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  • 10/7/24: Bye-Bye VAT Tax 👋💸📜

10/7/24: Bye-Bye VAT Tax 👋💸📜

Top News

  1. UAE eliminates 5% value-added tax on crypto transactions

  2. Coinbase to delist unauthorized stablecoins in the EU by December

  3. Ethereum devs propose EIP-7781 to increase throughput by 50%

Specs’ Insights

1. UAE eliminates 5% value-added tax on crypto transactions

⌐◪-◪ → Bye-bye crypto taxes. The UAE just gave virtual assets an exception from the country’s value-added tax (VAT). Better yet, the rule change applies retroactively all the way back to transactions in 2018.

For those who don’t know, VAT is a consumption tax levied on the value added at each stage of product production. It’s similar to sales tax but paid by various parties, not 100% by the consumer.

Some say this isn’t actually a big deal as VAT was only 5%, and the UAE already has zero capital gains for crypto, but I disagree.

Ideologically, this underscores a significant shift from thinking of crypto as an investment/asset to thinking of it as a currency, like fiat.

That, and 5% is significant in the context of all your cryptocurrency transactions today, let alone the growing number of transactions as DeFi displaces TradFi.

I wonder what countries will follow suit. Let me know in Specs.Chat!

2. Coinbase to delist unauthorized stablecoins in the EU by December

⌐◪-◪ → Stablecoin purge incoming. Coinbase just announced it will delist non-compliant stablecoins in the EU by December as the EU prepares to fully enforce its new MiCA (Markets in Crypto-Assets) regulations.

Coinbase plans to provide more details next month on its approach, and will also provide easy ways for users to swap non-compliant stablecoins for MiCA-compliant stablecoins — like USDC.

Speaking of which, given Coinbase’s relationship with Circle (a minority ownership stake), it does feel like they’re pumping their bags, but at the same time — they’re playing by the MiCA rules, and Circle’s USDC (by design) fits the mold.

While USDC is safe, its biggest competitor, USDT, is not. Given Coinbase’s dominance and influence, a move like this could help USDC start to close the gap on the stablecoin leaderboard and give USDT a real run for its money.

As of today, USDT’s market cap is $119.6B, a strong 3.37x larger than USDC’s $35.5B market cap. Remind me to check in on this in a year.

3. Ethereum devs propose EIP-7781 to increase throughput by 50%

⌐◪-◪ → Make Ethereum great again! Ben Adams just proposed EIP-7781, which would reduce slot times to lower latency for base rollups and boost overall transaction throughput by an estimated 33%.

The effective changes, as nicely outlined by BREAD, are:

  • Decrease block times from 12 → 8 sec

  • Increase blob limit per block from 6 → 9

  • Increase gas limit from 30M → 45M

  • Reduce confirmation times by 33%

If approved, this would be a huge performance increase to Ethereum’s layer 1 network and could generate some much-needed optimism amid growing Ethereum FUD.

With changes like this on the horizon, Wall Street products like Bitwise’s upcoming Bitcoin + Ethereum ETF, and Ethereum’s relatively poor performance vs. Bitcoin this year — it’s starting to feel like a good time to buy ETH. Not financial advice.

What do you think of ETH vs. BTC right now? Let me know in Specs.Chat!

Everything Else

⛓️ Crypto & DeFi

  • Memecoin creator who lit himself on fire quits DARE project

  • Bitcoin whales transfer $3.6M of Bitcoin mined in 2009

  • EigenLayer investigates suspicious wallet that sold $5.5M locked EIGEN

  • Polymarket sees 42% more traders in September than August, new high

  • Kalshi’s regulated election markets go live, tiny compared to Polymarket

  • Solana sees over $100M bridged from other chains last week

  • Vitalik Buterin sells 10B Moo Deng, then donates 260 ETH to charity

🏦 Wallstreet & VC

  • IcomTech founder, a mining and trading firm, sentenced to 10 years for Ponzi

  • Sol Strategies holding company likely to reinvest FTX windfall into Solana

  • Coinbase analyst says crypto market stable after volatile start to October

🏛️ Legal & Regulatory

  • Trump’s lead on Polymarket grows to 3% as registration deadlines loom

  • Mark Cuban tells Harris team FTX could have been avoided

  • US to seize $2.7M from Lazarus hacks traced through Tornado Cash

  • Coinbase seeks early appeal in case against SEC amid Ripple ruling

  • Binance playing offense with crypto crime, says head of Financial Investigations

🌎 Rest Of The World

  • Russia “Evil Corp” sanctioned by the US, UK, and Australia

  • Metaplanet buys another $6.7M BTC, brings total holdings over $40M

  • Arbitrum Foundation to double down on Asia with Road to Devcon campaign

🖼️ NFTs & Metaverse

  • Anduro unveils tokenization platform, starts with rare whiskey

  • Lens Sassaman memecoins appear as people guess HBO’s Satoshi

  • Ubisoft and Magic Eden release Captain Laserhawk anime NFT collection

  • FWOG becomes the largest memecoin launched on PumpFun

  • Ordinals up across the board, with BTC wizards leading the charge

  • NFTs surge, with Project Aeon up 3.5x in 1 week

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