Crypto Weekly 7/2/22

VIDEO OF THE WEEK

HIDDEN GEMS

CRYPTO Page 20

CAPITALIST FANTASY

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WEEKLY $2 cryptoweeklymag.com February 2022 | Volume 13

Rampant NFT Fraud

Shaping the Metaverse

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Page 02

FUDDOXX INSIDER Page 05

National Security

Facebook Loses

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Page 08

The Digital Dollar

Reaching the Mainstream

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Latest Government Threats

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Reactionary Regulaton Page 14

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METAVERSE CRIME Page 24

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CONTENTS $2 cryptoweeklymag.com February 2022 | Volume 13

What marketing and Advertising are Doing to shape the Metaverse ���������������������������������������������������� 2 UK's Advertising Watchdog Bans two Crypto.com Promotions for Being Misleading and Irresponsible ����������������������������������������������������������������������������������������������������������������������������������������������������������������� 3 In the near future, Bitcoin's correction could go 'parabolic,' says Peter Brandt ��������������������������������4 Tokens for the Solana ecosystem are close to being listed on Coinbase: sources ����������������������������4 FUDDOXX INSIDER ���������������������������������������������������������������������������������������������������������������������������������������������������� 5 Facebook Expects to Lose $10 Billion this Year Due to Metaverse Investments ������������������������������������������������������������������������������������������������������������������������������ 8 Could the U.S. dollar go fully digital? The Federal Reserve releases a report on potential competitors to cryptocurrency �����������������������������������������������������������������������������������������������������������������������������9 Regulation of Cryptocurrencies Outlined by Russian Authorities ��������������������������������������������������������� 10 Washington's Latest Threats Thwarted

by Crypto Community ���������������������������������������������������������������������������������������������������������������������������������������������12 Biden's 'reactionary' approach to crypto r egulation blasted by former CFTC chairman ������������������������������������������������������������������������������������������������� 14 NFT Games Are Capitalist Escapist Fantasy Where Players earn big Money ���������������������������������������������������������������������������������������������������������������������������� 16 Video of the Week ��������������������������������������������������������������������������������������������������������������������������������������������������� 20 'Mountains' of fraud are rampant in crypto and NFTs, IRS says �������������������������������������������������������������22 Metaverse Crimes Raise Major Concerns �������������������������������������������������������������������������������������������������������� 24 Crypto Rules Needed for National Security Reasons, says White House ������������������������������������������ 26 Hidden Gems ��������������������������������������������������������������������������������������������������������������������������������������������������������������28 What Is an ICO? �������������������������������������������������������������������������������������������������������������������������������������������������������� 30 Crypto World is Launching a Marketing Campaign to Reach Mainstream Consumers �����������������������������������������������������������������������������������������������������������������������������32

Readers get a chance to whitelist for the ambitious KAPEX project brought to you by Koda Cryptocurrency, Launch is expected next month (Feb 22) and public presale opens from 15th Feb. For more information visit https://KAPEX.me and join the conversation on telegram.

Referral code: CWEEKLY22 2 random applicants will be accepted to band A, and 10 band B. Other applicants guaranteed standard presale if before 15th Jan (up to maximum allocation).

1

EDITOR’S LETTER Welcome to Crypto Weekly W

elcome, this is the 13th issue of Crypto Weekly. I feel so drained these last few weeks. Seven days a week, I have been working 18-hour days since Sept. I do walk with my dad and the dog every other day or so, so that helps, but I still spend too many hours propped up against the headboard of my bed. That's right, I work in bed. It makes sense, right? Was my British Uncles' bed before me, a VP in Shell Oil. Much better than sitting in a chair all day. Having a thermos full of green tea next to me forces me to get up from time to time, then I am back. I arrived just as the pandemic began. I had been on the road for quite some time, and much of that time was spent in the wilderness. I was in good shape. Two years and 45 pounds later, I am in terrible shape. My reflection disgusts me. Twiddling fingers on a keyboard all day doesn't cut it.

The wilderness is really where I belong because it keeps me in proper shape, but we need to bring the money here in the civilized world or it won't be pleasant. What else is there to do but to find a passion that promises a torrent of sky money simply by following the paths outlined ahead. I do whatever it takes. It is important for all of us to live well and have options. So I work. I never quit. There is no quitting. There is no faltering on this road or what a waste. Just a few more months and the time commitment will be reduced to allow for a few healthy habits to have room in my life. This is the promise crypto keeps for me. On this path for me it is only going to get better. This time when the wind calls as it always does and squeezes me out of my chrysalis of radical change, sky money will never cease to fall and the backroads of the world ahead of me will take me to the wildest places of my lifetime.

Crypto Weekly will answer all of your questions. Whether you're new to crypto or have some experience, we're here to help. I hope you all have fun. Now that we have reached the end, it is time to turn the page, but let us know your thoughts. If you would like to see something featured, please get in touch with me. editor@cryptoweeklymag.com

Follow Me Robert Stone Editor

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shaketheweb

February 2022 | Volume 13

2

FEATURE Crypto Weekly

What marketing and Advertising are Doing to shape the Metaverse

Facebook, Microsoft, and other tech giants are boosting the metaverse.

In these virtual spaces, advertisers are scrambling to get their share of the action.

A big boost is being given to the "metaverse" by Facebook, now known as Meta, which invested $10 billion in it.

As well as Apple, Google, and Microsoft, other big tech companies are working on their versions of this concept.

This vague term refers to a variety of shared spaces and assets that people can access via the internet, sometimes using virtual reality and augmented reality devices, and interact with one another and purchase virtual goods.

However, Facebook itself says the payoff won't be immediate, and top executives have widely varying expectations when it comes to the metaverse.

February 2022 | Volume 13

Gaming in the Metaverse, Virtual Reality, Crypto, and NFTs

Experts in the Metaverse are Needed

Whether people play video games, explore virtual worlds, or buy NFTs using cryptocurrency, marketers and advertising agencies are racing to take advantage of the metaverse. Brands launched a variety of initiatives in 2021 to stake their claim in the metaverse, including the creation of non-fungible tokens, experimenting with smart contracts, and building metaverse and Web3 experiences. With new opportunities come new challenges, such as high unpredictability, lack of standardization, and inauthenticity.

As a gateway to the metaverse, advertising companies increasingly create gaming and entertainment divisions. Vayner Media is hiring for metaverse roles for its new VaynerNFT division; and S4 Capital's digital creative and production agency Media Monks, which is heavily focusing on the concept.

If brands are to be successful on the newest version of the web, they may need to rethink their approach to digital marketing. They're getting bombarded with proposals and need to figure out which tech and ad partners to work with which consumers to prioritize.

Deals in the Metaverse The metaverse will also drive dealmaking this year. Investors are looking at companies that help marketers master virtual reality.

Crypto companies could buy ad agencies to build awareness for themselves, now that Facebook and other platforms have relaxed limits on crypto advertising.

www.cryptoweeklymag.com

NEWS

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Crypto Weekly

UK's Advertising Watchdog Bans two Crypto.com Promotions for Being Misleading and Irresponsible

Two Crypto.com promos have been banned by the UK's advertising watchdog because they misled consumers.

These were considered irresponsible and exploited consumers' inexperience or credulity, according to the regulator.

Crypto.com responded to each claim and stated that the ads had been "voluntarily removed" after learning of the regulator's concerns.

Two Crypto.com promotions were banned by the UK's advertising watchdog Wednesday for misleading consumers. First, an ad appeared in September 2021 in the Daily Mail app that said: "Buy Bitcoin instantly with a credit card." The second ad appeared in July 2021 in the Love Balls app and stated: "Earn up to 3.5% p.a.," although the fine print said 8.5%.

Both ads were deemed misleading by the Advertising Standards Authority

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because they failed to illustrate the risks of investment, and irresponsible as they exploited consumers' inexperience and credulity. The regulator also noted that the first ad failed to mention that purchasing crypto with credit cards has certain limitations.

at which users could buy crypto.

Regarding the second ad, Crypto. com said it was referring to the yield crypto holders can generate, not the crypto itself. The risks associated with investing in crypto are well known to existing customers.

Similarly, the second ad failed to elaborate on the method for calculating the earnings forecast, the ASA said.

Crypto.com responded to the ASA and said the ads had been "voluntarily removed" after learning of the regulator's concerns. A representative of Crypto.com said, "We thank the Advertising Standards Authority for its collaborative dialogue and engaged participation regarding advertising in the UK in this relatively new industry, and we look forward to continuing to be in compliance with regulatory authorities around the world."

Cryptocurrencies soared to a $3 trillion industry at one point in 2021 as governments around the world stepped up their enforcement. ASA banned ads for soccer club Arsenal's fan token in December, calling the ads "irresponsible" for not highlighting the risks associated with crypto. Six crypto-related firms, including Coinbase, Kraken, and eToro, were also challenged on December 15 for alleged advertising violations.

The Singapore crypto platform defended its first advertisement, saying it was promoting the speed

As part of a Crypto.com campaign last year, actor Matt Damon appeared in a series of ads in October. As well, Crypto. com purchased naming rights to the iconic Staples Center in Los Angeles, renaming it the Crypto.com Arena for the next two decades. 

February 2022 | Volume 13

4

NEWS Crypto Weekly

In the near future, Bitcoin's correction could go 'parabolic,' says Peter Brandt

T

he recent crypto sell-off may simply be a dip within a longterm uptrend. This is according to chartist Peter Brandt, CEO of Factor LLC, a research and trading firm. When asked what it would take for Bitcoin (BTC) to get to $200,000, Brandt

said, "I think it's going to take a market that's going to go up on a parabolic basis – and that's what Bitcoin has done."

Bitcoin was trading around $37,000 at press time and is down 45% from its all-time high near $69,000 reached in November 2021. The sharp sell-off accelerated as some traders were forced to liquidate long positions over the past week.

"We haven't seen the volume increase we've seen in previous short-term bottoms in Bitcoin," Brandt said on CoinDesk's "First Mover" show on Tuesday. An increase in trading volume on price dips typically indicates sellers' capitulation. Brandt predicts a washout below $30,000 and down to $27,000 is likely, which could lead to further downside.

"We can get a sellers panic within the next 30 to 60 days," Brandt said. For now, BTC is locked within a tight price range between $33,000 and $42,000 and has been trading in lockstep with equities. "After we've seen a 50% decline in Bitcoin, now is the time to start recommitting to a long-term narrative," Brandt said. 

Tokens for the Solana ecosystem are close to being listed on Coinbase: sources

T

okens for the Solana ecosystem are ready to be traded on Coinbase's trading rails. CoinDesk spoke with four people familiar with the plans.

According to people familiar with the matter, the U.S. crypto exchange plans to offer withdrawals of SPL tokens - Solana's answer to Ethereum's ERC-20. USDC, which is native to Solana

and has a circulating supply of $4.8 billion, is also expected to be included. These features may be available shortly.

Coinbase is likely to announce a major development in its token onboarding strategy with the listing of SPL tokens. Based on a review of its listings, it has only listed Ethereum-based coins and Layer 1 blockchain assets, including Algorand (ALGO) and Cosmos (ATOM). Coinbase CEO Brian Armstrong stated in June 2021 that the company would list all assets where it was legal to do so, a goal that increasingly requires moving beyond Ether.

Solana's ecosystem of decentralized finance (DeFi) coins is still relatively small in terms of market value - for exchanges, staking protocols, and more. The largest SPL token based on the same metric is Serum (SRM), valued at $281 million, according to Coinbase. Shiba inu (SHIB) and Chainlink (LINK) are Ethereum-based tokens with market capitalizations exceeding $10 billion.

The first regions where Coinbase plans to offer trading were not immediately clear, nor which SPL tokens Coinbase will offer initially. 

February 2022 | Volume 13

www.cryptoweeklymag.com

FUDDOXX

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Crypto Weekly

FUDDOXX INSIDER

A quiet week in crypto this past week, With most projects in the red. However there does seem to be a slight recovery in BTC as I write this article.

Could this be the start of a reversal in the charts? Only time will tell.

This week we only have one pick of the week project due to the reserved nature of the market.

Patronus was finally able to launch after initial issues with their launch on Pinksale.

Launching during such a bear market is never easy nor advisable, however developer “Loco” pushed on with DX sale and although it was slow out of the gates to reach the modest softcap of just 35 BNB, from there it shot to the 70 BNB hardcap in minutes and launched the following day.

Since launch Loco has booked some prominent AMA sessions and introduced the projects own swap on the website with plans to integrate into Ecommerce also.

For those of you that are Harry Potter fans, the upcoming NFT launch will certainly be up your street. Check them out.

They are also now fully verified on Fuddoxx.

Marketcap:$117,903 TG: t.me/PatronusCoin.

www.cryptoweeklymag.com

February 2022 | Volume 13

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FUDDOXX Crypto Weekly

NEW VERIFIED PROJECTS:

CMCC officially joined the family of Fuddoxx verified projects this week and we very much look forward to working closer with Nathan and the team in the coming months.

ZAIN’S RUG OF THE WEEK:

This week being so quiet within the BSC space has meant that Zain is working on a new rug project for next weeks issue. Investigations are ongoing as we write but all will be revealed in next weeks issue.

LATEST NEWS Fuddoxx are very proud to announce the launch of our very own staking platform on Monday 7th of February 2022.

staking options for our verified projects as well as another string to the Fuddoxx bow.

The staking platform will initially include pools for both Fuddoxx and DDF holders and will grow exponentially over the following 2 weeks. With several projects poised to add in their own staking pools the platform will offer both a brilliant

The staking platform will enable holders to stake their tokens and receive a great APY as well as their normal contract reflections.

Fuddoxx has also reached a new ATH this week just teetering on the $200k mark, This is purely organic growth and building a solid foundation for future developments.

LATEST SCAMS In next week's edition of the Fuddoxx Insider, we are going to blow apart a big name influencer that most of you will have heard of or used in the past. Whilst we would love to warn you this week of exactly who this is we are currently collecting all of our screen shots and evidence together to be able to provide everything required to show just how unethical and callus this individual is.

Have A Bullish Week

and Fill Those Bags!!

February 2022 | Volume 13

www.cryptoweeklymag.com

8

NEWS Crypto Weekly

Facebook Expects to Lose $10 Billion this Year Due to Metaverse Investments

On Facebook, the metaverse will take center stage.

As a result of Facebook Reality Labs investments, Facebook expects to cut overall operating profits by about $10 billion this year.

Facebook Reality Labs will focus on Facebook's metaverse ambitions.

CEO Mark Zuckerberg said the metaverse will be the successor to the mobile internet.

At least $10 billion will be poured into Facebook's Reality Labs project, which is working on the company's metaverse ambitions.

In the company's earnings release on Monday, CEO David Wehner noted that Facebook's investment in Facebook Reality Labs will reduce the company's overall operating profit by approximately

February 2022 | Volume 13

$10 billion in 2021. We expect to increase our investments over the next few years as part of our commitment to bring this long-term vision to life. Metaverses are shared virtual spaces that people can access through the internet using virtual reality and augmented reality devices.

Mark Zuckerberg has pushed the buzzword into the mainstream. The company went so far as to change its name to reflect its focus on the concept.

However, it acknowledged that the idea wouldn't pay off right away. Zuckerberg told analysts, according to Reuters, "This investment will not be profitable for us anytime soon. But we believe that the metaverse will eventually replace mobile devices."

Facebook Reality Labs will also publish its financial results as a separate unit. In its earnings release, Facebook warned of "significant uncertainty" in the next

quarter due to "continued headwinds from Apple's iOS 14 changes, as well as macroeconomic and COVID-related factors."

App developers had to ask users' permission before tracking them before Apple introduced privacy changes earlier this year, a move that has impacted advertisers. Facebook's revenue increased to $29.01 billion in the third quarter from $21.47 billion a year earlier, falling short of expectations of $29.57 billion. In the same week that Facebook released its earnings, over a dozen news outlets published articles based on documents leaked

by Francis Haugen, putting intense scrutiny on the social media giant.

Documents known as the Facebook Papers revealed some controversial practices at the company, including how it ranks countries into different tiers to moderate the content. 

www.cryptoweeklymag.com

NEWS

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Crypto Weekly

Could the U.S. dollar go fully digital? The Federal Reserve releases a report on potential competitors to cryptocurrency

A

ccording to a report released by the Federal Reserve last week, the possibility of creating an entirely digital dollar could serve as a more stable alternative to other digital forms of money such as cryptocurrencies. In the United States, the currency would be called "central bank digital currencies" (CBDCs).

In the modern world, digital wallets and systems are used for many modern transactions. Over 97% of money in circulation comes from online transactions, according to an October 2021 article in Harvard Business Review.

A commercial bank ledger is typically used for storing digital money (or, in the case of cryptocurrencies, a public ledger). Conversely, a CBDC would be a Federal Reserve liability, owned and

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backed by the Fed. The Fed currently only backs physical cash. A digital dollar could streamline cross-border payments and reinforce the dollar's status as an international currency, according to the Federal Reserve. As an alternative to digital money created by private banks, the Federal Reserve claims digital currencies can also provide access to safe central bank money backed by the federal government.

The digital dollar could limit consumers' access to banks' money by reducing deposits into bank accounts. In its report, the Fed cautions that this could have detrimental effects on banks and the broader financial system. According to Time, "The benefits of CBDCs to international competitiveness and financial inclusion are theoretical, difficult to measure, and may be elusive,"

said the American Bankers Association at a congressional hearing on digital currencies. Furthermore, "the negative consequences could affect monetary policy, financial stability, financial intermediation, the payments system, and the customers and communities that banks serve."

A federal government will have access to consumer data, so a balance will have to be struck between protecting personal privacy and preventing crime.

The storage of data on government infrastructure may also make it vulnerable to foreign cyberattacks. As of yet, no policy decisions have been made regarding the development of a digital dollar, and the report is intended to aid in the understanding and feasibility of CBDCs, according to the Fed. 

February 2022 | Volume 13

10

FEATURE Crypto Weekly

Regulation of Cryptocurrencies Outlined

by Russian Authorities T

he document seen by Reuters on Friday shows Russian authorities have drawn up a 'road map' that envisions restrictions on cryptocurrencies but not a complete ban on trading and mining, as advocated by the central bank. Politicians have urged the central bank to rethink its policy of restricting cryptocurrency trading and energyintensive mining on Russian soil due to financial instability concerns.

to ban ownership of cryptocurrencies," Elizaveta Danilova, head of the central bank's financial stability department, said later on Friday.

projects with Russian roots as proof that banning cryptocurrencies slowed the development of the IT industry significantly.

According to Fitch Ratings, the proposed ban will limit the exposure of the Russian financial system to risk but may slow down innovation and slow down the technological development of Russian banks in the long run.

The report called for the road map to be approved soon. Central bank official Danilova said no decision had been made.

Legal action cannot be taken by either the central bank or the government... All parties have been contacted."

President Vladimir Putin has requested that a consensus be reached. Members of the finance, economy, digital, interior ministries, the FSB security service, and the central bank were involved in its development. The road map was reportedly signed by Deputy Prime Minister Dmitry Chernyshenko, as first reported by business daily RBC. Chernyshenko's representative confirmed the document's authenticity.

The working group's proposal would allow only Russian banking institutions to purchase and sell cryptocurrencies.

The document suggests creating procedures to block foreign crypto exchanges from offering services to Russian users, suggesting that foreign platforms can obtain licenses to operate in Russia.

As an example of the problems mining could cause, Kazakhs, the world's second-largest Bitcoin mining hub, were cited. This week, Putin pointed to Russia's competitive advantages of surplus electricity and well-trained personnel as reasons for being able to handle the situation.

According to the document, all agencies, except the Bank of Russia, supported the road map points. The central bank acknowledged that it was familiar with the draft. It is deemed necessary to draft a law banning the issue and circulation of private digital currencies on Russian soil, Danilova said later on Friday, adding that "We do not intend

February 2022 | Volume 13

Reuters reported this week that Binance, the largest cryptocurrency exchange globally, plans to expand into Russia.

In August, Russia accounted for 11.2% of global "hashrate" (crypto jargon for the amount of computing power used by Bitcoin computers).

Cryptocurrency mining, in which powerful computers solve complex mathematical puzzles as part of a global network, continues to be opposed by the central bank. It warns about inefficient energy consumption and environmental impact. The report cited the many cryptocurrency

Russia plans to test a digital rouble to facilitate payments for individuals and businesses in response to Western sanctions. Fitch said that the digital rouble might cause some deposits to leave the banking system, increasing competition for funding and raising interest rates modestly. 

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This Gem Won't Stay Hidden For Long

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12

FEATURE Crypto Weekly

Washington's Latest Threats Thwarted

by Crypto Community The Treasury secretary can ban crypto transactions under a new bill gaining traction Washington poses a new threat to cryptocurrency advocates Crypto advocates are concerned about two separate policy changes brewing in Washington. These changes could give federal regulators the power to ban financial institutions from engaging in cryptocurrency transactions and hamper crypto developers with new, "radical" regulations.

First, the Securities and Exchange Commission released a new rule proposal on Wednesday aimed at improving oversight of off-exchange

February 2022 | Volume 13

securities trade platforms, which are typically used in the bond market and some derivatives markets.

Gabriel Shapiro wrote in his Thursday newsletter that this new proposal could easily be used to expand the definition of stock exchanges to include automated market makers, which are types of protocols that match buyers and sellers of cryptocurrencies without an intermediary.

Shapiro wrote, "We should not underestimate the significance of the SEC's radical and sudden paradigm

shift for blockchain and decentralized finance." "Consumers have had just 30 days to voice their opinions - the SEC must revise this proposal to clarify that it does not intend to prohibit simple code for peer-to-peer token trading websites."

Though the SEC provided a concise 30day period for comments, that period is likely to be longer since a backlog of proposed regulations is making its way through the Federal Register. Once a regulation proposal is published in the Federal Register, interested parties will have 30 days to submit their comments

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FEATURE

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Crypto Weekly

to the SEC. Most comments are due within 45 to 90 days after publication.

During the SEC meeting on Wednesday, Hester Peirce, the lone Republican commissioner, objected to the short window for public comment. During his appearance at the Finance on the Blockchain conference Thursday, Peirce echoed Shapiro's concern that the new rule could adversely affect crypto operations, despite its stated purpose.

People in the crypto space who operate or plan to launch any kind of trading venue should pay attention to this release because it is very detailed, she said. Think about how it might apply, and consider writing a comment letter to help us work through those issues."

Despite a rise in the price of Bitcoin BTCUSD, -0.79% and ether ETHUSD,

-0.42% on Friday, both remain down more than 20% on the year, according to Dow Jones Market Data.

Earlier this week, the American COMPETES Act of 2022, designed to boost U.S. semiconductor production and other research and development, caused another scare for crypto advocates. Although the bill is being marketed as a measure that would give U.S. industry a technological edge over China, it contains provisions that would provide the Treasury Department more extraordinary powers to combat money laundering.

According to Jerry Brito, executive director of the crypto advocacy group, the bill "would give the Treasury Secretary unchecked discretion to prohibit financial institutions (including cryptocurrency exchanges) from

providing access to cryptocurrency networks," Coin Center reported.

"Any transaction involving any domestic financial institution is subject to the unchecked power of the secretary," he said. Money laundering concerns can be solved in a dangerously authoritarian manner."

In contrast to their failed effort to remove new crypto tax reporting requirements from last year's bipartisan infrastructure deal, crypto lobbyists appear confident that they can have the text amended to alleviate some of their concerns.

Kristin Smith, executive director of the Blockchain Association, a crypto industry group, said, "We're having constructive discussions with decisionmakers who are open to suggestions.".

The bill "would give the Treasury Secretary unchecked discretion to prohibit financial institutions (including cryptocurrency exchanges) from providing access to cryptocurrency networks," Jerry Brito Executive Director of the crypto advocacy group

www.cryptoweeklymag.com

February 2022 | Volume 13

14

NEWS Crypto Weekly

Biden's 'reactionary' approach to crypto regulation blasted by former CFTC chairman

Giancarlo calls for the creation of a Crypto Bureau joint with the SEC/CFTC

B

lockchain believers have called the rise of Bitcoin BTCUSD, -0.31% and other cryptocurrencies a revolution, implicitly placing bankers and federal regulators in the role of anxious reactionaries.

CFTC Chairman Chris Giancarlo termed the Biden administration's approach to crypto "highly defensive and reactionary" on Tuesday. A recent Biden administration report on stablecoin regulation revealed a concern for "what could go wrong" rather than "what could go right," while failing to "declare any national imperative to harness digitalasset innovation to extend inclusivity and lower costs for new generations of Americans."

In 2019, Giancarlo, who was appointed by the Obama administration as a Republican commissioner at the CFTC and then elevated to the position of chairman by President Trump, launched

February 2022 | Volume 13

the Digital Dollar Project after leaving public service to promote the creation of a central bank-backed digital currency.

According to him, "taking advantage of this wave of innovation will lead to greater financial inclusion, capital efficiency, and economic growth for generations to come. The coming wave of the internet will expose the weaknesses of our outdated analog financial systems, potentially disrupting western economies if we do not act."

Giancarlo supported recent efforts by the Federal Reserve Bank of Boston to create open-source code that could help the development of a digital dollar in collaboration with the Massachusetts Institute of Technology. The Fed has promised to issue a report on the benefits and risks of issuing central bank digital currencies. Although Chairman Powell promised that it would be released "soon," it remains unfinished.

Moreover, the former regulator believes Congress must act to streamline regulation of private cryptocurrencies by creating a new bureau jointly run by the Securities and Exchange Commission and the Commodity Futures Trading Commission.

During his remarks Tuesday, he argued Congress should transform the cryptocurrency working group he created with then SEC chairman Jay Clayton into a "crypto bureau that would be under joint authority of both the SEC and the CFTC but with its own authority and funding."

Giancarlo argued that this approach would take into account the fact that neither the Senate Agriculture Committee, which oversees the CFTC, nor the Senate Banking Committee, which oversees the SEC, will vote to give up their power to regulate the emerging crypto sector. 

www.cryptoweeklymag.com

16

NFT FEATURE Crypto Weekly

NFT Games Are Capitalist Escapist Fantasy Where Players earn big Money

M

ore affluent players are becoming bosses in blockchain-based video games like Axie Infinity. In the Philippines, people are earning twice what they could in a regular job just by playing this game.

Power fantasies are the focus of video games. The conventional wisdom says: Defeat enough dragons to reach level 99, sell enough wolf skins to buy a gaudy gold cape, and you will become rich or strong or accomplished in the world of

February 2022 | Volume 13

the game-despite not being wealthy or successful in real life. During her 30s, Catdicax, a Finnish woman, found that the online fantasy role-playing game Runescape was a place where she could earn more and more in-game items by working hard. Ten years of playing had paid off: She had amassed a collection of high-end relics.

Eventually, however, Catdicax became restless. Working so hard for Runescape's digital axes or cloaks felt like a waste of

time. Then in 2019, Catdicax discovered Axie Infinity, a blockchain-based video game where players collect and level collectible Pokémon-like virtual pets, known as Axies. A player's Axies compete to win cryptocurrency tokens, which are then used for breeding new creatures using NFTs. Smooth Love Potion (SLP) is a token earned by defeating your opponents in Axie-fights. You can trade it on crypto exchanges or exchange it for legal tender. Even though the game is not about the game, it is about the

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Crypto Weekly

economy. As if holographic Charizards were on steroids, rarer Axies sell for eye-watering amounts: A portly, winged angel Axie was sold for $130,000 in cryptocurrency in 2020.

Catdicax uses her screen name because she is afraid of being "targeted" because of her Money and to avoid sexist trolling.

Her digital pets now sold for as much as $500 per Axie as the value of her digital pets grew. Catdicax wasn't just a player anymore. She owned assets. In late 2020, after Axie Infinity became very popular, she realized that aspiring players who couldn't afford their own Axies would jump at the chance to use hers. Mostly based in the Philippines, she outsourced her video game grind to people she met online.

The cryptocurrency world is haunted by a new buzzword: play-to-earn.

Essentially, the term refers to a category of games that use blockchain technology to reward players with digital items with real-world (or at least crypto-world) financial value. Uplands, Splinterlands, and Alien Worlds are among the other titles. Sky Mavis' Axie Infinity is the most illustrious of the band's offerings.

According to crypto analytics platform DappRadar, gamers paid $2.32 billion for unique gaming objects on the blockchain as of the third quarter of 2021. Andreessen Horowitz led a $152 million investment round in Sky Mavis led by its grantees in October. Axie

Infinity had 1.8 million daily users as of August 2021, so thousands of people play at any given time.

Aleksander Leonard Larsen is the cofounder and COO of Sky Mavis, an online gaming company that uses cryptocurrency technology to transform the online gaming economy. When Axie Infinity launched in 2018, its only crypto element linked Axies to NFTs-unique crypto assets that can be minted on the Ethereum blockchain. In late 2019, Sky Mavis introduced SLP tokens and decided to harvest the tokens in-game rather than sell them to users. "Other game studios always want to make as

They would take a cut of her earnings as part of an Axie lending program-in Axie-speak, a scholarship. A new video game, power fantasy, was absorbing Catdicax: being a manager. "This is really amazing. People in the Philippines are earning twice as much as they could in a regular job," she says. I, too, wanted to help people. In fact, an analysis by the insights company Naavik suggests that, as of August 2021, only the most skilled players earned more than the average wage in the Philippines of $41.49 per day. And that's before considering compensation for scholarship managers.

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FEATURE Crypto Weekly

much money as they can from players," Larsen says, referencing games with business models that rely on selling extra objects or features. He believes Axie Infinity and other play-to-earn games reward competent players with valuable digital assets.

Sky Mavis launched Katana in November, an automated cryptocurrency exchange where Axie Infinity tokens can be exchanged for Ether - allowing a direct, cheap connection between the game and cryptocurrency-fueled decentralized finance. Ownership of an Axie entails owning an NFT; SLPs and Axie Infinity's other currency, AXS, are Ethereum tokens based on the ERC20 standard. Furthermore, these assets do not just exist as digits on an MMORPG server; they are stored in players' cryptocurrency wallets. Sky Mavis has been gradually implementing a monetary policy similar to a privatized central banker, ensuring that there is no oversupply of tokens. The company has been cracking down on people who use multiple accounts, capping the number of tokens that can be earned in non-fight modes and generally making it harder to earn tokens.

Larsen believes that offering DeFi services is a logical next step. "You get DeFi when you use a wallet that stores both digital and fungible assets."

According to DappRadar, Katana quickly became one of the most popular DeFi apps.

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Many players will not cite the game mechanics as the reason they keep coming back to Axie Infinity. In May, Sky Mavis founder Jeff Zirlin asked his Twitter followers what they loved most about the game. The economy was mentioned by 48 percent of respondents.

Like any economy, Axie Infinity's includes an active labor market. Axie Infinity's owners like Catdicax set up a scholarship system, which made Yat Siu, cofounder of Animoca Brands, one of the early backers. Both labor and capital were invested, says Siu. It was similar to how Chinese workers (and sometimes even incarcerated people) would "farm" fancy armor and gold they "grinded" for in World of Warcraft and sell it on graymarket websites. NFT games encourage players to sell their assets to other players, and trading those assets for real money is totally legal and above-board.

Similarly, Splinterlands' digital cards straddle both an altruistic and capitalist experience in increasing their financial status and standing. In Axie Infinity, some players rent their axies to other players for a 30 to 40 percent cut of the earnings. Players from developing countries like Ecuador and the Philippines are more likely to rent their axies. Sky Mavis reports that more than half of Axie Infinity's players are from the Philippines. In Axie Infinity's Discord, dozens of workers "apply" for positions every 10 minutes, sharing why they should be hired, what their gaming experience is, and

We come in, buy Axies in bulk, and then lend them out to players. Each party receives their profit cut using a self-executing piece of blockchain software or smart contract developed

by YGG

Gabby Dizon CEO, Axie Infinity Philippines

how good their internet connection is. Discord facilitates worker-manager relationships by allowing players to share their usernames and passwords.

Siu invested early in the market. Gabby Dizon, CEO of Axie Infinity in the Philippines, noticed players sharing their usernames and passwords last year, so he decided to formalize the relationship with Yield Guild Games, an online gaming guild with over 15 different titles. In an interview with WIRED, Dizon outlined the guild's business model: "We come in, buy Axies in bulk, and then lend them out to players." Each party receives their profit cut using a selfexecuting piece of blockchain software or smart contract developed by YGG. "Community managers" who recruit and manage players on behalf of YGG get 20 percent of their earnings. YGG receives 10 percent of those tokens and may reinvest them to breed more Axies.

Currently, there are about 5,400 scholars. Next year, we aim for hundreds

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Crypto Weekly

of thousands, Dizon says. His wager has so far paid off: YGG was funded with $4.6 million by Andreessen Horowitz in August. The company waxed lyrical about how jobs are evolving thanks to blockchain technology and gaming in its announcement of the deal. Axie and similar video games aren't even comparable to other video games, in Dizon's opinion. "It's a little like Uber, Grab, or Gojek, where you deliver food and get paid for it," he says. "Why not work from home and play this game and get paid in tokens instead?"

As the lines between investing and gaming have blurred, Axie Infinity has grown. Robinhood has helped turn investing into entertainment while also lowering the barriers to entry by offering commission-free trades.

Cryptocurrency exchanges have also grown in popularity, providing investors with better access to the volatile markets. Covid-19 and the financial volatility many people experienced over the last two years could be partly to blame, says Jill Carlson, founder of Open Money Initiative's economic research nonprofit. "That woke people up to the system." People are now asking themselves, 'Why shouldn't I take more control over my assets?'"

There has been a flurry of activity among

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Other game studios always want to make as much money as they can from players Aleksander Leonard Larsen Cofounder and COO of Sky Mavis

amateur investors in the past year, often inspired by online communities, such as Wall Street Bets' GameStop surge and Shiba Inu's Dogecoin. "Play to earn" takes the concept of investotainment very seriously, according to Gary Gensler, chair of the Securities and Exchange Commission. NFT players simulate capitalism in a less chaotic setting by gaining capital through labor, investing that capital, and earning money through other people's labor.

Traditional role-playing games have a linear relationship between work and reward. Studies have long discussed 'the fantasy of labor,' or how games satisfy itchiness created by modern-day capitalism but not satisfied by capitalism

itself, like earning a concrete rate for simple tasks or achieving renown through hard work in a linear manner.

According to Naomi Clark, chair of New York University's Game Center, the idea that everyone can reach level 50 if they work the same amount is associated with the bootstrap mythology of early capitalism.

Clark has been writing about "the fantasy of labor" for 15 years. He says NFT games represent a more modern philosophy brought about by people's disillusionment with today's financial systems and gamified investments.

According to Clark, modern games fulfill the dream of the modern economy: "You don't have to work. You don't have to grind. It's just a matter of watching the money roll in." Video games can provide an alternative to the current flawed economic system.

Gabby Dizon, YGG's star NFT player, is too busy to participate in the games.

There is no World of Warcraft guild that can compare to the guild he runs.

"I'm still playing a video game, but I'm not in the game," he says. "My role is to organize people to play these games and earn Money. It's more fun because the stakes are higher. I'm playing the meta-game." 

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Crypto Weekly

of the

week

NFT

Robert Hockett joins me to discuss the future of Fintech and Wildcat Crypto

February 2022 | Volume 13

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agromatic

agromatic

agromatic

agromatic

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NEWS Crypto Weekly

'Mountains' of fraud are rampant in crypto and NFTs, IRS says

G

overnment agencies are grappling with how to police digital assets in order to deter investors from engaging in criminal activity. A special agent assigned to the IRS's criminal investigation division's Los Angeles field office, Ryan Korner, reports mountains and mountains of fraud in this area.

Tax crimes and financial crimes are investigated by this division.

USC Gould School of Law professor Korner said celebrities aren't immune from the IRS's criminal probes. We aren't necessarily looking for celebrities, but when they openly say to the IRS, 'Hey, IRS, you should probably look at me,' we investigate."

A total of $3.5 billion worth of cryptocurrencies related to financial

February 2022 | Volume 13

crimes were seized by IRS investigators during fiscal year 2021, accounting for 93% of all assets seized by the division during that period. At the end of the year, IRS CI had 80 active cases where the primary violation concerned crypto, Korner said.

Criminal activity is a concern for law enforcement agencies. The Korners are concerned when they see people paying millions of dollars for assets, like NFTs, that don't seem to have any intrinsic value. He said that bad actors can use that to their advantage to launder money from criminal enterprises, such as drug trafficking. Market manipulation of NFTs and cryptocurrencies, in general, is rife, according to Korner, with highprofile investors able to influence asset prices with a single tweet.

Government agencies have in the past targeted crypto companies that used celebrities to endorse products and engage in illegal activities.

Earlier this year, boxer Floyd Mayweather and music producer DJ Khaled settled charges with the Securities and Exchange Commission that they failed to disclose payment for promoting a scheme through social media.

IRS CI is trying to train all of its agents on crypto and NFT issues because "this space is the future," Korner said. He said that the agency is looking to increase collaboration and information sharing with other federal agencies, including the Justice Department, to make sure everyone is on the same page and staying ahead of the criminals. 

www.cryptoweeklymag.com

Income Island Phase 1.5 METAVERSE January 2022

FORGET THE ROCKET, DON’T MISS THE BOAT!

incomeisland

incomeisland

incomeisland

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NEWS Crypto Weekly

Metaverse Crimes Raise Major Concerns In the crypto space, regulators have been particularly active since the turn of the year. Regulators' increased scrutiny has weighed on Bitcoin (BTC) and the broader market. Despite this, the NFT marketplace has thrived, and activity in the Metaverse is also on the rise.

Marketplace Crime and NFTs OpenSea, which has experienced a number of high-profile hacks in recent weeks, remains a key risk in the NFT marketplace. A "Rug Pull" social media scam promotes a digital asset. Once the scammer drives up the price, the scammer sells the asset, in this case, the

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NFT. Earlier this month, investors lost $1.3m due to a "Rug Pull."

Bored Ape and Mutant Ape NFTs from OpenSea.

OpenSea intervened in an NFT theft late last year. The wires reported that thieves stole Todd Kramer's NFT collection from his hot wallet. The stolen assets, worth $2.2 million, were frozen by OpenSea. The freeze resulted in the removal of 16

This month, news hit the wires that India's central bank has created a FINTECH division to keep up with the crypto market. Because of the surge in NFT activity, regulators have taken notice of the market. India's regulator

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Crypto Weekly

A look at the metaverse by the South Korean Communications Commission Earlier this week, South Korea's Communications Commission announced the creation of a council to address user protection on the Metaverse. According to reports, the council will also examine the issue of sexual harassment directed at minors.

In a recent news article, A 30-member council will discuss Metaverse issues such as inclusivity, violence, and sexual crime.

is planning on looking at exchanges and NFTs, and new crypto launches.

Cybercrime in the Metaverse is a major concern Metaverse, however, is subject to far less regulatory scrutiny. In spite of its lack of regulation and vulnerability, Metaverse is subject to far less regulatory scrutiny.

The number of Metaverse trademark applications in China has risen dramatically in recent months, as we reported late last year. People's Bank of China (PBoC) plans to use AML tools to clamp down on NFTs and the Metaverse, while many regulators have been silent

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on the matter. The PBoC believes the Metaverse is a threat and maintains continuous vigilance is necessary.

In the Metaverse, there was a flurry of news stories about sexual harassment last year. With the Metaverse country agnostic, this issue is becoming a global one. As other governments face similar challenges, South Korea's move is likely to be the first of many gaining media attention. In December, the New York Times and MIT Technology Review reported cases of sexual harassment in the Metaverse. Legislation in South Korea aims to hold online platforms accountable for the actions of their users.

The law in South Korea prohibits adults from engaging in sexually exploitative conversations and behaviors with minors, both online and offline.

A U.S.-South Korean partnership taking Kpop to the Metaverse makes this move all the more crucial for, the younger generation.

Metaverse Linked Price Predictions for 2022 Markets anticipate more of the same with the growing interest in the Metaverse.

According to a report from late last year, the Metaverse space is led by two leading projects, SAND and MANA. They were among the top performers in 2017.

According to Morgan Stanley analysts, the Metaverse could grow to an $8tn market. MANA and SAND may suffer from bad press and government scrutiny in the near future. MANA is currently down 36.11 percent to $2.085 for the current month. This month, SAND has declined by 48.32% to $3.0161. 

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NEWS Crypto Weekly

Crypto Rules Needed for National Security Reasons, says White House A

s a matter of national security, the Biden administration will issue an executive order requiring federal agencies to regulate cryptocurrencies such as Bitcoin.

A regulatory framework covering cryptos, stablecoins, and non-fungible tokens will be put together by several parts of the government, according to sources. By taking a holistic approach to digital assets, the government hopes to provide coherence to what it's trying to accomplish. The State Department, Treasury Department, National Economic Council, and Council of Economic Advisers will be involved as part of the initiative.

According to the individual, since crypto has economic implications for national security, the White House National Security Council would also be involved.

The administration will also instruct agencies to harmonize regulations of digital assets between countries.

"Since digital assets don't remain in one country, it is necessary to work with

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other countries on synchronization."

There were no recommendations from the White House. The White House will act as a policy coordinator and give agencies three to six months to develop proposals. Officials from the White House declined to comment.

The White House wants to bring order to the haphazard way the government has been regulating crypto. This industry is regulated by the Securities and Exchange Commission and the Commodity Futures Trading Commission.

There is, however, no consensus on how to oversee exchanges, stablecoins, and high-yield lending products or whether some tokens should be classified as securities.

Over the last few months, Congress has held several hearings on cryptos, exposing the partisan divide between Republicans and Democrats over regulation of the industry. Congress is also being urged to draft rules by the Biden administration. In November,

the White House released a report on stablecoins, recommending that Congress act promptly to regulate the industry.

The Federal Reserve has also commented on digital currencies. Earlier in January, the Fed released a report on a centralbank digital currency, or CBDC, which discussed the pros and cons of digitizing the dollar.

According to the report, the Fed could begin work on the project if the White House and Congress supported it. A Treasury Department spokesman called the report a crucial step forward in discussions about a CBDC. Several countries are intensifying their scrutiny of crypto as a matter of national economic security. Russia's Central Bank and Finance Ministry said that Bitcoin mining and trading should be tightly regulated this week. Russia's President Vladimir Putin urged regulators to come to a unanimous decision on how to regulate space Wednesday. 

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HIDDEN GEMS Crypto Weekly

PROJECT 1

luckyfairy.io

Lucky Fairy Token (FAE)

luckyfairytoken

LuckyFairyToken

Are you a fan of hitting jackpots on online slots and lotteries, or love to make your income from live dealers, and sportsbooks?

Are you also a crypto enthusiast? Get ready!

LuckyFairy ($FAE) is a deflationary token launched on the evergrowing AVAX Blockchain. Already partnering with a fully regulated, established online gaming platform in Numbers Game (PlayNumbersGame.com), LuckyFairy garners a 70% revenue share redistributed to $FAE. The token launched with an initial max supply of 777,777,777, conveniently, and carries a 10% tax. The tax breaks down to: 3%-Marketing & Development 2%-Reflections 2%-Liquidity 2%-Prize Pool 1%-Burn Here’s the winning strategy. By utilizing an anti-whale dump mechanism, the max transaction is 0.5% of the total supply, and

PROJECT 2

incomeisland.org

100% of the tokens revenue from the casino is put back in the $FAE ecosystem to maximize token growth, and will initially be distributed as such, but is subject to change following a snapshot vote from the community: 40%-Lucky Fairy Buyback and Burn Events 40%-Lucky Fairy Events ie. AVAX, ETH, BNB, and crypto airdrop to $FAE holders 19%-Marketing 1%-Charities Keep your eyes on this hidden gem as there are future plans to expand past the online casino and step into the metaverse, as well as Esports tournaments and betting, P2E games, decentralized slots machines, and more, and bringing all these additional features on their Lucky Fairy dApp.

Income Island

incomeisland

Income Island Token is a one-of-a-kind concept, developed to make anyone generous stable profits on a daily basis. The integrated gaming system uses blockchain technology which will allow anyone to earn a passive income whilst having fun at the same time. In addition, you may buy and own a personal mining plot and even more than one to generate an income. You may rent out your plots to other players and earn NFT’s offering extra Island Tokens every time someone sells, meaning you earn an income while you sleep.

As Warren Buffet famously said “If you don’t find a way to earn money while you sleep, you will work until you die!"

February 2022 | Volume 13

a max transaction on sales, with a 45 second cool down period between buys and sells.

incomeisland Through the ongoing development, Income Island will strive to make sure that the ecosystem is a safe and friendly environment to earn a passive income for the long term. Income Island Token, is not just all about the great rewards, it also has a great, doxxed, and highly dedicated team that is supported by a steadfast and strong community. The fundamentals for the ecosystem were created through Income Island`s global team and consists of both volunteers and working professionals from all over the world with skillsets ranging from web development, marketing, Dapp creation, and many other entrepreneurs willing to deliver a stellar financial product to the Income Island community. The Income Island Token is a revolutionary coin, created to be a safe.

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Crypto Weekly

XRise

PROJECT 3

xrisecoin.com

With volatility as the main antagonist of mass crypto adoption, XRise is bringing a smart contract that offers a substantial amount of certainty to investors. The goal being to minimize risk and loss that all too often, troubles the BSC space. XRise does this by controlling the max sell limit on every transaction, nurturing exponential growth.

Purchases carry no upper limit, and laddering out (safely taking profits) is welcomed. If you invest $1,000, and you have a 500% increase, ($5,000), your day 1 withdrawal would be set at your initial investment, plus 10% of your profit, ($1,000+$400). Let’s say day 2 realizes a 200% profit, putting your remaining $3600 from day 1, at $7200. Your day 2 withdrawal limit would be 10% of your total holdings, ($720). As the process continues, investments and holdings continually grow, while sells have a much lesser impact on the chart.

r

PROJECT 4

FuddoxxToken

XriseCoin

XriseCoin

Initial investment-$1,000 Day 1 (with a 500% increase)-$5,000 Profit-$4000 Day 1 withdrawal limit (Initial investment+10% of profit)=$1400 Remaining balance-$3600 Day 2 (with a 200% increase)-$7200 Day 2 withdrawal limit (10%)-$720 Brought to you by the powerhouse team at FudDoxx, XRise will launch on the Binance Smart Chain on February 14th and are accepting presale allocations on their Telegram channel.

FudDoxx will pay out their staking rewards in XRise, adding holders, and continually growing a consistent upward trajectory to the XRise token.

FudDoxx Token (FDOX)

FudDoxx

FudDoxx

Building on security, FudDoxx offers a wide range of services to benefit the entire crypto space. The team has compiled a list of projects that have passed their extensive verification process. FudDoxx offers doxxing services to bridge the gap between investors and developers. The doxxing info received by the team is securely stored for use in the event that a project scams, and is proven as far as possible, then that information would be released to the public and authorities. FudDoxx Audit service goes beyond the detailed analysis of solidity code. Not only tearing apart the smart contracts, but their risk assessment factors in the audited projects vision, team, maturity, funding, and community.

name a few. The simple navigation process streamlines buying and selling digital art.

The FudDoxx team has also incorporated a beautiful, userfriendly NFT marketplace in their ecosystem, (see for yourself, FudCoinNFT.com), where you will find everything from pixelated images, audio, video, and unique sports memorabilia NFT's, to

FudDoxx Token (FDOX) launched on Binance Smart Chain with a total supply of 100 trillion and has 328 holders at the time of writing. A 12% tax is attached to every transaction which breaks down to 7% LP, 3% marketing in BNB, and 2% native reflections.

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Fuddoxx doesn't stop there!

Swap platform: Complete (Swap.FudDoxx.com) Staking and Farming platform: In development ICO launchpad: In development

With so many avenues for continual success in crypto, FudDoxx truly covers every base with their comprehensive suite of revenue-generating, and security, features.

February 2022 | Volume 13

30

BEGINNERS GUIDE Crypto Weekly

What Is an ICO?

A

n initial coin offering (ICO) is a tool used by a company to raise money to develop a new cryptocurrency.

Early ICO investors can acquire a new cryptocurrency token before it reaches the masses. The token might relate directly to the company's product or service or be a piece of ownership in the business or project. An ICO is the cryptocurrency equivalent of an initial public offering (IPO).

How ICOs Work The first step for a cryptocurrency project wanting to raise money through an ICO is to choose how it will be structured. There are several ways to structure an ICO, including:

a fixed price, implying that the money raised dictates the supply.

What are the trading pairs or platforms to buy?

A critical step in setting up an ICO is the development of a white paper dedicated to the token and structuring the ICO to educate potential investors. The project's promoters utilize their white paper to provide detailed information about the ICO and many times will include:

What is the ICO campaign duration?

What is the utility of the project?

How much money are they looking to raise?

How many tokens will the devs/ founders keep?

In conjunction with the project's ICO campaign, the project releases its white paper to attract supporters and enthusiasts to buy tokens from the project. In general, cryptocurrency investors can buy new tokens using fiat or digital currency, with other crypto becoming increasingly popular purchasing options. Newly issued tokens resemble shares of stock sold during an initial public offering.

ICO funds might be returned to investors

Static supply/static price: A company can establish a funding goal or limit, which means that each token offered in the ICO has a predetermined price and a set number of total tokens available.

Static supply/dynamic price: An ICO may have a fixed supply of tokens and a dynamic funding goal. The amount of funds acquired during the ICO determines the overall price per token.

Dynamic supply/static price: Some ICOs have a fluctuating token supply but

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then transfers the tokens to individual investors, distributing the coins.

The risk is that because no financial authorities are regulating this industry, funds lost to fraud or negligence may be gone forever.

Most early investors in an ICO tend to be motivated by their expectation that the tokens will increase in value postlaunch. This potential for high returns is the primary advantage of an ICO.

if the funds raised fall below the launch criteria's minimum goal. If this happens, the ICO is considered unsuccessful.

Funds raised for the project's goals can be made available to the creators for use if the predetermined requirements are met within the specified timeframe.

Initial Coin Offering (ICO) vs.

Initial Public Offering (IPO) The initial public offering of stock is a way for companies to raise money by selling stock to investors. Crypto companies raise funds through ICOs by selling coins or tokens. Investors jump at the chance to get in on an ICO because they think the asset will increase over time.

A significant distinction between an ICO and an IPO is that investing in an ICO does not secure you an ownership stake in a company or project. Participants bet that an otherwise unknown currency will increase in value over time following launch.

While an IPO is regulated primarily by government entities such as the Securities and Exchange Commission, ICOs remain relatively unregulated.

Because of this lack of regulation and the often decentralized nature of crypto projects, an ICOs structure may differ significantly from one project to another. IPO structures, however, generally follow a similar format.

IPOs typically attract conservative investors hoping to earn a profit. In contrast, ICOs may obtain financing from risk-tolerant investors who desire to invest in an exciting, new project.

Some see similarities between ICOs and crowdfunded projects.

The primary difference is that an ICO offers the potential for financial gain over time, whereas a crowdfunding initiative receives donations. This ICO process has come to be known as crowdsales.

Initial Coin Offerings The Good and the Bad The availability of online services that facilitate the creation of cryptocurrency tokens makes it extremely easy for companies to launch ICOs. A manager of the ICO generates tokens in accordance with its terms, receives them, and

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Investment in a token sold in an ICO is considered high-risk. It is still an unregulated market, scam ICOs are unfortunately all too common, and investors have no protection if an ICO doesn't work out or is fraudulent.

According to a Satis report prepared for Bloomberg, almost 80% of ICOs were deemed fraudulent.

Be Smart!

Those interested in participating in an ICO should consider the following when performing their due diligence:

Examine the team to determine whether they have experience creating successful businesses.

Examine the white paper and roadmap of the project to understand how the intended product or service will work.

Check to see if a third party has audited the project.

In most cases, tokens with successful sales get listed on crypto exchanges.

If the coins are listed, investors who missed out on the token offering will have the opportunity to purchase them (albeit at a higher price). A project that has marketed itself well might find a significant demand for its token after the ICO. As a result, it has become commonplace for ICO investors to dump coins to the market upon listing to earn a quick return or to pump and dump their tokens. They will typically buy back in once the price has bottomed out. Be smart, and as always, DYOR! 

February 2022 | Volume 13

32

FEATURE Crypto Weekly

Crypto World is Launching a Marketing Campaign to Reach Mainstream Consumers

Investing in and interest in crypto is rising, leading to a marketing blitz.

Many companies are enlisting celebrities to advertise, such as eToro and FTX.

The challenge is to stand out in a crowded field and educate a stillskeptical public.

You will soon see cryptocurrency ads on your favorite platforms. In the coming months, cryptocurrency exchanges plan to spend millions on marketing to reach the mainstream, providing a welcome revenue stream for ad agencies still recovering from the pandemic.

Public relations is being used by crypto companies instead of traditional advertising to target investors and enthusiasts on platforms such as Reddit

February 2022 | Volume 13

and Twitter. FTX is the first crypto brand to buy a Super Bowl advertisement in a sign of things to come.

Advertisement channels such as broadcast TV are still relatively new to crypto exchanges. The company's head of digital marketing, Brad Michelson, said eToro quickly moved beyond Twitter with viral Bitcoin gifs to display and podcast ads, PR, and platforms that don't usually run fintech ads, such as dating app Tinder.

According to Kantar, the annual advertising budgets of two of the biggest exchanges, Coinbase and eToro, grew by 57% and 230%, respectively, last year. In the first half of 2021, crypto companies raised $8.6 billion in funding, more than double what they received during the same period in 2020. According to knowledgeable sources, several top exchanges, including Coinbase, eToro, Crypto.com, Blockfolio, and Gemini, have hired or started looking for advertising agencies in recent months.

According to Elizabeth Paul of The Martin Agency, which was recently hired

by Coinbase, everyone wants to become the Kleenex of crypto.

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Manifest Performance indicators, balance sheets and regulator guidelines are not the most appealing things to hear about in crypto, but it's necessary for us to operate correctly. Bouncing off of that, there is a certain appeal to a crypto that has its ducks in a row. Countless projects are removing general quality and value from their project and replacing it with marketing and high spirits. We are happy to get people pumped up about crypto, but it has to be done the correct way. For example, you want to tell people key things of what to look for when considering their vote of confidence in that particular crypto. Who is the team? Previous quality projects completed? Are they purely marketing? Is the use case frantically thought of or flimsy? Does the team have a vision of expansion in the future? Does the project rely on people's addiction?

Of course, this isn’t financial advice, but we feel you should have a checklist that you are checking off when you inspect a project. This can be as vast as you want it to be and ultimately can be tuned to your liking. This can be personal auditing procedures or standardized trading strategies. These steps take time to curate correctly and can benefit the user greatly. A simple checklist. Of course you can bend your own rules, but these rules protect you from overvalued and hollow projects. The goal of most of the projects we currently see is short term, under established and widely false. Crypto is fast, this doesn't mean you can forget the key factors of a trade and fundamentals of crypto. Never mistake a tax on a taxation token as a use case or utility.

All that brewing has ultimately led to the market's sour taste and low level mentality. The key to leveling the playing field is a short and sweet one, actually educating people on crypto. A lot of projects will detest what we have to say about them in a formal audit. We have decided to audit any project or firm that audits us, to help people better understand the process. As we pay for more intense auditing services, we can perform even deeper audits of these projects. Meaning, we will bring you the truth. This is going to make us naturally unpopular, we are crypto veterans, we will be alright. We buy the dip!

In summary, don't trust us, or anyone else until you know their tokenomics and team. This is the most basic level of understanding the project. Please make efforts to learn more about the cryptocurrency space overall. We will be in the telegram often to answer people's questions. We don't allow posting of other projects in the group, but if you bring your checklist to us, we can help refine that with you.

Redutoken.com Redutoken.com

34

FEATURE Crypto Weekly

Former Robinhood COO Sina Nader said brands like his are in a competitive market with public companies such as Coinbase and financial giants such as MasterCard, JPMorgan Chase, and MassMutual.

Though FTX processes more than $10 billion in trades each day, Nader said 99% of people outside the crypto community are unaware of it.

Sponsorships have been used to raise awareness. The Los Angeles Staples Center became the Crypto.com Arena after AEG signed the 20-year deal. FTX has been named the official crypto sponsor of Major League Baseball after paying $135 million to name the Miami Heat's American Airlines Arena. FTX acquired Blockfolio in 2020, which signed a sponsorship deal with top NFL draft pick Trevor Lawrence.

Blockfolio's head of partnerships, Avinash Dabir, said the company will

soon announce more global sports marketing deals as teams and leagues become more comfortable working with crypto companies. Crypto brands often use celebrities as ambassadors.

The eToro exchange has partnered with actors like Alec Baldwin and Kristian Nairn from HBO's "Game of Thrones."

MrBeast, Charlie D'Amelio, and Logan Paul have all endorsed currencies and exchanges, and Neil Patrick Harris is Coinflip's new spokesperson.

Advertisement channels such as broadcast TV are still relatively new to crypto exchanges. The company's head of digital marketing, Brad Michelson, said eToro quickly moved beyond Twitter with viral Bitcoin gifs to display and podcast ads, PR, and platforms that don't usually run fintech ads, such as dating app Tinder. Virtue, owned

by Vice, was recently hired to create the company's next big campaign.

It is difficult for exchanges to set themselves apart and convince the public to give their products a chance.

(Agencies face the risk that these companies spend heavily, then pull back as their strategies change.) Platforms like Facebook and YouTube restrict ads for certain crypto products.

Gemini conducted a survey in April that found that 14% of Americans had invested in crypto and another 13% planned to do so over the next year. According to a survey by the PR firm Edelman in 2020, only 26% of respondents thought cryptocurrency would have a positive impact on society.

As Elizabeth Paul explains, crypto companies may be tempted to position themselves as upstarts against the banking giants, but this will lead to commoditization. Brands are in the Wild West. It is not very often in history that you are about to reorganize the entire financial system." 

February 2022 | Volume 13

www.cryptoweeklymag.com

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