griffith.

The Coinbase CEO stated that he raised concerns over the de-banking of some crypto firms in the U.K. and the negative implications of the 24-hour “cooling off” for investments in financial product promotions that came into effect under the “Financial Promotion regime” in February.

UK Treasury to revive Asset Management Taskforce

Under the guidance of City Minister Griffith, the Treasury will soon revive the Asset Management Taskforce,according to a report from Sky News U.K.

The Asset Management Taskforce was initially established in 2017 and was designed to encourage greater communication between the government, the fintech and crypto sectors and the local financial regulator, the Financial Conduct Authority (FCA).

It appears the body has been relatively inactive over the past couple of years.

Related: Bank of England preparing for greater role of tokenization in finance, official says

However, Sky News claims that talks will take place this week between the Treasury, FCA, fund management bosses and other stakeholders as the government looks for ways to bolster the local crypto asset sector.

Notably, on April 17 Griffith spoke on the first day of the UK FinTech Week conference in London and emphasized the government is focused on “fostering innovation by making the U.K a safe jurisdiction for crypto asset activity.”

“We set out plans in our wide-ranging consultation published in February, and we want to proactively support the use of distributed ledger technology and tokenization where it makes sense,” he said.

ERC-20 tool recovers $150M — Coinbase exec explains how

Will Robinson, vice president of engineering at Coinbase, explains the crypto exchange’s plan to increase its on-chain presence with new tools and the Base network.

In episode 15 of Cointelegraph’s Hashing It Out podcast, Elisha Owusu Akyaw talks with Will Robinson, vice president of engineering at crypto exchange Coinbase. They discuss the exchange’s vision for the future of the cryptocurrency industry, which is tied to its new Ethereum layer-2 network, Base. Robinson provides updates on the exchange’s latest tools, including an ERC-20 recovery function, wallet as a service and more.

The episode starts with Robinson explaining what his role entails. Robinson explains that he manages the developer product group responsible for internal crypto infrastructure, developer-facing products and protocol-facing efforts. Despite the regulatory activity and “drama in the market,” Robinson believes building in the crypto space has never been this exciting

“I think the world is moving on-chain by default. It is going to happen in fits and starts — on-chain is the new online.“

As part of Coinbase’s plan to build more on-chain tools, the United States-based exchange launched Base, an Ethereum layer-2 network. According to Robinson, Base is a product born out of the exchange’s sturdy movement internally to build more things on-chain. Robinson hopes that Base would become the default on-chain home for Coinbase to steer its users into the larger crypto ecosystem, while partnering with developers to build applications for mass adoption.

The cryptocurrency industry has seen multiple layer-2 networks, such as Arbitrum and Optimism, release their ecosystem tokens. Rumors on social media have tipped Coinbase to release a token for the Base network, but Robinson says there will be no token or airdrop.

Late last year, Coinbase launched an asset recovery tool for users who “mistakenly send unsupported tokens” to exchange addresses. According to Robinson says the ERC-20 recovery tool has been used by over 10,000 users who have recovered over $150 million in assets.

Related: Who watches the watchers? CryptoHarlem founder Matt Mitchell explains why surveillance is the enemy

Robinson also describes the concept behind the wallet-as-a-service product by Coinbase, which is attracting Web2 applications intending to add Web3 features such as digital collectibles or nonfungible tokens.

Listen to the latest episode of Hashing It Out with Will Robinson on Spotify, Apple Podcasts, Google Podcasts, or TuneIn. You can also explore Cointelegraph’s complete catalog of informative podcasts on the Cointelegraph Podcasts page.

Brian Armstrong promised me $100 in Bitcoin — so where is it?

Is it possible that Coinbase CEO Brian Armstrong doesn’t know how to use the Bitcoin Lightning Network? It could explain why he stiffed me.

Coinbase CEO Brian Armstrong owes me $100. That’s because he might not know how to use the Lightning Network, the instant payment solution built on top of Bitcoin.

Armstrong, who’s been building in the Bitcoin (BTC) space since 2012, recently tweeted that he would pay people who provided the “best examples” of people using cryptocurrency in Africa. “If you’re using crypto in Africa, reply with a short video (<30 seconds) or photo of how you’re using it,” Armstrong wrote. “Best few examples get $100 in crypto.”

This is the CEO of Coinbase, after all, so I shared a video of myself using Bitcoin in Africa, which was part of a 30-second segment of a recent Cointelegraph documentary covering Bitcoin in Senegal.

The tweet quickly became the most-liked and most-shared response to Armstrong’s query. (Crucially, the tweet referred to Bitcoin in Africa, not crypto in Africa, and it demonstrated the ease and speed of the Lightning Network.)

However, Armstrong appears to have ignored my submission, despite more than 600 likes and 100 retweets. The next most popular submission had just 50 likes. So, I reached out to some key opinion leaders, creators and influencers within the Bitcoin community to amplify the tweet. Wicked, an anonymous Bitcoin educator and data analyst, tagged Armstrong in a post, accusing him of “actively ignoring the #Bitcoin Lightning Network.”

Wicked very kindly drew Brian’s attention to my tweet video about Bitcoin in Africa. The tweet, and Armstrong’s affirmation that “Lightning is great and something we’ll integrate,” led to news outlets around the world reporting on Coinbase’s next development.  He then also tweeted that he had sent me the money.

Here’s where things get weird. Armstrong said he paid me the $100. He said he sent $100 to the Lightning address shown in my Twitter profile bio:

Now, if you’ve never used the Lightning Network before, you’d be forgiven for confusing this address with an email address. But would the CEO of Coinbase make that mistake? Could the Bitcoin OG have failed to recognize that the request in my bio — which says “Send BTC to,” surrounded by lightning bolt emojis — could be my Lightning address?

Side note: Running a Bitcoin node is mildly technical, and sending money on the Bitcoin blockchain for the first time is a little nerve-wracking, as the transaction takes roughly 10 minutes to confirm and we live in an instant world. But using the Lightning Network in 2023? It’s brain-dead easy. A walk in the park. Seriously.

“That’s a big call, Joe,” I hear you say.

Yep, it is. And I’ve got the receipts to prove it. It’s so easy to use the Lightning Network that I stand in the street in locations worldwide giving out Bitcoin to people on their brand-new Lightning wallets — and I film their reactions.

The most common remarks are “I didn’t know it’s so easy” and “Wow, it’s so fast.” The videos are on my YouTube channel. Here’s a video shot in France for the Cointelegraph YouTube channel where I give out Bitcoin:

So, please — let’s not pretend that Armstrong is overwhelmed by the complexity of sending money to my Lightning address. Moreover, funnily enough, Bitcoin advocates worldwide saw my tweet and took pleasure in sending me sats to show that my Lightning address is alive and well.

My phone blowing up with payment notifications.

Back to the story. Danny Scott, CEO of CoinCorner — a Bitcoin and Lightning company — was quick to point out to Armstrong on Twitter that he might have made a mistake in confusing Bitcoin and email, as Coinbase provides a “send to email” function.

Related: Ethereum’s Shanghai fork is coming, but it doesn’t mean investors should dump ETH

Scott told Cointelegraph in an email, “Obviously, we know the address [that Joe shared] is a Lightning address, but clearly not everybody does.”

“So my guess is Brian knows very little about Lightning right now, in particular LNURL, Lightning addresses and other innovations being built out, which is perfectly fine, he’s distracted, it happens, now we just hope he helps himself and the industry by turning their attention to what really has substance and long term value, Bitcoin and Lightning.”

It’s true: Coinbase offers trading for more than 250 different cryptocurrencies — that’s a lot of tokens to keep one’s eye on. And as Scott adds, “I can appreciate how busy he will be — this industry doesn’t sleep, and running a Bitcoin company myself, I know that feeling even at a smaller scale.”

To give Brian and ultimately Coinbase the benefit of the doubt, I waited a few days before writing this article. I have tweeted repeatedly at Brian (no reply) and I also reached out to the Coinbase Press Team. They told me that they would get to the bottom of it, but “My guess is that Brian is likely batching the sends at certain times.” A day has passed since this message (more doubt-benefit-giving) and they’ve not sent an explanation.

Related: Coinbase wins $470K restitution in insider trading case

The press team email was particularly left-field as it referred to “batching.” Batching is consolidating multiple payments into a single transaction on the Bitcoin blockchain, not the layer-2 Lightning Network. Again, they’re not familiar with Lightning. This adds further insult to injury: Could it be that the Lightning Network simply isn’t on Coinbase’s radar?

It’s been three days since Armstrong said he would send the money, and there have been some simply wonderful memes from the Bitcoin and wider crypto community.

Brian the “LN Maxi” trying to blend in. Source: @Corndalorian

Armstrong has been active on Twitter, while his company is busy launching new projects and winning insider trading cases for the over 250-plus crypto projects Coinbase hosts.

Meanwhile, I’m still waiting for my $100. But I’m also increasingly alarmed that the billionaire, crypto OG and Coinbase CEO Armstrong struggled to spot a Lightning address.

Joe Hall joined Cointelegraph as a reporter in 2021. He holds an MA in French and Spanish from the University of Edinburgh and a BA in languages from Sceinces Po Lyon.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

When levees break, liquidity flows — Analyzing Ethereum Shapella and liquidity staking derivatives

Volumes from the top five Ethereum staking platforms suggest holders are hedging against the unknown until after ETH withdrawals are enabled.

The Ethereum network’s planned Shanghai hard fork is nearly here. Planned for April 12, this is the first major upgrade since the Merge in September 2022. The “Shapella” upgrade (a combination of the two major proposals, Shanghai and Capella), includes EIP-4895, which enables validators to withdraw staked ETH from the Beacon Chain (Consensus layer) to the EVM (execution layer). The execution layer is the fun and friendly Ethereum thausers have come to know and love. 

Why is this a big deal? With just over 18 million ETH currently staked (valued at just over $33 billion at the time of writing), some of which has been locked up for years, the possibility of these tokens flooding an already teetering market is enough to get some holders ready to sell the news once withdrawals are enabled.

For holders who are both long and short ETH post-withdrawals, it’s likely to be a significant event, and on-chain activity suggests many feel the same: activity around liquid staking derivatives (LSDs) can be a useful gauge for what the market might do post-unlock.

Liquid Staking Derivatives could exert influence over Beacon Chain unlocks

What are liquid staking derivatives? They are a relatively new financial instrument born of DeFi that functions like bearer instruments for staked ETH. Similar to how borrowing and lending protocols give users a share token to represent locked collateral (think Aave’s a-tokens), staking ETH generates a wrapped asset used to claim the equivalent amount of Ethereum from the staking platform. When a staker deposits ETH with major platforms like Lido, Rocket Pool, Frax, Stakewise and now Coinbase, they receive a platform-specific flavor of LSD. Because staked tokens are illiquid, these wrapped assets allow stakers to continue earning rewards while securing the network without completely giving up the opportunity to participate in other activities within DeFi.

Liquid staking derivatives aim to solve these problems by allowing staked assets to be traded on secondary markets. This means that stakers could access the value of their staked ETH before the Shanghai upgrade enables withdrawals or, in the future, while maintaining their staked position. For example, a staker could use their wrapped ETH as collateral on another platform, or cover an unexpected expense by selling their LSD on a secondary market.

Rocket Pool, Lido, Coinbase and Frax

Though the markets have seen what seems to be an increasing string of green days, with Ethereum rapidly catching up to Bitcoin’s year-to-date performance, ETH’s gains are set against a backdrop of volatility among LSDs and staking tokens.

Lido’s LDO hasn’t recaptured its high from early March and has maintained a resistance at $2.75. The largest staking protocol by nearly an order of magnitude, Lido currently offers some of the highest staking rewards among major providers, with an average APY around 10%. The high rewards are no surprise: Lido took in nearly 50 million ETH in fees and 5 million in revenue in March, with April on track to meet or exceed those numbers.

LDO versus ETH price. Source: TradingView

Rocket Pool’s RPL fared much better, with a 25% increase over the last thirty days. The wrapped asset issued by the number three staking provider by TVL, rETH, has historically traded at a premium to ETH and other LSDs, likely a result of the provider’s reputation as the most decentralized staking solution available to holders today, making rETH a desirable LSD to hold.

Over the last thirty days, Rocket Pool has seen over $46 million in inflows, with many likely hoping to cash in on rETH’s premium when withdrawals are enabled. Rocket Pool’s average APY according to DeFiLlama is around 3.65%, which isn’t as high as other providers, but with over 1,800 active Rocket Pool nodes, the decentralized nature of the protocol is attractive. Addresses holding RPL have been steadily increasing as well.

Conversely, LSDs from the two top staking providers, Lido and Coinbase, both trade at a discount to spot ETH. Together representing nearly 90% of all staked ETH, it’s unsurprising that Lido and Coinbase have both come under scrutiny as centralizing entities given their concentration of staked ETH.

Ethereum LSD providers share of staked ETH. Source: DeFiLlama

Despite RPL’s impressive performance and StakeWise’s native token SWISE’s 15% gain, Frax seems to have come out as the winner.

Frax Ether has seen the most significant jump in total value locked over the last 30 days compared to the other top 10 staking providers at 14% growth for a $244 million valuation. Despite the increase in TVL, Frax totaled only $3.1 million in inflow over thirty days, putting the protocol just above StakeWise’s $2.6 million.

Total value locked in Frax. Source: DeFiLlama

Liquid staking derivatives like the wrapped Ether offered by staking providers is an important part of the Ethereum ecosystem much like plasma is an essential part of human blood. DeFi, NFT trading and GameFi are all interlinked, sometimes more subtly than others.

LSDs perform an important function of maintaining liquidity within the Ethereum ecosystem. Currently, over 15% of all Ether that exists is staked with a Beacon Chain validator (meaning this doesn’t include any ETH being used as collateral on borrowing/lending platforms).

Considering that a non-trivial amount of that ETH has been locked for years, through one of the toughest bear markets on top of that, indefinitely freezing this much capital (worth over $33 billion at the time of writing) would have a lasting and noticeable effect on the entire ecosystem.

Over the last 30 days though, trying to hedge against the chaos post-Shapella by holding unstaked ETH didn’t perform much better than holding an LSD: ETH is up 31% compared to stETH’s 30%, rETH’s 30%, while Coinbase’s cbETH is up 32% and Frax’s LSD is up 34%.

Overall, liquid staking derivatives are an important development in the staking ecosystem, as they help to address some of the challenges associated with staking, while also expanding the pool of potential participants in the ecosystem.

Related: Ethereum traders show uncertainty ahead of April 12’s Shapella hard fork: Report

Withdrawals being enabled for staked Ethereum on the Beacon Chain means that proof-of-stake Ethereum has reached a point of sufficient stability and security, and the stakers who participated in securing the network will be able to retrieve their staked funds.

Regardless of the immediate impact of enabled withdrawals, proof-of-stake Ethereum’s continued success relies on incentivizing ETH holders to validate the network, and liquid staking derivatives have proven to be an effective mechanism to do so.

The views, thoughts and opinions expressed here are the authors’ alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Texas’ gold-backed digital currency project: Law Decoded, April 3–10

While Ted Cruz and Ron DeSantis attack the idea of American CBDC, Texan lawmakers propose to create a statewide one.

The topic of central bank digital currencies is in the crossfire of United States politicians, with figures like Ron DeSantis and Ted Cruz trying to prevent them from existing. But what about a statewide digital currency? The first of its kind, a gold-backed state-based digital currency project has appeared in Texas. 

On the same day, two Texan lawmakers introduced identical bills for creating a state-based digital currency backed by gold. Each unit of the digital currency would represent a particular fraction of a troy ounce of gold held in trust, according to the bills. Once a person purchases a certain amount of digital currency, the comptroller uses that money received to buy an equivalent amount of gold. Although neither of the bills has been passed or presented for a vote, both state that the act will take effect from Sept. 1, 2023.

Meanwhile, another bill has been passed by a senate committee in Texas. The bill would largely remove incentives for miners operating under the state’s regulatory environment. Under the bill, crypto firms participating in a program intended to compensate them for load reductions on Texas’ power grid would be capped for anticipated demand of “less than 10 percent of the total load required by all loads in the program.” Certain crypto mining companies would also not receive a reduction on state taxes for participation in the program starting in September 2023.

Regulators announce $10 million settlement with Robinhood ‘for failing investors’

The California Department of Financial Protection and Innovation said that the company behind cryptocurrency and stock trading platform Robinhood will likely pay more than $10 million in penalties “for operational and technical failures that harmed main street investors.” The settlement resulted from an investigation by the North American Securities Administrators Association in conjunction with securities regulators from Alabama, Colorado, California, Delaware, New Jersey, South Dakota and Texas. The platform suffered a series of system outages in March 2020, causing users to miss out on trades while many of its services were unavailable.

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Coinbase supports new court action to remove Tornado Cash ban

The U.S. Department of the Treasury faces a renewed legal challenge aiming to overturn its decision to sanction the crypto mixer Tornado Cash. The challenge was filed by six individuals backed by the cryptocurrency exchange Coinbase. A motion for a partial summary judgment was filed on April 5 in a Texas district court, with the Coinbase-backed plaintiffs moving for the U.S. Office of Foreign Asset Control (OFAC) to settle the first two counts from its original complaint filed in September 2022. The counts claimed OFAC exceeded its statutory powers under the International Emergency Economic Powers Act and violated the free speech clause of the U.S. Constitution’s first amendment.

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Bill protecting Bitcoin mining rights passes in Arkansas

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A bill seeking to regulate Bitcoin (BTC) mining activity in Arkansas has passed in the state’s Congress. It will now move to the governor’s office for approval. Under the legislation, crypto miners will enjoy the same rights as data centers. The bill outlines that Arkansas’ government should not “impose a different requirement for a digital asset mining business that is applicable to any requirement for a data center.” Arkansas’ move follows a similar initiative in the state of Montana, where the Senate passed a bill to protect crypto miners in late March. 

Coinbase head of exchange departs and plans to start new crypto project: Report

Before joining Coinbase in September 2020, Vishal Gupta had been the head of USD Coin at Circle and a vice president at Goldman Sachs.

Vishal Gupta, who has been the head of exchange at Coinbase, is reportedly leaving his position after more than two years at the United States-based cryptocurrency exchange.

According to an April 10 Bloomberg report, Gupta planned to exit Coinbase but remain in the crypto space, suggesting he could be planning to start a new project focused on digital assets or blockchain. Prior to his time at Coinbase, Gupta had been the head of USD Coin (USDC) for stablecoin issuer Circle and earlier was a vice president for Goldman Sachs.

Former FTX CEO Sam Bankman-Fried was one of the first people to congratulate Vishal Gupta on his position as Coinbase head of exchange in 2020. Source: Twitter

Related: Coinbase CEO says Bitcoin Lightning is ‘something we’ll integrate’

The head of exchange’s reported departure came amid legal and regulatory scrutiny at Coinbase. In March, the crypto exchange reported receiving a Wells notice from the U.S. Securities and Exchange Commission, hinting at a potential enforcement action. Coinbase is also backing plaintiffs in a lawsuit against the U.S. Treasury Department’s Office of Foreign Asset Control for its decision to sanction the Tornado Cash mixer.

At the time of publication, neither Gupta’s LinkedIn page nor his Twitter profile showed any change in his employment at Coinbase. Cointelegraph also reached out to Coinbase regarding Gupta, but did not receive a response.

Magazine: Samsung’s Bitcoin ETF, $700M bust, Coinbase exits Japan

Ethereum staking deposits dip due to regulatory pressure and Shapella upgrade

The amount of ETH being staked monthly has recently dipped according to the on-chain analytics platform Glassnode.

Ethereum staking deposits have declined slightly in recent weeks due to increased regulatory pressure and the Shapella upgrade slated for April 12.

On April 9, on-chain analytics provider Glassnode reported on the current state of the Ethereum staking ecosystem.

The data revealed that deposit activities are currently low, “due to regulatory pressure and the Shanghai upgrade.”

Financial regulators in the United States have been coming down hard on crypto this year. The Securities and Exchange Commission is adamant that Ether (ETH) is a security and has cracked down on staking despite there being no official legislation from Congress classifying ETH as such.

The Ethereum network will undergo a long-awaited upgrade on April 12. The Shapella hard fork, also known as the Shanghai hard fork, will enable the phased release of ETH staked on the Beacon Chain.

These two factors have caused the dip in Ethereum staking deposits, according to Glassnode.

The firm also noted that major centralized exchanges such as Coinbase, Binance and Kraken have lost a lot of market share to the liquid staking platform Lido.

“As the dust settled between the three giants, it was Lido who emerged victorious, continuing to dominate deposit inflows as of present,” it noted.

Lido currently accounts for almost a third of the total amount of ETH staked. This equates to around $11 billion from the 5.9 million ETH on the platform.

Centralized exchanges such as Coinbase take a hefty 25% commission from the staking rewards, with Coinbase’s commissions being even higher for other assets such as Cardano (ADA) and Solana (SOL).

Lido takes a 10% commission and offers the potential of earning additional yields on DeFi platforms through its staking token Lido Staked ETH (stETH). This explains the shift over time as savvy stakers switched to more profitable platforms.

Analysts have predicted that liquid staking platforms such as Lido will get a boost when ETH is released from the Beacon Chain after the Shapella upgrade.

Related: Analysts debate the ETH price outcomes of Ethereum’s upcoming Shapella upgrade

According to the Ethereum metrics tracking platform Ultrasound.Money, there are currently 18.1 million ETH staked in total currently valued at around $33.7 billion and representing 15% of the entire supply.

After the Shapella upgrade, this will be slowly released for withdrawal in the weeks and months that follow.

Magazine: Features ‘Account abstraction’ supercharges Ethereum wallets: Dummies guide

Coinbase CEO says Bitcoin Lightning is ‘something we’ll integrate’

“Lightning is great and something we’ll integrate,” Brian Armstrong said in response to an allegation that he was “ignoring” the network.

Bitcoin (BTC) layer 2 scaling solution Lightning may feature on the cryptocurrency exchange Coinbase in some capacity, according to its CEO, Brian Armstrong.

In a tweet on April 8, Armstrong said that “Lightning is great and something we’ll integrate” in response to a tweet criticizing him for “actively ignoring” the network.

Armstrong provided no further details on what a Lightning integration with Coinbase would involve or when it could be expected.

Coinbase, along with Binance and the now bankrupt FTX, has been called out in the past for not integrating the Lightning network which enables faster and cheaper BTC transactions than the Bitcoin base network.

According to a GitHub repository by Lightning enthusiast David Coen, Coinbase would join Bitfinex, Kraken and OKX as the largest trading platforms to have integrated Lightning, if Armstrong stays true to his word.

Coen had previously suggested that Lightning integration may go against the business plan for many of these trading platforms, “since the priority seems to be to integrate as many altcoins as possible and follow the trends of the market.”

Armstrong claims to have tested out a Lightning network application in recent days, and sent Cointelegraph reporter Joseph Hall $100 in BTC after Hall shared a video of himself using Bitcoin in Senegal.

The $100 was a prize by Armstrong for those who shared the “best” examples of how people are using crypto in Africa. Hall said he would give away the funds to onboard others to Bitcoin.

Hall reported, however, that he hasn’t received the payment, prompting Bitcoiner Derek Ross to suggest that Armstrong “needs a lesson on Lightning.”

Coinbase has lately been more active in the Ethereum ecosystem having launched “Base” on Feb 23 — an Ethereum layer 2 application-focused network powered by fellow layer 2 Optimism.

Related: Bitcoin Lightning Network growth is organic, coming from real-world adoption

Interestingly, Armstrong wrote a “Scaling Bitcoin” article in January 2016, where he said that he would throw support behind Bitcoin scaling solutions:

“We also did it to show our support for scaling Bitcoin, and encourage things to move forward, since we’d like to see a solution sooner rather than later.”

Lightning was launched about two years later in March 2018, with last month marking the fifth anniversary of the network.

Cointelegraph contacted Coinbase for comment but did not receive an immediate response.

Magazine: Bitcoin in Senegal: Why is this African country using BTC?