Daily Digest - 13th April 2023

Headlines

▌Ethereum has completed the Shapella upgrade

The Ethereum Shapella upgrade was completed at Epoch 194048. The data shows that it is currently estimated that all verifiers can withdraw 1,125,330 ETH as rewards on the beacon chain. The current cumulative pledge amount is about 18.15 million ETH, with a pledge rate of 15.07%. Previously, in September 2022, Ethereum successfully transitioned to the proof-of-stake (PoS) consensus mechanism, and 32 ETH can be pledged to become a validator. The Shapella upgrade adds a withdrawal function, and users can withdraw the pledged ETH and related earnings.

Policies

▌The U.S. House of Representatives subcommittee will hold a hearing on stablecoins on April 19

The House Subcommittee on Digital Assets and Fintech has scheduled a hearing to discuss stablecoins. The subcommittee is part of the House Financial Services Committee. The Digital Assets and Fintech subcommittee, chaired by Rep. French Hill, is a new subcommittee added after House Republicans took over the Financial Services Committee. The hearing is scheduled to begin at 10am on Wednesday, April 19, 2023. The theme of the meeting was: Understanding the role of stablecoins in payments and the need for legislation.

▌Texas Senate Passes Bill Limiting Bitcoin Miners’ Participation in Demand Response Programs

Texas’ Senate has passed a bill that would limit the number of bitcoin miners that can participate in demand response programs, under which they are paid to reduce operations during times of high energy demand. Bill SB1751 passed the Senate with only one vote against it and is now heading to the House of Representatives. If approved, it must be signed into law by the governor of Texas.

The bill seeks to cap the participation of bitcoin miners in demand response programs at 10 percent and eliminate tax breaks for the industry. The vote in the House of Representatives is expected to be more contentious, in part because bitcoin miners have stepped up their opposition to the bill. Three lobbying groups, including the Texas Blockchain Council, the Chamber of Digital Commerce and the Satoshi Action Fund, launched a campaign against the bill on Monday, calling it "anti-competitive."

▌Swiss court ruled that FTX is free to explore the sale of European branches

A Swiss court has approved a request from bankrupt cryptocurrency exchange FTX to explore the sale of its European branch. According to the announcement, FTX Europe AG, the holding company of FTX’s European operations, filed a petition to suspend the proceedings in Switzerland, which was granted by the court on Tuesday.

Under Swiss law, a moratorium allows debt restructuring or asset preservation for a limited period of time. According to the announcement, FTX Europe AG noted that the suspension of the proceedings will facilitate the exploration of strategic alternatives, including the previously disclosed possible sale of its business under a tender process approved by the US Bankruptcy Court.

Additionally, the Swiss court has appointed an administrator for FTX Europe AG, which is also a debtor of FTX in the U.S. bankruptcy proceedings. The notice clarified that the suspension process will not stop the process of confirming customer balances in preparation for allowing withdrawals of funds from Switzerland-based FTX EU Ltd.

Cryptocurrency

▌FTX has recovered $7.3 billion in liquid assets, and the exchange may reopen

FTX’s chief lawyer Andy Dietderich said at a court hearing on Wednesday that FTX is considering reopening at some point in the future.

One possible option discussed was for FTX creditors to convert some of their holdings into shares of the reopened exchange. However, the lawyer emphasized that restarting the exchange is only one of many possibilities and not a final decision. If this approach is taken, a large amount of capital will need to be raised, and there is currently a debate within the company about whether the funds should come from FTX or a third party.

In addition, FTX's lawyers also told the court that they have recovered $7.3 billion in liquid assets, up from $1.9 billion in January, but FTX is far from the "equity distribution" stage.