Maker Upgrade Brings Multi-Collateral to DAI

MakerDAO is upgrading its Maker (MKR) protocol, wherein Multi-Collateral DAI (MCD) will be implemented. While Maker announced the new protocol in October, the update with the upcoming changes to Dai will be live on Nov 18.

Multi-Collateral Option Coming to DAI

MakerDao’s MCD has been proposed to add new assets eligible as collateral for DAI – the system’s dollar-pegged stablecoin. If until now, only Ether (ETH) was being used to issue DAI, with the MCD upgrade Maker (MKR) holders will be able to deposit other cryptoassets as collateral. The governance community is yet to decide which assets will be added, with options between Augur (REP), Basic Attention Token (BAT), DigixDAO (DGD), Golem (GNT), OmiseGO (OMG) and 0x (ZRX).

As per the announcement, the launch of MCD will not require any action from Dai users. Maker stated it will be monitoring the deployment of the MCD closely and will update users if any action is required.

While the new type of DAI will be backed by several types of collateral, the existing Single-Collateral Dai that has been until now backed by ETH, will now be called SAI.

Maker Plans to Phase Out SAI

Maker views the upgraded DAI as the better version that will allow the currency to grow significantly. As a result, the team plans to gradually phase-out SAI. The plan is to Migrate SAI into DAI using Maker’s native migration portal.

DAI is at the heart of the decentralized finance (DeFi) ecosystem and the transition may not be without hiccups, but is certainly viewed by most of the community as a step forward. The new Dai will be available on DeFi protocols like Compound.

MCD system’s launch plans were first revealed by the Maker Foundation’s CEO Rune Christensen in mid-October. The MCD upgrade brings several new features beside the multi-collateral options, along the Dai Savings Rate as well as the re-branded collateral debt positions (CDP) as Vaults.

In early November, the Dai stablecoin hit its 100 million token debt ceiling ahead of the collateral protocol upgrade.

A number of crypto exchanges have already confirmed the switch to MCD including Wyre, Bitcoin Suisse, Bittrex, Kyber, Bamboo Relay, Bitfinex, DeversiFi, Coindirect, GO.exchange and dYdX.

Recently Coinbase, Crypto.com and Kraken also announced their support to trade the token.

LG Developing Blockchain Phone According to Industry Sources

South Korean tech giant LG is said to be working with blockchain developers to launch blockchain-based smartphones in response to Samsung’s recently unveiled Klaytn Phone, according to sources within the industry.

LG Blockchain Phone

According to media outlet IT Chosun, the tech giant plans to expand the next generation of its smartphones to introduce blockchain-friendly smartphones, making it the second major South Korean phone manufacturer to make a move in that direction. An industry insider said LG had already gone through market research of blockchain firms as well as held discussions with local decentralized application (DApp) developers, devising a use case for its future product.

The industry insider noted that “LG is likely to respond to Samsung’s innovation initiative.” Another source familiar with the LG Group told the media outlet that the company has been “struggling to apply blockchain to smartphones without any dissimilarity.”

The news follows just as last week LG’s rival Samsung launched yet another blockchain-friendly smartphone, dubbed KlaytnPhone, as a Galaxy Note 10 variant. The device will come with a wallet and a free handout of KLAY, the token developed by Kakao off-shoot, GroundX.

Currently the smartphone is available only in South Korea and is named after Kakao’s blockchain subsidiary GroundX’s blockchain platform Klaytn.

Rivalry with Samsung

Earlier this year, Samsung also launched the Galaxy S10 smartphone, which provides users with a cryptocurrency wallet and dApps, and has been adding a number of decentralized apps (or dapps) to its official DApp store, Blockchain Keystore.

The media outlet further quoted an anonymous source as saying that Samsung is a more attractive proposition for blockchain developers as the company already has a crypto wallet for smartphones and a dapps marketplace, whereas LG does not support blockchain technology yet.

However another unnamed source pointed out that LG has joined Klaytn Governance Council, an alliance of multinational businesses and organizations, responsible for Klaytn’s governance, consensus node operation, and ecosystem growth, in June this year.

Although no definite details about LG’s future smartphone have been disclosed, this move marks promising new waves of blockchain- friendly smartphones as well as encourages more adoption for the industry.

LG Exploring Blockchain

Other blockchain – friendly smartphones that are currently available in the market include Sirin Labs’ FINNEY and HTC’s EXODUS. Last year, Pundi X unveiled its blockchain phone XPhone, which allows users to switch between a traditional mode supporting Android apps and a blockchain mode which will enable them to access dapps loaded on the device.

Meanwhile, LG has been exploring a range of blockchain-related business avenues. For instance, the company has launched its own Monachain blockchain platform, and is working with major bank KB on a token of some form – thought by many to be a cryptocurrency or a stablecoin.

Most recently, LG filed a trademark application for ThinQWallet in the U.S. aiming to provide a number of services such as issuance of cyber money, a computer software platform for blockchain, and mobile electronic wallet for cryptocurrency.

Facebook Unveils Its Cryptocurrency – Libra

After months of anticipation, Facebook has unveiled its cryptocurrency – Libra. The social media giant has released the white paper for the cryptocurrency and blockchain-based financial infrastructure project.

Multi-Asset Stablecoin

The aim of Libra is to provide users across the globe with easy access to financial infrastructure with seamless transactions with low fees. According to the paper, Libra will operate on the native and scalable Libra blockchain, and be backed by a reserve of assets designed to mitigate volatility fluctuations.

Reserves, which back Libra, will consist of a collection of low-volatility assets like bank deposits and government securities in currencies like USD, GBP, EUR, and JPY. Libra is not pegged to a single currency and does not have a fixed value in any fiat currency.

Libra will also issue a security token called Libra Investment Token as a way to fund incentive programs and cover operating costs. They will be only available to accredited investors as securities. Holders can earn potential profits from interest on the reserves.

Governed via Libra Association

While the reserve assets are held by a geographically distributed network of custodians in order to maintain a degree of decentralization, the reserve is managed by the Libra Association, which is the only party able to mint and destroy the coin.

Libra’s governing body, the Libra Association, is a non-profit based in Geneva, which will eventually have 100 geographically diverse founding members. The current founding members include Uber, PayPal, Visa and investment house Andreessen Horowitz (a16z).

Among the payments giants, a number of NGOs are involved in the Libra Association, including Creative Destruction Lab, Kiva, Mercy Corps and Women’s World Banking. To become a Social Impact Partner, participating non-profits must have a five-year track record of poverty alleviation work, including digital financial inclusion initiatives in the field and an operating budget of greater than $50 million.

Calibra – The Wallet

Besides Libra, the currency and network, Facebook has also unveiled Calibra – the digital wallet for the network. As part of its services, Calibra intends to follow various anti-money-laundering and know-your-customer regulations in the jurisdictions in which it conducts business.

Calibra registered as a money service business with the U.S. Department of Treasury and is now working to acquire money transmitter licenses in U.S. states that treat digital currencies as the equivalent of money.

Libra cryptocurrency and the underlying blockchain network are set to launch next year. The testnet will be released in the coming weeks. The developers will be able to build, provide feedback, and take part in a bug bounty program.

Binance Exchange Suffers Security Breach Losing 7,000 Bitcoin

One of the largest cryptocurrency exchanges Binance has reported a “large scale” data breach in which unidentified hackers stole more than 7,000 Bitcoin (BTC) worth about $40 million.

Binance’s Security Breached

On May 7th, Binance issued a statement in which they announced that a “large scale security breach” had been identified and hackers withdrew 7,000 BTC worth about $40 million via a single transaction, marking this the latest in a long line of thefts in the digital currency space.

According to the exchange, the hackers used a “variety of techniques” including phishing and viruses to access user API keys, two-factor authentication codes and “potentially other info.” There may be additional accounts that have been affected but not yet identified, Binance said.

Respectively, the theft only impacted Binance’s BTC hot wallet and wiped out about 2% of the company’s total BTC holdings. The exchange assured that other wallets remained secure and unharmed.

CEO Changpeng Zhao has explained that “the hackers had the patience to wait, and execute well-prepared actions through multiple seemingly independent accounts at the most opportune time. The transaction is structured in a way that passed our existing security checks. It was unfortunate that we were not able to block this withdrawal before it was executed.”7

User Funds Are Safe

Apparently, once the transaction was executed, it triggered internal alarms, and following the discovery Zhao froze all withdrawals. The announcement comes hours after Zhao tweeted that the exchange was undertaking some unscheduled server maintenance, saying that “funds are #safu.”

In a tweet linking to the post, Zhao said it was “not the best of days, but we will stay transparent,” further adding that the exchange will conduct a thorough security review. Accordingly, the review of the hack will take up to a week, during which time all deposits and withdrawals will remain suspended. However, trading will continue to be enabled to allow investors to adjust their positions.

Binance further cautions users that hackers may still control some user accounts and may “use those to influence prices in the meantime.”

Meanwhile, the exchange platform informed that it will use its Secure Asset Fund for Users – an emergency insurance fund – to cover all losses and as such no user funds will be affected by the breach.

The emergency fund is made up of 10% of all trading fees held by the exchange, and was initially established to protect Binance’s users in extreme cases. It is stored in its own cold wallet.

Bakkt Acquires Digital Asset Custody Service DACC

ICE’s major institutional cryptocurrency trading platform Bakkt has announced the аcquisition of crypto custodian service – the Digital Asset Custody Company (DACC), as reported by the company itself on April 29th.

Former Coinbase executive turned Bakkt COO Adam White, wrote in a blog post Monday that it had acquired DACC with the aim to continue developing a secure digital asset storage solution. No details about how much the acquisition cost have been revealed. Furthermore, the post also stipulates a number of new measures in an effort to stimulate regulatory feedback.

The entire team at DACC will be joining the company, as the team shares Bakkt’s security-first mindset and will bring experience in building its own secure and scalable custody solutions.

White further added that DACC’s native support of 13 blockchains and more than 100 assets will contribute greatly to the scaling of the platform as well as adding support for other cryptocurrencies beyond Bitcoin (BTC).

In the same blog post, it was disclosed that the exchange platform has been working closely with global bank BNY Mellon on developing and establishing a geographically-distributed private key storage, in order to provide more storage solutions to its clients.

On another note, Bakkt has secured as well insurance for funds, which are stored offline.

According to White, the exchange uses both warm (online) and cold (offline) wallet architecture to secure customer funds. Thus, the majority of assets are stored offline “in air-gapped cold wallets that are insured with a $100,000,000 policy underwritten by leading global insurance carriers,” however the COO has offered no names for who these insurance carriers might be.

Meanwhile, the COO has also revealed that the exchange has filed an application with the New York Department of Financial Services (NYDFS) to operate as a trust fund.

If granted, the exchange would be able to offer a regulated custody for any crypto assets that it holds, which may facilitate the launch of physical bitcoin future contract. Respectively, Bakkt stated that the company is seeking to launch physically-delivered BTC futures, with contracts set to be traded on ICE Futures US (IFUS) and cleared on ICE Clear US (ICUS), which is a federally regulated exchange and clearinghouse overseen by the United States Commodity Futures Trading Commission (CFTC).

ICE – operator of 23 major global exchanges, including the New York Stock Exchange (NYSE), had first announced the launch of the Microsoft cloud-powered “open and regulated, global ecosystem for digital assets” Bakkt back in August of 2018. The launch date had been initially set for January 2019, however due to the pending approval from the CFTC, Bakkt postponed the launch to later within the year.