Offchain Labs, developer of the Arbitrum blockchain, is introducing Tandem as a new division to promote the use of cryptocurrency networks in general.
TakeAway Points:
- The creator of Arbitrum, Offchain Labs, has launched a $10 million Tandem unit to encourage the use of cryptocurrencies by the general public.
- At $15 billion in valuation, Arbitrum commands 41% of the Layer 2 market, making it the biggest player in its industry.
- Tandem’s priorities will include Ethereum ecosystem initiatives and collaborators such as Robinhood Markets Inc.
Offchain Labs introduces Tandem
Offchain Labs, the developer behind the Arbitrum blockchain, is launching a new unit named Tandem to drive mainstream adoption of crypto networks. Arbitrum, a layer 2 blockchain, facilitates faster and lower-cost transactions on Ethereum. Currently, Arbitrum holds around $15 billion in cryptocurrencies, accounting for 41% of the total layer 2 market, according to L2BEAT.
This makes it the largest player in the sector. Offchain Labs has committed over $10 million to Tandem, which will focus on projects within the Ethereum ecosystem but outside of Arbitrum. CEO and co-founder Steven Goldfeder emphasized that Tandem will not support projects that are entirely disconnected from their current focus. Offchain Labs, backed by venture investors like Lightspeed Venture Partners and Ribbit Capital, sees Tandem as a significant future revenue source.
Ripple’s legal case
Ripple Labs Inc. reached a significant milestone in its legal battle with the SEC last week. A federal judge ordered Ripple to pay a $125 million civil penalty for selling its XRP token to institutional investors without SEC registration. This penalty is a fraction of the $2 billion initially sought by the SEC, which could be favorable for other crypto companies facing similar legal challenges.
The case began in December 2020, with the SEC accusing Ripple of creating an “information vacuum” to sell over $1 billion worth of XRP. The lawsuit garnered support from various advocacy groups, including the Chamber of Digital Commerce and the Blockchain Association. The SEC has since targeted other crypto firms like Terraform Labs, Binance, and Coinbase.
The Ripple case is seen as a potential precedent for whether cryptocurrencies are securities requiring SEC registration. In July 2023, Judge Analisa Torres ruled that XRP was a security when sold to institutional investors but not to the general public. Ripple’s general counsel, Stuart Alderoty, stated that the company respects the ruling and can pay the penalty from its balance sheet. However, the SEC may still appeal the decision.
Citigroup’s digital assets head exits
Shobhit Maini, Citigroup Inc.’s global head of digital assets in the markets unit, has left the bank to pursue other opportunities in the crypto industry. Maini, who spent over 14 years at Citigroup, most recently led the digital assets team.
According to the report, he left to pursue “an entrepreneurial opportunity in the digital asset space,” according to an internal memo from Lee Smallwood, head of markets innovation and investments at Citigroup. Deepak Mehra, international lead for markets strategic investments, will expand his role to lead the markets digital assets team.
Citigroup has been exploring blockchain technology to update its infrastructure, aiming for greater transparency and instant transaction settlements. In February, Citigroup tested the “tokenization” of a private equity fund on a blockchain network.
