Tornado Cash banned, Moonbirds drama, and some fresh NFT drinks

Welcome back to Decentra Daily, where we love crypto more than a fat kid loves cake.

Estimated read time: 6 minutes 20 seconds

Table of Contents:

• Tornado Cash banned in the United States

• Moonbirds and CC0 issues

• Drinks based NFTs: Starbucks & wine

• Winners and Losers of the day

Tornado Cash blacklisted

You know the news is big when the likes of CNBC, CoinDesk, Al Jazeera, and Yahoo Finance all post about it on the same day.

Tornado Cash is a cryptocurrency mixer, which means that it is used to anonymize transactions. 

The Treasury Department believes that Tornado Cash has been used to launder more the $7bn in crypto since 2019.

As such, more than 400 million in assets were frozen. All of the crypto wallet addresses associated with Tornado Cash were added to the Specially Designated Nationals (SDN) list. Being on this list means that you cannot do business with anyone in the U.S.

There are legitimate reasons why some people may want to use Tornado Cash for on-chain privacy concerns. This move by the Treasury Department can be seen as an attack on the anonymity that the blockchain often can provide.

However, maybe the Tornado Cash team should have been more diligent in its efforts to combat nefarious actors. Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E Nelson has this to say: 

“Despite public assurances otherwise, Tornado Cash has repeatedly failed to impose effective controls designed to stop it from laundering funds for malicious cyber actors on a regular basis and without basic measures to address its risks.”

The U.S. and South Korea have accused North Korea of crypto hacks, which according to Chainalysis led to Tornado Cash to launder these funds. North Korea stole over $400m in digital assets in 2021 alone.

The addition of Tornado Cash to the SDN list is big, as it has never been used for a piece of technology. It has been used for dangerous people, now if you use Tornado Cash for bad OR good reasons, you may be in some trouble.

As such, the trolls are out in full force...

Looks like Jimmy Fallon, Cozomo Medici, Shaq, and more may be in trouble!

The news of the Treasury Department's announcement caused a series of events to unfold:

• Tornado Github accounts and code repositories suspended

• USDC issuer (Circle) blacklisted ETH addresses associated w/ Tornado Cash (>75,000 USDC is now more frozen than me going in for my first kiss)

• Tornado website shut down

• Alchemy and Infra blocked RPC requests to Tornado Cash, so it cannot be accessed

Ouch! Let's see how this plays out. 

CC0 NFTs: do they make sense?

On Friday, Moonbirds went completely public domain. That means that all their NFTs – including those already owned by collectors – are now free to be used by anybody, for any purpose.

Any spin-off collections will also no longer need to pay royalties back to Moonbirds.

Founder Kevin Rose wrote a thread justifying the change by appealing to the fundamental belief that Web3 should be a collaborative and decentralized space:

Moonbirds is one of a few prominent projects that have been pushing the idea of CC0 NFTs – but it’s more controversial for a collection to change its licensing rights after launch.

What’s a CC0 license?

CC0 is the “No Rights Reserved” option from Creative Commons – the widely adopted copyright permissions system.

It means that a creator gives away all rights to their work, making the content free to use, including for commercial or political uses, and as a PFP.

Creative Commons describes CC0 as “giving creators a way to waive all their copyright and related rights in their works to the fullest extent allowed by law.”

How does that make sense for holders?

A CC0 NFT is basically a piece of open source IP – which sounds like it shouldn’t make sense.

Seeing your NFT being used by other people without any ability to manage that usage could be frustrating and stressful – especially if the NFT wasn’t in the public domain when you bought it.

What if your digital art is adopted by shady groups or companies that you don’t agree with – how might negative associations affect a collectible’s value?

And, what exactly is the point of proving ownership over something if you can’t collect royalties or enforce your ownership in a substantial way?

Ownership ≠ control

With traditional IP, the concepts of ownership and control are closely linked. 

But setting IP free for use across the internet using NFTs can bring potential benefits, like:

• Massively boost awareness and cultural visibility of NFTs.

• Give artists and innovators the opportunity to enhance NFTs.

• Decentralize and democratize brands (anyone can evolve the IP).

All while your proof of ownership is secured on the blockchain.

As Rose said in his thread:

“The authenticity of Moonbirds will not come from lawyers enforcing trademarks but rather from the proven provenance and single source of truth of smart contracts.”

Where you sit on the CC0 debate often comes down to your response to a central question: overall, do copies increase the value of the original?

Let us know what you think. Are there situations where making NFTs CC0 could cause serious issues, or should every NFT be in the public domain?

Starbucks & wine in web3

Starbucks has always been a digital-savvy brand. They released their first app in 2009, came up with a digital wallet not long after, and mastered mobile ordering before anybody had thought of Uber Eats.

So it’s no surprise that, among corporate NFT projects, Starbucks’ effort looks set to be among the most interesting.

Instead of launching a set of expensive collectibles, Howard Shultz (CEO and founder) says that Starbucks NFTs will “build on the current Starbucks Rewards engagement model with its powerful spend to earn stars approach…integrating our digital Starbucks Rewards ecosystem with Starbucks-branded digital collectibles.”

Starbucks’ “stars” is one of the best reward programs in any industry. Customers get drinks, refills, and gifts by redeeming stars, which are earned by buying coffee, bringing a reusable cup, or completing a host of other actions.

It sounds like the company is looking to evolve its existing platform with NFTs – maybe customers will earn collectibles through purchases, or holders will get access to special services and drinks?

Adam Brotman, the guy behind Starbucks’ successful Mobile Order & Pay system is overseeing the project – so if all goes well, it sounds like Starbucks could play a significant role in the normalization of NFTs.

Techcrunch says that Starbucks will reveal its coffee-themed NFTs at next month’s Investor Day event.

More of a wine snob than a coffee drinker?

No worries, Web3 caters to all tastes. 

Evinco Winery DAO is integrating NFTs with a wine club, by tokenizing memberships and providing better ways to trace rare bottles.

Behind the project is crypto investor @wizardofsoho and fourth-generation Napa winemaker, Mario Sculatti. The duo launched their 5,555 strong collection on Ethereum last week (current floor: 0.13 ETH).

Evinco Winery holders get two 2013 vintages, inscribed with their mint number, as well as access to the clubs’ wine store and community resources. This looks set to include in-person events at “multiple Napa Valley properties,” wine parties in wine hubs like France and Argentina, plus virtual tastings.

Ok, but why tokenize a wine club?

• Mint/buy a membership to join – no long wait lists if you’re willing to pay

• Sell your place when you leave – get something in return for your membership

• Keep a public record of your bottle library & wine investments

• Trace rare wines on the blockchain

Winners and Losers

The projects that have stood out to us the most in the past 24 hours, the good, and bad.

Winner: Beyond Earth Land - Floor price up 14% in the last 24 hours (0.029 ETH → 0.033 ETH)

This one is pretty cool for the way it was launched. Instead of launching an NFT with promises of a future metaverse, these guys launched a full on MMORPG and had a free mint for the land in their game. The game can be downloaded for free right here, but I haven’t played it yet so not sure if you need to purchase one of the NFT players they released a few months ago.

Loser: The MV3 Universe - Floor Price is down 18% in the last 24 hours (0.309 ETH → 0.254 ETH)

Kind of in the same vein as Beyond Earth Land, but backwards. MV3 released access passes to their universe, with promises of utility and a future game. I admit the game sounds and looks cool (Eluna City, a cyberpunk dystopia), but they haven’t delivered yet. And in this space, you gotta deliver, as there are a million projects with a million promises. It’s only been a few months so maybe it’s a buying opportunity as the price keeps dropping. They do also have a strong community spirit and are trying to fund and mentor WEB3 projects. So we hope they can turn it around.

Headlines of the day

• FTX Bringing Crypto Swaps to Reddit

• New NFT Privacy Proposal Gets Vitalik Buterin’s Attention

• Pinata raised $21.5M to scale NFT media infrastructure

Disclaimer: Nothing in this article/newsletter should be considered financial advice. The purpose is to inform readers of the current trends and news in the web3 space. We encourage every reader to do their own research and not act upon information put forth by Decentra Daily.