🚨 MakerDAO May Execute ‘Emergency Shutdown’ If Sanctions Hit DAI

Hello Defiers! Here’s what we’re covering today:

News

• MakerDAO May Execute ‘Emergency Shutdown’ If Sanctions Hit DAI
• Centre Bans USDC Addresses After Tornado Sanctions
• Reddit Taps Layer 2 and FTX For Community Token
• Curve Finance Scrambles to Repel Exploit

Special Report

• Harmony Validators Decry Litany of Problems

Podcast

Video

• Tutorial: No Service or Creator Fees on sudoswap

DeFi Explainer

• CeFi Versus DeFi: Which One Is Better?

Elsewhere

• Coinbase Betting Big On Staking Ahead of Ethereum Merge: Decrypt
• At ETHSeoul, Ethereum Developers Turn Attention to Privacy and Users: CoinDesk
• The Chopping Block Live! - with Hasu & Rune: Unchained
• The contract that needs to be revoked is: 0x9eb5f8e83359bb5013f3d8eee60bdce5654e8881 If you have approved it please revoke it immediately on https://revoke.cash: Curve Finance

Trending in The Defiant

• Crypto Mixer Tornado Cash Added To US Sanctions List
• Ethereum Gas Fees Fall to Lowest Level in Two Years
• Buterin Backs Proposal For Stealth NFT Transfers

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Tornado Fallout

🚨 MakerDAO May Execute ‘Emergency Shutdown’ If Sanctions Hit DAI

DeFi Lender’s Stablecoin Under Pressure From USDC Contagion

By Samuel Haig

SHOCK WAVES Now it’s MakerDAO’s turn. The DeFi blue chip is the latest protocol to be struck by shock waves from the U.S. Treasury Department’s decision Monday to sanction Tornado Cash, a so-called “mixer” that lets crypto users anonymize their transactions.

CONTINGENCY Maker is making contingency plans to execute an emergency shutdown should core contracts underpinning DAI, its stablecoin, be sanctioned by Washington, according to posts from MakerDAO founder, Rune Christensen, in the project’s Discord channels. “If we get nuked by the U.S. government, we simply die,” Christensen warned.

BLACKLIST The move to blacklist Tornado Cash, which the Feds say laundered $7B worth of virtual currency, has already rocked USDC, the No. 2 stablecoin in terms of market value.

WALLETS On Tuesday, Centre, the consortium behind USDC, blacklisted 38 wallet addresses and froze the USDC tokens they held. Centre, which was set up by Circle and Coinbase, has now banned 81 wallet addresses in total since USDC was launched in September 2018.

👉READ THE FULL STORY IN THE DEFIANT.IO👈

Stablecoin Crackdown

🌪 Centre Bans USDC Addresses After Tornado Sanctions

Investors Eye Decentralized Stablecoins as Consortium Bars 38 Addresses

By Owen Fernau

NEWS Stablecoins are in the spotlight yet again. Centre, the consortium behind USDC, the world’s second-largest stablecoin, banned 38 addresses on Aug. 8. This means that the USDC tokens in those addresses are frozen and cannot be moved. 81 addresses have been banned in total.

Source: Dune Analytics

DEPOSITS Centre’s move came in response to the US Department of the Treasury’s decision to sanction Tornado Cash, a protocol which facilitates private crypto transactions by using a set of smart contracts to commingle and mix user deposits.

FREEZES Before Aug. 8, the Treasury had never sanctioned an open source protocol, wrote Circle founder Jeremy Allaire. Circle is a financial services company that founded Centre with Coinbase in 2018. Circle promotes a suite of products which involve USDC. The shockwaves from the asset freezes are rippling throughout DeFi.

👉READ THE FULL STORY IN THE DEFIANT.IO👈

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DeFi Governance

😤 Harmony Validators Decry Litany of Problems

Flawed Response to $100M Hack Exposes Crisis of Confidence in Layer 1

By Aleksandar Gilbert

PROPOSAL Last week, after near-universal condemnation, leaders of the Harmony blockchain scrapped their proposal to reimburse community members who lost money in a $100M hack in June.

STRUGGLING The Layer 1 network, which sports a $346M market cap and competes with other high-speed blockchains such as Solana, has been struggling to stabilize its situation ever since.

REIMBURSE Now co-founder Stepehen Tse is offering a pair of new proposals. One would use the Harmony Foundation’s treasury to partially reimburse tokenholders over a period of months, and replenish its coffers by minting new ONE coins over several years. The other proposal would increase fees from transactions and fund reimbursement and “ecosystem growth.”

OPTIONS “The last few days we held many calls to discuss options and tradeoffs, engaging over 20 validators, 20 community members, and 15 bridge and DeFi partners,” Tse wrote in a governance forum debating the original proposal. “We sincerely value engaging and gathering support from our community, partners, validators, and their delegators.”

👉READ THE FULL STORY IN THE DEFIANT.IO👈

Exploits

😳 Curve Finance Scrambles to Repel Exploit

DeFi Exchange Giant Says Attack Has Been Addressed

By yyctrader

NEWS Curve Finance, DeFi’s second-largest decentralized exchange with $6B in total value locked, has been hit by a frontend exploit. As of 530pm ET on Tuesday, the issue has been resolved, according to the Curve team.

PROTOCOL The Fixed Float exchange says it has frozen 112 ETH ($190,000) of the stolen funds. The protocol had earlier asked users not to interact with its website as the team investigates.

👉READ THE FULL STORY IN THE DEFIANT.IO👈

Web3 Social Media

🧐 Reddit Taps Layer 2 and FTX For Community Token

Social Media Giant to Launch Arbitrum-based ERC20 Tokens

By Aleksandar Gilbert

NEWS Arbitrum Nova, a Layer 2 blockchain that aims to improve the gaming and social media experience on Ethereum, debuted Tuesday alongside Reddit’s Community Points program.

TOKENS Reddit, the popular social media platform with 400M monthly users and hundreds of thousands of topic-specific communities known as “subreddits,” will enable its communities to issue Ethereum-based tokens known as Community Points.

POLLS By setting rules that determine how its Community Points are allocated, a subreddit can encourage engagement and create polls that give added weight to dedicated, long-term users, according to the social media giant.

👉READ THE FULL STORY IN THE DEFIANT.IO👈

The Tube

📺 Tutorial: No Service or Creator Fees on sudoswap

DeFi Explainers

🎓 CeFi Versus DeFi: Which One Is Better?

A Guide to Comparing Centralized Finance and Decentralized Finance

By Rahul Nambiampurath

ACCESS Blockchain technology is well on its way to expanding financial access. Pioneered by Ethereum, smart contracts are a breakthrough innovation in computer science that treats finance in a permissionless and non-custodial manner. At the same time, Bitcoin’s durability is demonstrating that a money system outside of central banking is possible.

PRIVATE KEYS Yet blockchain technology can also be used in a permissioned manner. That means a central authority controls the protocol and makes important decisions on its operations. This includes holding your private keys. This is the essential difference between centralized finance (CeFi) and decentralized finance (DeFi).

NO BOARD Developed as a peer-to-peer (P2P) electronic payment system, Bitcoin is the world’s first decentralized financial service. It has no board of directors to decide Bitcoin allocation or forbid anyone from accessing the Bitcoin network. Even the cryptocurrency’s creator, the pseudonymous Satoshi Nakamoto, is an unknown entity.

👉READ THE FULL STORY IN THE DEFIANT.IO👈

Elsewhere

🔗 Coinbase Betting Big On Staking Ahead of Ethereum Merge: Decrypt

Facing a slump in cryptocurrency prices on one hand, and less revenue from user transactions on the other, Coinbase CEO Brian Armstrong said the company isn’t focused on turning a profit. It’s focused on staking.

🔗 At ETHSeoul, Ethereum Developers Turn Attention to Privacy and Users: CoinDesk

Ethereum developers turned their attention to privacy solutions, scalability and enhanced user-friendliness as the bunch gathered at a swanky building in Seoul’s Gangnam business district for ETHSeoul 2022, a technical conference focused on the second-largest blockchain.

🔗 The Chopping Block Live! - with Hasu & Rune: Unchained

Crypto insiders Haseeb Qureshi, Robert Leshner, Tom Schmidt, and Tarun Chitra discuss the latest juicy topics in crypto.

Curve Finance @CurveFinanceThe contract that needs to be revoked is: 0x9eb5f8e83359bb5013f3d8eee60bdce5654e8881 If you have approved it please revoke it immediately on revoke.cash

Curve Finance @CurveFinanceThe issue has been found and reverted. If you have approved any contracts on Curve in the past few hours, please revoke immediately. Please use https://t.co/6ZFhcToWoJ for now until the propagation for https://t.co/vOeMYOTq0l reverts to normal9:28 PM ∙ Aug 9, 2022422Likes252Retweets

Trending in The Defiant

• Crypto Mixer Tornado Cash Added To US Sanctions ListCrypto mixing service Tornado Cash is now banned in America. On August 8, the Office of Foreign Asset Control (OFAC), an enforcement agency of the U.S. Treasury Department, added Tornado Cash to its Specially Designated Nationals (SDN) list.
• Ethereum Gas Fees Fall to Lowest Level in Two YearsWith network activity plunging, Ethereum’s transaction fees are now at their lowest level since the heady days of ‘DeFi Summer’ in mid-2020, according to data from Ycharts.
• Buterin Backs Proposal For Stealth NFT TransfersEthereum co-founder Vitalik Buterin likes the idea of ‘stealth addresses’ for NFTs. Using a new ERC721 extension proposed by Ethereum researcher Anton Wahrstätter, users would be able to transfer NFTs with only the new owners being able to see who owns the NFTs.

🧑‍💻 ✍️ Stories in The Defiant are written by Owen Fernau, Aleksandar Gilbert, Claire Gu, Samuel Haig, Jason Levin, and yyctrader, and edited by Edward Robinson, yyctrader and Camila Russo. Videos were produced by Robin Schmidt and Alp Gasimov. Podcast was led by Camila, edited by Alp.

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The Defiant is a daily newsletter focusing on decentralized finance, a new financial system that’s beinglt on top of open blockchains. The space is evolving at breakneck speed and revolutionizing tech and money. Sign up to learn more and keep up on the latest, most interesting developments. Subscribers get full access, while free signups get only part of the content.Click here to pay with DAI (for $100/yr) or sub with fiat by clicking on the button above ($15/mo, $150/yr.