Tech
Kraken Eyes Bets on New Blockchain Technology Amid Industry Competition
Everyone is doing it: launching new layer 2 blockchains on Ethereum to provide a place for easy and cheap transactions. This week brought the news (thanks to that news in advance from ours Margaux Nijkerk) that cryptocurrency exchange Kraken may be considering its own Layer 2 network, just months after rival Coinbase launched a Layer 2 network, Base. Details below.
We’re also covering further job cuts in the blockchain industry as the cryptocurrency winter drags on collapse of token issuance, even as digital asset markets begin to price in signs of green signals. ALSO: Postscript on Celestia’s TIA airdrop, $37 million in fundraising, and a Q&A with Tegan Kline, CEO of Edge & Node, the lead developer behind the sometimes-referred to as dominant blockchain indexing protocol, The Graph as “Google of Web3”.
You are reading The protocolCoinDesk’s weekly newsletter that explores the technology behind cryptocurrencies, one block at a time. Sign up here to receive it every week.
LAYER 2 LAYER ON: One of this year’s dominant blockchain trends has been technologists’ rush to launch new “layer 2“networks capable of processing transactions more cheaply and quickly than the primary (and sometimes congested) Ethereum network. And many of the developer teams behind the projects are competing to acquire new companies and customers who could use their technology to create even more layer 2 networks, including several projects that emerged just this week. CoinDesk reportedciting people familiar with the matter, that cryptocurrency exchange Kraken is in talks with Polygon, Matter Labs and Nil Foundation about the possibility of using their technology to create a new layer 2 network – and has even published a job description for a “senior cryptography engineer” who could work on the effort. Such a push would follow rival cryptocurrency exchange Coinbase’s move a few months ago to launch its own layer-2 network, Base. Another new arrival is the Nil Foundation rollup, which would combine zero-knowledge encryption with another scaling technique known as sharding.
CELESTIA POSSCRIPTION: Blockchain projects are rarely alone in the search for interesting new ideas. This is true of the current rush of various efforts to provide “modular” solutions to handle the various tasks of a blockchain, including “data availability” work, which involves managing growing reams of data and efficiently providing it. to users or applications when required. The Celestia data availability network dominated the headlines last week, especially with the lively TIA token launch garnering interest from cryptocurrency traders. This week, a rival project, Avail, announced a new incentive program on a test network to encourage early adopters”battle-testing our code base.” And the Near Foundation, which is hosting an annual conference in Lisbon this week for the NEAR layer 1 blockchain protocol, announced its plans offer a data availability network for the Ethereum ecosystem. Despite interest from solution providers, early use of Celestia appears to be so far modest. Christine Kim of Galaxy Research wrote in a newsletter on November 3: “Now that Celestia has launched, the true value of the protocol will come from the rollup ecosystem that will be created in the coming months and years on Celestia. The adoption of rollups built on Celestia will drive the revenue and long-term success of the protocol and ultimately prove (or disprove) the case for blockchain modularity.”
MAWR JOB CUTS, PART 2: Cryptocurrency markets may have emerged recently, but many blockchain startups are still struggling, with more job cuts piling up on top of those previously announced. Over the past week, sad news it came from the OpenSea NFT trading platform, used to trade included collections Bored monkeys AND Plump penguins. CEO Devin Finzer announced that the company was “saying goodbye” to teammates in an effort to “build a new foundation.” (Decrypt reported that the move may have affected up to 50% of the staff.) Separately, Emin Gün Sirer, CEO of Ava Labs, the lead developer behind the Avalanche blockchain, published on X that the company had carried out a “headcount reduction” amounting to 12% of the company, as part of an effort to “capture the speed and energy of a small, agile team”.
Highlighting updates and developments in blockchain technology.
1. Render network, a decentralized GPU rendering platform for 3D content creation, will officially move from Ethereum to Solana, becoming one of the largest projects on the chain, according to the team. “Render has allocated 1.14 million RNDR, which is equivalent to $2.6 million at current token prices, in grants to subsidize user fees during the upgrade and is leveraging Wormhole to facilitate cross-chain asset transfers .
2. Evmosthe Cosmos blockchain created to support Ethereum-compatible smart contracts, will stop supporting Cosmos transactions by the end of this year, according to a blog post.
3. Nym Technologiesa privacy infrastructure project backed by Binance Labs and venture capital firm Andreessen Horowitz (a16z), said its “decentralized VPN” is called NymVPN it would launch in the first quarter of 2024.
4. ScrollA recently launched zkEVM on Ethereum said Tuesday that Chainlink data feeds are now available.
5. Railguna smart contract system that enables zero-knowledge privacy for on-chain apps, makes real-world compliance compatible with on-chain privacy through its latest toolPrivate evidence of innocence, according to a message from the team.
Regulatory, political and legal
New cryptocurrencies are being created at the slowest pace in 3 years, CertiK data shows
The amount of new tokens created fell in the third quarter to the lowest level since at least the start of 2021, according to blockchain smart contract auditor CertiK. The company created the dataset using the list of tokens added each quarter to tracking site CoinMarketCap, and then eliminating so-called memecoins that serve no apparent purpose other than to provide yuk and a means for speculation.
The decline in new tokens could be explained by the worsening crypto winter during the last quarter: “Nobody wants to list a token when there is a lack of risk-taking,” said Sean Farrell, a crypto analyst at the independent investments. -research firm FundStrat. Another explanation could be that the cryptocurrency industry is becoming more mature. “There are more legitimate projects out there now, so the battle for that incremental liquidity is tougher,” Farrell said. “The bar for launching a token is higher.”