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Ethereum: Playboy Reports Loss Of Nearly $5M On NFT Earnings

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Playboy, a well-known adult publication, suffered an Ethereum impairment loss of $4.9 million due to the last year’s market-wide downturn.

In an annual filing, PLBY Group [PLBY], the parent firm of Hugh Hefner’s Playboy stated that it began accepting ETH for its NFT initiative called “Rabbitars” launched in 2021. As of last year, the value of the digital assets sits at $327,000.

The 70-year-old magazine company stated in the filing that it treats its digital assets as “indefinite-lived intangible assets,” which are liable to impairment losses if the fair value of the assets falls below their carrying value at any time.

The impairment losses on the digital assets cannot be recovered even if the fair value of the assets increases. The firm also reflected on the impact of Ethereum’s price volatility on its earnings.

The market price of one Ethereum in our principal market ranged from $964 – $3,813 during the year ended December 31, 2022, but the carrying value of each ETH we held at the end of the reporting period reflects the lowest price of one Ethereum quoted on the active exchange at any time since its receipt.

“Therefore, negative swings in the market price of Ethereum could have a material impact on the company’s earnings and carrying value, while the only time a rise in prices will impact the company’s earnings positively, is when the Eth held in the balance sheet, are sold at a gain,” the filing added.

In October 2021, at the height of the cryptocurrency market, the company announced the launch of its “Rabbitar” NFT project.

Ethereum Developers Released A Target Date For Shanghai Upgrade

Since October 2021, the value of Ether, the native token of Ethereum, has decreased by nearly 60%, per TradingView statistics.

Meanwhile, the much-anticipated Ethereum’s Shanghai hard fork now has a target date of April 12, as per an announcement made by its core developers in a meeting call.

The deadline- 10:27:35 UTC on April 12, epoch 620,9536 will be confirmed by developers on GitHub.

The Shanghai upgrade will facilitate validators to withdraw their staked ether as well as any incentives received from adding or approving blocks to the blockchain, transforming Ethereum’s entire shift to a proof-of-stake [PoS] network.

Ethereum Developers Discuss Successful Testing Progress For Shanghai & Capella Upgrades

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Ethereum developers recently held their 103rd All Core Developers Consensus call, discussing testing progress for the upcoming Shanghai and Capella upgrade. 

The testing included new software, such as the MEV-Boost, builder, and relay software, on test networks where the Shanghai upgrade had been activated, such as the Zhejiang testnet and Devnet 7. These tests have been successful so far, with no issues identified during the staked ETH withdrawals.

DevOps Engineers Provide Updates On Ethereum Testnets

During the call, Barnabus Busa, a DevOps Engineer at the Ethereum Foundation, revealed that Devnet 7 had been deprecated after processing 359,000 validator withdrawal credential changes and testing several client releases. 

The client versions utilized on Devnet 7 were not the ultimate versions, as several consensus layers (CL) and execution layer (EL) teams have not yet released them. 

Busa advised creating Devnet 8 in early March, following the Sepolia upgrade in Shanghai, to evaluate the ultimate client releases.

Another DevOps Engineer, Paritosh Jayanthi, gave an update on testing the MEV-Boost software on the Zhejiang testnet, which included testing the software with staked ETH withdrawals. 

Next, developers will test MEV-Boost software under edge case conditions on a dedicated devnet, where the developers will start to stress test MEV-Boost software under more extreme network conditions.

Hive Tests to Assess Client Logic & Behavior for Ethereum Developers

During a recent ACDE call, an Ethereum Foundation employee, Mario Vega, presented an update on the latest Hive tests for Ethereum clients. 

These tests aim to evaluate client behavior in the event of MEV-Boost software failure, which Vega had previously committed to developing during the call.

Danny Ryan, the Ethereum Foundation Chair, highlighted issues with the circuit breaker mechanism that ensures validators can fall back on local block production in lieu of MEV-Boost blocks, which are not implemented uniformly across all clients. 

Despite this, Ryan remains optimistic, stating that the team’s efforts to test the Shanghai and Capella upgrades and their software have been productive so far.

However, the Ethereum developers are working on testing and refining the various software being implemented in the upcoming upgrades. This is to ensure they function correctly under a range of network conditions. 

These upgrades will improve the performance of the Ethereum network, and the developers are focused on ensuring that the software is ready for widespread use.

Related Reading | Cryptocurrency Exchanges Will Continue To Fail: Kevin O’Leary

Ethereum Shanghai Upgrade Set For Sepolia Test Network Launch Despite Latest Bug Discovery

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Despite encountering a bug in the latest Shanghai release for the Geth EL client, Ethereum developers have agreed to proceed with the launch of the Shanghai upgrade on the Sepolia test network later this month. 

The bug was discovered on February 16th during the All Core Developers Execution (ACDE) call #155, which the Ethereum Foundation’s Tim Beiko chaired. The bug affected the Geth EL client and was discovered during testing on the Zhejiang test network.

Ethereum Developers to Implement Changes to Protocol

The Geth (EL) client team has since issued a fix for the bug, which caused nodes to fail to download and initialize blocks with zero withdrawals and transactions. 

During the ACDE call, representatives of the Nethermind and Erigon (EL) client teams confirmed that they would double-check the logic for handling empty blocks in their latest releases to ensure that they were not vulnerable to the same bug. In addition, the developers agreed to exclude zero blob transactions from the mempool and Ethereum protocol. 

The developers discussed how the protocol and mempool should handle transactions formatted as blobs that do not contain any data and ultimately agreed to ban zero blob transactions from the protocol in their implementation of EIP 4844 for the Cancun upgrade.

Despite these issues, developers are committed to launching the Shanghai upgrade on the Sepolia test network on February 28th. To achieve this, client teams must cut new releases for Shanghai by early next week, and all client teams have confirmed they can do so.

Furthermore, developers will begin testing the circuit breaker mechanism of MEV-Boost software in the coming weeks. Additionally, the Ethereum Nimbus (CL) client team is making progress on updating Ethereum EL block headers to an SSZ format, with two main approaches currently being considered.

However, the Ethereum protocol is constantly evolving, and its developers are working hard to make it even better. While bugs and issues are to be expected along the way, developers remain committed to moving forward and delivering the Shanghai and Cancun upgrades, which are critical to the continued success of Ethereum.

Related Reading | Polygon (MATIC) Sees 65% Surge in Trading Volume – Here’s Why

Ethereum-Focused Scaling Firm Teams Up With Chainlink

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Ethereum-focused scaling platform StarkWare has joined hands with leading blockchain oracle network Chainlink to onboard the latter’s price feeds into the StarkNet ecosystem.

Chainlink is a decentralized oracle network that enables smart contracts to securely interact with real-world data and events, making it possible for them to be triggered by data from external sources.

Through the partnership, StarkWare will be able to participate in Chainlink’s Scale program. In addition, certain Chainlink oracle node operation expenses will be covered by StarkNet tokens, providing Starket developers with access to Chainlink oracle services and data feeds.

Last year, StarkWare secured an $8 billion valuation and announced plans to open source its core cryptographic software tool.

The Israel-based tech firm oversees the scalability issues of Ethereum, which cause slow throughput and high gas or transaction fees.

The company has two platforms: the StarkEx scaling engine and StarkNet, which empowers developers to build decentralized applications [dapps]. In a meeting, the ETH-based scaling firm revealed its plans to open-source the STARK Prover technology.

The announcement was made during the two-day StarkWare Sessions 2023 event in Tel Aviv, Israel. The company said the plan to open source will take time to implement, but StarkWare is committed to making the entire tech stack transparent for developers.

StarkWare co-founder and President Eli Ben-Sasson said in a statement at the summit.

Every step we take to provide infrastructure and to make it accessible and decentralized is a catalyst for devs to build. And the quicker and more broadly they build, the faster we’ll see mass onboarding to solutions that truly enable people to manage their own funds. So there’s a direct line between open-sourcing key tech and popularizing self-custody.

As reported by TronWeekly, Ethereum for the first time since Sept. 12, climbed above $1700 briefly. The second biggest crypto by market cap began 2023 on an impressive note, with a 40% rise to date.

Ethereum Rally Might Stall; Here’s Why

Following the FTX saga and the prolonged bear market of 2022, the leading altcoin has been able to recoup the losses suffered during the events in just a span of 30 days.

Also, in February, ETH experienced the highest percentage of profitable transactions in the previous two years.

Investors are unsure whether the price rally would continue its momentum even as profit-taking has increased, Santiment noted.

On the brighter side of things, an Ethereum developer announced the launch of “Zhejiang” public testnet on February 1 which provides a test environment to run withdrawals of staked Ether.

Ethereum: Shanghai’s Latest Update Bring Relief For Stakeholders

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Ethereum’s most awaited Shanghai upgrade would include the ability to withdraw staked ETH, Bloomberg News reported recently.

Stakeholders and other interested parties are relieved by the revelation since it puts an end to lingering concerns about an extended token lock-in.

The amount of Ethereum invested into the staking contract has steadily increased since the Beacon Chain started live in November 2020. Presently, deposits totaling 15.9 million ETH, worth roughly $19.8 billion, or 13.2% of the total supply.

After the Merge in September 2022, the Ethereum network will undergo a significant upgrade with Shanghai. Its main highlights include:

Reducing the gas charge for layers 2 solutions could make using Eth after Shanghai faster and more affordable.

Efficiency improvements in data access and storage, like the elimination of past block hash information from contracts. Removal of the contract lock on staked tokens will enable unstaking and the withdrawal of staked ETH.

The 151st Ethereum Core Developers Meeting took place on December 8, and discussions there revealed that core programmers have set a possible timeframe of March 2023 for the Shanghai hard fork.

Additionally, programmers plan to roll out the Ethereum Improvement Protocol (EIP) 4844 update, which would bring proto-danksharding to the network, in May or June 2023.

Despite the completion of the eagerly awaited proof-of-stake Merge upgrade on September 15, staked Ether (stETH) was locked.

All About Ethereum Hard Fork

Nearly 3.5 million stETH [$4.48 billion] of the token, which was established by the decentralized financial protocol Lido, are currently in use. Users of stETH could only withdraw their money following the Shanghai upgrade, including any applicable staking incentives for confirming network transactions.

According to the Ethereum Foundation, this organizational strategy was used to “simplify and optimize attention on a successful transition to proof-of-stake” throughout the upgrades.

The EIP-4844 upgrade is intended to introduce a new data-blob-transaction prototype that was originally created by developers on February 21, 2022, following the hard fork.

Optimistic Rollups, a layer-2 technology, allowed Ethereum processing and network storage to be moved off-chain, increasing scalability by 10x to 100x.

The capacity of rollups is expected to increase by up to 100x with the introduction of big portable bundles that can hold cheaper data in Eth transactions. While the change will reduce transaction costs for layer-2 solutions, it will have no impact on the cost of Ethereum gas.

Here’s Why Ethereum’s Supply Is Close To Zero

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Ethereum’s net issuance is set for a deflationary path due to on-chain activity and a surge in gas consumption. Data shared by a analyst showed that Ethereum’s issuance is close to zero [around 0.0011% per year].

All Eth transactions require gas fees, that boost up Ethereum’s security by preventing the network from malicious requests. The greater the traffic on the Ethereum network, the higher gas fees will rise. 

Validators who process all ETH transactions pocket the gas fees. Since the launch of the burning proposal called EP-1559 last August, however, a portion of every gas fee has also been destroyed, to automate transaction prices and limit the supply of ETH. 

Average gas fees on the network have meanwhile registed an uptick.

The reason of the irregular surge in Ethereum traffic and spike in gas fee that switched ETH’s issuance on a deflation mode appears to be a novel token project called XEN Crypto. 

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Here's Why Ethereum's Supply Is Close To Zero 2

It is one of the highest gas consumers at the moment. Over the last 24 hours, XEN has burnt more than 210 ETH, or roughly $260k.

The gas consumption was more than OpenSea and near to Uniswap v3, the analyst noted.

XEN (a pointless scam token) is currently ~15% of Ethereum gas spend. – 4x more than all L2s. – 20% above OpenSea. – Not far from Uniswap v3.

XEN, a cryptocurrency launched on October by Google engineer and crypto influencer Jack Levin, defines itself as a “universal cryptocurrency” with “no intrinsic value” that will accumulate worth “as more and more people join and participate in minting.”

Ethereum Shanghai Upgrade To Enable Staking Withdrawals

The token recently came under a Sybil attack and a minting exploit that saw the attacker mint over 100 million tokens.

The concept initially gained attention for enabling users to create tokens by merely paying a gas price. With both the attacks affecting the network, the future of XEN looked bleak with analysts calling it “pointless scam project.”

It was claimed that the XEN token’s value came from the community, but that no longer seems to be the case. The token grabbed media attention for burning $1.85 million in ETH gas expenses in a single day,.

On the other hand, the Ethereum Shanghai hard fork has been scheduled for March 2023. The update will implement EIP-4895 which enables withdrawals of staked ETH, TronWeekly reported.

Ethereum’s core devs got their eyes on Shanghai upgrade

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The merge finally transpired after years of waiting. Ethereum’s historic switch to proof of stake occurred early on Thursday morning without a hitch.

The Ethereum merge dominated the attention and energy of the network’s elite cadre of core engineers for almost half a decade, with tens of billions of dollars’ worth of digital assets on the line and no room for error.

Ethereum’s core developers won’t meet in groups or make decisions regarding the network’s future for the next two to three weeks. This break from rapid-fire decision-making, though, won’t last long.

The network’s core developers will have to decide together within the next month whatever features they intend to incorporate in Ethereum’s upcoming update, Shanghai. Within the group, opinions are divided. Again, the decision will have far-reaching financial effects. Ethereum core developer Micah Zoltu told local media,

“Lots of people have lots of things they want to go in [Shanghai], but there isn’t yet consensus on what will actually make it.”

The ability for Ethereum validators to withdraw staked ETH is perhaps the most urgent feature under consideration for the Shanghai upgrade.

The recent merging has changed Ethereum to a proof-of-stake system; as of right now, no longer will energy-intensive “miners” confirm transactions on the Ethereum network, but rather users and organisations who have staked significant amounts of ETH. These organisations will be able to create and accumulate fresh ETH through staking as compensation for demonstrating the processing capacity required to validate transactions and protect the network.

However, ETH can currently only be placed into it’s staking system. It cannot be taken back. Until ETH’s developers introduce a withdrawal feature, the nearly $21 billion in ETH already staked on the network will remain there.

It seems sense that practically every core developer has withdrawal capability at the top of their list of priorities for the Shanghai upgrade.

Next in line for Ethereum

Updates to the Ethereum Virtual Machine (EVM), the developer-focused mechanism at the foundation of the world’s second largest cryptocurrency that establishes the norms dictating how blocks interact on the network, are the second most probable set of improvements to be included in Shanghai. The EVM hasn’t been updated in more than two years, in part because developers would have had a terrible time integrating such enhancements into the merge.

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Source: Twitter

Proto-danksharding, which has to do with the rollups of scaling technology, is another long-rumored ETH feature that has attracted a good amount of interest.

By condensing groups of transactions into a single transaction and presenting it to the ETH blockchain as a single transaction, rollups are solutions that solve the Ethereum mainnet’s sluggish pace and high gas prices.

Proto-danksharding would be the early iteration of danksharding, a method for verifying vast amounts of data on rollups using only a small sample of the total data. Essentially, the change would greatly speed up and simplify the verification of enormous volumes of data on Ethereum layer-2 networks like Optimism and Arbitrum.

Although layer-2 customers find the idea of danksharding to be quite appealing because the upgrade would probably reduce transaction times and gas costs, it would also have a price.

The upgrade will be more difficult and, most crucially, postponed the more complicated the set of features incorporated in Shanghai.

How long it will take to implement Shanghai cannot yet be predicted. However, Van Der Wijden is certain that the improvement will take place in the upcoming year.

However, that deadline likely be postponed as more Ethereum users and developers focus on more ambitious and urgent network enhancements, such as proto-danksharding.