Rally Shuts Ethereum Sidechain, UK To Regulate Cryptos

Social token platform Rally will reportedly abandon its Ethereum sidechain, which runs parallel to the mainchain, and warned fans that they may not be able to access their crypto holdings.

“Since NFTs on the Rally sidechain are not transferable to mainnet, these will not be accessible once the site shuts down,” Binance quoted Rally as saying in a statement.

Rally has cited a “challenging year” in 2022 and “macro headwinds” for forsaking the crypto assets. It said the site “will no longer be supported” beyond Tuesday, January 31, 2023.

According to data site Nansen, Rally’s token RLY has fallen 93 per cent since January 31, 2022.

UK Lays Down Proposals To Regulate Cryptos

In the wake of FTX collapse, Britain has formulated plans to regulate the crypto industry. CNBC reported that the proposed measures aim at regulating the crypto businesses in line with traditional financial firms. In 2022, the rise of crypto firms’ risky loan transactions and a lack of due diligence on counterparties was a huge issue.

The UK government’s new proposals reportedly aim to establish a “robust world-first regime strengthening rules around the lending of crypto assets, whilst enhancing consumer protection and the operational resilience of firms.”

It would also enforce strict transparency requirements on crypto exchanges, ensuring they publish relevant disclosure documents and set out clear admission requirements for trading digital tokens.

“We must also protect consumers who are embracing this new technology, ensuring robust, transparent, and fair standards,” CNBC quoted a top UK treasury official as saying.

After the collapse of FTX, the European Union and the US have proposed to improve consumer protections in crypto.

US Senators Seek Answers Over FTX’s Fund Misuse

US senators have reportedly turned their focus to Silvergate Capital Corp., yet again, saying the company’s responses to a previous inquiry over its ties with FTX exchange were “evasive and incomplete.”

According to Bloomberg, senators from both sides of the aisle have demanded the parent company of the Silvergate Bank to reveal the details of the alleged misuse of customer funds.

On Monday, the senators stated that Silvergate Capital Corp in its earlier response failed to include vital information that Congress needed to assess the transfer of funds to Alameda by Silvergate, and determine any fraud committed by the bank or the auditors.

In response, a Silvergate representative said the company has “a comprehensive compliance and risk management program”, the report said.