• Cardano’s Chang hard fork is set to go live on September 1st.
• ADA transactions have plummeted by 31%, indicating a drop in demand for the altcoin.
• ADA futures traders remain bullish, with a positive funding rate of 0.0084%

Cardano’s upcoming Chang hard fork is set to arrive on September 1st. The upgrade was to come earlier, but the Cardano founder Charles Hoskinson announced on X that the much-anticipated upgrade had been postponed. According to Hoskinson, the development was necessary because some tier-1 centralized exchanges, including Binance, were not ready to upgrade.

This upgrade introduces on-chain governance, which is the first for the platform. While the ADA community is excited about the upgrade, many are proceeding cautiously, which has decreased trading activity.

The upgrade might trigger a “sell the news” event

An on-chain analysis of ADA’s network activity reveals a waning demand for ADA as the upgrade date approaches. According to Santiment’s data, the daily count of addresses participating in ADA transactions has decreased by over 30%, indicating a drop in demand for the altcoin.

The negative price-daily active address (DAA) divergence further confirms this cautiousness. This metric compares price movements with changes in daily active addresses. ADA’s -15.7% DAA divergence signals a weakening market and potential for further price declines.

Many traders are worried that the Chang hard fork might result in a situation where they “sell the news.” This happens when traders buy expecting a price rise due to an upgrade but then swiftly sell afterward, leading to a price drop. To minimize risks of loss, holders of ADA holders are decreasing their trading activities. 

Interestingly, futures markets don’t seem bothered by these concerns. With a funding rate of 0.0084%, there appears to be more interest in long positions (predicting a price rise), showing that some traders are optimistic. 

ADA’s Price movements will vary depending on sell-off risks or upgrade-driven gain

Cardano traders can witness two possible price outcomes after the upgrade is implemented. In one scenario where the hard fork triggers a wave of sell-offs, ADA’s price could drop to $0.027. In a different scenario, if the upgrade brings about an optimistic market sentiment leading to a surge in ADA’s value, we might see its price rise significantly to $0.39 or even beyond the $0.40 mark, aligning with Cardano’s envisioned growth trajectory. 

Market sentiment is a good indicator of investors’ attitudes towards dumping. Currently, overall market sentiment has moved into the negative. 

Crypto Fear & Greed IndexSource: Alternative

The Fear & Greed Index shows that the market came out of “Greed” last week and lost over 27 points to move into “Fear” territory. This indicates that investors are more likely to sell their holdings than buy.

• Blockchain Association’s FOIA request seeks to uncover if the SEC is advising banks on bypassing SAB121.
• SAB121 faced repeal attempts but was vetoed by President Biden.
• BA previously investigated alleged unfair de-banking of crypto firms.

The Blockchain Association filed a Freedom of Information Act (FOIA) request to uncover if the US Securities and Exchange Commission (SEC) is secretly advising certain banks on how to bypass SAB121. This could allegedly mean providing special treatment for legacy banks.

Earlier, the association submitted a FOIA request to investigate the de-banking of crypto firms in the United States. It was linked to allegations about account closures and refusal to open new accounts.

FOIA request targets SEC’s possible favoritism

In an X post, the Blockchain Association posted that it has filed a FOIA appeal to dig into the possible correlation between the SEC and certain custody institutions with guidance on avoiding SAB121 requirements.

The commission’s “regulation by enforcement” is infamous, but this could signal a new strategy, added the association.

The association suggests that this move may signal a large carveout for a small number of legacy banks that leaves others without answers. This includes those that service the crypto industry. It mentioned that the SEC is targeting by regulation and is protecting legacy institutions from compliance with expensive rules. 

The group alleges the watchdog continues to impose these same regulations against those institutions that service the digital asset industry and shield others. It claims that SAB121 is a punitive, arbitrary, anti-crypto accounting bulletin issued by the SEC.

SAB121, the SEC’s controversial accounting bulletin, is known for its harsh stance against crypto. It’s been widely criticized and both the House and Senate voted to strike it down. Issued by the SEC in 2022, it requires companies holding customers’ crypto to list it on their balance sheets. This could have huge capital implications for banks dealing with crypto clients. 

Senate even joined the House of Representatives in order to erase the controversial bulletin in May. The Senate vote was a decisive 60 “Yeas,” which reflected a strong bipartisan stance against SAB121. In the end, US President Joe Biden vetoed the repeal of SAB121.

De-banking of the crypto industry

In March 2023,  the Blockchain Association filed FOIA requests with the FDIC, Federal Reserve, and OCC. It wants to uncover documents on the de-banking of crypto firms. The group wanted to go after the allegations of unfair account closures and refusals to open new accounts. However, it tried to look into potential regulator actions linked to the failures of Signature, Silicon Valley Bank, and Silvergate. 

Kristin Smith, CEO of Blockchain Association, shed light on the crucial role of the crypto industry. She stated that these are lawful businesses and should be treated like any other law-abiding business.  She called out all the impacted crypto industry participants to come forward and submit their stories confidentially.

• Telegram Wallet announced that the TON network is now fully operational.
• This announcement comes after the second TON network outage.
• TON failed to generate blocks for nearly four hours on August 28.

Telegram Wallet has announced in a recent post that the TON network is now up and running after the second outage that caused TON blockchain transactions to be paused.

TON network is seemingly under stress due to the overwhelming stress from DOGS transactions. The network stopped processing transactions for almost four hours yesterday. Exchanges like Bybit even suspended deposits and withdrawals via the TON network because of this.

The TON Foundation dev tweeted that the outage was caused by network overload due to DOGS transactions. Following the first outage, the network faced a second outage a few hours ago. Telegram Wallet announced that TON blockchain transactions were paused.

TON network is now fully operational

After nearly five hours since the network outage announcement, Telegram put out another post that the TON network is now fully operational. “TON-based asset withdrawals and deposits in Wallet will be credited in due course,” the announcement reads.

Interestingly, while the overall crypto market is bleeding, Toncoin is showing positive momentum. Even though Pavel Durov’s arrest caused the price of TON to plummet, the price seems to be recovering slowly.

TON’s price dropped to the $5.15 level yesterday after the first network outage. However, TON is back above $5.60 as the network has resumed transactions after its second outage. CoinGecko data shows that TON is up by over 7% in the last 24 hours.

Toncoin recorded an all time high of $8.25 in June. The network was showing great progression, mainly due to the rising popularity of Notcoin, Hamster Kombat and now DOGS. TON foundation dev Justin tweeted that “Chain being stress tested just means there that much activity on it. Onwards and upwards.”

DOGS price pumps amidst market crash

Just like any other airdrop coin, DOGS was quick enough to plunge by over 30% from its all time high since its launch. DOGS had touched a high of $0.0018 on August 26. However, the price fell as low as $0.001219.

Interestingly, as Bitcoin plunged as low as $58,000 yesterday, DOGS reversed course and pumped by almost 30% to the $0.0016 level. This pump could have likely triggered DOGS holders to realize some profits and offload their bag, which explains the stress on the TON network.

With Hamster Kombat announcing the launch of their HMSTR token and airdrop on September 26, the TON network will be put under another level of stress, mainly due to the popularity of the tap-to-earn game.

• Australians have become victims of crypto scams, losing $122 million.
• Pig butchering and deep fakes are the main tools for these scams.
• According to AFP, 60% of the victims are under the age of 50.

In a new report from the Australian Federal Police, Australians have lost $122 million, almost $180 AUD to crypto scams. The scams took place in the last 12 months. Most of the victims fall under the age of 50.

Over the last year, a loss of $269 million in total happened during investment scams. AFP revealed that 47% of these scams were related to crypto.

Crypto scammers use deep fakes and pig butchering

AFP announced the use of deep fakes and pig butchering as the primary method of scammers to dupe the victims.

Pig butchering is the method of developing an emotional connection with the victim over social media before motivating them to act on into a scam investment. While deep fakes are fake video or audio, from an influential figure or celebrities to lure the victims of these scams. Tesla’s Elon Musk is the most popular choice for deep fakes.

Richard Chin, who is Assistant Commissioner AFP, shared the important notice of victims’ age. In the gathered reports, 60% of the victims fall under the age of 50. Older populations above 50 years old, who are considered to be easier targets for crypto scams, are not the victims with the highest percentage, according to the report.

“Scammers promise high returns with little risk, using convincing marketing and new technology to make the investment sound too good to miss,”

Chin said. 

Scamwatch, an Australian government website, also shows that the most prominent way citizens lose money is through investment scams. Although contrary to AFP data, it also shows that people over 50 are more likely to fall victim to such scams.

According to Chin, it’s possible that more people are being targeted for these frauds. He thinks that victims are not aware of being scammed or they are avoiding reporting out of embarrassment. He said, “If an investment opportunity sounds too good to be true, then it probably is.”  

• FET has surged by over 70% in the past week.
• The price spike is fueled by Fetch.ai’s announcement of an Innovation Lab in San Francisco.
• A crypto whale, who previously sold FET at a lower price, has repurchased 1.79 million FET tokens.

Artificial Superintelligence Alliance (FET) emerged as one of the biggest gainers over the last week, outperforming the biggest cryptos like Bitcoin (BTC), Solana (SOL) and TRON (TRX). FET price has surged by more than 70% in the last 7 days.

FET price recent spike comes in as Fetch.ai is launching an Innovation Lab in San Francisco, California to push the boundaries of AI technology. It is expected to be a playground for early-stage startups developing AI agent solutions.

FET jumps 7% in 24 hours

Recovering from the heavy selling pressure, FET managed to get back on track posting the biggest gains among the top AI cryptos. Artificial Superintelligence Alliance price is up by over 6% in the last 30 days while Near Protocol (NEAR) and Internet Computer (ICP) have taken a hit of 14% each.

FET added another 7% of gains in the last 24 hours. On the other hand, NEAR and ICP printed red indexes despite registering a 25% and 18% jump over the past 7 days. FET is trading at an average price of $1.35, at the press time. Its 24 hour trading volume is up by 40% to stand at $293 million.

Whale regrets early load-off

As per the data shared by Lookonchain, a crypto whale seems to be reconsidering its position over FET price. The whale regretted its selling decision and spent 2.38 million USDT in order to buy 1.79 million FET tokens from Binance and that too at a much higher price.

The whale made the recent accumulation at the average price of $1.33, while, it sold 2.33 million of its FET holdings for 2.385 million USDT at a lower price of $1.02 from August 11 to August 23. FET is up by 70% in the past 7 days.

Fetch.ai announced of creating the launch of its Innovation Lab in San Francisco. It is setting aside $10 million annually to help startups build on their platform. It is reportedly planning to invest up to $1 million per project. They’re also rolling out an internship incubator for those eager to dive into decentralized tech, AI, and machine learning. With the AI agent market set to hit $88.1 billion by 2032, Fetch.ai is moving ahead to gain an advantage in the market.

• BTC inflows to exchanges have dropped sharply in late August.
• On 4th August, 94,000 BTC were sent to exchanges.
• On 20th August, this figure is less than half, as only 31,000 BTC were transferred to exchanges.

The total amount of Bitcoin inflows to exchanges has been sharply declining compared to the first few days of August. Recent data from 20 August shows only 31,000 BTC in inflows, which is more than 50% less as compared to inflows in the first week of August.

On 4th August, almost 94,000 Bitcoins were sent to various exchanges. Later, on 5th August, 49,000 BTC flew in, followed by deposits worth 51,000 Bitcoin on 6th August.

The recent drop in the inflows suggests that the sell pressure is reducing, and investors are generally holding their funds instead of off-loading them.

Could Mt. Gox transfers and US government sell-off have impacted BTC sell pressure?

According to Arkham Intelligence, Mt. Gox related wallets are still holding 44,899 Bitcoin worth approximately $2.7 billion at press time.

Earlier, on 20th August, 12,000 Bitcoin were moved by Mt. Gox to unknown wallets. This was the first time a transfer was made by the exchange in over 3 weeks.

At the same time, rumors about US government selling Bitcoin have been circulating after it transferred 10,000 Bitcoin related to Silk Road to a Coinbase Prime wallet on 14th August.

However, there has been no confirmation as of yet whether the US government plans on off-loading these funds. Users on Twitter have pointed out that it could merely be due to custodial reasons.

While we haven’t seen a sell-off of a magnitude that corresponds with the amount of Bitcoin moved by the US government and Mt. Gox, these transfers may have initially contributed to a state of panic in the market. However, with the inflows reducing, it is certain that Mt. Gox creditors are still holding on to their funds, which goes in line with the demographics of Mt. Gox representing the early adopters of decentralized finance. These creditors already waited 10 years to get a repayment, and likewise, may not be in a hurry to off-load their holdings.

• UAE FSRA regulatory authority seeks to issue new stablecoin for payments.
• The FSRA authority in ADGM is calling these stablecoins FRTs (Fiat Referenced tokens).
• UAE Central bank recently came out with its stablecoin Payment token regulations.

The UAE’s Financial Services Regulatory Authority (FSRA) of Abu Dhabi Global Market (ADGM) has published consultation paper No. 7 of 2024, containing proposals to enhance its regulatory framework to allow the issuance of fiat-referenced tokens (FRTs) from the ADGM and invites the public feedback and comments on the proposals.

As per the announcement, FRTs are a category of stablecoins that are backed by high-quality, liquid assets denominated in the same currency as the FRT and that can be liquidated rapidly with minimal adverse price effect.

FRTs are intended to be used as a means of payment and share certain characteristics with Stored Value.

FRTs qualify as stablecoins

According to the consultation paper, while all stablecoins establish their value in reference to a fiat currency, asset-referenced tokens and commodity-backed tokens are not considered ‘stable’ due to the fluctuation of the value of their underlying asset, as expressed in fiat currency.

So as such all FRTs may qualify as stablecoins, but not all stablecoins may qualify as FRTs.

As such the consultation is not to propose to introduce new Regulations or Rules to address commodity and asset-backed tokens. This will be considered in due course later on.

While the most recent version of the FSRA’s guide discussed stablecoins in general and distinguished them from virtual assets, the FSRA’s legislation will now specifically address FRTs and their issuance.

The FSRA is proposing to adopt a risk-based and proportionate approach to FRT issuance in response to industry demand, based on appropriate regulatory requirements that incorporate the necessary safeguards to ensure that FRT issuers operate in a safe and sound manner and informed by current practices in leading jurisdictions.

The consultation paper notes that the current set of Regulated Activities would require the issuer of an FRT to seek an FSP enabling Providing Money Services, specifically for the issuance of Stored Value. However, the FSRA in ADGM believes that the rulebooks are too restrictive to support FRT issuance.

The FSRA wants to adopt a policy approach similar to the regulatory frameworks of the New York Department of Finance, the EU as represented by the Markets in Crypto-Assets Regulation, the Monetary Authority of Singapore, HM Treasury and the Financial Conduct Authority in the UK, as well as the Hong Kong Monetary Authority.

FRTs will be a medium of exchange

FRTs will be used as a medium of exchange; achieves a stable store of value by referencing a fixed amount of a single fiat currency; and enables the holder to redeem the FRT in exchange for the amount of the fiat currency referred to in from its issuer upon demand.

Issuance of FRTs would constitute a new Regulated Activity, distinct from the issuance of Stored Value within the Financial Services and Markets Regulations 2015 (FSMR), with commensurate conduct of business and prudential requirements.

The consultation period will close on 3 October 2024.

UAE Central Bank regulates stablecoins

This announcement comes just after the Central Bank of the UAE came out with their stablecoin regulation that allows the usage of Dirham-backed stablecoins for payment for goods and services within the UAE.

UAE Stablecoin Payment Token Services Regulation came out laying down the rules and conditions by the Central Bank of UAE for licenses pertaining to payment tokens, not allowing algorithmic tokens to be included and only allowing foreign stablecoins to be used to purchase virtual assets.

As per the UAE Central Bank, payment tokens are virtual assets which purport to maintain a stable value referencing the value of the same fiat currency as the payment token is denominate in or another payment token also denominated in the same fiat currency.

• ZachXBT claims to have discovered a network of North Korean developers working on over 25 crypto projects.
• Payments have been linked to IT workers in North Korea and an individual, Sim Hyon Sop, sanctioned by the OFAC. 
•  ZachXBT discovered instances of Russian Telecom IP overlaps among developers who claimed to be located in Malaysia and the United States.

ZachXBT, a blockchain investigator, has discovered evidence of a sophisticated network of North Korean developers who earn as much as $500,000 per month by working for “established” crypto projects.

In an Aug. 15 post on X, ZachXBT informed his over 618K followers that he believes a “single entity in Asia,” likely operating out of North Korea, is receiving $300,000 to $500,000 per month and employing at least 21 workers to contribute to over 25 crypto projects.

ZachXBT tweets “Recently, a team reached out to me for assistance after $1.3M was stolen from the treasury after malicious code had been pushed. Unbeknownst to the team they had hired multiple DPRK IT workers as devs who were using fake identities. I then uncovered 25+ crypto projects with related devs that have been active since June 2024.”

ZachXBT claims that the most recent $1.3 million stolen by DPRK staff was laundered through a series of transactions, which include transferring to a theft address and culminating in 16.5 Ether being sent to two separate crypto exchanges.

ZachXBT adds, “Using multiple payment addresses for 21 devs I was able to map out a cluster with the most recent batch of payments for ~$375K over the last month.”

ZachXBT is onto North Korean crypto developers

Following a more thorough investigation, ZachXBT believes that these developers are only one part of a much more extensive network. He uncovered a cluster of developers who had received “$375,000 over the last month” and had previously transacted a total of $5.5 million. 

This money was transferred to an exchange deposit address between July 2023 and some point in 2024. He was able to track multiple payment addresses. ZachXBT adds “Prior to this, $5.5M flowed into an exchange deposit address with payments DPRK IT workers were receiving from July 2023 – 2024 and connections to Sim Hyon Sop, who is OFAC sanctioned. “ 

US law enforcement suspects that Kim is “involved in the payment of salaries to family members of Chinyong’s overseas DPRK worker delegations” and has received $2 million in crypto for the sale of IT equipment to DPRK-affiliated teams in China and Russia.

Additionally, he discovered instances of Russian Telecom IP overlaps among developers who claimed to be located in Malaysia and the United States. “At least one of the employees  “accidentally leaked their other identities on a notepad.”

At the end he points out, “A number of experienced teams have hired these devs so it’s not fair to them single as the ones to blame.”

• Ethereum has tanked by 2.6% over the last 24 hours, currently trading around $2,600.
• ETH could remain in the $2800-2900 range from August through September. 
• Jump Trading ETH dumps continue to affect Ethereum’s price.

Ether’s price is currently trading 25% upside from the eight-month bottom of $2,112 reached on August 5. Peter L. Brandt, an Ethereum crypto trader, made a bold prediction regarding Ethereum (ETH), the leading alternative currency and how far it can fall.

Brandt observes in a post on X that the altcoin’s price will decline to $1651, the lowest it has traded since October 2023.

Over the past seven days, the second-largest crypto by market capitalization has experienced a 13% increase in value. Despite this performance, analysts maintain that Ethereum’s downside risks persist.

In an Aug. 15 post on X, Arete Capital partner McKenna stated, “I don’t really expect $ETH to break above $2800-2900 but rather remain range bound for August and some of September.” 

Following the recent drawdown, which was exacerbated by ETH dumping by market maker Jump Trading and concerns regarding a global recession, McKenna discussed Ether’s price action. On August 5, ETH experienced a 21% decline, reaching a swing low of $2,112 before rebounding to its current price of $2,614.

The analyst points out that the supplier congestion zone at $2,800 provided significant resistance to Ether’s ascent to $2,750 on Aug. 12. McKenna stated that they would not be highly convinced to go long on Ethereum from the current levels, as the price is “trading close to this supply.”

Ethereum set to lose its support level at $2,200

At the same time, Peter Brandt, a fellow analyst, stated that Ether’s price action offered two potential scenarios derived from two separate chart patterns: a 5-month rectangle and a rising wedge. In the first case, when the price of Ethereum rose above $2,960, an ideal exit position for longs was presented.

The second standpoint suggested that the ascending wedge would collapse, thereby extending the downward trend. This would result in Ether falling to $1,650, the rectangle’s bearish target.

The coin’s consolidation phase closed on August 4, when it dipped below the lower line of the rectangle pattern. Typically, an asset retests the breakout level to ascertain whether it will serve as support or resistance after breaking out of a consolidation pattern. 

Brandt asserts that the altcoin is currently retesting this breakout level at its current price in order to determine whether it will maintain or decline.

Additionally, the market analyst sees a rising wedge pattern on an intraday chart. This pattern is established when an asset’s price consistently experiences higher and lower lows, but the distance between them narrows, resulting in a wedge shape. This pattern, which is generally regarded as a negative signal, indicates a potential reversal to the downside.

The coin’s price will continue to decline as it is unable to surpass the level. In light of this information, Brandt started a short position with a target of $1,651. This position provides a risk-to-reward ratio of 3:1.

Nevertheless, acknowledging the necessity of caution, he announced that he would set a stop loss at $2,961 and exit the trade if ETH’s price surpassed this threshold.

Glassnode data shows that Ethereum’s funding rates have been consistently positive since the start of 2024, which implies optimistic expectations. However, the recent drop in price to $2,100 was accompanied by a drop in funding rates, which underscored a change in market sentiment.

In general, negative funding rates suggest that short positions outnumber long positions, which suggests a high number of bearish bets.

• Pump.fun continues to generate fees in the Solana ecosystem, driven by trading newly launched tokens. 
• Less than 1% of Pump.fun tokens move to DEXs, but trader interest remains high. 
• Pump.fun has no serious competitors and manages to concentrate liquidity for meme token action.

Pump.fun continues to print fees, on a new inflow of meme creation. Token fatigue has not hurt the bottom line of the platform, despite the 99% failure rate. 

Pump.fun continues to generate record revenues, by providing starting liquidity and an easy token launch. Briefly, Pump.fun surpassed all other apps and protocols, measuring peak 24-hour revenues. The meme token DEX and launchpad even surpassed Ethereum (ETH) and TRON (TRX), two of the biggest activity hubs in crypto. 

Pump.fun is also close to the top in terms of weekly and monthly fees, competing not only with Solana apps, but with the entire crypto ecosystem. The meme coin launcher achieved unified liquidity and a single entry point, while helping onboard new crypto users. Both new and returning users expanded in August, and were completely unaffected by the correction on centralized crypto markets. 

The creation of tokens on Pump.fun also overcame other types of Solana launches, with a constant rate of growth in the past few months. As of August 14, more than 67% of Solana tokens were made through Pump.fun, for a total lifetime mints of 1.76M tokens.

Tracking fees among crypto protocols is inexact, as LidoDAO marks the biggest fee flows due to redistribution. However, Pump.fun is the only protocol that gets as close as possible to onboarding real users. On a monthly basis, Pump.fun generates close to $30M in launch and trading fees.

While Pump.fun remains an extremely risky bet, it is also seen as the fastest way to test new tokens and make up for the losses with one winner. The need for fast and competitive transactions, as well as the mint fees, turn Pump.fun into a source of income for other apps and validators in the Solana ecosystem. 

The effects of Pump.fun also spill over into Raydium and Jupiter DEX aggregator, as well as into MEV bot fees for additional meme token trading. 

Pump.fun decouples from the meme token narrative

Despite being the main launchpad for meme tokens, Pump.fun has decoupled from all previous successful token launches. Large-scale meme tokens that graduated to top centralized exchanges are also suffering as the market slides. At the same time, users on Pump.fun are aware that most of the assets will fail within 24 hours, but choose those assets precisely because of their risk profile. 

During the peak days of Pump.fun, older meme tokens took a step back, losing $12B in market capitalization in the past two weeks. Older meme tokens also suffer from cannibalizing each other, as funds flow into the most active one, while causing rapid selling and crashes. 

Pump.fun is extremely responsive to social media, especially X. The speed of launching new tokens accelerates with current events. The recent X Spaces talks with Elon Musk led to the creation of more than 157K new tokens, of which only two survived. The tokens are created with practically no hope of finding liquidity, except for the element of having fun. 

The launches of new coins accelerated in the past week, after Pump.fun introduced a new way of interacting with the protocol. Launches are free, but the new asset is not created on the Solana chain until at least one buyer appears. This has allowed multiple creators to build tokens without even the smallest initial investment. Tokens that survive the initial trading also receive 0.5 SOL in liquidity to trade on Raydium. 

Pump.fun competitors are slow to arrive

One of the high-profile competitors to Pump.fun was Moonshot, a protocol with more detailed information on the progress of tokens. 

Moonshot was also promoted by Dextools and started to invite listings. However, the fees and activity on Moonshot are still lagging and even slowing down about a month after the platform’s launch. 

Despite social media rumors and promotions of new projects, Pump.fun had no close competitors. Trading also concentrated on the new tokens, in hope of finding the winner or achieving short-term gains. Pump.fun is also seen as a liquidity drainer, as users move away from other crypto influencers with complex, slow token launches.