  The biggest crypto news and ideas of the day Jan. 13, 2022 If you were forwarded this newsletter and would like to receive it, sign up here. Sponsored by  Welcome to The Node.
In today's newsletter: Visa and ConsenSys tackle CBDCs. Environmental concern over Wikipedia's crypto donations. And ERC-4626: a proposed token type for DeFi yield, below.
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Today's must-reads Top Shelf  CLARIFYING STANCE: The government of Pakistan and its central bank want to ban the use of cryptocurrencies, local media reported, citing a document produced by deputy governor of the State Bank of Pakistan (SBP) Sima Kamil and other high ranking officials. This marks the first official stance taken by the central bank. Meanwhile, in the U.S. a bipartisan group of lawmakers tasked with overseeing the CFTC have asked newly confirmed Chairman Rostin Behnam to provide guidance on regulating cryptocurrencies – asking particularly pointed questions about "crypto crime."
CBDCs: Visa has teamed up with Ethereum incubator ConsenSys to build central bank digital currency (CBDC)-linked Visa cards and digital wallets that will be accepted anywhere that Visa is accepted globally. Meanwhile, following a probe beginning last September into how the Bank of England might use a national digital currency, a House of Lords committee found there is "no convincing case" for the U.K. for CBDCs.
MINING PROFITS? Wikimedia, the non-profit foundation that runs Wikipedia, is facing internal opposition to its policy of accepting crypto donations, primarily for environmental reasons. Wiki contributor Molly White raised environmental concerns (primarily regarding Bitcoin and Ethereum) just days after non-profit peer Mozilla paused its crypto donation. Crypto is energy-intensive because it's profitable – operators are incentivized with crypto payouts to contribute computation to network security. Just today, bitcoin miner Rhodium disclosed plans for a $796 million IPO.
WEALTH MANAGEMENT: Crypto exchange Gemini has acquired digital asset management startup Bitria to expand its offerings for financial advisers. Terms of the deal were not disclosed. Meanwhile, fintech Seashell has emerged from stealth mode with the launch of its high-yield Seashell Save app – advertised as an "inflation-resistant" savings tool. Finally, Goldman Sachs is "bullish" about the prospects for online brokers' Q4 earnings, citing a surge in retail-led, crypto-trading revenue.
CAPITAL FLOWS: DeFi Alliance, the incubator of platforms ranging from Sushi to Olympus DAO, rebranded itself as "Alliance DAO" Thursday following a $50 million raise. Some 300 contributors provided funding for the "digital startup nation," according to project founder Imran Khan, including Libra co-creator Morgan Beller, OpenSea's Devin Finzer and Jake Paul. Separately, the Near Foundation, developers of the eponymous blockchain, announced a $150 million private token funding round led by Su Zhu's Three Arrows Capital.
Elsewhere ... Xapo Gives Up Its NYDFS BitLicense. Proof-to-Learn is a thing now. Ex-CFTC chief Giancarlo is a CoinFund strategic adviser.
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Putting the news in perspective The Takeaway  The Newest Money Lego
Proposed Jan. 4, ERC-4626 co-creator Joey Santoro said Wednesday the token's documentation is ready for "final review." He called on the "giga chad brains" of Crypto Twitter to offer feedback on this novel Ethereum Request for Comment.
The original scope of the proposal was to standardize yield-bearing tokens to make them easier to build with, but now it covers a wider set of use cases. If adopted, ERC-4626 will offer a general way for platforms like Aave or Yearn to build assets that reward users. At the risk of overstatement: This could simplify parts of the entwined DeFi "stack" by making yield-bearing tokens easier to implement across platforms and therefore save developers time and money.
"It's just an interface for depositing and withdrawing the token from any kind of strategy that handles a single token," Santoro explained in a recent Solidity Friday podcast.
Decentralized finance is a nascent economy where people lend, borrow and steal tokens – all the basic financial services you can expect – without a middleman. It has grown from a sliver of the cryptocurrency market to its economic engine. There are some $95.2 billion worth of tokens "locked" into various Ethereum protocols alone, not counting other chains like Solana or Near.
One of the primary benefits of DeFi is the ability to generate yield, often at rates much higher than you could expect from traditional bonds or savings accounts. DeFi tools incentivize use and attract liquidity by paying out tokens. Take Sushi, a decentralized exchange, where users can stake their SUSHI tokens to receive xSUSHI, an instrument that pays returns.
Much of DeFi is "interoperable," meaning that tokens can be plugged in on different platforms to perform different economic tasks. Santoro, who also co-founded the stablecoin platform Fei protocol, teamed up with two Rari devs – Jet Jadeja and the pseudonymous transmission11s – to make it easier to plug and play with yield tokens.
There are essentially three ways to earn yield in DeFi: earning yield by lending (like on Compound), aggregating yield from different sources (like on Rari) and holding an "intrinsically yield-bearing" instrument that rebases the underlying asset (like xSushi), Santoro said.
"You can already see that those are like some pretty diverse use cases," Santoro said. "And there is no standard interface for a token which generates yield." He noted this is a problem not just for yield aggregators but across DeFi, which so far requires "custom connectors all over the place."
It's still an open question how this will propagate throughout DeFi and Ethereum broadly. The Defiant reports it won't require a hard fork to implement. Like any other open-source development, the code is posted to Github and teams across the industry could implement it as they see fit.
"Please read the proposed spec, and give us your feedback. Let's make this work," Alberto Cuesta Cañada, who is a co-author of the latest ERC-4626 documentation, said on Twitter. Some technically minded people have already raised concerns on GitHub. Approached for comment, Cañada has not yet replied.
Like all else in DeFi, it'd be better if this were properly audited before implementation. But it's a fast-moving world and it's not every day a new token type is proposed – ERC-4626 is worth keeping an eye on.
The Chaser... 
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Thursday, January 13, 2022
Pakistan Plans Crypto Ban
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