Sorare, the platform for digital soccer collectibles, announced Friday that FC Barcelona defender Gerard Piqué is investing $4.3 million in the non-fungible token (NFT) site. Piqué will also join the firm as a strategic adviser.

“Gerard will help us strike the best deals with the biggest sport organizations in the world,” Sorare CEO Nicolas Julia told CoinDesk in an email. 

The investment from Piqué’s Cassius Family fund brings Sorare’s total seed round to roughly $9 million, the firm said in a press release. The move comes as the Ethereum-based NFT platform has seen a steady uptick in collector interest – with one Kylian Mbappé collectible even fetching $65,000 earlier this month.

Read more: Blockchain Enabled Fantasy Soccer Firm Sorare Raises $4M in Seed Fund Round

As an investor, Piqué has made big bets in the sports world before. In November 2019 he and his partners at Kosmos invested millions in a revamp of tennis’ Davis Cup.

“Gerard is committed to revolutionize the way we interact with and enjoy sports,” Julia said.

With Piqué’s addition, Sorare will leverage the full Kosmos network, notably its partners in Asia, Julia added.

Sorare’s growth

Based in Paris, Sorare provides a soccer team management game with digital NFT cards that fans can collect and trade. 

The firm grew exponentially this year with 80 clubs joining the platform, including five European Champions: Bayern Munich, Juventus, Paris Saint-Germain, Porto and Zenit. Sorare also announced licensing partnerships with the U.S. soccer league, MLS, and the South Korean K-League earlier this year, bringing both leagues onto its platform. The firm has partnerships with a total of 105 football clubs worldwide.

According to Julia, Sorare currently has 2,000 monthly active users and sold $1.5 million worth of cards in November 2020. A recent tweet thread by Messari analyst Mason Nystrom identified Sorare and NBA Top Shot as among the leading projects bringing NFTs to the masses.

For clubs, there’s upside as well. With the lack of live events during the COVID-19 pandemic, Sorare is in a position to help sports teams connect with their fans in a digital way.

“I see a huge potential in the sports gaming segment in a digital economy where the attention of audiences is the single most important unit of currency,” Piqué said in a press release.

The Financial Crimes Enforcement Network (FinCEN), the top financial crimes watchdog within the U.S. Treasury Department, is hiring two policy officers to help draft regulations for the cryptocurrency space.

Disclosed in Dec. 11 job postings, these “Strategic Policy Officers” will “assist in the development of policy responses” to “threats” posed by cryptocurrency, issue advisories to financial institutions and collaborate across government and the private sector on crypto policy.

The timing of the listings is notable. Just two weeks prior, Coinbase CEO Brian Armstrong stoked rumors that Treasury Secretary Steven Mnuchin would rush out self-hosted wallet regulations that Armstrong speculated could cripple the industry.

The Block further illustrated what those regulations might look like late Thursday night. As soon as Friday, Mnuchin could mandate that crypto companies file a “currency transaction report” with FinCEN on individuals moving over $10,000 in cryptocurrency to or from a self-hosted crypto wallet in a single day.

Whether those regulations will actually arrive, what they would actually look like and if they’d survive after President-elect Joe Biden and his designated Treasury Secretary nominee, Janet Yellen, take office is yet to be determined.

But the minutiae of the Dec. 11 listings indicate FinCEN is eager to boost its crypto base chops regardless of who runs Treasury. Both top secret-clearance level jobs are permanent, full-time positions. Given the requirements that candidates have experience drafting, strategizing and researching crypto policy, it’s safe to say FinCEN is only interested in subject-matter experts.

That could be the difference between crafting effective cryptocurrency regulations and the type of knee-jerk crackdowns Armstrong warned against. Crypto industry lobbying group the Blockchain Association told CoinDesk at the time of Armstrong’s tweet that it was “actively educating” policymakers to fix “misconceptions” around self-hosted wallets.

“To properly regulate emerging industries, especially the crypto economy, in the most nimble and responsive way requires officials in government to have true 21st-century expertise and experience,” Executive Director Kristin Smith told CoinDesk Thursday. “We’ve been encouraged by the type of talent FinCEN has attracted over the past several years and it’s encouraging that they’re looking to add even more relevant expertise with this new hire.”

Decentralized finance (DeFi) platform Warp Finance was exploited for $8 million Thursday evening, possibly due to a flash loan attack, according to analysis portal DeFi Prime.

• The exploit appears to be a flash loan attack, DeFi Prime said, citing data from Etherscan. The scheme has become common in the fast-growing DeFi sector.
• Flash loans allow users to borrow funds without collateralization because the lender expects the funds would be returned instantly.
• Warp Finance, which enables users to deposit crypto tokens in exchange for stablecoin loans, said in a tweet it was experiencing problems.
• "We are investigating irregular stablecoin loans taken out in the last hour, we recommend that you do not deposit anymore stablecoins until we have clarity on the irregularities," the platform tweeted.

Bitcoin is back in the news.

As a wave of institutional liquidity pours into Bitcoin’s markets, even some of its staunchest critics are finding it hard to dismiss the 12-year-old asset as its price surges to new all-time highs. 

At the very least, these past three years have proven that Bitcoin is certainly not dead. At the most, it gives credence to the investment thesis of its most bullish proponents: that it is one of the most revolutionary technologies of its time.

But what makes bitcoin (BTC, +0.78%) so unlike any other investment (or cryptocurrency) that blue-chip insurance funds, hedge funds and asset managers are now comfortable with buying it? 

Read more: Over $20K? Why Is Bitcoin Worth Anything at All?

Bitcoin is a synthesis of decades of cryptographic technology and research with numerous precursors and false starts that predate it. For all of its predecessors, Bitcoin was the first attempt at digital cash that laid out a (more or less) completely decentralized system. 

For those of you who are new, here’s what that means and the technical features that make bitcoin such a standout. 

Fact #1: Bitcoin is cryptographic money

Contrary to common misconception, Bitcoin transactions aren’t kept secret or encrypted – in fact, they’re quite public.

But Bitcoin’s system is built on public-key cryptography, a branch of computer science that uses complex math (via a system of digital keys) to encode data and keep it hidden from those who don’t have the right key to decode it.

Read more: What Is Bitcoin?

With Bitcoin, users have a public key (from which they can create public addresses to receive bitcoin) and a private key; as their names suggest, the former is meant to be shared while the latter must be kept secret (if revealed, your bitcoin can be stolen, but more on that later).

The private key is what gives you a claim to the bitcoin you own. Technically speaking, wallets store private keys and not “bitcoin.” Every bitcoin exists on the blockchain – wallets just hold the keys that give users access to them. 

You need your private key to approve transactions, and you need someone else’s public address to send a transaction. 

If you’re familiar with PGP encryption, you may see how Bitcoin transactions are similar. The same principles that make encrypted communications so secure are baked into Bitcoin’s code, except instead of messages, Bitcoin’s design secures the bitcoin currency.

Factoid: Bitcoin with a capital "B" refers to the Bitcoin technology or protocol. We use bitcoin with a lowercase "b" when we are referring to the digital currency.

Like sending an encrypted message, Bitcoin transactions are peer-to-peer and (because of the mining process, which we’ll cover later) they can’t be obstructed by anyone.

Fact #2: Bitcoin is permissionless and censorship resistant

Because bitcoin can be sent as freely as a message, Bitcoin is inclusive.

When Satoshi Nakamoto, Bitcoin’s creator, designed the system, he made it “permissionless,” meaning anyone can use Bitcoin to hold and transfer value. He also designed it to be “censorship resistant,” meaning no one can block you from joining the network and making transactions. Nobody can freeze the funds in your wallet, and no one can stop you from making a transaction with Bitcoin.

Because of the way bitcoin transactions are processed, no central party has control over your payments. Unlike PayPal, Venmo, or any other electronic transfer, bitcoin payments are made directly between the payer and recipient, thanks to the cryptography we touched on above.

The foundation of this system, Bitcoin Core, is an open source software which is an all-in-one wallet and server for the Bitcoin network. Anyone with the proper hardware can download and run Bitcoin’s software; it keeps a copy of the Bitcoin blockchain’s transaction ledger and broadcasts transactions to other servers in the network. 

“Running a full node,” as this is called, is the ultimate exercise in Bitcoin control because you can fully audit the Bitcoin ledger yourself and broadcast your own transactions.

Even without running a full node, Bitcoin users can use the network at their will when they use a wallet that lets them control their own private keys, though this means that they are trusting someone else’s network node to broadcast their transactions for them.

Fact #3: Bitcoin transactions are forever

The Bitcoin blockchain – the digital ledger which stores a record of all the network’s transactions – is immutable. It cannot be altered by a central party, and nobody can cheat the network to spend coins they don’t own.

Bitcoin transactions are processed into the ledger by a global network of “miners,” individuals and collectives who run machines to “mine” (maintain) the Bitcoin blockchain. Miners receive bitcoin as a reward for mining in the form of a “block reward,” a payout that goes to the miner(s) who finds the next block in the blockchain’s sequence and records the latest pending transactions in it. 

Read more: How Do Bitcoin Transactions Work?

If you’ve know anything about mining, you probably know that it requires *a lot* of energy because mining competition is fierce. When you take bitcoin’s price into account, this makes sense – they’re not giving these things away for free!

This competition and energy expenditure helps secure the network. Miners are incentivized to process transactions and not interfere with the transaction ledger – otherwise, they risk their payday and, in the case of the big mining firms, tens of millions of dollars in hardware and operational expenses. 

If a miner did want to cheat, the only way to alter Bitcoin transactions that have been recorded in the blockchain is to perform more work than roughly half of all other miners in the network – and the older the transaction, the longer you will have to work. To give you an idea of how much energy you’d need to attack Bitcoin, the network annually consumes, on average, as much electricity as a nation the size of Austria or Switzerland.

Read more: How Bitcoin Mining Works

So altering a transaction from, say, three years ago would require several hundreds of millions of dollars. Rollbacks are not theoretically impossible, but when you factor in the cost to mine with Bitcoin mining’s decentralization, they’re highly improbable (and have never happened in Bitcoin’s existence).

Fact #4: Bitcoin is (practically) unconfiscatible

Of course, bitcoin can be stolen or seized if you’re not careful. 

But if you take the right precautions, you can make your coins practically impervious to seizure, because so long as you keep your private key (or, the password that controls your bitcoin) in your custody and away from the eyes of others,your coins are in your complete control.

Read more: Unconfiscatable? Using Bitcoin to Resist Police Extortion in Nigeria

For increased security, you can set up “multi-signature” wallets that distribute access to your funds across multiple devices. Some wallets even include safety features like dummy passwords you can enter to show a blank account if you are at risk of being extorted, for example.

You can even memorize your private key in the form of a 12-to-24 word seed phrase, destroy the wallet associated with it, and store your bitcoin in your brain. When you want to access them again, you can download just about any Bitcoin wallet (all the good ones support these “seed phrases”), plug your seed phrase in, and you can access the bitcoin in your “brainwallet.” 

You can also store your seed phrase on a piece of paper or (more to the taste of hardcore Bitcoiners) on metal sheets to protect them from the elements, or you can encrypt it on a USB drive and store it in an airgapped laptop –  a computer that is never connected to the internet. 

It’s even possible to send a bitcoin transaction without being connected to the internet via satellites and mesh networks.

Read more: GoTenna Partners With Blockstream Satellite to Make Using Bitcoin Without an Internet Connection Simpler

Fact #5: Bitcoin is a decentralized, digital monetary system

Bitcoin is both a peer-to-peer payment network and a personal digital bank. Its economy is driven by consumers who purchase bitcoin, miners who process transactions and mint new bitcoin for circulation, node operators who audit the network and broadcast transactions, businesses who build on bitcoin and everyone in between. 

This economy is also self-regulated. Every four years, a self-executing mechanism cuts the number of bitcoin that is minted via mining in half. This reward will eventually dwindle until the last bitcoin is mined over one hundred years from now. This “halving cycle” ensures that Bitcoin’s supply will never exceed 21 million and makes its inflation rate predictable. 

Satoshi Nakamoto titled the Bitcoin white paper “Bitcoin: A Peer-to-Peer Electronic Cash System.” In the strictest since, Bitcoin *is* digital cash that you can spend as freely as physical cash, but some have taken this branding by Bitcoin’s creator as a signal that bitcoin is primarily meant to be used as a currency.

Bitcoin can be used this way, and new scaling technologies like the Lightning Network are providing infrastructure to process these transactions in faster, cheaper ways. 

Read more: What Is Bitcoin’s Lightning Network?

But Bitcoin doesn’t care what you use it for, ultimately. Companies including Square and MicroStrategy are using it as a treasury for their company’s savings. At the same time, everything that makes Bitcoin censorship resistant and permissionless makes it an attractive donation source for dissidents protesting abusive governments, or a financial lifeline for citizens living in financially sanctioned (and economically battered) countries.

Yes, Bitcoin’s technology makes it attractive for criminals, but that’s only a small fraction of the network’s real users. (Criminals use cash, too, after all!) And since all bitcoin transactions are public, sometimes it’s easier than not to pin illicit transactions on their transactors. Of course, there are also privacy-preserving technologies to make your blockchain footprint less traceable.

Bitcoin’s core technology is rooted in principles of user freedom and financial liberty. Branching from this is a plethora of softwares, wallets, protocols and other dodads that developers are working on to make bitcoin more functional and sustainable for the long haul.

The rabbit hole is deep. If you’re ready to dive in and learn more, we’ve got you covered.

Bitcoin hits a new high at $23,770 on higher-than normal volume; DeFi’s total value locked has also hit a record on the strength of ether.

• Bitcoin (BTC) trading around $22,818 as of 21:00 UTC (4 p.m. ET). Gaining 9% over the previous 24 hours.
• Bitcoin’s 24-hour range: $20,756-$23,770 (CoinDesk 20)
• BTC below its 10-hour moving average but well above the 50-hour on the hourly chart, a bullish-to-sideways signal for market technicians.

The price of bitcoin continued its rise to all-time highs, going up to $23,770 as of press time in a highly bullish run that had lots of volume-fueled momentum. 

Read More: Bitcoin Drops Nearly 7% After Setting New Record High of $23,770

The $23,800 level may be a spot of exhaustion for the world’s oldest cryptocurrency, according to Constantin Kogan, partner at financial firm Wave Financial. “There’s some strong selling resistance at $23,800. Let’s see if bitcoin can break it,” Kogan told CoinDesk.

Volumes on Thursday were higher than on Wednesday, with the eight major exchanges tracked by the CoinDesk 20 seeing over $3.5 billion in volume so far as of press time versus $2.9 billion the day previous.

“Breaking the $20,000 psychological barrier was a strong bullish signal allowing bitcoin to set a new record high,” said Elie Le Rest, partner at crypto quant trading firm ExoAlpha. However, Le Rest cautioned about crypto’s classic gyrations possibly affecting the market. “Volatility is very high and small pullbacks have been witnessed along the way.” 

Indeed, bitcoin’s 30-day volatility has been picking up and will be something to watch over the balance of December.

“Traders should be careful and on the lookout for stronger pullbacks, especially with year-end approaching and traders looking to close their 2020 profit-and-loss,” added LeRest. 

Chris Thomas, head of digital assets Swissquote Bank concurred, saying the most recent move feels too strong for his taste. “I’m just waiting for a few big sellers to come back to the market and take profits,” Thomas said. “Let’s look ahead to the next few weeks. Institutional volumes will drop significantly through Christmas so the market will be driven by retail until early January.”

“This should cause us to keep the high volatility, but we’ve got to also be aware there may be a chance of testing $20,000 to the downside,” added Thomas. 

Read More: Coinbase Files With SEC in Preparation for Landmark Public Offering

Henrik Kugelberg, a crypto over-the-counter trader, noted “fear of missing out” or FOMO as a factor playing into the market’s fervor. “There is of course an element of FOMO in this but the fundamentals are stable as pyramids,” Kugelberg said. “I have said $30,000 before summer but by the looks of this, that might be a very low bid.”

Ethereum network locked value at all-time high

The second-largest cryptocurrency by market capitalization, ether (ETH) was up Thursday trading around $640 and climbing 2.7% in 24 hours as of 21:00 UTC (4:00 p.m. ET).

The amount of crypto “locked” in decentralized finance, or DeFi, is at $16 billion as of press time, increasing over 2,200% from the $690 million locked at the start of 2020.

Meanwhile, the amount of ether locked in DeFi is going up, over 7.1 million ETH total.

Yet the amount of bitcoin locked in DeFi has actually fallen during the market’s price run, down to 142,652 BTC.

Nicholas Pelecanos, head of trading for blockchain ecosystem provider NEM, told CoinDesk many investors continue to overlook the Ethereum network and its alternative assets, also known as altcoins. 

“While bitcoin has largely dominated the narrative, I believe investors should look to altcoins that have tremendous amounts of development in both the core technology and usership, yet are still a fair way off their all-time highs,” said Pelecanos. “I am expecting to see the price of these altcoins, such as ETH and XEM, rally hard when the BTC price inevitably slows down.”

Other markets

Digital assets on the CoinDesk 20 are mostly green Thursday. Notable winners as of 21:00 UTC (4:00 p.m. ET):

• xrp (XRP) + 14%
• litecoin (LTC) + 13%
• stellar (XLM) + 5.5%

In addition, prices for COMP, the governance token for the Ethereum-based lending protocol Compound, jumped on the news that Compound Labs will build a new blockchain to provide money market services across multiple networks.

As CoinDesk reported, the new blockchain could be significant because those new supported assets won’t be limited to blockchains – it is designed to also support the forthcoming and rumored central bank digital currencies. Like Compound v1, the new blockchain will also be governed by the COMP token. Once it goes live, it will add more value to COMP holders. At the time of writing, prices for COMP were traded at $167.14, up 9.43% in the past 24 hours, according to Messari.

Notable losers:

• orchid (OXT) - 2%
• algorand (ALGO) - 1.8%
• omg network (OMG) - 1%

Equities:

Read More: Robinhood Pays SEC $65M to Settle Allegations It Misled Customers

Commodities:

• Oil was up 1.1%. Price per barrel of West Texas Intermediate crude: $48.40.
• Gold was in the green 1.1% and at $1,884 as of press time.

Treasurys:

• The 10-year U.S. Treasury bond yield climbed Thursday jumping to 0.933 and in the green 1.2%.

The U.K. financial services regulator admitted defeat this week in its effort to register all of the country’s crypto-asset firms by Jan. 10, too late for firms that already racked up costs preparing for that deadline while they awaited registration.

Back in January 2020, the Financial Conduct Authority (FCA) announced that no firm would be allowed to engage in “crypto-asset activity” in the U.K. after Jan. 10, 2021, unless it was registered. But with less than a month until that date, the FCA’s website only lists four registered firms, of which two are subsidiaries of Gemini. Zero new registrations have been processed in the last three months.

On Dec. 16, the FCA backed down by emailing more than 100 unregistered applicants that it “may not be able to complete the assessment by 9 January.” Those firms have been granted temporary registration until July 9, 2021. In the email, the FCA emphasized their applications had still not been processed and they had not been assessed as “fit and proper.” 

By leaving it so late to back down, the FCA raised the fear that a large number of firms would have to stop trading temporarily in January. That forced firms to accept now-unnecessary expenses to prepare to protect themselves from that outcome. 

“We would lose all of our client base,” said the boss of an over-the-counter crypto trading desk based in Mayfair, London, who asked to remain anonymous, “something which we probably couldn’t recover from.” 

For the sole purpose of preparing for this possibility, he “had a parallel offshore structure set-up and was arranging an appointed agent for the U.K.” The costs of these measures stretched into six figures.

By leaving it so late to back down, the FCA raised the fear that a large number of firms would have to stop trading temporarily in January.

As late as Dec. 1, the FCA still actively stood by its January deadline. It refused to respond to any questions for this article except to comment: “We are working hard to process applications before the 10 January 2021 deadline and continue to review our progress as this date approaches.”

Even though digital asset custody service Copper, also based in London’s Mayfair, submitted its application more than nine months ago, marketing director Tyler Kenyon says the company is still involved in a slow dialogue with the FCA. There have been long periods of “radio silence” in the meantime, punctuated by occasional fresh questions. 

Cryptocurrency brokerage BC Bitcoin also applied promptly and diligently. It, too, has made sure to meet the FCA’s requirements, according to sales manager Tyler Smith, but has received no verdict on its application.

Kenyon says he feels some sympathy for the FCA because his understanding is the Treasury – the U.K.’s finance ministry – was responsible for setting the January deadline. The coronavirus pandemic might have caused certain delays. On top of that, he suspects FCA staff has had to learn about the crypto asset sector on the job and on the clock. This could be why some applicants are being asked for up to 80 documents and three-hour interviews, to the surprise of seasoned compliance consultants.

The FCA has kept some interested groups in the loop about its slow progress. According to people with access to that communication, the regulator received 160 applications. It admits it does not know how many firms should have applied except that the number might be several hundred. That implies it does not know how many firms could be flouting its rules by continuing to trade after July next year. It also refused to say what would happen to firms that did so.

FCA blamed its slow progress on the poor standard of applications. Less-experienced firms may have underestimated the complexity of regulatory requirements. London-based financial services regulatory consultancy Bovill comments that these cover “the business plan, organizational charts, IT arrangements … policies and procedures as well as governance provisions.” Copper’s Kenyon says that some probably thought it would be a tick-box exercise, but they were wrong.

Firms and regulators alike are having to contend with a real and major threat of money laundering and other illicit activity. “It is safe to say that there is a relatively high inherent risk of money laundering in the virtual asset space,” according to Bovill. Rapid growth has brought its own risks, too. Firms that expand quickly can find themselves facing compliance responsibilities for which they were not prepared. 

See also: UK FCA Grants Crypto Firms Temporary Registration as It Deals With Applications Backlog

But if this explains the FCA’s failure to approve more than four of the robust applications, it only means that conscientious firms were forced to take costly precautions as the deadline loomed just because of the shortcomings of their peers. 

The FCA finally granted the temporary registrations and effectively extended the deadline because of the magnitude of the damage it would do by forcing legitimate crypto-asset businesses to suspend trading. Copper’s Kenyon speculates about the impact of a temporary stop: “The knock-on effects would be substantial, because a lot of firms rely on our infrastructure.”

The boss of the Mayfair over-the-counter (OTC) desk explains a temporary halt would have necessitated redundancies in the short term followed by expensive recruiting later on. The impact on client relationships would probably have ended the business.

That company is keeping its costly precautions in place in case of “any more speed bumps” with the registration process going forward. 

Unless the FCA accelerates its progress significantly in the coming months, the U.K.’s crypto-asset firms could face another tense countdown next summer – or another regulatory U-turn.

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