⚡ Bitcoin upgrade wen?

All Things Flooz newsletter is for innovators, creators and traders.

Flooz

4 min read May 5, 2023


Talking points

  • 👀 US crypto bill coming

  • ⚡ Bitcoin upgrade strikes

  • 🏦 Another bank collapse?

👀 US crypto bill coming

The US House Financial Services Committee and House Agriculture Committee are gearing up to introduce a comprehensive bill to oversee the crypto industry, and it looks like it could be even be signed by President Joe Biden this year!

Now that would certainly be some progress...

Representative Patrick McHenry, chair of the House Financial Services Committee, announced during the Consensus 2023 conference that the two committees will hold a joint public hearing in May before unveiling the new bill in the next two months.

The bipartisan subject aims to be addressed before the 2024 election, said Senator Cynthia Lummis, the other panelist during the session. She also shared that if the House moves first on crypto, it would improve the Senate's chances of getting the legislation through earlier.

However, the US isn't the only jurisdiction taking steps to regulate the crypto space. The European Union has already approved the Markets in Crypto Assets (MiCA) law, and regulators in Japan, the United Arab Emirates, Hong Kong, and the UK are also revisiting their approach to crypto, so it is about time that the US steps up and provides some clarity too before they fall behind in the standings.

The recent collapse of FTX and other high-profile digital asset firms has pressured lawmakers to introduce legislation that provides adequate guidance and protections for the industry as too many investors have been hurt by the lack of protection.

The Commodity Futures Trading Commission and the Securities and Exchange Commission have launched an aggressive crackdown on the crypto industry, suing Binance and sending a “Wells notice” to Coinbase.

This is making it tough for investors to know the direction crypto is heading next in the US.

One thing is evident though, and that is a lack of protection and understanding, and the longer this occurs for, the more damage it will do to investors, and with other regions seemingly moving forward to provide more clarity and protection, the US most definitely do not want to fall behind on that as they could lose any advantages to the market as a result and see US-based investors flood to other regions.

⚡ Bitcoin upgrade strikes

If you're a Bitcoin enthusiast, you may be familiar with Lightning Labs, the major developer of Bitcoin's Lightning Network. And if you're not, don't worry, because Lightning Labs has just made it even easier for everyone to use this fast payment protocol!

The Lightning Network is a "layer 2" payment protocol built on top of Bitcoin. However, it requires users to run a Lightning "node" to send and receive payments on the network non-custodially.

This can be a daunting task for users who aren't tech-savvy, but no need to fear as Lightning Labs has created Litd, a node management tool to simplify the process.

This new update adds automated fee management, custodial accounts, finer-grained LNC permissions, and the Pool Order Board to Litd. In other words, it takes care of all the complex technical details, so you don't have to! Pretty neat, right?

One of the most exciting updates is the automated channel fee management in Terminal. This means that you no longer have to manually adjust the fees; instead, fees will change dynamically based on how many payments each channel is routing each week, so you can put those pesky spreadsheets to bed!

The update also introduces "accounts," which enables several users to share a single Lightning node, eliminating the need to deal with all the complexity of liquidity or node management.

The changes are intended to increase node-management automation and provide better developer tooling. Plus, they will make it easier to onboard new users to the network regardless of their experience level which is primarily one of the main reasons for dissuasion for any new players coming into the crypto world. And that's not all!

Earlier this month, Lightspark unveiled a platform for the Lightning Network aimed at onboarding businesses to the network, called the Lightspark Platform, the first enterprise-grade entry point to the Lightning Network.

So, if you've been hesitant to try the Lightning Network because it seemed too complicated, now is the perfect time to dive in. With the latest update to Litd, you can easily manage your node and enjoy lightning-fast payments without any technical hassle or worries!

🏦 Another bank collapse?

It's been a crazy few months in the world of banking lately, and the latest news is no exception.

JP Morgan Chase, one of the largest investment banks in the US, has swooped in to take over troubled lender First Republic Bank in a deal brokered by regulators.

This comes on the back of the collapses of Silicon Valley Bank and Signature Bank, leading some to worry that a wider banking crisis is on the horizon.

So, what exactly went down? 🤔

Well, First Republic Bank collapsed on Monday, prompting US officials to different banks in a scramble to come up with a rescue package. JP Morgan Chase was among those contacted, and according to CEO Jamie Dimon, they "stepped up" at the government's invitation.

As part of the deal, JP Morgan will take on all of First Republic's deposits and the majority of its assets, including $173bn of loans, $30bn of securities, and $92bn of deposits. Yes, that is a HUGE amount of money!

The FDIC will share losses on loans with JP Morgan, and estimates that its insurance fund will take a hit of about $13bn in the deal.

However, JP Morgan seems to be taking it all in stride, with the belief that this acquisition will be a positive on their current business endeavors and that they expect to reopen over 80 offices in multiple states as rebranded branches of JP Morgan Chase Bank from this week.

It's also worth noting that this situation doesn't seem to be an exact repeat of the 2008 financial crisis, as this time is more related to the increased interest rates, therefore, applying pressure on some lenders where bond portfolios are getting hit hard, as opposed to a systematic collapse in 2008 due to poor investment decisions.

However, this time it appears that First Republic Bank has been rescued in a timely manner with minimal damage caused, which is a positive and will definitely put many minds at ease in regard to an imminent financial collapse.

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