Daily Digest - 2 March 2023

Headlines

▌Coinbase announced that it will list the Parallel token PRIME

Coinbase announced that it will list the Parallel token PRIME. Trading will begin on or after March 1 at 11:00 AM PT, provided liquidity conditions are met.

Policies

▌Senior official of the U.S. Treasury Department: The U.S. government is still weighing whether to launch a CBDC

Nellie Liang, Deputy Finance Minister of the U.S. Department of the Treasury, said that the federal government’s work on the digital dollar is accelerating, and that leaders from various agencies and the White House Office will hold meetings in the “coming months.” While she made clear in her speech to the Atlantic Council on Wednesday that no decision has been made and that U.S. officials are "actively assessing whether a CBDC is in the national interest," she highlighted some of the potential benefits of a central bank digital currency (CBDC) in her speech. Building a digital dollar "could help preserve the greenback's global status" and potentially reduce friction in cross-border transactions, she said. Noting that the U.S. is in talks with a number of allies, she said that even if the U.S. does not issue a CBDC, it could be issued elsewhere, noting that 11 jurisdictions have moved forward with their virtual currencies.

Blockchain Application

▌Polygon releases a Web3 identity service called Polygon ID

Polygon has released a Web3 identity service called Polygon ID, which will allow blockchain-based applications to verify user credentials without revealing personal information. The product can verify user data for blockchain applications while maintaining on-chain privacy; it uses zero-knowledge proofs that can verify data while encrypting it and hiding it from validating parties. Core developers at Polygon Labs have integrated this Identity Toolkit technology into the Polygon zkEVM, which is expected to launch later this month.

Cryptocurrency

▌Coinbase CEO: The decision to delist BUSD is due to concerns about liquidity

Coinbase CEO Brian Armstrong said on Wednesday that the exchange’s decision to suspend BUSD trading was due to concerns about liquidity. “The reason we’re doing this is that Paxos, the issuer of BUSD, has been ordered to stop minting it, so we’re concerned about liquidity issues for our clients,” Armstrong said. As previously reported, Coinbase had stated that the reason for the delisting was that BUSD no longer met its listing criteria under its own internal monitoring and review process, but it did not provide any additional details.

▌Binance Can’t Keep Its Story Straight on Misplaced $1.8B USDC

A new and detailed investigation by Forbes has raised significant questions about the management and custody of customer assets and stablecoin collateral by Binance. There are many possible explanations for the nature and intent of certain on-chain transactions highlighted by Forbes, and they could be entirely innocuous. But Binance’s so far confused and sometimes contradictory responses to the findings do not inspire confidence, particularly in a post-FTX era of rightfully widespread suspicion of centralized custodians with off-chain balance sheets.