October 24th, 2022

Are Non-Fungible Tokens (NFT) Regulated? What Are The Concerns?

The hype around NFT has slowed down. It seemed like NFT was slated for explosive growth in 2022, being named “word of the year” and coming off a record-high volume in January this year. But as it turns out, that was the peak. Looking at Q3 2022 NFT trading volume around the top 8 chains. There is a 76.4% trading volume decrease from Q2 2022 to Q3 2022.

Since then, the trading volume has tumbled 83% from the start of the year, according to Footprint Analytics’s data on CoinGeco. Recent months have logged numbers lower than July 2021, right before NFT summer. Most notably, Ronin and Avalanche have fallen out of the Top 8, replaced by ImmutableX and Panini. Recent sports mania has spilt over to the NFT space, propelling Flow into the Top 3. Solana’s NFT ecosystem doubled its September volume while all its competitors faltered.

During this period of time, where the market is bearish, you will see changes. For example, in Q3 Magic Eden gains grounds on OpenSea dominance. Magic Eden was the only one that saw growth in September, doublings its month-on-month volume and dominance, while the rest of its competitors continued to slip further. Magic Eden (22%) has gained ground on OpenSea’s (60%) dominance, but it remains to be seen if it can sustain its current momentum.

Another factor in sustaining the current momentum is aligning with the regulatory norms. There is still disagreement over how to handle NFTs, which makes it difficult to set clear regulatory norms. NFTs can now be seen in one of three ways: as commodities, securities, or intellectual property. Let’s explore each interpretation in more detail.

Commodities

Commodities are defined by US law as reasonably interchangeable services, goods, and rights, including money and interest rates, that are traded as commercial articles. The Commodity Futures Trading Commission (CFTC) asserts that cryptocurrencies like Bitcoin and Ethereum, as well as renewable energy credits and other intangible assets, are included in the definition of commodity.

If we take NFTs, they resemble cryptocurrencies in several ways. They may be bought and sold and are based on blockchain technology. In addition, the CFTC emphasises price manipulation and commodities exchanges more than it does on underlying assets and issuers. The Commodity Exchange Act (CEA) may be implemented if it is decided that NFTs should be classified as commodities. The CEA’s rules on manipulative trading may be applicable in this situation.

Securities

Most NFTs with a single owner and only one unique asset are unlikely to be securities. However, under certain situations, they might. If an NFT possesses security-like characteristics or otherwise satisfies the Howey test, such as when money or another kind of compensation is invested with a reasonable expectation that gains will result from others’ efforts, then the NFT may be subject to US securities legislation. A case-by-case Howey analysis is essential to ascertain if a specific NFT is a security. NFTs may, however, violate securities laws in the following situations, depending on the specifics:

NFTs are pre-sales of digital assets intended to be used on a platform that has not yet been developed, with the sale’s proceeds going toward developing the platform;
Digital assets can be “pooled” or “fractionalised” (for instance, in the case of art, when creators pool resources and divide profits, or where several NFTs reflect different investors’ fractional ownership of a single asset);
NFTs are a license to a digital asset (like a song) and a portion of its earnings (e.g., a percentage of sales).

Intellectual Property

NFTs might be covered by intellectual property rights such as copyright, design patents, and trademark protections. As a result, buyers of NFTs should be aware of any associated intellectual property rights. In fact, the license that comes with many or even most NFTs merely allows the NFT buyer to use, copy, and display the NFT.

A clip of renowned basketball star LeBron James’ slam dunk is an excellent illustration. The video was made available as a limited-edition NBA highlight video collector. The NBA collectables are available for purchase and sale on the Top Shot NFTs market. The NBA owns the copyright, nevertheless, and the rules of its licensing agreement continue to apply to any purchased item’s replication.

However, while most NFT producers place limitations on commercial use, other authors grant NFT owners broader rights. Members of the Bored Ape Yacht Club (BAYC) have the right to use their “apes” for commercial purposes, which allows them to produce and market hats, T-shirts, mugs, and other items.

Brand owners should consider how current or upcoming design patents can protect against imitations or infringement in addition to trademark and copyright protection. Because they grant owners full ownership of an infringer’s profits rather than just the fraction related to the use of the design, design patents are important intellectual property protections compared to other IP rights.

Fraud Schemes

Despite being a relatively new idea, NFTs are already being utilised to commit numerous forms of fraud. Here, we go over some of the most prominent NFT-related fraud schemes that have occurred:

Tokenisation– The process of producing digital tokens that reflect ownership of physical assets is known as tokenisation. This happens when someone steals an artist’s creation without their consent and “mints” it to create an NFT.
Wash trading– This is the practice of users manipulating transactions by trading with themselves or others to feign large demand for an NFT, manipulate its price, or enhance its visibility.
Insider trading– The practice of using information that is not generally known to benefit personally from it. In recent high-profile situations, employees and executives of NFT companies and markets have engaged in behaviour that may be viewed as unfair or illegal. Various events generate negative press for these organisations. NFT insider trading regulations frequently forbid buying NFTs based on secret information. Similarly, multiple forms of trading in business NFTs that aim to inappropriately manipulate the perceived price or trading volume of such NFTs are prohibited.
Anti-Money Laundering– NFTs, especially those with large value, may occasionally be utilised to aid in money laundering. A study on how the art market aids in the financing of terrorism and money laundering was released by the US Department of Treasury. The study covered a variety of topics, including the dangers of financial crimes in relation to digital art and NFTs. The study discovered that the high-value art market has several intrinsic characteristics that could make it susceptible to various financial crimes.

To Conclude

As we can see, the market for NFTs is still growing, and it will take some time until an appropriate regulatory framework for NFTs is put in place. Having said that, governments all over the world have already begun the process of developing NFT norms and standards, proving that they are seriously interested in these digital assets.

Additionally, you should be aware that the phenomenal success of NFTs will undoubtedly result in fraudulent activities. For this reason, it is becoming more and more crucial to conduct your research before purchasing or investing in NFT collections or projects.

Source: https://www.benzinga.com/22/10/29371369/are-non-fungible-tokens-nft-regulated-what-are-the-concerns

Anndy Lian

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com

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September 13th, 2022

Who owns the most voyager crypto? VGX tokens are also distributed among troubled platform’s customers

Voyager Digital has been making headlines ever since the crypto platform filed for Chapter 11 bankruptcy protection in July 2021. The company is engaged in ongoing court proceedings.

Here we take a look at the voyager (VGX) tokens circulating supply and analyse who owns the most VGX.

Voyager Digital: Origins & token history

Voyager Digital is a US-based cryptocurrency platform that was founded in 2017 by a team of finance and technology industry veterans, including the firm’s CEO Stephen Ehrlich, chairman Philip Eytan and Gaspard de Dreuzy, a serial entrepreneur.

In addition to being a crypto company, Voyager Digital is a publicly traded company listed on the Toronto Stock Exchange (TSX) since 2021 under the ticker VOYG.

As of September 2022, the company hosts over 100 different digital assets through its mobile application and allows clients to earn rewards of up to 12% annually on more than 40 cryptocurrencies.

The Voyager token (VGX) is the platform’s native cryptocurrency. It’s designed to reward customers for their loyalty. It was based on the Ethos Token. In 2019, Voyager acquired Ethos.io and incorporated the team, technology and native token into its ecosystem.

Until 2020, Voyager operated with a multi-token functionality. After 2020, the company integrated its native tokens into a new single token model known as VGX 2.0. Today, VGX maintains a presence on the Ethereum blockchain as an ERC20 cryptocurrency.

According to the project’s whitepaper, Voyager utilises the VGX 2.0 token to boost the platform’s adoption and functionality. Holding VGX allowed users to earn 7% staking rewards and raise their earnings by joining the Voyager Loyalty Program.

The VGX token was met with enthusiasm. The price rose to an all-time high of $11.02 just six months after the token launched in 2017. The bullish run was short-lived, and the price fell by 96.7% to $0.3678 by August 2018.

The next big jump took place between January and February 2021, when VGX surged 3,267% to $6.9023, from levels as low as $0.2. Around this time, the Uniswap (UNI) token became available on the Voyager platform.

On 22 November 2021, VGX surged to $5 amid a positive general crypto market sentiment, however, this was the token’s last peak as it embarked on a bearish run. But since its November high, the VGX has lost more than 75% of its value, sliding down to $0.9188.

Latest voyager crypto news

In July 2021 Voyager filed for Chapter 11 bankruptcy protection, as it was heavily affected by the global crypto crash. Since then, the company has been in and out of court proceedings.

As Voyager moves through the Chapter 11 bankruptcy process, latest filings revealed on 8 September that the company will auction off the remainder of its assets on 13 September. The results of the auction will become final during a court hearing approving them on 29 September.

In the latest voyager token news, potential buyers remained unnamed. However, bids previously made by the crypto trading platform FTX were made public. FTX said in a press release on 22 July that it would buy Voyager’s assets and loans at cash value and open accounts for Voyager customers on FTX. This proposal, however, was branded a “low-ball” bid by Voyager’s lawyers.

In a second-day hearing presentation on 4 August, the company stated that it had received “higher and better” buyout offers. As of 12 September, Voyager said that it was contacted by 88 potentially interested buyers and was in “active discussions” with 20.

Who owns the most Voyager crypto?

So, who owns the most Voyager crypto and how is the token distributed?

When Voyager decided to integrate its tokens (VGX and LGO (the native token of a company Voyager acquired) into one, VGX was exchanged for VGX 2.0 (now known as VGX) at a 1:1 rate. LGO’s exchange rate to VGX 2.0 was 6.5356340619:1.

The circulating supply of VGX tokens stood at 222 million. The circulating supply of LGO was over 33 million. Following the token swap, Voyager chose to mint a growth pool of tones on an annual basis to power Voyager Loyalty Program rewards, as well as fund promotional campaigns for new and existing customers.

Hence, 40 million new tokens were minted in the first year since the integration, 20 million will be minted in the second year and 10 million between the third and eight years.

According to data provided by CoinMarketCap, the total and circulating supply of VGX, as of 12 September, surpassed 278 million tokens. The maximum supply stood at 297 million.

Voyager also introduced a new initiative called the Voyager Loyalty Program, which Voyager customers can qualify for by maintaining a number of VGX tokens in their accounts. The programme has three tiers:

Adventurer – customers holding over 500 VGX
Explorer – customers holding over 5,000 VGX
Navigator – customers holding over 20,000 VGX

The more VGX customers stake, the higher they move up these tier categories and the more rewards they earn with each tier.

So, who owns the most Voyager crypto?

Over the last few months, VGX whales have gradually reduced their holdings. However, data revealed by etherscan.io showed that the top 100 VGX token holders, as of 12 September, collectively owned 97.62% of the total supply in circulation.

The website noted that the top account holding the most voyager tokens owned 93.9% of the circulating supply, which amounted to 208 million VGX tokens worth $191m, as of 12 September. According to the website, the account’s address is 0x933bb73de8fcfb74415fbc99561623c593bf3b61.

The second biggest VGX whale owned 1.9% of the total circulating supply, amounting to four million VGX tokens.

The third biggest VGX holder was an account under the address ‘Binance 8’ that held around 0.18% of the total circulating supply, amounting to around 395,757 tokens.

The fourth and fifth biggest voyager coin whales owned around 0.14% of the total circulating supply.

Final thoughts

While knowing who owns voyager crypto may be useful for the coin’s enthusiasts, it shouldn’t be used as a sole reason to trade. Nearly all of the maximum VGX supply is in circulation, as of the time of writing (12 September), which could lead to the possibility of greater volatility. Investors are warned to exercise caution.

According to Invezz’s analyst Crisous Nyaga, “uncertainty about the Voyager collapse and low volume trading could lead to market manipulation.

“The coin’s future is uncertain and it will depend on the outcome of the bankruptcy proceedings. If the firm moves completely out of business, there is a possibility that the VGX token will not survive. On the other hand, if it is acquired, there is a possibility that the coin will continue doing well.”

Anndy Lian, chief digital advisor at the Mongolian Productivity Organisation and the author of NFT: From Zero to Hero, told Capital.com that retail investors are buying VGX based on rumours that the company will be acquired by either Binance or FTX.

“I noted that the current investors are still working very hard promoting in different channels with the hope of making the VGX a more viable choice for new investors and perhaps drawing more attention so that the buyout can complete faster. These are positive signs from the community members who want the token to do well and resume their staking and cashback rewards,” he stressed.

Note that analysts’ predictions and opinions can be wrong. Always conduct your own due diligence before trading. And never invest or trade money you cannot afford to lose.

Source: https://capital.com/voyager-who-owns-most-vgx-crypto-tokens

Anndy Lian

www.anndy.com

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April 25th, 2022

What Are The Best Metaverse Tokens To Invest In?

With Facebook changing its name to Meta and top investor Cathie Wood CEO of Ask Invest predicting that the future market value of metaverse would be in trillions of dollars, is it worth ‘getting in on the ground floor’ and investing in metaverse tokens? It’s worth having an investor approach, of course, not just being swept along by these headline announcements, but in such an innovative technology how do you decide what’s worth investing in? We’ve therefore compiled a watchlist of metaverse tokens that we believe will play a significant role in realizing the metaverse’s potential to become a trillion-dollar industry.

But just as importantly we’ve set our stall out by asking investors to consider metaverse tokens in terms of the wider thesis about what adds value from a web3 perspective. Apart from having a clear purpose or problem they are trying to solve, not just a white paper and a cute explainer video, they need to have a strong community foundation. Of course, every crypto startup talks the talk when it comes to community. But having a Discord server busy with airdrops and users waiting for the next price pump isn’t going to make it in the longer term. What is worth looking for when assessing which metaverse project to invest in is the degree to which they are actually community-owned, and how well they share the revenue and the control with their users.

Zilliqa (ZIL)

Flying somewhat under the radar has been Layer 1 blockchain Zilliqa, notable as the first Layer 1 to use sharding to solve the blockchain scaling problem that Ethereum has faced. What’s interesting is that with a recent change in leadership, and a new CEO with Ben Livshits who comes from the Brave browser, Zilliqa has already announced that is launching its own metaverse, ‘Metapolis’.

The obvious challenge for Metapolis will be its competitors Decentraland and Sandbox that currently have captured the majority of the blockchain metaverse users. Despite the current depressed value of the ZIL in 2022, the plans for a landmark event at the start of April, built around Zilliqa’s “position as the first layer-1 to build multiple commercial avenues of Web3” look exciting. The Q2 landmark event, which is built around Zilliqa’s “position as the first layer-1 to build multiple commercial avenues of Web3” is also a great opportunity for the Zilliqa team to organize PR and messaging – getting the consistency in messaging and confidence in its delivery should be a significant driver in the value of the ZIL token. The price of the token has been on a downward decline from a price on CMC of $0.2376 in mid-April 2021 to $0.0456 on 22 March 2022. But by the same token, this could be an ideal time to buy the dip in light of the Metapolis launch, the succession of new hires being announced, and the publicity surrounding the event itself.

It’s instructive that Ethereum’s co-founder Joseph Lubin recently criticized Zilliqa rival Solana for over-generous rewards to users validating transactions on the network. Solana Labs responded that “simply looking at protocol revenue doesn’t tell the full story of the long-term performance” of a blockchain’s economic model. That also begs the question as to whether in the longer term Zilliqa sufficiently incentivizes its mining community. After all the key to web3 isn’t merely community-engaged, but community ‘ownership’ in terms of the token structure and for governance.

Axie Infinity (AXS)

The growth of play-to-earn gaming, led by Axie Infinity, where engagement with a younger generation of gamers in countries like the Philippines shows how this can make a real financial difference to people’s lives. This is also why the role of DeFi in the metaverse, can be so important in providing people with a low-cost way to earn, save and send money from person to person. Back in October last year it hit a $3 billion equity valuation. Token Terminal estimates AXS is driving about $28.9 million in weekly revenue. Annualized, this equates to $1.5 billion in revenue, which is comparable to blockbuster games in the traditional gaming sector. Last month, Axie reduced production of its main in-game rewards to avoid what its blog post describes as “total and permanent economic collapse.” These changes should make a positive difference. However, as the chart from CoinMarketCap shows, the value appears to correlate heavily to the price of Bitcoin.

Tracking the price of AXS vs BTC (AXS: see green trend line; BTC orange trend line)

Decentraland (MANA)

Decentraland is an Ethereum-based blockchain-powered virtual-reality pioneer. Decentraland has the largest market capitalization in the metaverse space, and as one of the early adopters, the company is well-positioned to maintain its dominance in this space. Decentraland is divided into LAND parcels that are NFTs, and LAND ownership gives users complete control over what they build. In total there are 90,601 land parcels, and the LAND NFTs can be purchased using Decentraland’s native token MANA.

Users in Decentraland can use MANA tokens to buy and develop land, as well as some of the game’s tools to create spaces and works of art. Users are free to create whatever they want. Decentraland also holds various entertainment activities regularly, with users able to attend parties, play games, and visit digital art exhibitions. Decentraland recently hosted the world’s first multi-day music festival, with many well-known artists performing. Adding to the utility, as reported by Motley Fool, this month it will host Metaverse Fashion Week from March 24–27, featuring global brands, including Tommy Hilfiger, and Dolce & Gabbana.

The Sandbox (SAND)

Sandbox is similar to Decentraland in that users can use SAND tokens to purchase land, build houses, and share games on the purchased land. Sandbox has announced several collaborations in recent months, including top NFT marketplace OpenSea, Snoop Dogg, and The Walking Dead. At the same time, it recently completed a US$93 million round of financing led by Softbank, a leading investor in the blockchain space. There are three billion SAND tokens, and a third of its total supply is circulating at $3.06. Compared to MANA, SAND has been hit harder by the market downturn, with a drop in the last month alone from $4.20 in early Feb to $2.90 on March 7, a 30% decrease. However, recent price aside the fundamentals suggests SAND is a good bet for the future, based on a successful implementation of their project roadmap to date.

Coming back to the guiding thesis about the importance of community ownership for the longer-term viability of metaverse tokens one of the key benefits of Sandbox is that it’s decentralized both in name and in terms of its community governance. Indeed, the play-to-earn approach type revenue is shared throughout the gaming ecosystem via tokens, while Sandbox users can earn a passive income by charging other users to access their land. With both rewards and fees paid in SAND underline how this core web3 approach to community ownership supports the value of the SAND token to investors.

Somnium Space (CUBE)

Somnium Space is another metaverse ecosystem BigONE believes is worth investigating. Somnium space’s goal is to create an immersive metaverse. Users can buy lands, customize their avatars, and invest in real estate in Somnium, which was founded in 2017. Gemini supports the Somnium space, and the FTX exchange recently built a metaverse headquarters on the Somnium space.

In the last month, its native token $CUBE’s price movement has been very similar to SAND’s. The market capitalization of CUBE is $59 million, with 12.5 million circulating supply out of a total supply of 100 million. Somnium Space is ideal for users to build their real estate using their builder tools and create custom avatars using the Unity SDK. In addition, in 2019 they partnered with Sony to allow users to create full embodiment avatars of themselves in minutes alongside any 3D models for Somnium Store. Sony’s VR store in Somnium Space was among the world’s first.

Investing in the future of the metaverse

By providing more incentives and giving back to users, the metaverse will constantly flip the script and change how things will be done. BigONE anticipates a more transparent, open, and fully decentralized experience from the vibrant creative landscapes and avatars. The landscape itself will be visually stunning, a virtual place where the imagination is no longer constrained. Clearly, the development of a fully functional metaverse has the potential to fundamentally alter how people interact with the digital world. A collective virtual experience would reimagine the creative industry and open new doors for creators, gamers, and artists. BigONE Chairman Anndy Lian said: “The metaverse is here to stay, it’s clear the success already of Sandbox and Decentraland shows it has tremendous potential to bring people together. That potential in terms of GameFi we can see with Axie Infinity’s play-to-earn gaming which is making a real difference to people’s lives. However, there remain obstacles to its growth. Countries like China and South Korea have had laws about converting in-game tokens into fiat currency for nearly 15 years, for instance.

“However, I believe like any disruptive paradigm-shifting technology, which is attracting the attention of global players such as Facebook and governments keen to keep control of the internet, there are risks involved. But I’m optimistic that the decentralized community-owned development of an interoperable metaverse will deliver lasting value to both users and investors,” Lian added.

Any references to projects in this article are purely for information and should not be deemed financial advice, or promotional.

Original Source: https://metaverseinsider.tech/2022/04/25/what-are-the-best-metaverse-tokens-to-invest-in/