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Business

Meta discontinuing NFTs on Facebook and Instagram

After about 10 months after its first deployment, the large tech company Meta is discontinuing its nonfungible token (NFT) features on its social media platforms, Facebook and Instagram.

In his recent tweet, Meta’s Head of Commerce and Financial Technologies, Stephane Kasriel, stated that the company is winding down its NFT support in order to focus on other ways to support creators, individuals, and businesses.

Kasriel added that the firm is still prioritizing ways for users to connect with their fans and monetize and will focus on tools such as building payment rails on its platform and through its messaging apps, along with monetizing Reels, the short-form videos that feature on Facebook and Instagram.

He particularly mentioned a focus on Meta Pay, the firm’s payment platform, which in the future could support cryptocurrency according to trademark filings from May. 

NFTs on the platforms were relatively short-lived, as testing began in May with select creators on Instagram before expanding to Facebook in June last year. The NFT features expanded again in August as Instagram made NFT tools available to over 100 countries. In November last year, Meta launched an end-to-end toolkit for minting and trading NFTs within Instagram.

The announcement has received scathing criticism from the crypto community, with most people stating that Meta’s move was shortsighted.

According to Cointelegraph, Meta’s scrapping of its NFT tools aligns with other cost-cutting measures across the company as it directs focus to its expensive metaverse ambitions.

Last year alone, its metaverse-building division Reality Labs recorded its largest-ever yearly losses at $13.7 billion. Meta also undertook in November the first mass layoff in the company’s history, cutting 13% of its workforce, some 11,000 staff.

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Blockchain

Artificial Intelligence and Blockchain; Can they complement each other?

Blockchain and Artificial Intelligence (AI) are two equivalently important and emerging technologies. According to some experts, blockchain is versatile and easy to apply whereas AI has surpassed all its limitations as experiments have shown. Some emphasize that both are often embedded with recent technological developments, albeit they both have different roots.

Additionally, most developers claim that blockchain technology and Artificial Intelligence (AI) are two distinct but complementary fields. Both are considered cutting-edge technologies that have the potential to revolutionize the way we live and work. However, they can also be combined to create powerful new solutions.

Defining blockchain and AI 

According to Investopedia, a blockchain is a distributed database or ledger that is shared among the nodes of a computer network. As a database, a blockchain stores information electronically in a digital format. Blockchain technology is best known for its crucial role in cryptocurrency systems, such as Bitcoin, in maintaining a secure and decentralized record of transactions. The innovation of blockchain is that it guarantees the fidelity and security of a record of data and generates trust without the need for a trusted third party.

On the other hand, Artificial intelligence (AI) refers to the simulation of human intelligence in machines that are programmed to think like humans and mimic their actions. The term may also be applied to any machine that exhibits traits associated with a human mind such as learning and problem-solving. The ideal characteristic of artificial intelligence is its ability to rationalize and take actions that have the best chance of achieving a specific goal.

In other words, the main difference between blockchain and AI is that blockchain is used to store data in a safe and decentralized manner while AI is tasked to make artificial objects smart like humans for example smartphones that can have programmed fingerprints and the new and trending AI language model, Chat GPT, an AI Chatbot introduced by Open AI.

Similarities between the two

According to some sources, blockchains and AI have combined values and the two can be interlinked in some way, here’s how;

  1. Blockchain’s digital record offers insight into the framework behind AI and the provenance of the data it is using, addressing the challenge of explainable AI. This helps improve trust in data integrity and, by extension, in the recommendations that AI provides. Furthermore, using blockchain to store and distribute AI models provides an audit trail, and pairing blockchain and AI can enhance data security. 
  1. AI can rapidly and comprehensively read, understand and correlate data at incredible speed, bringing a new level of intelligence to blockchain-based business networks. By providing access to large volumes of data from within and outside of the organization, blockchain helps AI scale to provide more actionable insights, manage data usage and model sharing, and create a trustworthy and transparent data economy.
  1. AI, automation, and blockchain can bring new value to business processes that span multiple parties, removing friction, adding, speed, and increasing efficiency. For example, AI models embedded in smart contracts executed on a blockchain can recommend expired products to recall, execute transactions such as re-orders, payments, or stock purchases based on set thresholds and events resolve disputes, and select the most sustainable shipping method. 

Can the two complement each other?

While blockchain and AI are known to have functioning individually and independently, the two technologies are more intertwined than ever in recent times. One such area where the combination of AI and blockchain would serve as the ideal model is data handling. The combination helps deal with data-related issues by breaking down the data into smaller parts in a blockchain, which is then distributed across the network. 

This model can solve some of the major issues for businesses from various industries. While AI can enhance the performance, accuracy, and efficiency of the data, blockchain can run computer networks by looking for power and energy.

According to Eng. David Lumala, a Ugandan developer and blockchain expert, the complement exists and is quite palpable. He emphasizes that many blockchain companies, have imbued AI in their operations and this is their way of maximizing the opportunities technology offers.

“I’d give an example of bubble.io and LensAI,” he notes.

He further adds, “AI is most appreciated in operations with repetitive tasks. Blockchain often captures data where there is a defined pattern. AI then helps by automating this process. See for example the language model, ChatGPT, where Google will give you a billion answers, ChatGPT will give you a brief and precise response.”

While AI and blockchain are a new age of technology, these fields offer so many opportunities for young people currently. Unfortunately, only a small portion of African countries actively participate in AI and blockchain. Although there are attempts to increase awareness, there is still a massive stereotype hindering fast adoption.
Through Blockchain 360, Uganda will be hosting a blockchain conference at the Uganda Institute of Information and Communications Technology (UIICT) in Nakawa, on 18th March. The event will further demystify the ever-changing and disruptive technologies including, blockchain, AI, and Web 3.0.  The conference is anticipated to bring together experts, entrepreneurs, local developers already building DApps and virtual worlds, and legal practitioners in the blockchain field. To participate, register via: https://www.eventbrite.ie/e/blockchain-360-tickets-541708062397.

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Business

Binance trains Ukraine’s cyberpolice and security service

Crypto exchange, Binance, has given training in the form of online seminars for their personnel on cryptocurrencies and blockchain technologies to Ukrainian law enforcement authorities and regulatory bodies.

Employees of the Ukrainian Cyberpolice, which is the cybercrime combatting unit of the National Police of Ukraine (NPU), the Security Service of Ukraine (SBU), and the Asset Recovery and Management Agency (ARMA) attended the classes.

According to  Kiril Khomyakov, Binance General Manager for Ukraine and Central Europe, Ukraine, which is fighting a bitter war with Russia, responds to various challenges on a daily basis.

“Among them are financial crimes that threaten the stability and security of the country’s financial ecosystem. Our goal is to unite efforts to prevent cybercrime and, in particular, the financing of terrorism,” he further noted.

Ukraine’s law enforcement agencies are involved in operations against crypto-related crime. In November, the Cyberpolice force hit a fraud scheme making €200 million a year by luring investors through call centers across Europe. The unit has in the past voiced support for the legalization of cryptocurrencies in the country and in March, last year, started accepting crypto donations.

The Eastern European nation is a leader in crypto adoption and has been taking steps to regulate the market in cooperation with its participants. Since, November, ARMA is exchanging information with major crypto trading platforms about the ownership of wallets as part of criminal proceedings.

Over the past year, the investigation team at Binance has organized over 30 workshops on financial fraud and cybercrime. Representatives of law enforcement agencies from many countries have attended this. Earlier this year, the Australian police had a crypto training workshop.

The exchange has been engaged in educational projects in the region, too. In February, it agreed to support Georgia in developing its crypto sector through education and crypto-focused events. In December, Binance launched a blockchain education program in Kazakhstan and offered to support Azerbaijan’s regulatory efforts.

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Business

Feds shut down Signature bank

Two days after authorities shut down Silicon Valley Bank (SIVB.O) in a collapse that left billions in savings unclaimed, state regulators have closed New York-based Signature Bank, the third-largest failure in American banking history.

The Federal Deposit Insurance Corporation (FDIC) took control of Signature, which had $110.36 billion in assets and $88.59 in deposits at the end of last year, according to New York state’s Department of Financial Services.

This announcement was made in a joint statement by U.S. Federal Reserve Chairman Jerome Powell, U.S. Treasury Secretary Janet Yellen, and Federal Deposit Insurance Corporation (FDIC) Chairman Martin Gruenberg. According to the Feds, all depositors in Silicon Valley Bank as well as depositors of Signature Bank will have access to their funds starting Monday.

The decision was made in consultation with President Joe Biden, according to a press release, which emphasized that the U.S. taxpayer will not bear any losses as a result of the resolution.

The Joint statement noted that banking regulations established after the 2008 global financial crisis ensured better safeguards for the banking industry and the U.S. banking system remains resilient and on a solid foundation. 

The failure of Signature Bank is the second major financial institution to have affected the market for digital assets, and it marks the third U.S. bank failure in the previous week.

Last Wednesday, Silvergate announced that it would voluntarily cease operations and liquidate, promising to reimburse its depositors in full. The bank had already declared that it would likewise discontinue the Silvergate Exchange Network (SEN).

The SEN played a crucial role for crypto-native firms as a round-the-clock payment service for Silvergate’s clients. Signature Bank operates a similar service called Signet, a digital payments platform used for real-time payments by the institutions’ clients.

Though Silvergate and Signature were both popular institutions among crypto-native firms, Signature’s total assets of around $110 billion made the bank much bigger than Silvergate, which reported a total of $11 billion in assets as of the end of last year.

“Though depositors who held funds with Signature Bank will be protected when the institution reopens Monday, shareholders and certain unsecured debtholders will not be,” the statement said, adding that the crypto-friendly bank’s senior management has been removed.

The Federal Reserve Board noted on Sunday that additional funds will be made available to depository institutions that are eligible in order to assure they’re able to meet the needs of their depositors.

Following the release of the joint statements, cryptocurrency values have risen. According to CoinGecko, Bitcoin, and Ethereum have increased 7.2% and 8.2% during the last day to reach about $21,850 and $1,580, respectively.

Stablecoin USDC also swelled towards its peg to the U.S. dollar, which it previously lost amid the collapse of Silicon Valley Bank. The price of USDC, the second-largest stablecoin by market capitalization, fell to $0.87 after its issuer Circle said $3.3 billion of the token’s reserves were held with the failed bank.

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Opinions

African crypto and startup industry to be affected by Silicon Valley Bank’s closure

The Federal Deposit Insurance Corporation (FDIC) shut down Silicon Valley Bank, the bank of choice for the majority of startups and venture capitalists, according to news reports from yesterday. The bank’s announcement that it had lost $1.8 billion on the sale of treasuries and securities was followed by a bank run, which led to the closure. Many customers decided to withdraw their money from the bank as a result of those losses because there was unclear communication.

Customers of SVB have been given the assurance in a memo released by the FDIC that insured depositors will have access to their money by Monday. Deposits are only up to $250,000 insured, and non-insured depositors will receive an advanced dividend within the upcoming week. As SVB’s assets are sold in the near future, future dividends may be paid, according to the FDIC.

Panic has been caused by the closure of SVB on the African continent, and this fear is not unfounded. Garry Tan, the president of Y-Combinator, wrote on Twitter that 30% of the startups exposed by SVB won’t be able to pay their employees in the upcoming thirty days. Over 80 African startups are included in Y-Combinator’s portfolio.  “All the startup founders groups I’m in are in full-on panic mode,” one of its founders tweeted yesterday. Everyone is moving money around. Nobody knows which banks are safe.” 

SVB was a lender to startups and required that they have deposited there as collateral, so several African startups had money there. For founders, the bank provided cashflow loans and loans secured by shares. Additionally, Silicon Valley Bank (SVB) was the preferred bank for startups prior to Mercury Bank, one of its competitors, being founded in 2019. Customers of SVB who started their businesses in Africa before 2019 may be impacted by the bank’s sudden closure. 

One of the most successful startups in Africa, Chipper Cash, was a client of SVB, according to the company’s website. The startup recently made headlines for a second round of layoffs after firing 12.5% of its workforce the year prior. An employee at a different fintech startup told TechCabal under the condition of anonymity that their company had $1.5 million in SVB and that they were unsure of how to proceed.

The crash may have an immediate impact on startups that have received funding from SVB. They might have been required to open bank deposit accounts, which held funds for operating costs, as part of the investment. Similar layoffs occurred at cryptocurrency startup Nestcoin after the collapse of one of its key investors, FTX. The majority of the startup’s operational funding was invested in the long-gone business. For businesses that the bank made a sizeable investment in, this might be the case.  

However, there are hints that the consequences might not be as severe as initially thought. Numerous observers have noted that opening bank accounts for startups with an African base has proven to be difficult. Over the coming weeks, the situation will become clearer, making it easier to calculate how the closure of SVB will affect African startups.

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Opinions

CFTC chair insists Ether is a commodity, not security as claimed by SEC chairman

At a hearing before the Senate Committee on Agriculture, Nutrition, and Forestry on Wednesday, the chairman of the Commodity Futures Trading Commission (CFTC), Rostin Behnam, addressed the assertion made by the chairman of the Securities and Exchange Commission (SEC), Gary Gensler, that all crypto tokens aside from bitcoin are securities.

Senator Kirsten Gillibrand (D-NY) questioned Behnam about the implications of Chairman Gensler’s recent assertion that all digital assets other than bitcoin are securities for the designated contract markets (DCMs) that currently provide futures or swaps on ether. DCMs are exchanges that function under the CFTC’s regulatory control.

“It would obviously raise questions about the legality of those DCMs, designated contract markets, listing these digital assets that are purported to be securities,” the CFTC chairman replied, reiterating, “I’ve made the argument that ether is a commodity.”

Noting that ether-based products have been “listed on CFTC exchanges for quite some time,” Behnam said: “For that reason, it creates a very direct jurisdictional hook for us to police obviously the derivatives market but also the underlying market as well.”

He further detailed: “The process for which an exchange or DCM will list a contract is very clear under our law. They could seek approval from the Commission [CFTC] or they could self-certify a product. That self-certification process is one that shifts the responsibility to both the CFTC and the market participant.”

The CFTC chief proceeded to explain why he strongly believes that ether is a commodity. “I would say serious and deep legal analysis goes into the thought process before a product is self-certified, so there’s no doubt in my mind and having known this and been at the Commission when ether futures were listed that both the exchange and the Commission thought very deeply and thoughtfully about ‘what is the product?’ and ‘does it fall within the commodity regime or the security regime?’” He stressed:

We would not have allowed the product, in this case, the ether futures product, to be listed on a CFTC exchange if we did not feel strongly that it was a commodity asset.

“Because we have litigation risk, we have agency credibility risk if we do something like that without serious legal defense or defenses to sort of support our argument that the asset is a commodity,” Behnam concluded.

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Business

India brings crypto transactions under prevention of money laundering act

The Prevention of Money Laundering Act, 2002 (PMLA) will apply to certain crypto activities “when carried out for or on behalf of another natural or legal person in the course of business,” according to a gazette published on Tuesday by India’s Ministry of Finance.

According to the notice, the exchange of virtual digital assets for fiat currencies, the exchange of one or more types of virtual digital assets, and the transfer of virtual digital assets will all fall under the purview of money laundering legislation.  

Furthermore, the PMLA will apply to the safekeeping or administration of virtual digital assets, as well as participation in financial services related to the offer and sale of virtual digital assets.

According to local media, this notification is a huge step towards compliance for the cryptocurrency industry, according to Sharat Chandra, co-founder of the India Blockchain Forum.

He was quoted as saying, “It requires entities dealing in cryptocurrency to follow KYC [know your customer], anti-money laundering regulations, and due diligence in the same way that banking and other financial entities that fall under the PMLA reporting entity classification do.”

Sumit Gupta, co-founder and CEO of Indian crypto exchange Coindcx, stated, “Slowly but steadily, we are moving towards a regulated crypto ecosystem.”

“The Finance Ministry’s notification to bring VDA [virtual digital asset] transactions under PMLA is a positive step in recognizing the sector,” said Ashish Singhal, co-founder of crypto investing app Coinswitch. 

“This will strengthen our collective efforts to prevent bad actors from abusing VDAs,” she added.

The Indian Government recently convened G20 finance ministers and central bank governors to discuss cryptocurrency regulation. At the conclusion of the G20 finance ministers’ meeting, India requested that the International Monetary Fund (IMF) and the Financial Stability Board (FSB) collaborate on a joint paper to assist countries in developing comprehensive crypto policies. Nirmala Sitharaman, India’s Finance Minister, has repeatedly called for international cooperation on cryptocurrency regulation.

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Business

Cassava Network partners with self-custody wallet to broaden crypto adoption in Africa

The third iteration of the African Web3 platform Cassava Network, which specializes in nonfungible tokens (NFTs), gaming, and loyalty rewards, has just been released. This version integrates with the non-custodial smart contract wallet UniPass, which enables users to use email addresses rather than seed phrases and gas.

The partnership makes it possible for users to sign up for UniPass and hold, send, and receive on-chain digital assets across multiple Ethereum Virtual Machine blockchains when they create Cassava accounts, helping to transition Africans from Web2 to Web3.

In an interview with Cointelegraph, Mouloukou Sanoh, a co-founder of Cassava Network, described how African consumers and companies can use the new version to enter the Web3 market.

“With Cassava v3, we have made it easy for African users to interact with their favorite Web2 and Web3 brands. As users interact with these brands, they earn both CB Coins and other on-chain rewards specified by partners.”

The network’s reward tokens, CB Coins, currently exist off-chain, but users will soon be able to exchange them for on-chain assets, according to Sanoh. The platform will then accept CB for the purchase of mystery boxes and concert tickets.

Thanks to the new partnership, Cassava Network users now have direct access to the UniPass wallet. 

Sanoh stated that Cassava v3 “provides a channel through which partners can grow their African market” in relation to its use by businesses. Business brands that collaborate with Cassava Network can also build communities on the network by utilizing the new “community” feature to attract followers and engagement on various platforms through the development of tasks that users can participate in and earn rewards for completing.

Sanoh discussed the new version’s potential to boost Africa’s business economy during the interview. Cassava v3 “serves as a bridge for global Web3 businesses to connect with African Web2 users,” according to Sanoh. Sanoh added that 90% of the partners using the Cassava v3’s community feature so far are African companies.

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Business

EchoVC launches an $8M new fund to invest in blockchain startups

An $8 million pilot blockchain-focused seed fund has been formed by Lagos-based venture capital firm, EchoVC. EchoVC is a technology-focused early-stage VC firm focusing on investing in underrepresented founders and neglected markets.

Commenting about this, the firm’s team stated in a blog post, “Over the past few years at EchoVC, we have become intrigued with blockchains. The more we explored, and learned, the more excited we’ve become about blockchain applications and their functions in Africa.”

The team added, “For African markets, we believe blockchain functionality is more of a need, rather than a want. Our thesis is to leverage these functions to enable new leapfrogs or unlock novel market opportunities, across the continent.”

According to the Venture capital firm, the EchoVC Chain is an $8 million pilot seed fund focused on making investments in founders and startups that span EchoVC’s specific areas of interest. The company has been excited with two capabilities of blockchain, that is to say, the ability to abstract or tokenize, and the ability to scale autonomously.

The Venture Capital firm also noted, “However, our perspective on the applications of blockchain in Africa traverses multiple layers. Our first layer of focus is on foundational fintech infrastructure. This includes infrastructure leveraging stablecoins to optimize payments, liquidity, and treasury; and also explores the unbundling and delivery of crypto/fintech building blocks, or “primitives” – which other companies can utilize to scale faster. The second layer above this targets blockchain functionality. DeFi functionality can be leveraged in Africa for innovative financial products improving access to credit and savings, or perhaps powering new-age decentralized neobanks. NFTs can serve to foster the creator economy for the rising Gen-Z, enable games to provide new ways to earn, or even fractionalized real-world assets and portfolios to lower affordability barriers to investments.”

Furthermore, EchoVC is excited about the prospects of DAOs, not just for their ability to scale autonomously, but also to organize human networks. 

The company stated, “Examples in Africa are social collectives and informal markets, which are key strands of Africa’s offline economic fabric. DAOs can organize the offline and informal networks in a way that is beneficial for all participants. This should unlock labor liquidity and increase earning potential for the bottom-of-the-pyramid demographics. Other examples include decentralized agent networks, social networks, as well as gig networks.” 

Conclusively, the company also noted, “Looking beyond this, we continue to explore other emerging blockchain aspects ranging from digital identity, privacy, decentralized infrastructure edge nodes, and agile supply chains to a possible future intersection between AI/ML and DAOs. On the regulatory side, we continue to observe the evolving landscape. Our view is that regulation is required and will have a positive impact to help guide innovation, improve stability, and remove frictions that still exist between decentralized and centralized worlds.”

“One aspect that we are tremendously excited about is the advent of central bank digital currencies (CBDCs) as the digital version of cash, channeled through the banking system – to remove friction in access to financial products, streamline cross-border payments, and enable programmable local money,” the company added.

EchoVC, which says its mission is to be the Sequoia Capital for underestimated founders and markets, has invested in almost 40 companies across various markets worldwide and made its first investment in the blockchain segment in 2021.

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Business

JPMorgan ends banking relationship with Gemini

JPMorgan is dissolving its banking partnership with cryptocurrency exchange Gemini, according to Coindesk. Moreover, the banking giant had first taken on both Gemini and Coinbase as customers in 2020, with the latter continuing work with the banking firm.

The US Securities and Exchange Commission (SEC) has been conducting some regulatory investigations on Gemini. Although no formal statement regarding the decision has been made, it appears that the regulatory concern underlined the reasoning behind the severe relationship.

The situation was reported based on information gathered from an individual familiar with the situation. Additionally, the crypto exchange owned by Cameron and Tyler Winklevoss has seen plenty of headlines to start the year due to various regulatory issues they have been confronted with.

Currently, only Coinbase has commented on the reports, stating it maintains a banking relationship with JPMorgan. Alternatively, Coindesk notes that the development marks an ongoing trend, showcasing crypto companies having greater difficulty accessing banking services.

They also noted that Gemini has other banking options at its disposal. Specifically, they maintain a relationship with State Street banks, according to the exchange’s website. However, the bank has yet to comment on whether it would be altering the status of the company’s banking relationship based on unearthed information.