Payments

YouTuber baits MMA fighter into secretly shilling fake NFTs for $1K

Coffeezilla, a YouTuber and crypto investigator, revealed that American mixed martial artist Dillon Danis promoted a fake NFT project without disclosing that he received $1,000 for the advertisement.

While the support from numerous A-list celebrities expedited the nonfungible token (NFT) boom of 2021 and 2022, some promoted unvetted projects to fans without knowing if they were legitimate or scams. The practice retains its popularity in 2023 as markets recover.

In the promotion, Danis tweeted out a digital image with a website URL, which, according to Coffeezilla, “literally spells out S.C.A.M.” A further investigation from Cointelegraph shows that the website was newly created on Feb. 1, 2023 — an important clue to check when checking the credibility of new projects.

Moreover, the website FAQ mentions that no investors can get hold of the “Sourz” NFTs, a crucial piece of information overlooked by the MMA fighter.

SourzNFT FAQ highlighting that no users can get the NFTs. Source: sourznft.com (CoffeeZilla)

A similar incident involving Kim Kardashian was flagged in June 2021 by the United States Securities and Exchange Commission (SEC) when she promoted EthereumMax (EMAX) crypto token to her 330 million Instagram followers. According to the SEC, Kardashian violated the anti-touting provision of the Securities Act by failing to disclose the $250,000 she had received for the promotion.

However, Coffeezilla ensured that the users who fell for the scam NFT project were notified immediately. When users click the “Mint Sourz” button (as shown in the above screenshot), they are redirected to a website that cautions against a possible scam.

A webpage showcasing crypto projects previously promoted by MMA fighter Dillon Danis. Source: sourznft.com (CoffeeZilla)

While Coffeezilla plans to share more information through a follow-up video, the incident is a strong reminder for influencers and investors to do their own research before promoting or investing in a project.

Related: FBI seizes $100K in NFTs from scammer following ZachXBT investigation

Little Shapes NFT, a project launched in Nov. 2021, was a “social experiment” designed to shed light on large-scale NFT bot network scams on Twitter, according to pseudonymous founder Atto.

“I needed a story that sells to make sure no one would ignore a story that hurts,” explained Atto when explaining his intent behind launching the NFT project.

Little Shapes was marketed as an upcoming avatar-style project with 4,444 NFTs that would allow owners to interact and change the artwork in real time.

Do Dogecoin’s (DOGE) and Shiba Inu’s (SHIB) stalled rallies mean the memecoin trend is dead?

Absent shill and bullish newsflow, DOGE and SHIB have struggled to keep up with the wider crypto market rally that occurred in January.

The memecoin phenomenon didn’t prove as effective in the last month’s crypto market rally, as the gains of the top cryptocurrencies in this category barely outperformed Bitcoin. The monthly gain of Bitcoin (BTC) stood at 44.5%, while the top two meme-based coins, Dogecoin (DOGE) and Shiba Inu (SHIB), gained 27% and 40.7%, respectively.

Top meme-coins by total market capitalizations. Source: CoinMarketCap

Doge needs a market moving catalyst

Dogecoin is losing its popularity, as its most prominent supporter Elon Musk is reportedly developing an independent Twitter Coin instead of integrating his favorite cryptocurrency with the social media platform.

For the greater part of 2022, DOGE/USD performed poorly except for when Elon Musk acquired Twitter. The acquisition raised hopes in the Dogecoin community about increased cryptocurrency usage.

However, without any tangible announcements or reports from Twitter hinting at Dogecoin usage, the 100% price surge from October reversed in the following two months. The Google search volume for the token has also subsided since Q1 2022.

The NVT ratio for Dogecoin. Source: Coinmetrics
Google trends score for “Dogecoin” and “Shiba Inu” Source: Google Trends

Another factor influencing the price of DOGE last year was the launch of Dogechain. An EVM-compatible blockchain that uses DOGE as the gas-paying token. However, Dogechain failed to gain user traction, becoming a place mainly for “shitcoin” trading. Currently, less than 1% of DOGE is bridged on Dogechain.

Lastly, the on-chain data for Dogecoin suggests that the price may be overpriced. The Network Value to Transaction Value (NVT) ratio metric is a price-to-earning ratio equivalent for the cryptocurrency markets. The metric measures the ratio of the market capitalization of the token against its transaction volume. Higher transaction volume compared to the market value corresponds to low NVT readings.

Coinmetrics’ historic NVT chart of Dogecoin suggests that the token could be overpriced. For the last eight years, the NFT ratio has oscillated between 10 and 100, with a few outliers during bull markets. Dogecoin’s NVT metric hasn’t tapped the bottom of its long-term range since mid-2021, which exposes it to more downside risk.

The NVT ratio for Dogecoin. Source: Coinmetrics

The internet’s first and most favorite meme coin would require a catalyst like a tweet from Elon Musk, or drastic change in the token’s tokenomics or fundamentals to revive a positive run in the short-term.

DOGE/USD daily price chart. Source: TradingView

Dogecoin has been trading in a range between $0.05 and $0.14 since last June. A breakout from the range could see continued momentum in the direction of the breakout. 

Related: Rumor has it that Dogecoin could shift to proof-of-stake

Shiba Inu’s brand building strategy may not be enough

Like Dogecoin, the weakening memecoin narrative affected the buying strength of Shiba Inu. The second-largest memecoin has been working on enhancing the brand value of Shiba Inu by forming partnerships with clothing brands like Bugatti Group and English designer John Richmond.

The Google Trend score of Shiba Inu shows a similar depressing pattern since early 2022 as Dogecoin, with no spikes in search volume since the crypto bull mania of 2021 subsided in Q1 2022.

Like Dogecoin, the Shiba community also has an independent blockchain, Shibarium, which is owned by the Shiba community. However, the blockchain’s gas-paying token is BONE instead of SHIB, which brings no real value to the token holders of SHIB.

The total balance of SHIB on crypto exchanges jumped earlier in January, which is a negative sign, exposing the token to more sell-offs. On the contrary, the smart money wallets identified by Nansen increased their holdings slightly on Jan. 25, which may add some strength to the recent rally.

Token balance on exchanges. Source: Nansen 

On a weekly time-frame, the token is trading between $0.00000825 and $0.00001794. A breakout from this range will likely see a strong move in the direction of the breakout. The midpoint of the range at $0.00001200 is also acting as a resistance level for buyers. 

SHIB/USD daily price chart. Source: TradingView

While the top meme tokens have seen fading momentum, Floki Inu and Solana’s BONK token had impressive runs in January thanks to an SOL price rise and tokenomics improvement with Floki Inu. The Floki community voted to burn $100 million worth of FLOKI tokens, which nearly doubled its price on Jan. 29. 

Generally, it appears that the memecoin phenomenon from 2021 has lost its steam considerably. While the memecoins are moving with the rest of the market, their performance has been average. Improvements in the projects by the team or community have become essential to push these tokens back up.

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.

New York Assembly introduces crypto payments bill for fines, taxes

The bill clarifies that state agencies can legally agree to accept cryptocurrency payments and that these agreements should be enforced by the courts.

A bill introduced to the New York State Assembly on Jan. 26 would allow state agencies to accept cryptocurrency as a form of payment for fines, civil penalties, taxes, fees and other payments charged by the state.

New York State Assembly Bill A523 was introduced by Democratic Assembly Member Clyde Vanel, who is often seen as a crypto-friendly politician. It allows state agencies to enter into “agreements with persons to provide the acceptance, by offices of the state, of cryptocurrency as a means of payment” for various types of fees, including “fines, civil penalties, rent, rates, taxes, fees, charges, revenue, financial obligations or other amounts, including penalties, special assessments and interest, owed to state agencies.” 

The bill does not obligate state agencies to accept crypto as payment, but it does clarify that state agencies can legally agree to accept such payments and that these agreements should be enforced by the courts.

The bill defines “cryptocurrency” as “any form of digital currency in which encryption techniques are used to regulate the generation of units of currency […] including but not limited to, bitcoin, ethereum, litecoin and bitcoin cash.”

Depending on how this definition is interpreted, it may or may not include stablecoins like USD Coin (USDC) and Tether (USDT). On the one hand, the supply of stablecoins is usually regulated by the issuer instead of by cryptography. On the other hand, the bill does recognize that some cryptocurrencies have an “issuer,” and it provides that agencies can charge the payor an extra fee if such a fee is charged by the cryptocurrency’s issuer.

Related: Arizona state senator pushes to make Bitcoin legal tender

To become law, the bill will need to be passed by the New York Assembly and Senate, as well as signed into law by the state’s Governor, Kathy Hochul.

The New York state government is often seen as hostile to cryptocurrency. In November 2022, New York became the first state to pass a bill that banned nearly all cryptocurrency mining. It also has been criticized for the restrictive “BitLicense” it requires all crypto exchanges to acquire. In April 2022, the mayor of New York argued that the BitLicense law should be repealed.

Crypto-friendly Stripe weighs public offering: Report

In 2021, Stripe raised $600 million from a group of investors at a valuation of $95 billion, making it one of Silicon Valley’s most valuable startups.

Internet payment processor Stripe is reportedly eyeing a public offering and has set a 12-month timeline to explore the possibility.

Stripe has hired Goldman Sachs and JPMorgan Chase to advise on the feasibility and timing of a public-market debut, according to a Jan. 26 report by The Wall Street Journal. A source with knowledge of the matter told the Journal that Stripe’s executives will either take the company public or allow employees to sell shares in a private transaction.

The Journal also reported that Stripe’s management is unlikely to pursue a traditional initial public offering because the company doesn’t need to raise additional capital. Rather, the company is more likely to pursue a direct listing. In such a scenario, Stripe would place existing shares on a public stock exchange and let the market decide the price.

Founded in 2009 by Irish entrepreneurs John and Patric Collison, Stripe provides payment processing solutions for several major internet companies, including Shopify and Instacart. The company raised $600 million in 2021 at a valuation of $95 billion. Its investors included Ireland’s National Treasury Management Agency, Fidelity Investments and insurers Allianz and AXA.

Stripe has had a hot-and-cold relationship with digital assets dating back to at least 2014. In 2015, the company announced that it would accept Bitcoin (BTC), allowing users to send and receive BTC as they would fiat currencies. Stripe’s Bitcoin payment services would be halted in 2018 after three years, with the company’s founders claiming that BTC is better served as an asset rather than a medium of exchange.

Related: Listen-and-Earn allows Bitcoin payments for podcasters and listeners

The company reentered the crypto sector during the bull market of 2021 with a renewed focus on blockchain payments. The following year, Stripe announced fiat payment support for cryptocurrencies and nonfungible tokens. Through new application programming interfaces, businesses can now use Stripe to accept fiat payments for crypto.

As reported by Cointelegraph, Stripe also launched a new payout program in 2021 that would allow select content creators to withdraw earnings denominated in USD Coin (USDC).

CBDCs not worth the costs and risks, says former BoE advisor

Tony Yates, the former senior adviser of the Bank of England, argues that CBDCs are not worth the headache.

Central banks worldwide are pushing forward with digital asset projects despite the various crypto industry implosions of the past 12 months. China has rolled out its central bank digital currency (CBDC) to several cities and made it available for use at the Winter Olympics.

Many other central banks, including the Bank of England, are considering how to roll out a CBDC, while Nigeria’s CBDC has had poor uptake so far. India has already launched a pilot scheme, while Mexico has confirmed the launch of a digital peso.

However, Tony Yates, former senior adviser to the Bank of England, advises against CBDCs in a recently published opinion piece for the Financial Times. According to Yates, “The huge undertaking of digital currencies is not worth the costs and risks.”

CBDCs are already in place in most countries as most countries already have digital versions of cash, coins and notes. Yates, therefore, questions the motivations behind global rollouts of CBDCs, calling them “suspect.”

CBDCs could be a way of quashing crypto, including decentralized currencies such as Bitcoin (BTC). However, “Cryptocurrencies are such bad candidates for money,” he explains, adding:

“They don’t have money supplies managed by humans to generate steady paths for inflation and are hugely expensive and time consuming to use in transactions.”

Yates’ take on Bitcoin is unsurprising. He has tweeted several times about Bitcoin, claiming that most of Bitcoin’s use is “illicit” and “speculative.”

Since Bitcoin use a public ledger available for everyone, its use for illicit purposes has decreased steadily over the years to less than 1% of total transactions, reports show. 

On top of that, the layer-2 Lightning Network allows instant remittance payments, while other cryptocurrencies and even stablecoins continue to grow in use cases and development.

For Yates, introducing CBDCs is akin to “making central bank reserves more widely available than just to counterparties.” But in a world where the reserve currency is the U.S. dollar, the competition for a new global CBDC is counterproductive.

Related: Tanzania ‘cautious’ on CBDC adoption after initial research

The Financial Times opinion piece summarizes that the most compelling arguments for CBDCs are around payments and settlement efficiency, but the debate is “mysterious.” Yates explains that it would be a colossal undertaking for the central bank to employ the staff to build and manage the hardware and software of a new payment system. 

MetaMask removes Wyre from aggregators amid shutdown reports

Wyre was set to be acquired for $1.5 billion by San Francisco e-commerce startup Bolt last year, but the deal was eventually scrapped.

Crypto wallet MetaMask is ending support for services of Wyre crypto payment platform amid reports of Wyre planning to shut down operations soon.

MetaMask took to Twitter on Jan. 5 to announce that it has removed Wyre from its mobile aggregator, which allows users to buy crypto directly through its digital wallet.

“We’re currently working on extension removal and appreciate your patience,” MetaMask said, asking users not to use Wyre on the mobile aggregator.

According to the announcement, MetaMask still supports a wide number of other payment gateways, including Transak, MoonPay and Sardine. The services are available on Apple Pay, bank cards and transfers, MetaMask noted.

The news comes soon after Wyre CEO Ioannis Giannaros reportedly announced to employees that the firm is going to soon shutdown operations.

“We’ll continue to do everything we can, but I want everyone to brace themselves for the fact that we will need to unwind the business over the next couple of weeks,” Giannaros reportedly stated.

Related: 2023 could be a rocky year for crypto venture investments: Galaxy Research

MetaMask did not immediately respond to Cointelegraph’s request to comment. Wyre did not respond to several press inquiries from Cointelegraph.

Founded in 2013 in San Francisco, Wyre is a major crypto payment firm that came close to being acquired for $1.5 billion last year. In April 2022, the United States e-commerce startup Bolt agreed to acquire Wyre. Amid the massive crypto bear market of 2022, Bolt eventually opted to scrap the deal in September.

Ukrainian pharmacies enable crypto payments via Binance Pay

Ukraine continues adopting cryptocurrency payments with crypto exchange Binance amid the ongoing war with Russia.

Pharmacies in Ukraine are embracing digital payments amid the ongoing war, with a major local chain enabling payments in cryptocurrencies like Bitcoin (BTC).

ANC Pharmacy, one of the biggest pharmacy chains in the country, has partnered with Binance Ukraine to debut cryptocurrency payments via contactless crypto payment service Binance Pay.

ANC Pharmacy is now enabling its customers to proceed with instant payments while purchasing pharmacy products online, the chain officially announced on Jan. 3.

The pharmacy chain operates more than 1,000 pharmacies across Ukraine, running its own online pharmacy service. According to the announcement, Binance Pay payments will be initially rolled out in Kyiv.

The new payment feature will be available at ANC pharmacies as well as ANC Pharmacy-operated stores like Kopiyka and Shara. “ANC, Kopiyka and Shara are the first pharmacies in Europe to accept crypto,” the announcement states.

In order to proceed with a crypto payment, users need to download the Binance application and then go to ANC’s website. After choosing a product to order online, users will be able to pay using Binance Pay and pick up the order at a preferred location.

A spokesperson for Binance Ukraine did not immediately respond to Cointelegraph’s request to comment.

Related: Ukraine collabs with international consultants to update crypto framework

Binance has been actively pushing its presence in Ukraine over the past few years. In September 2022, Binance partnered with the Ukrainian supermarket chain Varus, allowing customers to pay for grocery purchases through its Binance Pay Wallet.

In early February 2022 — just weeks before Russian forces invaded Ukraine — Binance Ukraine’s general manager, Kirill Khomyakov, told Cointelegraph that launching a Binance Card in Ukraine was one of its top priorities for 2022.

According to Khomyakov, crypto payments via services like Binance Card do not conflict with Ukrainian laws because there is no ban on crypto-derived transactions in the country. At the same time, local laws do not allow direct payments in cryptocurrencies like Bitcoin.

Italy approves 26% capital gains tax on cryptocurrencies

The Italian Senate approved the new tax rate for crypto trading as part of the budget legislation for 2023.

On Dec. 29, 2022, days before the year’s end, Italy’s Senate approved its budget for 2023, which included an increase in taxation for crypto investors — a 26% tax on capital gains on crypto-asset trading over 2,000 euros (approximately $2,13 at time of publication).

The approved legislation defines crypto assets as “a digital representation of value or rights that can be transferred and stored electronically, using distributed ledger technology or similar technology.” Previously, crypto assets were treated as foreign currencies in the country, with lower taxes.

As reported by Cointelegraph, the bill also establishes that taxpayers will have the option to declare the value of their digital-asset holdings as of Jan. 1 and pay a 14% tax, incentives that are intended to encourage Italians to declare their digital assets.

Other changes introduced by the budget law include tax amnesties to reduce penalties on missed tax payments, fiscal incentives for job creation and a reduction in the retirement age. It also includes 21 billion euros ($22.4 billion) of tax breaks for businesses and households dealing with the energy crisis.

Related: MiCA bill contains a clear warning for crypto influencers

Giorgia Meloni, the first woman to serve as Italy’s prime minister, received wide support for her bill from the legislative body, even though she promised dramatic tax cuts when elected in September.

According to local media reports, measures from Italy’s government to reduce gas consumption across the country including over 15 days without central heating for buildings, with the population being asked to turn their heating down one degree and turn it off one hour more per day during the winter.

Italy‘s legislation follows the approval of the Markets in Crypto Assets (MiCA) bill on Oct. 10, establishing a consistent regulatory framework for cryptocurrency in the 27 member countries of the European Union. MiCA is expected to come into effect in 2024.

Brazilian president signs crypto bill into law

The law includes many digital currencies under the definition of legal payment methods in Brazil and established a licensing regime for virtual asset service providers.

Jair Bolsonaro, the president of Brazil set to leave office on Dec. 31, has signed a bill aimed at legalizing the use of crypto as a payment method within the country.

In a Dec. 22 publication of the official journal of the federal government of Brazil, Bolsonaro’s office said the president had signed bill 14.478 into law following approval from the country’s Chamber of Deputies. The legislative body sent the bill to the president’s desk on Nov. 29 as the final step in recognizing crypto payments.

According to the text of the bill, Brazil’s residents will not be able to use cryptocurrencies like Bitcoin (BTC) as legal tender in the country, as is the case in El Salvador. However, the newly passed law includes many digital currencies under the definition of legal payment methods in Brazil. It also establishes a licensing regime for virtual asset service providers and sets penalties for fraud using digital assets.

Bolsonaro’s announcement did not suggest which federal agency could be in charge of supervising crypto payments. However, like the United States, digital assets considered securities fall under the regulatory umbrella of Brazil’s Securities and Exchange Commission. The law also included provisions likely made in response to the collapse of FTX, requiring exchanges to distinguish between user and company assets.

Related: Brazil could cement its status as an economic leader thanks to 2024 CBDC move

The crypto law will take effect in 180 days — likely in June 2023. Bolsonaro is slated to leave office in a matter of days, after which Luiz Inácio Lula da Silva, or simply “Lula,” will assume the presidency on Jan. 1. Lula served as the president of Brazil from 2003 to 2010 and has previously made statements in favor of crypto and blockchain adoption.

Twitter adds BTC and ETH price indexes to search function

Twitter searches for “$Bitcoin,” “Bitcoin price” and “BTC price” pulls up a price chart, with equivalent searches working for Ethereum too.

Social media platform Twitter has added a new crypto feature that enables users to search the price of Bitcoin (BTC) and Ether (ETH) simply by typing their names or tickers into the search tab. 

The new feature is an improvement of “$Cashtags” and was announced by the Twitter Business account on Dec. 21.

The account noted that whenever one tweets the symbol of a major stock, exchange-traded fund or cryptocurrency with $ in front of it, people will be able to see a clickable link that takes them to search results that now will include the pricing graphs for those symbols. 

It also noted that simply searching for the ticker symbol, whether for a stock or crypto, will also bring up the price graph. 

Shortly after that, on Dec. 22, Twitter CEO Elon Musk retweeted the announcement of the new feature, stating that it is “one of many product improvements coming to financial Twitter.”

It appears that BTC and ETH are the only two cryptocurrencies with price charts at the time of writing. Other top cryptocurrencies, including Musk’s beloved Dogecoin (DOGE), have not made the cut.

However, Twitter Business said that it expects to expand its coverage of symbols and improve user experience “in the coming weeks.”

A screenshot of Twitter’s 24 hour price chart of Ether (ETH). Source: Cointelegraph.

Cointelegraph found that a number of variations of Bitcoin such as  “$Bitcoin,” “Bitcoin price” and “BTC price” also bring up the price chart, with corresponding searches also working for Ethereum.

Tech blogger Jane Mastodon Wong noted to her 158,700 Twitter followers on Dec. 21 that the charts are sourced from trading analysis platform TradingView.

The price charts also include a “View on Robinhood” link that can be clicked in the bottom left hand corner, suggesting the retail trading platform has teamed up with Twitter for this integration.

There, users are brought to Robinhood’s price chart for ETH, which provides an additional link below stating “Sign Up to Buy Ethereum.” The same links are provided for Bitcoin too.

However, no partnership details have been disclosed between Twitter and Robinhood.

Twitter’s price chart integration may arguably lead to more traffic to Robinhood, as #Bitcoin alone is tweeted roughly 120,000 times per day, according to data from BitInfoCharts.

#Ethereum on the other hand hovers at around the 25,000 range.

Related: Crypto fans should get behind Elon Musk’s subscription model for Twitter

Earlier this month, rumors began to circulate that Twitter may create its own native cryptocurrency, “Twitter Coin” to be used for payments on the platform. The rumors began on Dec. 4, about a week after Musk shared a glimpse into what “Twitter 2.0” may look like, including the possible integration of cryptocurrency-based payments on Twitter.

But Musk’s future at Twitter appears to be at the crossroads after the controversial figure asked Twitter users whether he should “step down as head of Twitter?” in a Dec. 19 Twitter poll — with 57.5 of the 17,502,391 voters polling “Yes.”

Musk later added that he “will resign as CEO as soon as I find someone foolish enough to take the job!”