Good Morning Crypto Enthusiasts!

Glad to have you back for another edition of the UseTheBitcoin.com newsletter.

1. US House Approves FIT21 Crypto Bill: The U.S. House of Representatives passed the Financial Innovation and Technology for the 21st Century Act (FIT21) with a bipartisan vote of 279 to 136. This legislation aims to create clear regulatory frameworks for digital assets, defining the roles of the SEC and CFTC.

2. Ethereum ETF Confirmed? VanEck's spot Ether ETF has been listed by the Depository Trust and Clearing Corporation (DTCC), sparking speculation of imminent SEC approval. Designated under the ticker "ETHV," the ETF remains inactive pending regulatory approval. This follows Franklin Templeton’s similar ETF listing.

3. Binance.US Wins Florida License Appeal: Binance.US successfully appealed the suspension of its money-services business license in Florida. The Florida First District Court of Appeal ruled the suspension lacked legal justification.

4. 🫨 What’s Buzzing? - Are you constantly looking for opportunities to earn in crypto? Liquid staking might be the one for you! Read the whole shebang from UseTheBitcoin’s latest article “What is Liquid Staking? How Does It Work?” and learn how to maximize your earning potential or join our Discord Channel for alpha!

5. 💡Feature of the Day - Taiko ‘Genesis Airdrop’: Taiko, an Ethereum Layer 2 rollup project, announced a "genesis airdrop" distributing 5% of its 1 billion token supply before its mainnet launch. The airdrop targets community members who interacted with the testnet and other key contributors.

    
   All this and more in today’s headlines!

📰 News Highlights:

US House Approves FIT21 Crypto Bill [Source][Source][Source][Source]

In a significant move for the crypto industry, the U.S. House of Representatives passed the Financial Innovation and Technology for the 21st Century Act (FIT21) with broad bipartisan support.

The legislation, approved by a 279 to 136 vote on May 22, aims to establish clear regulatory frameworks for digital assets, delineating the roles of the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). Notably, 71 Democrats joined 208 Republicans in favor of the bill.

Representative Patrick McHenry, a key proponent, emphasized the need for regulatory clarity to unlock the full potential of digital assets. However, the bill faced opposition from some Democrats, including Representative Maxine Waters, who argued that it could lead to a "regulatory no man’s land" and potentially deregulate both cryptocurrencies and traditional securities, raising concerns about market stability and potential crashes.

The House will next consider the Central Bank Digital Currency (CBDC) Anti-Surveillance State Act, which aims to restrict the Federal Reserve's issuance of a digital dollar.

As the U.S. gears up for the 2024 elections, with digital assets becoming a critical issue, President Joe Biden and former President Donald Trump are expected to address crypto policies in upcoming debates.

Ethereum ETF Confirmed? [Source][Source][Source]

VanEck's spot Ether ETF has been listed by the Depository Trust and Clearing Corporation (DTCC), sparking speculation about imminent approval from the U.S. Securities and Exchange Commission (SEC). Designated under the ticker "ETHV," the ETF remains inactive until it secures the necessary regulatory approvals.

Recent reports suggest that SEC officials have engaged with major exchanges like Nasdaq and the New York Stock Exchange to amend existing spot Ether ETF applications, indicating a potential shift in the SEC’s stance, possibly influenced by political considerations and former President Donald Trump's pro-crypto endorsement.

Crypto lawyer Jake Chervinsky noted that the political landscape increasingly favors crypto, with the SEC's recent actions suggesting a higher likelihood of approval for spot Ether ETFs.

The final decision on VanEck’s application is expected on May 23, with industry analysts now estimating a 75% chance of approval, up from previous expectations of 25%.

Binance.US Wins Florida License Appeal [Source][Source][Source]

Binance.US has successfully appealed the suspension of its money-services business license in Florida. The Florida First District Court of Appeal ruled that the emergency suspension issued by the state’s Office of Financial Regulation (OFR) lacked legal justification.

The appeals court found that the OFR did not adequately consider less severe alternatives to suspension and failed to provide sufficient reasoning for the decision.

The court highlighted that suspending Binance.US’s license would significantly harm over 170,000 state account holders due to potential financial losses from liquidating digital assets amidst market fluctuations.

This ruling, which remains subject to further appeal, reinstates Binance.US’s ability to operate in Florida, though it faces ongoing regulatory challenges in several other states.

🫨 What’s Buzzing?:

What is Liquid Staking? How Does It Work?

Liquid staking is a method to engage in a PoS blockchain network while keeping your staked assets liquid. Unlike traditional staking, where tokens are locked for a period, liquid staking provides liquid staking tokens (LSTs) in exchange for your staked assets. These LSTs can be traded on decentralized finance (DeFi) exchanges or used as collateral for loans.

How Does Staking Work?

In a PoS blockchain, validators are selected based on the amount of cryptocurrency they have staked, not their computing power, unlike Proof-of-Work (PoW) mining.

1. Lock up your crypto: To become a validator, you stake some cryptocurrency, acting as a deposit to show your commitment to the network’s health. The more crypto you stake, the higher your chance of being chosen as a validator.

2. Validate transactions: Validators verify transactions and add new blocks to the blockchain, ensuring accuracy and security.

3. Earn rewards: Validators are rewarded with new tokens for their work, similar to representatives earning a salary for their contributions.

Benefits of Staking

• For Users: Earn passive rewards (interest) on holdings by staking crypto.

• For the Network: Validators are less likely to cheat or make mistakes, as they risk losing their stake, ensuring security and efficiency.

How Liquid Staking Works

1. Deposit your tokens: Send your PoS tokens (e.g., Ethereum, Solana) to a liquid staking service.

2. Staking on your behalf: The service pools and stakes your tokens on the underlying PoS blockchain, handling validator selection and operation.

3. Receive Liquid Staking Tokens (LSTs): In return, you get LSTs representing your staked tokens and any staking rewards.

4. Use your LSTs: LSTs are liquid, meaning you can trade them on DeFi exchanges or use them as collateral, providing flexibility not found in traditional staking.

Advantages of Liquid Staking

• Increased Flexibility: LSTs can be traded or used in DeFi without waiting for an unbonding period, unlocking capital and generating additional returns.

• Reduced Opportunity Cost: Traditional staking locks up tokens, but liquid staking allows earning rewards while accessing the value of assets through LSTs.

• Promotes Crypto Adoption: Liquid staking increases the utility and value of staked assets, attracting more users and boosting overall growth and liquidity.

Challenges of Liquid Staking

• Slashing: Validators can be penalized for misconduct, leading to a loss of staked funds. Choose reputable providers and understand their policies.

• Centralization: A single liquid staking service controlling a large portion of staked assets can centralize power, compromising security and decentralization. Diversify your liquid staking providers to mitigate this risk.

• Regulation: Stay informed about evolving crypto regulations as staking rewards may be subject to future regulations.

Liquid staking revolutionizes participation in PoS blockchains by allowing you to earn rewards while maintaining liquidity through LSTs. To learn more, read UseTheBitcoin’s latest article “What is Liquid Staking? How Does It Work?” and maximize your earning potential or join our Discord Channel for alpha!

💡 Feature of the Day: 

Taiko ‘Genesis Airdrop’ [Source][Source]

Taiko, an Ethereum Layer 2 rollup project, has announced a “genesis airdrop” distributing 5% of its 1 billion token supply ahead of its mainnet launch. The airdrop will reward community members who interacted with the Taiko testnet, block proposers and provers, contributors to specific GitHub repositories, and participants of the Ethereum ICO.

The distribution plan includes significant allocations for key stakeholders: 20% for Taiko Labs and the core team, 16.88% for Taiko Foundation reserves, and 11.62% for investors.

Additionally, the DAO Treasury will hold 20% of the tokens, with further allocations for grants, liquidity, and market making. The airdrop will be available to claim once Taiko’s Layer 2 chain goes live.

😂 Crypto Meme of the Day: 

And that’s it for this today.

With all of the recent hacks taking place, remember to protect your crypto assets with today’s sponsor Trezor hardware wallets.

See you all tomorrow’s edition!

Jonathan Gibson
UseTheBitcoin.com