Investments

Over 30% of TikTok videos on crypto investments are misleading: Research

TikTok videos tagged with popular crypto-related hashtags — such as #crypto, #cryptok and #cryptoadvice — have cumulatively garnered over 6 billion views.

More than one-third of crypto influencers on TikTok, the go-to social media platform for the younger generation, have posted misleading videos about Bitcoin (BTC) and other cryptocurrency investments, according to a recent study.

Many people now rely on TikTok as their first source of information rather than going to Google for answers, but the recent study from daapGamble alleges that many influencers are sharing unvetted misinformation about crypto investments, often trying to convince unwary viewers to put their — or their parents’ — hard-earned money into cryptocurrencies that will lose them money.

Many TikTok influencers use the hashtag “#cryptok” while posting crypto-related content. DaapGambl analyzed 1,161 such TikTok videos and found that more than one in three were misleading. The research also found that just one out of 10 “cryptok” accounts or videos contained some form of disclaimer that warned users about the risks of investing.

47% of the crypto TikTok creators were found to be trying to make money by pushing services. Meanwhile, mainstream influencers such as Kim Kardashian, Jake Paul and Soulja Boy were also previously accused of promoting cryptocurrencies to their millions of fans without disclosing the payments they had received.

The United States Securities and Exchange Commission forced Kim Kardashian to pay $1.26 million in penalties for promoting EthereumMax (EMAX). While crypto influencers have a smaller reach than their mainstream counterparts, the potential financial risk for unwary investors remains equally high.

The research also found that one in three misleading videos on TikTok mention Bitcoin. Moreover, videos on TikTok sporting popular crypto-related hashtags — such as #crypto, #cryptok, #cryptoadvice, #cryptocurrency, #cryptotrading and #cryptoinvesting — have cumulatively garnered over 6 billion views.

Viewers often overlook the ill intent of influencers and trust their content purely based on its high number of views or likes. Both new and seasoned investors are advised to do extensive research on crypto projects prior to making any form of investment.

Follow Cointelegraph’s TikTok account for the latest crypto industry news.

On April 2, a $1 billion lawsuit was filed against crypto exchange Binance, CEO Changpeng Zhao and three crypto influencers for allegedly promoting unregistered securities.

“This is a classic example of a centralized exchange, which is promoting the sale of an unregistered security,” said the lawsuit, filed by the Moscowitz Law Firm and Boies Schiller Flexner.

As Cointelegraph reported, the lawsuit alleges that “millions” of people could be eligible for damages.

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Ukraine plans to adopt EU’s new cryptocurrency regulations

Immediately after passing the European Parliament, Ukrainian authorities announced plans to adopt the EU’s MiCA regulations on crypto assets.

Hot on the heels of the European Parliament passing the Markets in Crypto-Assets (MiCA) regulation, Ukrainian regulators have stated publicly that they will adopt the legislative package in their own country as well.

The deputy chairman of the Tax Committee of Ukraine, Yaroslav Zheleznyak, said on his Telegram channel on April 20, “We, along with colleagues from the NKCPFR [National Commission on Securities and the Stock Market] and other regulators, are already working on implementing some provisions of MiCA to make crypto assets legal in Ukraine.”

Yuriy Boyko, a member of the NKCPFR, said, “I am sure Ukraine will be one of the first countries to implement this regulation into national legislation.”

The introduction of MiCA marks a major advancement for the crypto industry within the European Union.

MiCA is the result of long efforts of European policymakers to introduce uniform regulations and create standardized rules for crypto assets across the EU, as crypto businesses are currently required to adhere to 27 distinct regulatory frameworks across EU member countries.

The implementation of MiCA is expected to enhance the competitiveness of startups in the EU, which could lead to a rise in their market share as compared to unregulated competitors.

Despite the need for EU lawmakers to still conduct legal and linguistic checks for MiCA as well as publish the bill in the EU journal, different stakeholders in the crypto industry have reacted positively to the development.

Ukraine’s move to adopt EU regulations comes on the backdrop of the Eastern European country receiving candidate status to the EU in June 2022. Per the European Council, European regulators have “acknowledged the considerable efforts that Ukraine has demonstrated towards meeting the objectives underpinning its candidate status for EU membership.”

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African blockchain ventures outpace global funding growth: Report

Africa witnessed a 429% YoY increase in venture funding in 2022, with the majority of funding coming from Seychelles and South Africa.

The African continent continues to be a fertile ground for the growth and implementation of blockchain technology.

According to the 2022 “African Blockchain Report” by CV VC, blockchain deals in Africa raised a total of $474 million in 2022, representing a 429% increase from the $90 million raised in 2021. This growth in funding far surpassed the global average, which only saw a 4% increase in blockchain funding.

According to the report, African blockchain funding demonstrated a growth rate that was over 12.5x higher than that of general African venture funding on a year-on-year basis. Overall African venture funding saw just a 34% increase, with $3.14 billion raised across 570 deals.

Africa experienced the highest growth rate in funding globally, while the United States remained steady at $15.2 billion in funding and Asia and Europe saw YoY increases of 50% and 35% with $4.74 billion and $4.88 billion in funding, respectively.

*African blockchain venture funding by countries. Source: CV VC*

Last year, Seychelles and South Africa were responsible for 81% of the blockchain venture funding in Africa, having raised $208 million and $177 million, respectively. Moreover, the total number of African blockchain deals increased by 12% YoY, from 26 to 29.

African blockchain venture funding made up 1.77% of global blockchain venture funding, which saw an impressive 407% YoY increase, with several countries contributing to the surge. By comparison, the U.S. concluded 137 deals while Asia and Europe had 84 and 78, respectively.

Nigeria was the frontrunner when it comes to the number of blockchain startups receiving funding, followed by South Africa, Seychelles and Kenya. However, despite Nigeria having the highest number of deals on the continent in 2022, it only accounted for 3.4% of all African blockchain venture funding, with an average deal size of $1.25 million.

Taking into account the substantial increase in blockchain funding in Africa and the fact that there was a relatively small increase in the number of blockchain deals shows that the median deal size has significantly risen. This suggests that businesses are securing more substantial funding and investors are becoming more confident in African blockchain ventures.

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Aleph Zero launches $50M ecosystem funding program

The Funding Program for the ecosystem involves grants, incubation, and acceleration for all phases of product development, with approved applicants receiving up to $500,000 per project.

Aleph Zero is launching a $50 million Aleph Zero Ecosystem Funding Program, the layer-1 privacy-enhancing blockchain announced on April 18. The nonprofit Aleph Zero Foundation overseeing its development of Aleph Zero aims to support developer teams to build on its platform and advance blockchain adoption globally.

In an interview with Cointelegraph, Aleph Zero co-founder Antoni Zolciak shared that “the goal of the Aleph Zero Ecosystem Funding Program is to fund innovations from developer teams that expand the capabilities, functionalities, and adoption of the Aleph Zero blockchain.” Zolciak also told Cointelegraph that the program would support various project ideas, from proof-of-concept to experienced teams with solutions on different platforms.

Aleph Zero wants to attract developers by providing comprehensive support that goes beyond just grants, such as assisting with business feasibility, regulatory compliance and community-building. The foundation seeks to offer access to a reliable partner network, as well asshare its own experience in building something from scratch. “We’re hoping to introduce a somewhat redesigned approach to how layer-1s can support builders and to go beyond simply providing grants,” said Zolciak.

The Ecosystem Funding Program comprises of grants, incubation and acceleration at all stages of product development, with successful applicants receiving up to $500,000 per project in grant funding. Additionally, grant recipients will gain exclusive access to Aleph Zero’s venture capital pool, infrastructure credits from Amazon Web Services and security design consultations from Kudelski Security. The Aleph Zero partner network will also provide marketing, branding, UX, product design and operational support as needed.

Speaking on the kinds of projects Aleph Zero is interested in supporting and the criteria for selecting grant recipients, Aleph Zero ecosystem lead Magdalena Oleksy told Cointelegraph that “the Aleph Zero Foundation is actively seeking to support a diverse range of projects that add value to the ecosystem. When selecting grant recipients, we consider the ability of the team to enhance network usage and adoption, their execution capabilities, and the uniqueness of the project.” Ultimately, the foundation seeks to encourage innovation and originality in proposals.

The program’s pilot phase has already produced a range of projects, such as decentralized lending and borrowing protocol Abax, NFT marketplace ArtZero, domain name service AZERO Domains, unique dark metaverse experience DRKVRS, enterprise-grade decentralized identity platform Gatenox and decentralized security platform Interlock.

Aleph Zero’s Ecosystem Funding Program is backed by long-term contributors to the project, including NxGen, Diamond Atlas Capital, BlackDragon, Necker Ventures, Hodl.nl and Hodl Ventures, Pragma Ventures, RR2 Capital, Cardinal Cryptography and Cardinal Ventures, Bellwether Rocks and Offbeat.

Despite recent ecosystem funding news, venture capitalist investment into crypto firms continued to fall in the first quarter of 2023. According to a report by Galaxy Research — the research arm of crypto investment firm Galaxy Digital — $2.4 billion invested by VCs throughout Q1 2023 was the lowest sum invested since the last quarter of 2020.

The report said that “Companies building in the Web3, NFTs, DAOs, Metaverse, and Gaming subsector raised the most deals, while Trading, Exchange, Investing, and Lending companies raised the most capital ($538m).”

VC investments have been falling since peaking at nearly $13 billion in Q1 2022, with the latest quarter’s results representing a decline of over 80% compared to the same to last year.

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Core DAO partners with Bitget and MEXC to launch $200M ecosystem fund

The Ecosystem Fund will provide financial support to early stage projects.

Core DAO, an organization committed to the development of the Satoshi Plus ecosystem, has introduced a $200 million Ecosystem Fund aimed at speeding up the development of decentralized applications and protocols built on the Core layer-1 blockchain.

According to two press releases seen by Cointelegraph, one from CoreDAO and one from Bitget, The Ecosystem Fund — which is supported by strategic partners such as cryptocurrency exchanges Bitget and MEXC — aims to provide financial support to early-stage projects. This support will encompass various areas such as research and development, recruitment, marketing, community-building programs and other essential growth initiatives.

In addition to the investment, the partnership also involves the listing of Core projects and the opening of a new Core Trading Zone on Bitget and its integrated BitKeep wallet. Bitget also plans to become one of the validators of the Core network and support Core staking on the exchange. Bitget’s user base of over 8 million can also offer substantial staking capabilities to the Core DAO ecosystem, providing it with essential liquidity.

The Ecosystem Fund of Core DAO claims to distinguish itself from industry peers by not adopting a grant-based system in which a project’s primary requirement to obtain financial support is committing to build on a particular protocol. Instead, the Ecosystem Fund will incentivize each project to achieve pre-agreed customized benchmarks that provide tangible value to the Core community.

Rich Rines, the initial contributor at Core DAO, commented: “Too often, grant programs seem designed to grab headlines and generate short-term momentum rather than incubating projects aligned with the ecosystem’s long-term success.”

“Core DAO has always prioritized creating the highest quality technology in the blockchain industry versus being the ‘first’ or the ‘fastest’ to do something. That’s why our Ecosystem Fund will incentivize projects for their ability to both deliver value and sustain success,” he added

Gracy Chen, the managing director of Bitget, said:

“This investment is another show of proof of our commitment to supporting the blockchain space from various angles. We have to keep in mind that the purpose of blockchain is to link the real world with Web3 space, and that is exactly what we are promoting with this partnership and our support to the ecological fund.”

Crypto derivatives exchange and a strategic partner of The Ecosystem Fund of Core DAO, Bitget, has also recently launched a $100M Web3 fund for crypto projects in Asia. Bitget has declared its intention to direct its funding towards Web3-compatible venture firms and projects on a global scale. The company shared that it will focus on Asian projects led by experienced teams that possess clear roadmaps and are addressing real-world issues.

During the launch of its Web3 fund, Bitget managing director Gracy Chen highlighted the fast-paced evolution of the Web3 landscape and emphasized the need to support deserving projects that can propel its development and make it a global phenomenon like Web2. Chen stressed that the Bitget Web3 fund’s primary objective is to identify projects that have the greatest potential to drive this transformation forward.

The other strategic partner of the Ecosystem Fund of Core DAO is MEXC, a cryptocurrency trading platform that offers users access to various digital assets and trading features, including spot and margin trading, derivatives trading and staking services.

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CME Group to expand Bitcoin and Ether option expiries after record daily volume

The CME Group aims to offer market participants more accuracy and flexibility in managing the risk of short-term fluctuations in the prices of Bitcoin and Ether.

On April 17, derivatives marketplace Chicago Mercantile Exchange (CME) Group announced it would broaden its range of cryptocurrency options by adding new options to its standard and micro-sized Bitcoin (BTC) and Ether (ETH) contracts. Pending regulatory review, these new contracts will be available from May 22, and expiries will be available every day of the business week from Monday to Friday.

According to the announcement, CME Group’s expanded suite of cryptocurrency options will include new expiry dates for Bitcoin and Ether futures contracts. These options will now expire every day from Monday to Friday, providing traders with greater flexibility to manage short-term price risks. Furthermore, options on micro-sized Bitcoin and Ether futures contracts will add Tuesday and Thursday expiries to their existing Monday, Wednesday and Friday contracts. The newly added expiries will complement the existing monthly and quarterly expiries that are already available across all Bitcoin and Ether options on futures contracts.

The move, according to CME Group, is aimed at providing market participants with greater precision and versatility in managing short-term Bitcoin and Ether price risk. It also comes at a time of heightened market volatility in the digital asset sector.

CME Group’s Bitcoin and Ether futures and options complex has already achieved a record daily average notional of more than $3 billion through Q1 2023. This signifies an increase in client demand for liquid hedging tools. The complex achieved other trading highlights as well, including a record 11,500 contracts and open interest, with a record average of 24,094 contracts for Bitcoin futures and options in Q1 2023. In addition, CME Group’s Bitcoin and Ether futures and options have a surge in trading volumes, with a record 2,357 Bitcoin options contracts traded on March 22 and a record open interest (OI) of 14,700 contracts on March 31.

CME Group introduced its first BTC futures contract in December 2017, followed by an ETH futures contract in February 2021. To cater to the increasing demand for cryptocurrency investment options, the exchange expanded its offerings in 2022 to include micro BTC and ETH futures. Additionally, it launched euro-denominated BTC and ETH futures when the euro was trading at parity with the United Statesdollar, which is currently worth around $1 per euro at the time of writing.

As at the time of publication, the price of ETH is at $2,085 and the price of BTC is at $29,503, falling below its previous high of $30,000.

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Nigerian crypto payment startup shuts down, offers IP for sale

Nigerian crypto and Web3 company Lazerpay shuts down after failing to raise funds and advises users to withdraw before April 30.

Nigerian crypto and Web3 company Lazerpay announced on April 13 that it is shutting down its operations.

According to a statement released on Twitter by Lazerpay founder and CEO Emmanuel Njoku, the decision to shut down the startup was necessary after the company could not raise funds in a funding round.

In the statement, Njoku said, “We are immensely grateful for the connection we have made and the impact our platform has made in the crypto ecosystem. We fought hard to keep the lights on for as long as possible, but unfortunately, we are now at the point where we need to shut down.”

The shutdown comes just months after announcing layoffs in November 2022. The company’s layoffs were due to its inability to raise funds after a lead investor pulled out.

The startup has announced its renewed focus on ensuring a seamless transition for its users by resolving any outstanding issues. To this end, it has been recommended that merchants use the bank or crypto payout options and withdraw their funds from the platform before April 30, 2023. Additionally, the startup is now inviting companies to make offers to purchase its intellectual property.

Njoku launched Lazerpay as a teenager and co-founded the company with Abdulfatai Suleiman and Prosper Ubi in October 2021 to drive crypto adoption globally. The company helps businesses accept stablecoin payments from customers globally.

According to Njoku, Lazerpay has onboarded over 3,000 businesses, processing over $1 million in transactions.

The African crypto space has recently been hit with a wave of upheaval. Just last week, Bitcoin (BTC) peer-to-peer marketplace, Paxful, announced that it would cease operations.

However, certain crypto payment startups in the continent are still thriving. For example, NairaEx is an active Bitcoin exchange in Nigeria serving as a medium for Nigerian traders to purchase or sell the country’s fiat currency, nairas, for cryptocurrency.

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Brooklyn court charges former banker for allegedly defrauding crypto investors

Brooklyn federal court charged a former investment banker for allegedly taking investors’ money under the pretext of making profitable crypto investments.

The federal court in Brooklyn, New York, charged a former investment banker and registered broker for allegedly defrauding numerous investors by promising profits on fake cryptocurrency investments and misappropriating the funds received to finance his lifestyle.

Documents with the court claim the defendant, Rashawn Russell, misused the growing interest in crypto investments to mislead investors. Russell convinced multiple investors to reinvest their fiat savings into cryptocurrencies, often promising significant or “guaranteed” returns. However, it is alleged that Russell misappropriated the investors’ money to fund his personal lifestyle.

Breon Peace, United States attorney for the Eastern District of New York, revealed the court’s intent to pursue the case against the former banker:

“As alleged, Russell turned the demand for cryptocurrency investments into a scheme to defraud numerous investors in order to fund his lifestyle. This Office will continue to aggressively pursue fraudsters perpetrating these schemes against investors in the digital asset markets.”

After convincing investors about the fake cryptocurrency investment scheme based on his credibility as a former investment banker and a registered broker with the Financial Industry Regulatory Authority, Russell allegedly used their money to gamble and repay other investors.

According to the information shared by the U.S. Department of Justice (DOJ), Russell fabricated documents to mislead unwary investors about the status of their crypto investments. The forgery involved altering an image of a bank’s website to depict fake balances and bank wire transfer confirmations.

If convicted, Russell could face a maximum of 20 years in prison. The DOJ also requested other investors to reach out if they suspect themselves of falling victim to the alleged crime.

On April 6, the Washington State Department of Financial Institutions issued a consumer protection alert against the crypto exchange Eucoinotrade.

According to the report, Eucoinotrade facilitated an “advanced fee fraud” wherein users were asked to pay up for upgrading accounts and withdrawing funds. While users faced no problems depositing money, they encountered problems when trying to cash out.

Bitcoin continues to shine with 98% of inflows into crypto investment products

According to CoinShares, Bitcoin saw $56 million of inflows last week, which accounted for 98% of all investments into digital asset investment products.

On April 11, European cryptocurrency investment firm CoinShares published its latest “Digital Asset Fund Flows Report,” revealing that digital asset investment products experienced positive sentiment, with inflows totaling $57 million last week, bringing them back to a net positive position year-to-date. However, despite this, “volumes were low at $970 million for the week.” The global Bitcoin (BTC) exchange market also saw low volumes, ”just 25% of the year-to-date average at $18 billion for the week.”

*Weekly crypto asset flows in millions (U.S. dollars). Source: CoinShares*

According to the report, inflows were primarily driven by investors in the United States, with $27 million in inflows. Germany, Switzerland and Canada also saw positive sentiment, with inflows totaling $17 million, $13 million and $2.2 million, respectively, indicating a broad-based increase in confidence toward digital assets.

Investors primarily focused on Bitcoin, which received $56 million in inflows, accounting for 98% of all inflows. Meanwhile, short-Bitcoin suffered minor outflows totaling $0.6 million. In contrast, altcoins — including Uniswap’s UNI (UNI), Polkadot’s DOT (DOT) and Polygon’s MATIC (MATIC) — saw minor inflows of less than $1 million each.

The report also notes that, despite the Ethereum network’s Shapella upgrade scheduled for April 12, Ether (ETH) inflows were relatively minor at $600,000, suggesting that perhaps investors are cautious about investing in ETH until they are more confident about the impact of the upgrade. Additionally, blockchain equities saw minor inflows totaling $2.1 million, indicating a relatively quiet week for the market segment.

Overall, the positive sentiment in the digital asset market last week — despite low volumes — indicates that investors remain bullish on the prospects of cryptocurrency. As previously reported by Cointelegraph, Bitcoin has reclaimed $30,000, its highest price since June 2022. Over the last 30 days, BTC recorded gains of nearly 46%, rising to its highest level in 10 months on April 11.

*Bitcoin price chart. Source: CoinGecko*

On April 5, American business intelligence firm MicroStrategy added another 1,045 BTC to its growing crypto treasury, for approximately $29.3 million at an average price of $28,016 per BTC. Saylor has been a prominent Bitcoin proponent, urging businesses to incorporate the leading cryptocurrency into their strategic asset allocation. He has consistently emphasized his belief that Bitcoin is the most dependable, secure store of value available in the current market and presents a distinctive avenue for enterprises to safeguard their assets against inflation.

G20 countries aim to develop global framework against crypto-related risks

The G20 also aims to bring together global economies to fight debt distress and hyperinflation in smaller economies like Sri Lanka and Ghana.

The G20 — an intergovernmental forum comprising 19 countries and the European Union — has planned to develop a common framework for helping all countries deal with risks associated with cryptocurrency investments.

Under India’s presidency, the G20 called for coordinated global crypto policies — a vision put forth by the country’s finance minister, Nirmala Sitharaman. However, with multiple ecosystem collapses impacting investors worldwide, Sitharaman believes disparate reforms will not help address the global reach of cryptocurrencies.

*Union Finance Minister Nirmala Sitharaman arrives for a business roundtable meeting organized by US India Business Council, in Washington. Source: Press Trust of India*

Speaking at the Peterson Institute for International Economics in Washington DC, she highlighted the numerous crypto collapses while revealing the need for a coordinated effort from all jurisdictions:

“Cryptocurrencies are a very important part of the discussion under the #G20India presidency, given so many collapses and shocks in cryptocurrencies. We seek to develop a common framework for all countries to deal with this matter.”

Moreover, Sitharaman also disclosed G20’s aim to bring together global economies to fight debt distress and hyperinflation in smaller economies such as Sri Lanka and Ghana. In this regard, she said:

“In G20, there is an opportunity for India to bring all countries together to address debt distress in middle-income and low-income countries. Multilateral institutions are coming up with resolutions for debt-laden countries in 3 to 5 years’ time.”

India’s G20 presidency will end on November 30, 2023, leaving roughly seven months for the group of 20 nations to carve out blanket crypto reforms that could be implemented across jurisdictions.

On the other hand, the previously struggling economy of El Salvador showcased the importance of an asset like Bitcoin (BTC) in reducing the impact of hyperinflation and dependence on the U.S. dollar.

India’s home-grown payment network, the unified payments interface (UPI), is also on an expansion drive.

UPI goes Global!

Since UPI was introduced as a payment system in India, it has revolutionised the lives of Indians, but in fact, India’s digital payment system is steadily becoming globally attractive & is being adopted by other countries.#indiafirst #IndiaSingaporeRelations pic.twitter.com/55sGh5bzbZ

— MyGovIndia (@mygovindia) February 21, 2023

Singapore’s PayNow rapid payment system recently integrated UPI to allow swift cross-border payments. At the time of the announcement, it was revealed that the State Bank of India, Indian Overseas Bank, Indian Bank and ICICI Bank would facilitate outgoing remittances, with Axis Bank and DBS Bank India facilitating incoming remittances.