Man your battle stations! February 14, 2023 | [Read Online]( Gm. This is Milk Road, the crypto newsletter thaaaaEEEEaaaaaat will always loooooove yoooooooooUUUUUUUuuuuuu (happy Valentineâs Day, ya filthy animals.) Hereâs what weâve got for you today: - Armstrongâs 4 reasons why staking isnât a security
- All eyez on BUSD
- Coinbaseâs QR code Super bowl legacy
- Hackers go phishing for MetaMask users SEC, HEAR ME OUT The crypto staking-as-a-service saga continues! Todayâs episode: Brian Armstrong is a Wee Bit Scared. The Coinbase CEO wrote a [blog post]( Friday laying out the reasons why staking on his exchangeâs service is NOT a security. It has big Make a powerpoint for your mom to convince her to let you have a sleepover energy. To recap: users can stake their crypto on a blockchain in the hope of being chosen to verify transactions, keep things secure, and pocket a return. Staking is an alternative to mining, and platforms like Coinbase have staking programs for retail investors to get in on the action. But the SEC just shut Krakenâs staking service down because it said it was offering unregistered securities. Dun dun duuuuuuun. Hereâs a rundown on why Armstrong says the the SECâs 4-rule security template doesnât apply to staking: 1/ Staking is not an investment of money Users may be getting a return on their staked crypto, but theyâre not losing what theyâre depositing, he says. âThey own the same thing they did beforeâ and maintain full ownership of their assets. They can also unstake their assets âconsistent with the underlying protocol.â 2/ Staking doesnât have a âcommon enterpriseâ issue Thatâs a term used to describe how investorsâ returns depend upon the party offering the service, which is Coinbase in this case. But Armstrong is saying that Coinbase isnât dictating which staker gets chosen because thatâs not how blockchain protocols work. Instead, they choose a validator, or staker, at random based on how many tokens they have staked. Kinda like how the more church raffle tickets you bought, the more likely you are to win that $50 Applebeeâs gift card. 3/ Thereâs not a âreasonable expectation of profitsâ with staking It means customers are drawn to a certain asset because they A) think they can make money from it or B) want to use or consume it in some way. But Armstrong said it doesnât apply to staking because users stake crypto as payment simply to be able to validate transactions on the blockchain. 4/ And staking rewards donât depend on the âefforts of othersâ Armstrong says customersâ staking rewards donât depend on what other people do, like how someoneâs dogecoinâs shares could drop or rise if, say, Elon Musk says he was [chatting]( about it during one of the countryâs largest sporting events⦠Instead, staking rewards are randomly automated by blockchain protocols. Itâs luck oâ the draw. Ofc, Coinbase would also have something to lose financially if the SEC drove a stake through its staking program. It charges customers a ~30% fee of their rewards, amounting to $62M in revenue in July to Sept. 2022. Thatâs no smol cut. FILE YOUR CRYPTO TAXES WITH AWAKEN Last year it took me 3 full days to file my crypto taxes, and I still think I paid the wrong amount to the IRS. It was a nightmare. Thatâs why we are introducing our friends from [Awaken](. Unlike other crypto tax solutions that are 4-6 years old, Awaken was built for todayâs Web3 world. - Awaken is 10x more accurate. They have best-in-class support for 25,000 tokens, NFTs, wallet transfers, liquidity providing, staking, bridging, and much more. Itâs the only DIY software that captures all of your transactions and calculates the cost basis correctly.
- Awaken is 10x faster. Their software learns as you file taxes. When you label 1 transaction, 10+ others are automatically labeled for you, saving you hours of time.
- Awaken is 10x easier to use. Crypto taxes can be complicated, but Awakenâs user-friendly interface is simple and clean. Itâs a fully anonymous product. You sign up with your email and thatâs it. If they ever ask you to connect a wallet or a seed phrase weâll smack the s*** out of them. Theyâre [offering $100 of free credits]( to the first 400 users who sign up: [CLAIM $100 ON AWAKEN]( ALL EYEZ ON BUSD You thought regulators would give us a change to breathe after the Kraken staking shutdown? Surprise mothaf*cka!!! [tenor.com]( Yesterday, the New York Department of Financial Services (NYDFS) announced itâs [cracking down on Paxos](, a stablecoin issuer. Hereâs everything you need to know: - Paxos has been directed by the NYDFS to stop minting new BUSD tokens. BUSD = Binance USD. Itâs the 3rd largest stablecoin (Note: Itâs named after Binance but itâs wholly owned and managed by Paxos. Confusing, I know)
- The existing BUSD remains fully backed and will be redeemable through February 2024. Paxos will continue to manage BUSD dollar reserves, which are always backed 1:1 with U.S dollar-denominated reserves. (So donât worry, if you have BUSD it isnât gone)
- Paxos has ended its relationship with Binance. And just like that, the 5-year stablecoin marriage is officially over. But wait! Thereâs more⦠According to [a WSJ report](, the SEC has issued a Wells notice to Paxos and will be suing the stablecoin issuer for selling BUSD tokens as an unregistered security. A Wells notice is a letter that tells companies the SEC is going to take action. Itâs a warning that things are [not] Well. Why this matters: This is big because regulators are now coming after the largest crypto currencies and the SEC is claiming that a stablecoin can be categorized as a security. You see, Gary Gensler (the head of the SEC) is a lot like that one friend thatâs always too scared to go up to a girl at a bar, so his friend always does it. But instead of checking out girls, Gary checks out companies that sell assets. And instead of telling them theyâre cute, he tells them whether theyâre a security or not. Now Garyâs got his eyes set on BUSD. And if this claim that itâs a security holds, it could set a big precedent & impact how the future of crypto is (or isnât) built. Itâs going to be a long year, my milky friends. OK, ENOUGH QR CODES Tubi convinced us we accidentally sat on the remote. Human-sized rabbits creepily threw people into holes in the ground. Jesus paid a cool [~$20M]( for ad spots. But crypto giants like FTX and co. were, of course, nowhere to be found on Sunday given the year theyâve had. The industry did leave its mark though: brands displayed QR codes hoping for the virality and site-crashing that Coinbase delivered last year with its floating square. They included: - Avocados From Mexico
- Michelob Ultra/Instacart
- Limit Break, an NFT company That last one was really the only Web3 rep in the game. And the link the QR code led to? The founderâs Twitter page, which now has a cool [1M]( followers. Say what you will, but weâve gotta h/t them for such a genius social growth campaign. MILK AND COOKIES Love in the metaverse? [Paris Hilton dropped a new dating metaverse called Parisland.]( Players will be able to hit on random strangers online, complete quests, and ultimately âchoose a partnerâ. PayPal presses pause. [The finance giant has announced its pausing its new stablecoin project due to regulatory bodies cracking down on crypto a lot lately.]( PayPal was working with Paxos to issue the new stablecoin. Top Play of the Day:[Our lanky king, Vitalik Buterin, has reportedly donated $225k+ to victims of the Turkey earthquake.]( Hackers go phishing. [MetaMask has warned of a new phishing campaign targeting its user](s. Remember kids: the crypto hardware wallet will never email you asking for your personal information. MILKY MEMES ð¤£ð¤£ That's a wrap for today. Stay thirsty & see ya tomorrow! If you want more, be sure to follow our Twitter [(@MilkRoadDaily)]( Share Milk Road You currently have 0 referrals, only 1 away from receiving An Inside Look At What The Crypto Whales Are Betting On. [An Inside Look At What The Crypto Whales Are Betting On]( [Click to Share]( Or copy and paste this link to others: [ INTERESTED IN ADVERTISING ON THE MILK ROAD? [Fill out this survey]( and we'll get back to you soon! What'd you think of today's edition? - [ð¥ð¥ð¥ð¥ð¥ F**king great](
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- [ð¥ You didn't bring the heat]( ROADERS REVIEW VITALIK PIC OF THE DAY [tw profile: Milk Road] Milk Road @MilkRoadDaily [tw] Feb 14, 2023 4 Likes 1 Retweets 1 Replies DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research. [tw]( [ig]( [yt]( [tk]( [in]( Update your email preferences or unsubscribe [here]( © Milk Road 603 Munger Avenue Suite 100 #1006
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