According to a member of ConsenSys, the creator of the platform could pause the contract. More than 1,200 addresses seek to obtain returns that exceed 200% per year for their money.

Decentralized finance (DeFi) platform Swerve has almost USD 547 million deposited in its smart contract. The anonymous developer of this contract could pause it at any time, which would cause investors to lose their money forever.

This DeFi platform, the same as others like Yearn Finance and Curve, offers its users the possibility of trading pairs of ERC20 tokens with immediate liquidity. In other words, there is no need to wait for another user with a matching offer, known as the market maker pool (or market maker).

Swerve allows making all possible exchange combinations between the DAI, Tether (USDT), USD Coin (USDC), and True USD (TUSD) stablecoins. These tokens receive their liquidity from other users who deposit them, previously converted into Swerv USD (SWUSD), in exchange for rewards in Swerve (SWRV), the native token to this platform.

At the time of writing this article, Swerve promises a 254.60% interest per year. This number is too good to be true and safe but does not seem to cause alarm among the 1,229 people (given that each address belongs to an individual) who keep their money in this smart contract.

Twitter as Marketing Space for DeFi Platforms

The Swerve platform, which has been operational since September 4^th, spread like many other products in the DeFi ecosystem, through Twitter accounts of dubious identity and often recently created.

For example, user @MarioMusu5 stated that Swerve is a token “without pre-sale, not in the pockets of the development team, and not yet listed in any exchange (except for Uniswap).”

The marketing campaign seems to be giving good results, since exchanges OKEx, MXC, and Balancer also saw a business opportunity and incorporated Swerve to their exchanges, a day after that post.

Well-Know Developer Wonders Whether He is  the Only One Who Realizes It

There were some other critical voices in the aforementioned social network. This was the case of John Lilic, a member of ConsenSys and co-founder of Code to Inspire, the first programming school for girls in Afghanistan.

He wondered whether he was the only one that realized that the anonymous founder of the Swerve contract could pause it at any time, thus locking all the funds forever. He also wrote, “Who else sees a lot of irrelevant copying and pasting of the Curve code?”

From Swerve’s official account, they responded that his assessment was wrong. As they said, only the governor (the DAO) can execute the kill_me command, which would pause the smart contract. They also told him that “this would stop future deposits and exchanges, but not withdrawals, and the governor could reverse the action.”

The aforementioned @MarioMusu5 participated in this conversation and replied to Lilic that he was able to enter and withdraw his funds as many times as he wanted. He said that he was even able to “reverse the transaction more than once.”

These responses did not seem to convince Lilic, who subsequently wrote that the developer could request 25% to resume the contract at any time.

Investors Could Lose Everything

Amid this DeFi fever, Swerve is not the only platform that could cause these kinds of problems. For example, the developer of the Ren platform could pause the contract, thus causing the loss of invested funds.

Besides, possible code errors could lead a few users to earn a lot of money or lose everything, the latter having happened at least twice in 2020. Users lost USD 750,000 on the Yam platform, while a typing error led the Hegic platform to freeze more than USD 28,000.

By Alexander Salazar

There is a Bitcoin wallet with 69,000 BTC that hackers are reportedly passing to each other. The person who claims to have it is requesting a quantum computer to force its key.

A Bitcoin wallet with USD 693,207,618 is reportedly at stake. However, anyone seeking to hack it will first have to decode the password.

Alon Gal, a Twitter user, and a cryptocurrency enthusiast claims to have a Bitcoin wallet with 69,000 BTC in his possession. Undoubtedly, that amount has a value higher than USD 695 million.

The challenge is that the key to the Bitcoin wallet is lost. As a consequence, no one has yet managed to access it.

Alon Gal appealed to his more than 30 thousand followers and Google. He requested them to help him connect to a quantum computer to force the key, which would allow him to move the great lost Bitcoin treasure.

Last September 8^th, Gal posted that hackers have passed the wallet to each other during the last two years. Of course, they have not succeeded in finding the password.

He recently added that someone had warned him that there could be a method for hacking wallets, but that he did not know if it was true.

Possibility of Access Wallet with Lost Password

Advances in quantum computing have been areas of contention for cryptocurrency advocates. Many of them believe that machines could put the security of the Bitcoin blockchain at risk.

However, there is a great debate as to whether a current quantum computer can breach the security of blockchain technology. As a result of that, it would be able to decode the key to the wallet.

As many members of the community know, scientists in China were able to change an encryption key at a distance of 1,120 kilometers in June. They mainly used quantum entanglement, outperforming the previous best attempt by 1,000 kilometers.

This time, they used quantum entanglement to change a secret key, which would also allow encrypting and decrypting messages.

Experts’ Opinions

Some experts claim that such a device does not exist, but others consider that a quantum computer will have that potential and much more sooner than expected.

In that sense, Wladimir van der Laan, the developer of Bitcoin Core, said that he hopes that it will be long before quantum computers become common enough. He especially stated that regarding their applicability to a decentralized network like that of Bitcoin.

In the same vein, Ian Grigg, the inventor of Ricardian Contracts, indicated that a quantum computer is not necessary to distribute keys securely. He said that it is possible to do it with cheaper software methods.

To conclude, the website of consulting firm Deloitte said that quantum computers could become so fast that they would affect the Bitcoin transaction process. They believe that that would happen even though everyone took the same protective measures.

By Alexander Salazar

Rogers believes that “something” will eventually replace the US dollar as a reserve currency. According to the investor, the US dollar will have its “last chance” in 2021.

The dominance of the US dollar as a world reserve currency is nearing its end, according to investor Jim Rogers. Former George Soros’s partner believes that the US dollar is losing strength while the Chinese fiat currency, the yuan, is strengthening.

According to the co-founder of Soros Fund Management, “something” would replace the US dollar shortly. He did not directly refer to the yuan, but he envisions an adverse for the US fiat currency compared to its Chinese counterpart.

Rogers stated that “the US dollar has been the strongest currency in the world” for almost 100 years. In this regard, he referred to the background of the British pound and the Dutch guilder, the most reliable fiat currencies on the planet at the time.

The Chinese state medium Global Times reported that the Asian country plans to reduce its holdings of US debt from USD 1 trillion to USD 800 billion, around 20%. China would even be willing to sell all its US debt bonds in an extreme case, anticipating an armed conflict, according to the same medium.

The also co-founder of Quantum Fund considers that the growing tensions between the United States and China create a climate of uncertainty. This will eventually affect the dominance of the US dollar as a world reserve currency.

The increasing indebtedness of the United States adds to the tensions and the Chinese plans to erase at least 20% of its holdings of US debt. According to Rogers, this will be another negative factor in the immediate future of the US fiat currency.

The financial analyst predicted that the United States could revitalize control of the US dollar next year, but he warned that that would probably be its last chance.”

US Dollar Crash and Bitcoin Boom

The US dollar is not undergoing its best moment. In mid-August, the USDX weighted index fell to levels not seen since May 2018, while the price of Bitcoin has remained more than 50% higher so far this year.

Rogers’ position coincides with that of other renowned economic analysts, who consider that the dominance of the US fiat currency is at serious risk. Robert Kiyosaki, author of the best-seller “Rich Dad Poor Dad”, maybe one of the most persistent.

On several occasions, Kiyosaki has referred to the imminent death of the US dollar as a global reserve currency. He has even seriously considered Bitcoin as a safe alternative to the crisis that he sees coming.

On the other hand, Rogers stated that many countries — among which are Russia, India, and, Brazil — are considering alternatives to the US dollar. To summarize, this position stems from the behavior of the United States regarding other countries. He said that the sanctions that Washington imposes “hurt everyone.”

Apart from China, Russia has also been reducing its holdings of US debt, favoring its reserves in gold. At the same time, dozens of countries have been paying more attention to the possibility of launching their digital currencies (CBDCs).

By Alexander Salazar

The authorities of each country and EU agencies will comprise the new supervisory agency. The European Banking Authority will be in charge of supervising issuers of stablecoins.

The European Commission (EC) will announce a regulation bill for cryptocurrencies — especially stablecoins — which will be applied in the member countries of the European Union (EU) and would come into effect in late 2020.

The said bill plans to create a team of supervisors with national authorities and EU agencies. The European Banking Authority (EBA), the entity that would assume a more prominent role in controlling the cryptocurrency sector in the region, will preside over these teams.

The national authority of the Member State, the European Securities and Markets Authority, and the European Central Bank (or any EU central bank) will comprise the supervisory entities. They will be in charge of reviewing the operation and use of “significant” (risky) cryptocurrencies, which include projects similar to Libra (Facebook’s stablecoin).

The regulation will be applied on a scale, through the imposition of stricter rules — in terms of obligations, supervision, and sanctions — to cryptocurrencies considered risky. The crypto assets that supervisory entities assess as less risky will receive the application of more lax rules. Central bank digital currencies (CBDC), currently under development, will be exempted from regulation.

Supervisors will have powers, both to request cryptocurrency issuers to keep more of their funds and to revoke the authorization of the operation if there are serious breaches. ABE will impose fees on “top issuers” to fund supervisory functions.

The project proposes that it is ABE that evaluates the opinions of the supervisors of each country. It will also have powers to conduct investigations and inspections, and impose fines of up to 5% of the issuers’ annual revenue, or twice the profits made or losses avoided with the infringement.

Crypto asset developers must present their users with a technical document with information about the issuer, the token, or the trading platform. National and European regulators must approve this material in advance.

This plan for standard regulation in the region has received the endorsement from Germany, France, Italy, Spain, and the Netherlands in a draft joint statement. These countries support the idea of not allowing stablecoins to operate in the European Union until having addressed legal, regulatory, and supervisory challenges.

The five members of the EU add that stablecoins must have a 1:1 parity with reserve assets denominated in euros or fiat currencies of the member states and be deposited in an institution that the European Union has approved. The draft bill indicates that entities operating pegged cryptocurrency schemes must be registered in the EU.

Regulation Bill Based on Expert Consultation

The EC has been working on a regulatory framework for cryptocurrencies for several years. Last December, it opened a consultation with experts, where Google and PayPal also participated, receiving opinions on the regulatory needs of the sector.

They evaluated many of the ideas of the consultation in a “non-paper”, entitled “Cryptographic Assets: Key and Regulatory Developments”, which they produced in April 2020.

Based on this material, the EC team is working on the regulation bill. The definition of the types of cryptocurrencies and the introduction of changes in the Markets in Financial Instruments Directive II (MiFID II 2014/65/EU) are among the priorities. With this, they seek to include crypto assets within this legal framework.

The report emphasizes the regulation of stablecoins, calling them risky for the control of monetary policy. It contemplates expanding the supervision of the sector and requiring the application of anti-money laundering regulations to cryptocurrency exchanges, portfolio providers, and issuers of security tokens. In this way, it is in line with the regulations of the Financial Action Task Force (FATF).

By Willmen Blanco

The US dollar will have a noticeable level of inflation in 2021, according to Ruchir Sharma. The strategist believes that in the coming years the stocks that retain their value will receive a better valuation.

Commodities like gold and Bitcoin will perform well in the next 3-5 years, according to Morgan Stanley’s head of emerging markets and global strategy. Ruchir Sharma showed his vision of how the economy and the global financial market will behave after 2021.

Sharma, a writer, and executive at Morgan Stanley, said that current conditions have led the vast majority of stocks to be overvalued. Among the factors, he mentions the high monetary liquidity and the low-interest rates that exist in most first world countries. This situation would be a preview of an inflationary spiral that would consume the economy as a consequence of the money that central banks inject.

The strategist believes that it is a good time to invest in commodities, since their growth potential in the next 3 to 5 years is better than that of stocks, except for some video game companies.

Concerning commodities like gold and Bitcoin, Sharma stated that both are speculative instruments. However, they are investments that prove how little confidence people have in the implementation of financial policies that central banks currently need to implement.

He added that he considers this a demographic issue since older investors (boomers) usually invest in gold. In contrast, millennials are increasingly turning to Bitcoin and other cryptocurrencies. He stated that having around 5% of his investment portfolio in gold “is not a bad idea” and thinks that the most adventurous are exploring cryptocurrencies.

Why Bitcoin and Gold Will Perform Well in 2021

Central banks usually deal with cash-rich environments, as is the case in many of the world’s economies today. This situation allows people to understand Ruchir Sharma’s statements accurately.

Concerning the factors that would lead to the scenario that the executive envisioned, he said that these would be the availability of a vaccine against COVID-19 and the rapid inflation that would come once it exists.

The current situation in most countries of the world has disrupted consumption patterns. As a result of financial aid and other incentives, there is a lot of money on the street. On the other hand, people are not consuming as much as they were used to.

The scenario that Sharma envisioned depends on the normalization of the current situation and the possibility of “herd immunity”. In this context, people will resume their economic activities with greater confidence. Likewise, inflation will manifest itself when they begin to buy the products available in the market with money artificially printed.

Increasing interest rates is one of the mechanisms that central banks preferably use to control inflationary environments. In theory, this leads to more people to think about saving rather than borrowing. Sharma believes that those who bet on explosive growth stocks will switch to a market where they bet on stocks — like Bitcoin — that retain their value.

When it comes to their behavior in the financial markets, Bitcoin and gold have a lot in common. They show a historical price correlation of 70%, and everything seems to indicate that this will continue to be the case.

By Willmen Blanco

After selling his tokens for 38,000 ETH, ChefNomi apologizes and returns the funds that he obtained. The successful migration of SushiSwap and ChefNomi’s apologies give new impetus to its valuation.

In recent days, the creator and main developer of Sushiswap announced the return of 38,000 ETH, valued at USD 14 million, which he obtained after the sale of the SUSHI tokens that he owned.

The developer, identified as ChefNomi, recently posted the details of the transaction and sent his apologies to all the developers, financiers, and users of Sushi who his actions affected on September 5^th.

At the same time, he stated that he will let the community decide in an election how many SUSHI tokens he deserves for having created the project. The community itself would also establish the conditions under which they would do that.

The developer admitted on Twitter that he had acted for the wrong reasons. “I acted emotionally, I was greedy, I was scared. I made bad and controversial decisions, acting under pressure, hurting, and betraying everyone. Sorry,” he said.

To end his comment thread, he announced that he would continue to participate in the technical discussion, in a collaborative and non-leading role. He also said that he will not make decisions or participate in the governance of the platform.

Movement Revalues Token of SushiSwap

On September 11^th, the migration of SushiSwap subtracted 80% of liquidity from Uniswap, a decentralized platform for trading DeFi application tokens.

This amount corresponds to about USD 1 billion in liquidity, which now makes SushiSwap the largest decentralized exchange in the world. In light of the facts, there was doubt as to the reliability and credibility of this protocol the week before.

The successful migration, along with Chef Nomi’s apologies, seems to have restored the confidence in this project. The token’s price recently increased by 15%, according to data from Coingecko. On its first day of operation since the migration, SushiSwap reported on Twitter that it had reached USD 273 million in trading volume.

However, the DefiSafety website, which indexes the security level of DeFi projects, still considers it to be one of the least reliable.

Activities that Other SushiSwap Developers and Leaders Do

Adam Cochran, a SushiSwap business investor, and Cinneamhain Ventures partner, recently made two proposals regarding recent events and the future of the platform.

In the first instance, he proposed to buy Sushi tokens again with the ethers (ETH) that ChefNomi returned. Cochran said that ChefNomi returned the equivalent of USD 14 million worth of Ether, but the Sushi fund no longer has the tokens sold on the market. He believes that the community should vote to use part of the returned ethers to buy SUSHI at the market price.

A Twitter user suggested that this transaction should occur under the same terms of the events to compensate for. In other words, it is necessary to buy SUSHI tokens without prior warning, keeping the trading time confidential.

In the second instance, Cochran nominated the developer under the pseudonym 0xMaki to become the project leader. “SushiSwap does not yet have a dedicated full-time team,” he said in a proposal that includes a guarantee of 500 thousand SUSHI. This would be possible if the developer were dedicated to consistently collaborating on the project, according to a budget and a sustainable management plan.

An apparent exit fraud or scam, in which the foremost developer of a project betrayed good practices to the detriment of an entire community, today seems to give SushiSwap one more opportunity to live.

By Willmen Blanco