Sebastian Sinclair

Michael Arrington, founder of Arrington Capital, has opted not to join the new board of directors being constituted following the bankruptcy proceedings of Celsius Network.&nbsp;



Court <a href="https://cases.stretto.com/public/x191/11749/PLEADINGS/1174909242380000000001.pdf">filings</a> show his partner at investment consortium Fahrenheit, Ravi Kaza, will instead assume his seat of the recently formed public, regulatorily compliant, reporting company NewCo. Kaza is an advisor and angel investor at Arrington Capital.



Arrington, in a social media <a href="https://x.com/arrington/status/1705940251158430176?s=20">post</a>, cited his undisclosed disagreements over the board’s composition as his reason for stepping back. However, he and his firm continue to support the Celsius restructuring and maintain an advisory role.



“I am not able to go into much detail on why I requested this change, but that information will come out in due time,” Arrington said. “I disagree with some of the decisions made around board constitution and, in particular, the board observers.”



Arrington did not immediately respond to Blockworks’ request for comment.



More than 95% of Celsius creditors voted in favor of the crypto lender’s bankruptcy plan, according to court documents filed Monday.



Read more: <a href="https://blockworks.co/news/celsius-bankruptcy-plan-vote">Celsius seeks ‘swift approval’ from court after bankruptcy plan vote</a>



Filed in June, the updated bankruptcy plan follows a successful asset acquisition bid by Fahrenheit.



Comprising venture capital firm Arrington Capital and mining company US Bitcoin Corp, the consortium successfully countered an <a href="https://blockworks.co/news/celsius-auction-begins-tuesday">earlier bid</a> by NovaWulf Digital Management — the firm overseeing the distribution of its liquid assets — to acquire the beleaguered crypto lender in May.



The asset acquisition bid by Fahrenheit, submitted for approval to a New York bankruptcy court, has been met with disapproval from certain creditors. Legal representative <a href="https://news.bloomberglaw.com/bankruptcy-law/crypto-quest-for-freedom-ends-in-bankruptcy-bureaucracy">David Adler</a>, of the firm McCarter &amp; English, announced his intent to oppose the plan, accusing it of violating consumer lending laws and criticizing the consortium for poor communication.



Per the terms agreed upon by Fahrenheit, the new entity is set to inherit between <a href="https://blockworks.co/news/fahrenheit-wins-bid-for-celsius">$450 and $500 million</a> in liquid crypto. Additionally, US Bitcoin Corp has plans to establish a range of crypto mining facilities, including a new 100-megawatt plant.



According to court documents, the new board will consist of nine directors and include notable names such as Asher Genoot, President of US Bitcoin Corp and Elizabeth LaPuma, a veteran financial advisor with more than 20 years of board experience.



With the board&#8217;s composition being a subject of negotiation among various stakeholders, including the Official Committee of Unsecured Creditors, the inclusion of two additional seats has been agreed upon.

bankruptcy

Arrington gives up seat on Celsius board citing disagreement with its makeup

Bessie Liu

<div id="highlights-block_62993e8b93442" class="highlights">
 <ul>
 <li>The outage was handled swiftly in less than 4 1/2 hours</li>
 <li>Solana developers made “fundamental design choices” to improve base layer throughput — at the expense of network reliability, industry exec says </li>
 </ul>
 
</div>



The Solana network took another reputational hit this week, booking its latest in a series of outages in 2022. 



The most recent downtime, this Wednesday, came just a month after bots swarmed popular non-fungible token (NFT) minting protocol Candy Machine, pushing validators out of consensus and crashing nodes. 



This time, validators — which sign off on block transactions — were manipulated so that the network ceased to produce blocks, as validators were prevented from reaching a consensus. The network was restarted about 4 ½ hours later.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">1/10 Yesterday, <a href="https://twitter.com/solana?ref_src=twsrc%5Etfw">@solana</a> broke down but we fixed it with what might be the fastest hardfork in the history of the ecosystem. Just 4.5 hours and the blockchain stuck in a rut was free and running again. Here’s a thread about how it happened 🧵&mdash; Everstake (@everstake_pool) <a href="https://twitter.com/everstake_pool/status/1532334632590622721?ref_src=twsrc%5Etfw">June 2, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Michael Arrington, founder of Arrington Capital, a crypto investment firm, told Blockworks that Solana’s developers have made “fundamental design choices” to improve base layer throughput — at the expense of network reliability.



“We don&#8217;t believe these technical trade-offs are necessary, and there are other networks, like Bitcoin and Algorand, which do not sacrifice robustness for performance,” Arrington said.



Following the downturn, Solana’s <a href="https://coinmarketcap.com/currencies/solana/" target="_blank" rel="noreferrer noopener">market capitalization</a> dropped by over 11% in 24 hours. It is trading at roughly $40 as of 7 pm ET, down by over 80% since its all-time high of $260.06 in November 2021.



Even so, Sergey Vasylchuk, CEO of Everstake, Solana’s biggest validator and co-developer of Metaplex, said he’s still optimistic on the beleaguered protocol.



&nbsp;&#8220;The blockchain industry is up and running, and it&#8217;s common for new areas to face crises,” Vasylchuk told Blockworks. “For the past four years, my company has been running over 8,000 nodes for 50 blockchain networks. We&#8217;ve been in Solana since the very beginning of its story. What I can say for sure is that the Solana community knows how to tackle problems very fast.”



The relatively short span of the outage, Vasylchuk said, points to the ecosystem learning from past mistakes.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



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Markets

Solana Price Dips After Another Network Outage

Morgan Chittum

<div id="highlights-block_6201732984b27" class="highlights">
 <ul>
 <li>An NFT of a Ukraine-based studio apartment sold for roughly $113,176 of ether last year</li>
 <li>Former CFTC enforcement attorney said real estate has “huge upside potential” when it comes to smart contracts and NFTs</li>
 </ul>
 
</div>



A Gulfport, Fla., four-bedroom home is hitting the market this week with a $650,000 starting price tag, an otherwise unremarkable listing in a red hot real estate market.



Or it would be, anyway, except for a crypto caveat: Buyers can purchase the home with ether, receiving a property deed via an NFT — one of the first such instances to hit the US real estate market. Though it has become commonplace for listings to attract a number of bidders, some 1,500 people had registered for the auction by Tuesday. Talk about competition.



Blockchain startup Propy will host the auction on its online platform. CEO Natalia Karayaneva told Blockworks the company’s services could “turn into a standard in the [real estate] industry.”&nbsp;



“NFT sales reached $4 billion in December 2021, and real-world assets will soon represent a significant portion of that market,” Karayaneva said. “We have developed all the necessary smart contracts and a compatible legal framework that allows tokenizing any real estate property in the United States.”



The Florida home’s property rights will be minted as an NFT — signifying ownership on-chain — which Karayaneva said cuts down on closing time. The NFT owner will then own the property via a limited liability company (LLC) that houses the NFT.



The startup previously <a href="https://www.businesswire.com/news/home/20210525005839/en/Propy-Auctions-World%E2%80%99s-First-Real-Estate-NFT-with-Ownership-Transfer" target="_blank" rel="noreferrer noopener">sold</a> TechCrunch founder Michael Arrington’s studio apartment in Ukraine last year for roughly $113,176 of ether at time of publication.



“The traditional real estate sale process is arduous and broken…It’s an opaque, dated, and unnecessarily lengthy process, full of risks such as wire fraud,” Arrington <a href="https://propy.com/browse/propy-nft/#:~:text=About%20the%20Sale&amp;text=The%20apartment%2C%20which%20was%20the,TechCrunch%20and%20Arrington%20XRP%20Capital." target="_blank" rel="noreferrer noopener">said</a>. 



Propy can smooth the process of real-world property sales, according to Karayaneva, while also attracting younger investors to the real estate market.



“Now, Gen-Z and millennials can transact real estate very easily,” she said. “This is what they [want.]”



Propy’s tokenized real estate service only works, however, if the home buyer owns enough ether to power the transaction — one obstacle for potential bidders. Karayaneva said the company is exploring lending options for real estate-backed NFTs.



Venture capitalist Tim Draper and the National Association of Realtors are two of the company’s backers.



Braden Perry, a former CFTC enforcement attorney, told Blockworks that real estate has a “huge upside potential” when it comes to NFTs and smart contracts, but the US regulatory environment “lags innovation” to support it.



“The [real estate] title process is ideally suited for streamlined and protected recordings on a blockchain,” Perry said. “But the regulatory system is still new, and there are a lot of questions regarding the government’s role in crypto.”



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/thebreakdown">The Breakdown</a>: Decoding crypto and the markets. Daily.</li>



<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Crypto news and analysis to start your day.</li>



<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
</ul>

Michael arrington