Web3 🌖Tuesday Revolution: Citi's Digital Assets, Canto's Move to Polygon, SEC vs. Binance.US, and JPEX Drama

Hello, and welcome to another exciting update from the world of Web3! This Tuesday, we bring you a snapshot of the latest developments. Stay with us to explore these intriguing stories and gain deeper insights into the evolving landscape of Web3!

1. Citi Empowers Institutions with Digital Asset Payments

Citi Treasury and Trade Solutions has partnered with Maersk to introduce blockchain-based services for institutional clients. This move reflects a growing boldness among financial institutions in exploring digital assets. Citi's expansion includes enabling powerful institutional clients to conduct tokenized cross-border deposits, leveraging smart contracts for efficient payments. This development is not surprising for those following Citi's foray into the digital asset space, showcasing their commitment to stay at the forefront of crypto demand. Past engagements with crypto custodian Metaco and investment in Xalts highlight their dedication to innovation in this rapidly evolving landscape. Ultimately, this initiative aims to facilitate swift, secure conversions of funds into instantly transmittable tokenized assets, operating around the clock.

Citi Develops New Digital Asset Capabilities for Institutional Clients

Citi, the leading global bank, serves more than 200 million customer accounts and does business in more than 160 countries and jurisdictions. Learn more today.

citi logo

2. Canto Takes DeFi App to Polygon

Canto, a blockchain tailored for decentralized finance, is poised to shift to a zero-knowledge layer-2 on Ethereum through Polygon's Chain Development Kit. This move enables enhanced security and interoperability within the Polygon ecosystem. By utilizing shared liquidity via a zk bridge and interoperability layer, Canto aims to tap into Polygon's liquidity and inherit Ethereum's security features, reducing reliance on fraud proofs and economic incentives. This transition is facilitated by Polygon's innovative CDK, empowering developers to launch their own zk-powered layer-2 chains. Notably, chains sharing the same prover and bridge contract can trust each other for swift, secure asset transfers. Canto's shift involves using Plonky2 for zk proofs while maintaining a proof-of-stake validator set, ensuring continuity in validation processes. Other projects, like Immutable, are also leveraging Polygon's CDK for innovative solutions in the Web3 gaming space.

Canto is moving its DeFi-focused app chain to Polygon

The Canto alt layer-1 network intends to transition to a zero-knowledge layer-2 on Ethereum, via the Polygon Chain Development Kit.

BlockworksBessie Liu

3. SEC Locks Horns with Binance.US over Custody

The U.S. SEC presses for an inspection into Binance.US, alleging non-compliance in document production for an ongoing lawsuit. The SEC's case, filed in June, contends that Binance operated an unlicensed securities exchange. They highlight concerns about Binance's use of custody platform Ceffu, suspecting it may facilitate the movement of U.S. customer funds internationally, contrary to a prior agreement. The SEC seeks BAM Trading Services' documents regarding wallet custody software. They criticize BAM's inconsistent disclosures and delays in information sharing. The SEC challenges Binance founder Zhao's jurisdictional stance and calls for full cooperation. Meanwhile, Ceffu asserts its independence as a third-party service provider, though its exact relationship with Binance remains ambiguous.

SEC Rips Into Binance.US Over ‘Shaky’ Asset Custody, Asks Court to Order Inspection

The regulator asked a U.S. court to reject Binance’s “half-hearted” objections to its motion seeking depositions, an inspection and communication from the exchange.

CoinDeskSandali Handagama

4. JPEX Fund Freeze Saga Unravels

Dubai-based crypto exchange JPEX faces a liquidity crisis, blaming third-party market makers for freezing funds. This led to raised withdrawal fees and the suspension of certain operations. JPEX alleges unfair treatment by Hong Kong institutions and negative news as the cause. As a response, they'll delist operations tied to their Earn product. Spot trading remains functional, but users report high withdrawal fees. JPEX vows to restore liquidity and gradually adjust fees after negotiations. They'll use a DAO for user suggestions on restructuring. The Hong Kong SFC warned against JPEX for unauthorized services to residents, noting suspicious practices. A Token 2049 conference attendee claimed JPEX's booth was abandoned after the warning. Hong Kong police received 83 complaints about the exchange.

JPEX blames partners for causing liquidity crisis

JPEX has accused regulators and third-party market makers of causing a liquidity crisis by freezing funds and demanding more information, leading to increased withdrawal fees and operational challenges.

Eloise

In this dynamic Web3 update, the financial sector's growing interest in digital assets is underscored by Citi's partnership with Maersk, offering blockchain services for institutions. Canto's move to Polygon emphasizes Ethereum's security and interoperability. The SEC's ongoing dispute with Binance.US over custody highlights regulatory complexities, while JPEX's liquidity crisis serves as a stark reminder of crypto's risks. As the Web3 landscape evolves, we'll keep you informed about trends and developments in decentralized finance and digital assets. Stay tuned for more updates in this rapidly changing space.

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