Decentral Block Post

In one of those storms in a teacup that’s impossible to imagine occurring before the invention of Twitter, social media users got very upset that ChatGPT refused to say racial slurs even after being given a very good — but entirely hypothetical and totally unrealistic — reason.

User TedFrank posed a hypothetical trolley problem scenario to ChatGPT (the free 3.5 model) in which it could save “one billion white people from a painful death” simply by saying a racial slur so quietly that no one could hear it. 

It wouldn’t agree to do so, which X owner Elon Musk said was deeply concerning and a result of the “woke mind virus” being deeply ingrained into the AI. He retweeted the post, stating: “This is a major problem.”

Another user tried out a similar hypothetical that would save all the children on Earth in exchange for a slur, but ChatGPT refused, saying:

“I cannot condone the use of racial slurs as promoting such language goes against ethical principles.”

Every day this week we’re highlighting one genuine, no bullsh*t, hype free use case for AI in crypto. Today it’s the potential for using AI for smart contract auditing and cybersecurity, we’re so near and yet so far.

One of the big use cases for AI and crypto in the future is in auditing smart contracts and identifying cybersecurity holes. There’s only one problem — at the moment, GPT-4 sucks at it.

Coinbase tried out ChatGPT’s capabilities for automated token security reviews earlier this year, and in 25% of cases, it wrongly classified high-risk tokens as low-risk. 
James Edwards, the lead maintainer for cybersecurity investigator Librehash, believes OpenAI isn’t keen on having the bot used for tasks like this. 

“I strongly believe that OpenAI has quietly nerfed some of the bot’s capabilities when it comes to smart contracts for the sake of not having folks rely on their bot explicitly to draw up a deployable smart contract,” he says, explaining that OpenAI likely doesn’t want to be held responsible for any vulnerabilities or exploits.

This isn’t to say AI has zero capabilities when it comes to smart contracts. AI Eye spoke with Melbourne digital artist Rhett Mankind back in May. He knew nothing at all about creating smart contracts, but through trial and error and numerous rewrites, was able to get ChatGPT to create a memecoin called Turbo that went on to hit a $100 million market cap. 

Binance and its co-founder, Changpeng “CZ” Zhao, have reached a settlement over criminal and civil cases with the United States Department of Justice. CZ will plead guilty to one felony charge as part of the negotiated agreement. Attorney General Merrick Garland announced the settlement, claiming Binance’s policies allowed criminals involved in illicit activities to move “stolen funds” through the exchange. As part of the settlement, CZ announced on X (formerly Twitter) that he had stepped down as CEO and that Binance’s global head of regional markets, Richard Teng, will assume the position. He added he was “proud to point out” that U.S. officials didn’t allege that Binance misappropriated funds or manipulated markets. CZ was released on bail and is battling government efforts to bar his return to the United Arab Emirates to be with his family. His sentencing is scheduled for February.

Representatives from BlackRock and Nasdaq met with the U.S. Securities and Exchange Commission (SEC) to discuss the proposed rule allowing the listing of a spot Bitcoin exchange-traded fund (ETF). BlackRock provided a presentation detailing how the firm could use an in-kind or in-cash redemption model for its iShares Bitcoin Trust. Many reports have suggested the SEC could be nearing a decision on a spot BTC ETF for listing on U.S. markets. SEC officials also met with Grayscale representatives this week to discuss the listing of a Bitcoin ETF. BlackRock is one of many firms with spot crypto ETF applications in the SEC pipeline awaiting a response, including Fidelity, WisdomTree, Invesco Galaxy, Valkyrie, VanEck and Bitwise.

A Bitcoin user paid $3.1 million in fees for transferring 139.42 BTC. The transaction fee is the eighth-highest in Bitcoin’s 14-year history. A wallet address tried transferring 139.42 BTC only to pay more than half the actual value of the transaction fee. The destination address received only 55.77 BTC. The mining pool Antpool captured the absurdly high mining fee on block 818087. This is the largest Bitcoin transaction fee ever paid in dollar terms, knocking off Paxos’s September transfer of $500,000.

The U.S. Securities and Exchange Commission has sued Kraken, alleging it commingled customer funds and failed to register with the regulator as a securities exchange, broker, dealer and clearing agency. Additionally, the SEC alleged Kraken’s business practices and “deficient” internal controls saw the exchange commingle up to $33 billion worth of customer assets with its own. The SEC said this resulted in a “significant risk of loss” for its clients. In a follow-up blog post, Kraken said the SEC’s commingling accusations were “no more than Kraken spending fees it has already earned,” and the regulator doesn’t allege any user funds are missing.

Sam Bankman-Fried will stay jailed after failing to convince a United States appellate court that he should be freed while his legal team appeals his conviction. Government prosecutors accused Bankman-Fried of leaking Caroline Ellison’s journals to The New York Times in July, which caused his bail to be revoked by a New York District Court. Bankman-Fried was found guilty of seven fraud and money laundering-related charges on Nov. 2. The former FTX CEO will remain behind bars while he awaits his sentencing on March 28 next year.

Our weekly roundup of news from East Asia curates the industry’s most important developments.

In the fourth hack affecting the HTX (formerly Huobi Global) ecosystem in just two months, the exchange lost $13.6 million via a hot wallet hack that occurred on Nov. 22.

In its Nov. 23 announcement, the exchangepromisedto “fully compensate for the losses caused by this attack and 100% guarantee the safety of user funds,” as well as restore services within 24 hours of the attack. The day prior, the HTX Eco Chain (HECO) bridge was exploited for $86.6 million. An investigation is ongoing.

In September, the HTX exchange was hacked for $7.9 million; this was followed by a $100 million hack against the Poloniex exchange, a related entity, in November. Justin Sun, the Chinese blockchain personality and de-facto owner of HTX (not to mention the owner of Poloniex, founder of Tron and CEO of BitTorrent etc),stated after the attack that “HTX Will Fully Compensate for HTX’s hot wallet Losses. Deposits and Withdrawals Temporarily Suspended. All Funds in HTX Are Secure.” Sun previously also madeassurancesthat “all user assets are #SAFU” in the aftermath of the September hack against HTX.

Huobirebranded to HTXduring this year’s Singapore2049 event in September. Although its executives have repeatedly reassured that the exchange is doing well, the exchange ran into a number ofserious incidentsthis year, including analleged employee revolt.

As the year winds down, every gaming company and its dog are dropping year-in-review reports.

A recent report from blockchain gaming accelerator Game7 suggests that many game developers had an enforced nap instead of pumping out new games.

This year, just 223 Web3 games were launched which is a 65% drop from the 640 games launched in 2022, and even more distant from the 811 games launched in 2021.

So what’s the deal with the sudden nosedive in output?

Well, the optimistic answer is Rome wasn’t built in a day.

Although documented statistics about cryptocurrency trading and substance abuse are hard to come by, addiction experts are treating an increasing number of crypto traders.

Abdullah Boulard, founder and CEO at The Balance Luxury Rehab, tells Magazine that a number of crypto traders struggle with substance abuse. “Our client base is diverse, but this is a unique demographic that we’ve seen an increase in over the recent years,” Boulard says. 

According to Boulard, the high intensity of cryptocurrency trading combined with 24/7 accessibility encourages some to use stimulants to keep up the pace. “Substances like amphetamines, cocaine and even excessive caffeine use are common among these individuals,” says Boulard. 

Caroline Ellison, the former CEO of Alameda Research, tweeted about the use of stimulants in April 2021.

New York Magazine subsequently reported that a successful trader who met with Ellison commented about her use of stimulants and their overall effects on members of the community. “Crypto really fucked with a lot of people’s perceptions of money. A lot of stuff doesn’t feel real. And if you add speed …”

Prior to that, in September 2019, the former CEO of disgraced cryptocurrency exchange FTX, Sam Bankman-Fried, tweeted about his use of stimulants and sleeping pills.

Dominic Frisby recalls meeting MicroStrategy’s Michael Saylor for the first time at a crypto event. What started off as an awe-struck moment became confusing after things took an unexpected turn.

“I saw Michael Saylor there. I was like, ‘Wow, that’s him!’” he tells Magazine. But it was Saylor who quickly came over and introduced himself before Frisby had a chance:

“He just came up to me and said, ‘I’ve seen some of your videos, and I really like your work and what you’re doing. Would you like to come over to dinner?’”

Frisby explains he was thrilled to be hanging with the OG Bitcoin maxi in Saylor’s house, which is “much nicer” than his own.

“Every time I watch a Michael Saylor video, I get orange pilled. The guy is so clever,” he declares.

Umami Labs CEO Alex O’Donnell grew up on the outskirts of Philadelphia before attending Temple University to study literature and economics. That path led him to devote seven years of his life as a financial journalist at Reuters, where he specialized in M&As IPOs.

He said his academic focus created a “pretty natural synthesis” when it came ot financial journalism. However, he said he became “disenchanted” with his industry while he was cooped up at home during the Covid-19 pandemic. “There really was a three-way alliance between journalists, government officials and technology companies trying to control the flow of information,” O’Donnell said in an interview with Cointelegraph.

He began tinkering with cryptocurrency, which led to his introduction with Umami DAO — and ultimately his creation of Umami Labs.

O’Donnell and his wife, Sanjana, are preparing for a “third, smaller person” to join their family next year. In the meantime, he said he’s also gearing up for another crypto-related venture. The details aren’t fully public yet, but he said he plans to release more information the months ahead.

I’d been a journalist for the better part of a decade primarily covering mergers and acquisitions. I always had an interest in finance and tech. But I started becoming a bit disenchanted with the mainstream media around the time of the pandemic. That was the first time I started becoming a bit more cynical about my own industry’s role in the information economy. So I started paying more attention to issues like privacy, censorship and other things I had not taken as much interest in before.

ChatGPT developer OpenAI removed founder Sam Altman from his CEO position on Nov. 17. Chief technology officer Mira Murati is now serving as interim CEO. According to a blog post, the board of directors engaged in a “deliberative review process,” which resulted in the conclusion that Altman “was not consistently candid in his communications with the board, hindering its ability to exercise its responsibilities.” Shortly after, OpenAI co-founder and president Greg Brockman revealed his exit from the organization.

The world’s largest asset manager, BlackRock, officially filed for a spot Ether exchange-traded fund (ETF) with the United States Securities and Exchange Commission (SEC) on Nov. 15. The ETF, dubbed the iShares Ethereum Trust, aims to “reflect generally the performance of the price of Ether,” according to the S-1 filed with the SEC. The iShares brand is associated with BlackRock’s ETF products. The move by BlackRock comes nearly a week after it registered the iShares Ethereum Trust with Delaware’s Division of Corporations and almost six months after it filed its spot Bitcoin ETF application. Following BlackRock’s filing, asset manager Fidelity also sought a green light for its own Ether ETF.

The Australian Taxation Office (ATO) has issued guidance on capital gains tax (CGT) treatment with regard to decentralized finance and wrapping crypto tokens for individuals, confirming that Australians are liable for capital gains taxes when wrapping and unwrapping tokens. The transfer of crypto assets to an address that the sender does not control or that already holds a balance will be regarded as a taxable CGT event, the ATO said in its statement. The CGT event will trigger depending on whether the individual recorded a capital gain or loss. A similar approach has been considered for taxing liquidity pool users, providers and DeFi interest and rewards. In addition, wrapping and unwrapping tokens will also be subject to triggering a CGT event.

An employee of FTX’s charity wing recruited by Sam Bankman-Fried is trying to get paid $275,000, the remainder of his claimed 2022 salary bonus. Ross Rheingans-Yoo’s lawyers argued in a court filing that only $375,000 of his $650,000 bonus was paid by FTX. They claim the remaining funds were owed when the crypto exchange filed for bankruptcy in November 2022. The fate of Rheingans-Yoo’s bonus will be determined by a Delaware bankruptcy judge who is overseeing FTX’s Chapter 11 bankruptcy.

WisdomTree filed an amended Form S-1 spot Bitcoin ETF prospectus with the U.S. SEC on Nov. 16. The update comes a few months after WisdomTree refiled its spot Bitcoin ETF application in June 2023, proposing a rule change to list and trade shares of the WisdomTree Bitcoin Trust. The amended prospectus mentions that the WisdomTree Bitcoin Trust ETF will trade under ticker symbol BTCW, with Coinbase Custody Trust serving as the custodian holding all of the trust’s Bitcoin on its behalf.

Mark Wilson — the artist known as diewiththemostlikes — has a truly unique style to his art and a presence that could be described as grotesque, performative, thought-provoking and hilarious all in one packet of rolled-up ground beef.

In a digital art market where supply can be infinite, the Indiana-based artist really stands out from the crowd with his ability to garner attention by often ridiculing the NFT space and eliciting both humor and sadness within his work.

An author of five books, diewiththemostlikes has a passion for not only visual art but also scribing his streams of consciousness. He originally minted his first NFT on March 26, 2021, on Foundation after a random account on X reached out because Wilson had made a joke campaign poster for comedian Eric Andre that went viral.

“This dude reached out and just said, ‘Hey, I have a Foundation invite. Would you want to mint a piece on there?’ I said I don’t know what minting is. I don’t know what Foundation is. I have no clue what any of this shit is,” Diewiththemostlikes explains.

“He said, ‘It could be a good avenue for your digital art,’ so I said, ‘Well, fuck it, man. It’s not like I’m not doing anything with it now. It’s getting two likes on Instagram from fucking porn bots. So, whatever, I’ll mint something, and maybe I can sell something finally as an artist — that would be nice.’” 

Our weekly roundup of news from East Asia curates the industry’s most important developments.

Hashkey Exchange — one of the first regulated crypto exchanges in Hong Kong — has announced insurance coverage for clients assets stored in its hot and cold wallets. accounts. The policy will cover 50% of Hashkey’s digital assets in cold wallets and 100% of digital assets in hot wallets and pay out anywhere between $50 million to $400 million in the event of a claim.

Hashkey’s partnership with fintech OneDegree will also see the pair co-develop novel crypto security solutions for the exchange to manage server downtime, data back-up, and load control. “Getting insurance cover from OneInfinity by OneDegree not only fulfills the Securities and Futures Commission requirements, we believe the collaboration can also enhance our financial, technical, and service infrastructure to provide our customers with comprehensive protection,” said Livio Wang, COO of Hashkey Group.

Disembarking the Liberty houseboat moored off the frontier of the European Union, we’re met by a pair of Serbian police officers, their lit squad car nearly blinding us in the dark forest.

“How many people are staying on the boat?” one asks, holding a large dog at bay. “I really don’t recall,” says my colleague from Reuters. Fortunately, they let us go.

We must run, using phone lights to navigate the muddy path to the rally point a bit further in Croatia, in hopes that the departing presidential convoy has not left us behind.

We are meters from the border of Liberland, an unrecognized micronation of crypto fans claiming a piece of land between Croatia and Serbia on the Danube river. At just seven square kilometers — 2.7 square miles — the piece of land is roughly the size of Gibraltar.

Liberland “president” Vít Jedlička explains it had not officially been claimed by either neighboring country, making it terra nullius — nobody’s land — when he planted a flag there on April 13, 2015.

I just spent an entire week working in virtual reality using the new Meta Quest 3. While the experience still mostly sucked, I came away with some renewed optimism for VR in the workplace.

As I took Ron’s outstretched, virtual hand for a handshake, my actual hand — in the real world — clumsily whacked into the side of my desk.

Ron started laughing, his avatar’s animated facial expressions mimicking his real face thanks to his device’s eye and facial tracking technology.

A project manager at Microsoft, Ron tells me it’s something I’ll get used to. He’s been working in the metaverse for over a year.

Days later, I meet Heather, a mother who’s been working in virtual reality for a couple of months. She likes to jump into the metaverse to work when her kids are at school and the house is quiet.

Bitcoin’s futures market is showing an interesting shift as global derivatives marketplace the Chicago Mercantile Exchange (CME) has surpassed Binance in terms of Bitcoin futures open interest. This change occurred after Bitcoin exceeded the $37,000 mark for the first time in over 18 months.

However, James Seyffart, a research analyst at Bloomberg Intelligence specializing in exchange-traded funds, questioned whether the increasing open interest in Bitcoin futures on CME would address historical concerns of the United States Securities and Exchange Commission regarding the depth of Bitcoin markets and the potential for market manipulation.

“Okay this is interesting… Does this constitute a ‘market of significant size’ now?” Seyffart stated in a post on X (formerly Twitter).

The former head of legal and compliance at OneCoin is looking at a potential 10-year prison term for her involvement in the $4 billion cryptocurrency trading scheme. In Manhattan federal court, the ex-compliance chief of OneCoin, Irinia Dilkinska, pleaded guilty to charges of wire fraud and money laundering.

According to a statement from the U.S. Department of Justice, U.S. District Judge Edgardo Ramos accepted Dilkinska’s guilty plea. She admitted to one count of conspiracy to commit wire fraud and one count of conspiracy to commit money laundering. Each charge carries a maximum sentence of five years in prison. 

Hong Kong Web3 gaming giant Animoca Brands (The Sandbox, Revv, Phantom Galaxies), has acquired blockchain-powered streaming platform Azarus for an undisclosed sum.

Built around the slogan “streams are not TV,” Azarus allows users to livestream their gameplay while using tokens for incentives and rewards. Animoca Brands says it wants to change gaming culture with Azarus’ tech, by enabling streamers to generate new sources of income, engage their audience and reward their followers while allowing viewers to support their preferred creators. 

In a surprise move, the Chinese government has guaranteed legal protection for NFTs.

In response to a series of often conflicting judicial opinions on the state of cryptocurrency in the country, the Chinese government has officially issued a legal commentary on dealing with cases of nonfungible tokens (NFTs) theft and their status as virtual property protected by law. 

According to a November 9 publication by China’s state-controlled Southwest University of Political Science & Law (SUPL), digital collectibles such as NFTs — unlike ordinary online images — conform to the characteristics of online virtual property due to their non-tamperable features, unique codes, and detailed transaction information.

“This highlights the scarcity of digital collections, which have both use value and exchange value,” jurists write. “According to Article 127 of the Civil Code, it can be seen that from the perspective of civil law, online virtual property is regarded as an object of rights that ‘is different from property rights, creditor’s rights, intellectual property rights, etc. and is protected by civil law’.”

In addition, jurists state that the theft of NFTs therefore carries applicable criminal penalties, which can be evaluated in conjunction with related offenses committed during the course of the theft, such as hacking into computer systems or data theft.