Our own formula for the metaverse

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The Blends Briefs
TL’DR: Here’s a sneak peek into today’s newsletter

• Our own recipe for the Metaverse

• Over $1 billion has been stolen in 2023…so far

• Altcoin prices jump over the past week

• Terraform Labs seeks early court rejection

• NEOM-themed Metaverse

• Leak reveals a game-changing US executive order for crypto.

• Pakistanis' alternative for hawala-hundi

• Formal crypto legislation by the UK

•  Dictionomics: Bitcoin pegging

A must-have
Our own formula for the Metaverse

A metaverse is a term that describes a shared virtual reality where people can interact with each other and with digital content. A metaverse is not just a VR headset or a game but a persistent and immersive digital environment that spans multiple platforms and devices. 

To create a metaverse, some of the ingredients are:

• A high-fidelity and realistic 3D graphics engine that can render complex and dynamic scenes in real time.

• A distributed and scalable network architecture that can support millions of concurrent users and data transfers across the globe.

• A robust and interoperable protocol that can enable cross-platform compatibility and seamless transitions between different applications and devices.

• A rich and diverse content ecosystem that can offer a variety of experiences, activities, and services for users to explore and enjoy. This ecosystem may rely on tokenization, which is the process of creating digital assets that represent real or virtual goods, services, or rights.

• A social and collaborative framework that can foster user engagement, interaction, and community building.

• A secure and transparent governance system that can protect user privacy, identity, and ownership rights.

In the upcoming issues, we will discuss further the ecosystems surrounding the metaverse. 

Global Biscuits

Over $1 billion has been stolen in 2023…so far.
In 2023, over $1 billion has been stolen in 75 crypto hacks, a drop from the $3.2 billion heisted across 60 hacks in 2022. The decrease in value is attributed to the current lower market prices of cryptocurrencies rather than enhanced security measures or reduced criminal activity. Although the number of incidents has increased, the drop in crypto values has led to a lesser overall value stolen. This scenario has raised concerns about the industry's security and regulatory inadequacies. Smaller but more frequent heists have emerged, with only 11 incidents out of 75 in 2023 seeing thefts of over $10 million. Industry experts are urging clearer regulations, increased consumer education on asset protection, and closer scrutiny of institutions offering custodial services for crypto assets to address these issues. Meanwhile, cybercriminals are adopting alternative strategies like online extortion, aiming to generate around $900 million in 2023 from ransomware crimes, often demanding crypto payments.

Altcoin prices jump over the past week.
In the cryptocurrency market, while Bitcoin's rally has slowed down with a moderate increase, several altcoins have experienced substantial gains in the past week. Solana, among the top 20 coins, has shown remarkable performance with a 7% surge, trading at $34.78 and climbing nearly 20% in the last week. XRP has also seen significant gains of almost 5%, currently valued at $0.58. Avalanche, ranked 20th by market cap, has increased by over 3% in the past day and 17% over the week. Pepe, a meme coin, is up by nearly 5% in the last 24 hours and has surged by over 60% in the past week, currently priced at $0.00000120. The recent enthusiasm in the crypto space is attributed to increased optimism surrounding the potential approval of a Bitcoin exchange-traded fund (ETF). As Wall Street firms have submitted applications to the U.S. Securities and Exchange Commission for such a product, many experts anticipate approval from the top regulator in the near future. Bitcoin itself hasn't seen a significant increase in the last day but has climbed by nearly 14% over the last seven days, trading at $34,664 at the time of reporting.

Terraform Labs seeks early court rejection.
Do Kwon, the founder of Terraform Labs, a company that develops stablecoins, faced a crisis in May 2022 when a market crash caused the value of his stablecoins, such as TerraUSD (UST) and TerraKRW (KRT), to drop below their pegs. This threatened the stability and credibility of his project. As he managed to restore confidence in his stablecoins by using a mechanism called seigniorage, which involves creating and burning tokens to adjust the supply and demand of the stablecoins, the challenges that Kwon faces in maintaining his stablecoins' pegs presistant. This is combined with many issues, such as liquidity issues, arbitrage opportunities, and network congestion. He has resolved some of these challenges by implementing new features, such as an oracle system that provides reliable price feeds, a swap protocol that allows users to exchange different stablecoins, and a governance token that gives holders voting rights and rewards. The highlight of the challenges and opportunities that Kwon and his company faced can be embodied in the rapidly evolving crypto space, as well as the regulatory risks that they have to navigate in different jurisdictions, such as South Korea, Singapore, and the US.

Recently, Terraform Labs filed for summary judgment, aiming to dismiss the U.S. SEC case against them, arguing insufficient evidence for unregistered securities offerings. Despite extensive investigations, they claim the SEC lacks substantial proof. The SEC accused Terraform and co-founder Do Kwon of selling unregistered securities following the company's 2022 turmoil. Terraform also disputes the SEC's expert analyses. Earlier dismissal attempts were denied, acknowledging the SEC's plausible claims. Do Kwon opposes testifying, citing detainment in Montenegro with extradition requests from South Korea and the U.S. 

Tastes of the regions

NEOM-themed Metaverse.
NEOM, a futuristic city project in Saudi Arabia, has announced a partnership with Animoca Brands, a blockchain gaming company, to explore the potential of digital entertainment and gaming in the region. The deal is worth $50 million and will involve the development of a NEOM-themed metaverse, a virtual world where users can interact with each other and create their own content. Animoca Brands is the creator of popular blockchain games such as The Sandbox, F1 Delta Time, and Axie Infinity. The partnership aims to leverage the growing demand for immersive and social experiences in the Middle East, as well as to promote innovation and sustainability in the gaming industry. NEOM is a $500 billion initiative by Saudi Arabia to build a smart city that integrates cutting-edge technologies such as artificial intelligence, biotechnology, and renewable energy. The project is part of the country's Vision 2030 plan to diversify its economy and reduce its dependence on oil. NEOM and Animoca Brands hope to create a metaverse that reflects the values and vision of the city, as well as to attract global talent and investment.

Leak reveals a game-changing US executive order for crypto.
According to a leaked document, President Joe Biden is considering signing an executive order that would have a significant impact on the cryptocurrency market. The order would reportedly create a new regulatory framework for digital assets, including Bitcoin, Ethereum, XRP and other cryptocurrencies. The order would also establish a new interagency task force to coordinate the federal government's approach to crypto-related issues, such as taxation, consumer protection, national security and financial stability. The leak has caused a lot of uncertainty and speculation among crypto investors, who are unsure how the order would affect the prices and adoption of their favourite coins. Some fear that the order could impose more restrictions and barriers on the crypto industry, while others hope it could provide more clarity and legitimacy for the emerging sector. The leak has also sparked a debate among crypto experts and advocates, who have different opinions on whether the order would be beneficial or harmful for the innovation and growth of the crypto space.

Pakistanis' alternative for hawala-hundi.
Cryptocurrencies are digital currencies that use cryptography to secure transactions and control the creation of new units. They are decentralized, meaning they operate without the involvement of central authorities or intermediaries. Some people in Pakistan are using cryptocurrencies as a high-tech alternative to hawala-hundi, a traditional system of informal money transfer that relies on trust and social networks. Hawala-hundi is often used to evade taxes, regulations, and sanctions, but it also exposes users to fraud, theft, and money laundering risks. Cryptocurrencies offer some advantages over hawala-hundi, such as faster speed, lower cost, greater transparency, and enhanced security. However, they also pose some challenges, such as legal uncertainty, regulatory hurdles, technical complexity, and volatility. The government of Pakistan has not recognized cryptocurrencies as legal tender and has banned banks and other financial institutions from dealing with them. However, there is no clear law or policy that prohibits individuals from using or trading cryptocurrencies. The future of cryptocurrencies in Pakistan depends on how the government and society will balance the benefits and risks of this emerging technology.

Formal crypto legislation by the UK.
The UK government has announced its intention to introduce formal legislation to regulate the crypto industry following a consultation process that began in July 2023. The proposed bill, which is expected to be presented to Parliament in early 2024, aims to provide clarity and certainty for crypto businesses and investors, as well as to protect consumers and prevent illicit activities. The bill will cover aspects such as licensing, reporting, taxation, anti-money laundering, and consumer protection. The UK hopes to become a global leader in crypto innovation and adoption while ensuring high standards of governance and compliance.

Dictionomics
Bitcoin Pegging

Bitcoin pegging is the practice of linking the value of a currency, asset, or contract to the price of Bitcoin, the most popular and widely used cryptocurrency. Bitcoin pegging can be done for various reasons, such as hedging against inflation, facilitating cross-border transactions, or accessing decentralized finance platforms. Bitcoin pegging can be achieved through different methods, such as using synthetic tokens, smart contracts, or centralized intermediaries.

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