This Week in Crypto

October 20, 2023

Welcome to another edition of This Week in Crypto. We’ve got some exciting updates and news to share:

Key Points:

• California’s AB39 becomes law with potential regulatory ambiguities.
• Introduction of the Shatter Contract, a novel NFT smart contract reshaping collectibility.
• Scroll, an Ethereum layer-2 network, launches on the mainnet, promising faster transactions and reduced costs.

California’s AB39 Becomes Law

AB39, the recently passed law in California, has raised interest within the digital financial asset business sector. While there is some concern about ambiguities in the law, it’s promising to see Gavin Newsom’s statement highlighting the need to balance consumer protection with responsible innovation. The California Department of Financial Protection & Innovation is expected to play a crucial role in clarifying and addressing the law’s uncertainties swiftly. Additionally, this development underscores the necessity for clear federal-level regulations, which Congress should consider.

Introducing the Shatter Contract

The innovative Shatter Contract is set to revolutionize NFT collectibility. With Shatter, artists can mint their digital creations as unique 1/1 NFTs and choose to shatter them into editions or unique 1/1s while defining the edition cap. Collectors, in turn, can “shatter” these NFTs into pre-defined editions or unique 1/1s. Furthermore, for collectors who own all the editions or 1/1s, there’s an option to “fuse” them back into their original 1/1 form, providing flexibility, liquidity, and engagement. This groundbreaking contract also optimizes gas costs, making NFT interactions more cost-effective.

Ethereum L2 Scroll Launches on Mainnet

The Ethereum layer-2 network, Scroll, has successfully launched on the mainnet. Scroll, with its zkEVM technology, aims to combine Ethereum’s network security with lower fees and latency. This zkEVM technology offers faster transaction speeds at reduced costs through efficient proof batching. Existing Ethereum projects can directly deploy on Scroll, leveraging familiar tools. Deployed smart contracts will store transaction bytecode on Scroll, which a centralized zkEVM node will verify without revealing the transaction’s contents, ultimately updating Ethereum’s transaction state without re-execution. Scroll’s mainnet code has undergone audits by major firms, ensuring security.

Scroll is currently in a “research” phase for its decentralized prover network and sequencer. Future upgrades aim to minimize the probability of a sequencer halt through decentralization, while governance mechanisms are planned for introducing a Security Council and delayed upgrades to enhance protocol control.

In summary, these developments in California’s digital financial asset regulations, the Shatter Contract for NFT collectibles, and Ethereum L2 Scroll offer exciting advancements in the crypto and blockchain space.