Last Week’s Cryptocurrency News. Friday, August 12th

Friday, 12tth of August. As the week comes to an end, we can focus on the highlights of the crypto industry over the past few days.

Over 12,000 accounts blocked in Chinese social networks due to promotion of crypto

Cyberspace Administration of China (CAC) revealed the suspension of 12,000 social media accounts that dealt with the promotion of cryptocurrencies and attracting investors.

As reported by the regulator, information about “easy earnings from digital assets,” mining and cross-border currency speculation were spread through Weibo, Baidu, Tieba, WeChat and other platforms.

The agency also removed 51,000 articles and restricted access to 105 crypto-related websites. More than 500 commercial organizations engaged in speculative activities were interviewed by the authorities. 

According to CAC, the ban was imposed due to the prohibition of cryptocurrency trading by the state officials in China. That said, the bulk of accounts, articles and websites are blocked after being “tipped” by users.

CAC will keep cooperating with other agencies to “crack down on illegal financial activity related to cryptocurrencies.” 

“We remind users of the Internet and social media to post correct investment concepts, warn investors of the risks and not engage in speculation in virtual currencies,” the regulator said in a statement.

As you may remember, this June, the WeChat communication software put a ban on secondary NFT trading, as well as announced “penalties” for accounts tied to the trading of crypto.

The loss of Coinbase reported twice as much as predicted

Coinbase posted a net loss of $1.1 billion or $4.98 per share in the Q2 2022, which was double analysts’ expectations ($2.47). In the post-trading session securities fell in price by 8% after losses of 10.55% at the end of the main session.

During the same period in 2021, Coinbase saw a net profit of $1.6 billion and a loss of $429.7 million in the Q1 of 2022.

Net revenue in April-June shrank from last year’s $2.03 billion to $803 million. This is because the prices of digital assets dropped – trading volume on the platform was $217 billion compared to $462 billion. The number of traders who made at least one transaction during the month jumped from 8.8 million to 9 million. The value of assets dropped from $180 billion to $96 billion.

Trade commission fees generated 82% of net revenue. The remainder came from revenues pooled in the category of Subscriptions and Services.

Coinbase is still largely dependent on retail traders. This category of market participants accounted for $616 million of the $655 million in revenue from trading commission fees.

“Dramatic market movements shifted user behavior and trading volume, which impacted transaction revenue, but also highlighted the strength of our risk management program. We are focusing on our top business priorities and more tightly managing expenses. We continue to take a long-term view and remain focused on building for the future,” the letter to shareholders said.

Injective raises $40M from Alan Howard and Jump Crypto

The DeFi protocol called Injective has successfully brought in $40 million in a funding round to accelerate the adoption and development of Web3.

Brevan Howard Digital, the arm of British billionaire hedge fund manager Alan Howard,  participated in the funding round.

“We want to be in the best position possible during a bear market to build and support new incoming developers and capture those opportunities,” stated Eric Chen, founder of the project.

Injective Protocol will allocate the raised funds for the development of the project ecosystem, INJ token and Web3 technologies.

“Businesses and financial institutions have already begun to participate in DeFi in a big way and the natural next step will be building personalized decentralized applications,” noted Jump Crypto president Kanav Kariya.

INJ token responded to the news by surging to $2. At the time of writing, the asset has rolled back to the $1.8 area.

As of April 2021, Injective closed a $10M funding round. The project was backed by billionaire Mark Cuban, Pantera Capital, BlockTower, Hashed Ventures, CMS Holdings and QCP Capital.

As a reminder, Messari and Dove Metrics analysts estimated the amount of funding for blockchain startups for January-June 2022 at $30.3 billion. Web3 developers and DeFi protocols each represented ~$1.8 billion of the total. 

Robinhood to pay $9.9M in technical glitch case

Robinhood reimburses a group of customers $9.9 million who sued the online broker for repeated malfunctions in its app. It is estimated by the plaintiffs that their damages amounted to $20.4 million.

The class action lawsuit was filed by 150,000 platform users.

All of these parties have agreed to a pre-trial settlement.

The claims against Robinhood stem from the March 2, 2020 incident. It was the day when the stock market showed the greatest increase in history up to that point, but the platform didn’t run properly until the next trading session.

There was one more such malfunction on March 9, 2020. 

In the middle of the year, numerous lawsuits against Robinhood were consolidated into one in federal court in California.

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