Chain Catcher Weekly | Sequoia Capital launches crypto fund; BSC renamed to BNB Chain; Helium completes $200 million financing

Organizer: Linqi, Chain Catcher

Important Events

1. Sequoia Capital Launches a $500-600 Million Cryptocurrency Investment Fund

On February 17, Sequoia Capital announced the launch of a $500-600 million cryptocurrency investment fund, primarily investing in liquidity tokens, including both listed and unlisted tokens on cryptocurrency exchanges. The investment size for individual projects ranges from $100,000 to $50 million, and the fund plans to participate in processes from staking to providing liquidity to governance. This is Sequoia Capital's first specific industry fund since its establishment in 1972.

Sequoia Capital partner Maguire stated that the firm is particularly interested in cross-chain interoperability and GameFi projects, believing that multi-chain is the future. "If the crypto market enters a bear market, the fund is expected to be fully deployed within a year; if it enters a bull market, the fund will be fully deployed in more than a year." Maguire said, "We are still in the absolute early stages. Cryptocurrency will be the biggest trend in the next 20 to 30 years." (Source Link)

2. BSC (Binance Smart Chain) Announces Renaming to BNB Chain, Building MetaFi World Infrastructure

On February 15, Binance's official blog reported that BSC (Binance Smart Chain) will be renamed to BNB Chain. The renaming aims to highlight its connection with BNB and the decentralized evolution of the BNB ecosystem, showcasing how BNB surpasses the Binance ecosystem in its application scenarios. BNB Chain aims to become the infrastructure provider for the virtual world economic system by developing the MetaFi concept.

BNB Chain includes the BNB Beacon Chain (formerly Binance Chain) and the BNB Smart Chain (formerly Binance Smart Chain). BNB stands for "Build and Build," serving as the gas and on-chain governance token on the BNB Chain. "BNB Chain will support large-scale applications including GameFi, SocialFi, and the metaverse. From single-chain to multi-chain, BNB Chain has improved scalability solutions and expanded the number of original BSC validators from 21 to 41," said Samy Karim, the BNB Chain ecosystem coordinator. (Source Link)

3. Xuhui District, Shanghai Proposes to Develop NFT Industry and Establish NFT Art Ecological Alliance

On February 18, Xuhui District in Shanghai explicitly proposed to develop the NFT (Non-Fungible Token) art industry. At the same time, the first domestic NFT art ecological alliance is set to launch in Xuhui District. Jin Jianhong, deputy director of the Xuhui District Bureau of Culture and Tourism, stated at a communication meeting that Xuhui District has established the goal of creating an NFT art industry ecosystem centered around the West Bank and will soon establish the NFT art ecological alliance, accelerating the construction of platform scenarios and formulating industry development standards and rules, "seizing this hot new track and vigorously developing the regional digital economy." (Source Link)

4. Zhejiang Provincial Development and Reform Commission: Implementing Differential Electricity Pricing for Virtual Currency "Mining"

On February 14, the Zhejiang Provincial Development and Reform Commission announced on its official website a notice regarding the implementation of differential electricity pricing for virtual currency "mining." The notice requires that in order to rectify virtual currency "mining" activities and assist in achieving carbon peak and carbon neutrality goals, differential electricity pricing will be implemented for virtual currency "mining," with a surcharge of 0.50 yuan per kilowatt-hour.

Development and reform departments at all levels need to strengthen the dynamic identification of electricity used for virtual currency "mining," regularly publish and update the list of electricity users subject to differential pricing and the effective dates, and notify power grid enterprises. Power grid enterprises at all levels must ensure strict implementation of the differential electricity pricing policy for virtual currency "mining" and collect the surcharge electricity fees in a timely and full manner. Previously, the Hainan Province and Inner Mongolia Development and Reform Commissions also announced the implementation of differential electricity pricing for virtual currency "mining." (Zhejiang Provincial Development and Reform Commission)

5. Coinbase CMO Discusses Super Bowl Ad: Over 20 Million Clicks in 1 Minute, Traffic Far Exceeded Expectations

On February 14, Coinbase Chief Marketing Officer Kate Rouch responded in an interview regarding the temporary downtime of the website. She stated that the traffic generated by the Super Bowl advertisement far exceeded expectations. Previously, the engineering team had conducted load testing on the website to handle millions of simultaneous clicks. However, the actual traffic was astonishing, with over 20 million clicks on Coinbase's target webpage within one minute, "This is historic and unprecedented."

Kate mentioned that due to the massive short-term traffic, Coinbase temporarily restricted the system and quickly brought the website back online. She also stated that Coinbase had prepared $10 million in funds for users who registered during the Super Bowl event and plans to provide over $100 million in similar incentives in the future to help people access and participate in the crypto community throughout the year. (Source Link)

Important Product/Technology Updates:

1. Polygon Responds to "Over-Centralization" Concerns: Planning Improvements and Eventually Removing Multi-Signature

On February 16, in response to previous criticisms from Cyber Capital founder Justin Bons regarding the "over-centralization and insecurity" of Polygon's multi-signature mechanism, Polygon co-founder Mihailo Bjelic acknowledged that the multi-signature mechanism does have its limitations but is essentially designed to enhance the security of new projects to protect users from hacking. Exiting this mechanism is not realistic at this time.

Polygon has always regarded Justin Bons' suggestion to "transfer the smart contract management keys to Matic token holders" as a goal, but this would increase response time in case of errors. Therefore, as the community matures, Polygon will gradually phase out the multi-signature mechanism, while still responsibly using it for now. Polygon recently released a multi-signature transparency report, disclosing details about the relevant signers and plans to improve and eventually remove the multi-signature. Additionally, the other four parties in the multi-signature were not chosen by Polygon but voluntarily joined. (Source Link)

2. Circle Partners with Block, Coinbase, and Others to Launch Decentralized Identity Standard, Providing Digital Identity Credentials for Users and Institutions

On February 17, USDC issuer Circle announced a partnership with Block, Coinbase, and Centre to launch the decentralized identity standard Verite, enabling any organization to issue and verify digital identity credentials for users and institutions participating in the crypto economy. Unlike centralized approval mechanisms, Verite is decentralized, open-source, and free for anyone to build upon. Moving forward, any project can begin adopting Verite's open-source standards.

With Verite, certificates can be issued to prove identity claims for countless use cases, including KYC verification, accredited investor status, social reputation, NFT provenance tracking, etc., without requiring participants to disclose personal data. These credentials are portable, tamper-proof, and can be easily stored in crypto wallets like digital assets. At the same time, the credentials belong to the users, allowing complete control over when and how different organizations or protocols access their identification proof. (Source Link)

3. Helium Completes $200 Million Series D Financing at a $1.2 Billion Valuation, with Participation from Tiger Global and Others

On February 19, decentralized wireless network operator Helium completed $200 million in Series D financing at a $1.2 billion valuation, with participation from Tiger Global and FTX Ventures.

Previously, Helium announced in August last year that it had completed $111 million in financing through a token sale, led by a16z, with participation from Ribbit Capital, 10T, Alameda Research, and Multicoin Capital. In 2019, Helium also received $15 million in Series C financing from Union Square Ventures and Multicoin Capital. (Source Link)

4. Blockchain Interoperability Network Axelar Completes $35 Million Financing, Valuation Reaches $1 Billion

On February 15, blockchain interoperability network Axelar announced the completion of $35 million in financing, reaching a valuation of $1 billion. Investors include Dragonfly Capital, Polychain Capital, North Island Ventures, Rockaway Blockchain Fund, Cygni Capital, Lemniscap, Olive Tree Capital, Blockchange Ventures, Node Capital, as well as angel investors Waikit Lau and Gokul Rajaram. The project has been gradually launching its mainnet since late January.

Axelar is building a decentralized network and tools to connect users, assets, and dApps across multiple blockchain ecosystems. The network enables developers to build on the best platforms that meet their needs while leveraging the Axelar stack to unlock cross-chain composability and liquidity. The Axelar Network consists of a suite of protocols, tools, and APIs designed to break down barriers to cross-chain communication. (Source Link)

5. Decentralized Trading Terminal DexGuru Completes $5 Million Financing, Plans to Issue GURU Token and Airdrop NFTs

On February 16, decentralized aggregation trading terminal DexGuru announced the completion of $5 million in financing, with participation from Shima Capital, Huobi Ventures, Wintermute, Impossible Finance, Mirana Ventures, Legos Capital, HoneyDAO, Nima Capital, D1 Ventures, Woodstock, and other investment institutions.

DexGuru stated that it plans to pass governance functions and treasury management to the community through the issuance of the GURU token. The first step in launching the GURU token will be the DAO-guided phase. Early users who tipped DexGuru during trading before February 1, 2022, will be able to mint Guru season ticket NFTs, allowing them to participate in governance mining during the DAO-guided phase. Subsequently, the DAO will decide when and how to launch the GURU token and how to reward early governance participants, and there will be no airdrop to historical trading users.

DexGuru aims to become the Bloomberg terminal for any permissionless DeFi market on-chain, providing detailed information on on-chain spot markets and decentralized AMM exchanges, and plans to offer information on products such as NFTs, options, contracts, and bond markets in the future, providing a concise real-time overview of the entire crypto market and its main stakeholders, allowing web3 traders to easily monitor any and all assets' on-chain liquidity.

Important Security Incidents:

1. Opensea Migration Contract Suspected of Being Hacked, Official Claims It May Be a Phishing Attack Outside the Website

On February 20, multiple Twitter KOLs reported that the Opensea migration contract appeared to have a vulnerability and was attacked, resulting in a large number of NFTs being stolen from user wallets that had previously authorized clicks on its V2 contract, after which the attacker sold them for profit. The stolen NFTs included various high-value series such as BAYC, BAKC, MAYC, Azuki, Cool Cats, Doodles, and Mfers. Currently, the address has profited over 641 ETH.
In response, Opensea officially stated that it is actively investigating rumors of exploitation related to OpenSea's smart contracts. This seems to stem from a phishing attack outside the OpenSea website and advises users not to click links outside of http://opensea.io.
Previously, on February 19, OpenSea officially announced on social media that its smart contract upgrade had been completed, and the new smart contract is now online. Users migrating smart contracts need to sign a pending migration request, which does not require gas fees and does not need to re-approve NFTs or initialize wallets. During the migration, offers on the old smart contract will become invalid. (Source Link)

2. Coinbase Vulnerability Investigation: Could Allow Nearly Zero-Cost Accounts to Profit Millions, $250,000 Bounty Paid to Discloser

On February 19, Coinbase released an investigation report on its official blog regarding a previous vulnerability incident, stating that on February 11, 2022, it received a report from third-party researchers who discovered a flaw in the Coinbase trading interface. Coinbase promptly mobilized its security incident response team to identify and fix the vulnerability, resolving the underlying system issue without affecting customer funds, and stated that the vulnerability had never been successfully exploited.

Coinbase stated that the root cause of the error was the lack of logical validation checks in the retail brokerage API endpoint, which allowed users to submit trades to a specific order book using mismatched source accounts. This API is only used by the retail advanced trading platform, which is currently in limited beta testing.

For example, if a user has one account with 100 SHIB and a second account with 0 BTC, they could submit a market order to sell 100 BTC on the BTC-USD order book by manually editing their API request to specify their SHIB account as the source of funds, thereby selling a market order of 100 BTC on the BTC-USD order book.

In response, Coinbase stated that it paid a $250,000 bounty to the discloser. However, many comments below its tweet believe that this reward amount is too low. (Source Link)

3. Xuzhou Public Security Bureau Has Cracked 49 Digital Currency Pyramid Scheme Cases in the Past 3 Years, Involving Over 7 Billion Yuan

On February 16, according to the Legal Daily, the Xuzhou Public Security Bureau in Jiangsu Province has severely cracked down on online pyramid scheme crimes, having solved 49 cases of online pyramid schemes disguised as blockchain technology, using game projects as a vehicle, and digital currency as a medium over the past three years, arresting 419 suspects involved in online pyramid scheme crimes, with a total amount involved exceeding 7 billion yuan.

The suspects used popular social concepts such as "digital currency, blockchain technology, metaverse, internet financial innovation, franchise agents, investment and financial management, and points rebate" to dress themselves in a shiny exterior and conducted online pyramid scheme crimes with high returns as bait. According to statistics, in 2021, 80% of the online pyramid scheme cases investigated by the Xuzhou Public Security Bureau were pyramid schemes using "speculating on coins" as a gimmick. (Source Link)

4. Ali NFT Project Faces Multiple Vulnerabilities, Official States It Will Randomly Rearrange All Leaked Metadata

According to community feedback, the well-known IP Ali ALI& HIS FRENS NFT had its debug mode left open during the presale process, allowing users to access the corresponding metadata and image information of the blind boxes through backend code logic. However, the official can still resolve this issue by randomly rearranging the original corresponding data. The official website also had spelling errors, and project vulnerabilities were rampant.

In response to this issue, the official later released a statement in the Discord community, stating that the ALI& HIS FRENS NFT is actively rectifying the website and will randomly rearrange all previously leaked metadata to reorder NFT rarity. (Source Link)