Crypto Guides, Knowledge & Insights

Russia’s Latest Bill Proposal Could Ban Crypto as a Payment Method

The head of the Russian parliament‘s lower chamber (State Duma) – Anatoly Aksakov – presented legislation focused on cryptocurrencies and their employment inside Russia’s borders. If the bill gets approved, “digital financial actives” (DFA) wont be accepted as a means of payment for any type of products or services inside the country.　　Scrap Crypto, the Ruble is Russias Currency　　The Russian authorities are strongly divided on how to approach the local cryptocurrency industry. The countrys central bank insists on a total ban of all digital asset endeavors, while the Finance Ministry believes imposing regulations is a better idea.　　At first, the lower house of the Federal Assembly of Russia – the State Duma – shared the central banks vision. In 2020, the lawmakers considered prohibiting the usage of digital assets and insisted that those who continue to interact with the sector be fined and even sent to jail.　　In March this year, the authorities abandoned such plans, claiming that designing an appropriate regulatory framework is wiser than imposing a blanket ban on the asset class.　　Earlier this week, the head of State Duma – Anatoly Aksakov – touched upon the topic once again, proposing a bill that outlines digital currencies as inapplicable for a payment

2022-06-09Deep Dive

Litecoin (LTC) Gets Delisted from Biggest South Korean Exchanges

Major cryptocurrency exchanges in South Korea have delisted Litecoin following the activation of new privacy features.　　Litecoin Too Private For South Korean Exchanges　　Several exchanges in South Korea have announced that they have removed Litecoin from their listings.　　Upbit noted that the decision to end support for LTC relates to Koreas Reporting and Use of Specific Financial Transaction Information Act, which requires crypto exchanges to check transactions for transparency so as to prevent illicit money laundering activities or terrorist financing. In other words, this rule prohibits anonymous transactions that hide sender and receiver inputs and outputs.　　The delisting follows the launch of the eagerly-anticipated MimbleWimble Extension Block (MWEB) upgrade that made Litecoin transactions faster and more private. The MWEB compresses unnecessary transaction data from blocks, allowing for confidential transactions on the Litecoin network. This privacy-preserving feature was implemented earlier this year — almost two and a half years after it was initially proposed.　　Upbit indicated that it requested the Litecoin Foundation to provide more details about the MWEB upgrade. And after a thorough review of the privacy-focused technology, it was decided to remove LTC from the exchange as it is perceived as a risk when it comes to KYC/AML compliance.　　Upbit will officially discontinue support for

2022-06-09Deep Dive

Mike Novogratz Says Most Crypto Hedge Funds Will Go Bust

For the second time in less than three weeks, Mike Novogratz, CEO of digital asset manager Galaxy Digital, has spoken on the ongoing cryptocurrency crash. On May 21, Novogratz warned against trying to predict a bottom to the crypto crash.　　Crypto Hedge Funds Will Fail　　In a latest, Novogratz said two-thirds of the hedge funds that invest in cryptocurrencies will fail in the current market downtown. According to Bloomberg, the CEO made the comments at the Piper Sandler Global Exchanges and Brokerage Conference.　　“Volume will go down, hedge funds will have to restructure. There are literally 1,900 crypto hedge funds. My guess is two thirds will go out of business.”　　Novogratz faced criticism for his role in the recent collapse of the Terra blockchain. At the time, Galaxy lost $111.7 million in the first quarter of the year 2022. The loss was largely due to the fluctuation in the cryptocurrency industry.　　Removal Of Stimulus Had An Impact　　The Galaxy CEO cited the market‘s reaction to Fed’s removal of stimulus as a reason for the recent collapse in token prices. He added that the tokens collapse dented confidence in the cryptocurrency and decentralized finance space.　　After the Terra crash panned out last month, Novogratz said trying to pick

2022-06-09Deep Dive

Japan-based exchanges to change screening method for listing crypto assets

Japan Virtual and Crypto assets Exchange Association (JVCEA) plans to ease its strict screening process for listing new cryptocurrencies after the Japanese government expressed some concerns about the process, Bloomberg News reported.　　JVCEA is responsible for assessing the crypto assets that exchanges in the country want to list. The body usually takes as long as six months or longer to approve an exchange request — a process that has drawn the ire of the countrys government.　　In May, a government panel, that included Prime Minister Fumio Kishida, criticized the organization and said it should “ease the criteria while being mindful of the need to protect users.”　　The body might change its approach and focus more on policing listed assets. It is also likely that the JVCEA will still have the authority to ask exchanges to delist assets if any problem should occur.　　Meanwhile, crypto exchanges in the Asian country would still have to report any plans to list new tokens as this will help keep the association informed about listed tokens.　　Japans crypto space to become more liberal　　JVCEAs decision will open up the Japanese crypto industry to a new wave of digital assets, offering Japanese citizens more exposure to the space.　　For context, GMO Coin Inc,

2022-06-09Deep Dive

Britain Plans to Implement Blockchain into Traditional Markets

The United Kingdom will start testing blockchain technology in traditional finance operations, like stocks trading and bonds settlement, in the next year. The main mission of innovation is to establish the United Kingdom as a worldwide crypto hub, announced the countys ministry of finance on June 7.　　According to Gwyneth Nurse, one of the top people at the UK treasurys financial authority, implementation of blockchain is a major way to modernize and improve the efficiency of the United Kingdoms financial markets. The revolutionary innovation has the potential to be a game changer and may make it possible to emit securities much quicker than it is now.　　The process of launching and testing blockchain-using projects under regulatory supervision will utilize the sandbox model, an experimental framework for testing projects, which involves real customers. This is the same model that UK regulators first applied to the development of fintech companies. In addition to the sandbox model, the authorities also plan to introduce stablecoin regulation.　　Digital pound on the way？　　However, industry representatives believe that to leverage various advantages of blockchain technology within the market infrastructure, a proper digital currency is needed. According to ministry officials, though, work on the digital pound matter is already underway, with

2022-06-08Deep Dive

Crypto cannot fulfil ‘social role of money’ due to fragmentation: BIS

Blockchains have “inherent limitations” that lead to fragmentation, which means crypto is unsuitable as a means of payment, economists at Bank for International Settlements (BIS) said in a June 7 report.　　As the crypto landscape began to grow rapidly, the decentralized finance (Defi) ecosystem began to fragment, the report contends.　　Until January 2021, Ethereum was the dominant layer 1 blockchain controlling over 90% of total value locked (TVL) in Defi, DefiLlama data shows. As more layer 1 blockchains emerged, mainly Binance Smart Chain, Avalanche, and Terra until its downfall, Ethereums share of Defi TVL dwindled to around 54% by April 2022.　　The report argues that this fragmentation of the market arises from the inherent faulty designs of blockchain systems. It states:　　“It is the inherent features of blockchains – first and foremost, the need to incentivize decentralized nodes to validate transactions – that drive the fragmentation of the crypto landscape.”　　The consensus mechanism of decentralized blockchains requires validators to record transactions. These validators need to be rewarded with block rewards and transaction fees.　　For a blockchain to maintain its integrity, transaction fees need to be high enough to incentivize validators. If transaction fees become too low, validators may have an incentive to cheat, compromising the security

2022-06-08Deep Dive

DOJ Calls for International Cooperation to Fight Crypto Crime

A new DOJ report is calling for a strengthening of international cooperation to counter the criminal use of digital assets. Their recommendations include helping foreign nations develop the necessary infrastructure to investigate cyber crimes, robust information sharing, and uniform international regulations.　　Greater Cooperation Needed　　The U.S. Department of Justice (DOJ) submitted yesterday its response to President Joe Bidens Executive Order on digital assets from March 2022.　　The 58-page report, called “How To Strengthen International Law Enforcement Cooperation For Detecting, Investigating, And Prosecuting Criminal Activity Related To Digital Assets,” was produced in collaboration with the State Department, Treasury Department, Department of Homeland Security (DHS), Securities and Exchange Commission (SEC), and Commodity Futures Trading Commission (CFTC).　　While acknowledging that “the United States supports the responsible use and development of digital assets,” the report states that their “perceived pseudonymity” make cryptocurrencies an attractive vehicle for money laundering schemes, ransomware, terrorist financing, fraud, and sanctions evasion. The DOJ also warns that criminals have targeted consumers and retail participants all over the globe by taking advantage of information asymmetry and anonymity-granting technology.　　“Uneven and often inadequate regulation,” the report says, “allow criminals to expose the U.S. and international financial systems to risk from jurisdictions where regulatory standards and enforcement are

2022-06-08Deep Dive

FTX And Opensea Hit $32 Billion And $13.3 Billion Respectively In Forbes Fintech List

Nine cryptocurrency-centered firms has made Forbes Fintech 50 seventh annual list, with top crypto exchange, FTX, and the worlds largest NFT marketplace, Opensea, taking the lead.　　FTX and Opensea tops Forbes list　　With a whooping valuation of $32 billion, Sam Bankman-Frieds crypto exchange and trading platform FTX, outranked other crypto fintechs to take the lead. The Bahamas based crypto exchange raised a $500 million fund earlier this year which took its valuation to $32 billion.　　NFT marketplace, Opensea, valued at $13.3 billion, is seen on the list for the first time and comes second among the nine crypto firms on the list. Opensea continues to dominate the NFT marketplace with over 1.5 million accounts having transacted on the platform.　　Other crypto fintechs that makes the Fintech 50 list are; Alchemy valued at $10.2 billion, AVA labs native token Avax market cap stands at $8.5 billion, Chainalysis latest valuation is $8.6 billion, Circle, creator of USDC is currently valued at $9 billion among others.　　Despite the bear run and the bloody losses suffered lately following the crash of the Terra ecosystem and huge selloffs in the crypto space, it seems crypto firms are still holding their own and cementing the general strength of crypto in Fintech.　　CEX

2022-06-08Deep Dive

Binance Partners With Malaysian Exchanges to Accelerate Crypto Adoption

The worlds leading cryptocurrency platform – Binance – reportedly revealed intentions to join forces with Malaysian exchanges to boost the local digital asset sector.　　Malaysia Could Benefit From Binances Robust Platform　　Binance has displayed its ambition to strengthen its global presence, and South East Asia is among its key targets. Three months ago, it made an equity investment in MX Global (one of Malaysias cryptocurrency exchanges). The latter will use the capital to educate locals about cryptos merits, find talents in the space, and develop new features within the domestic regulatory framework.　　According to a recent coverage, Binance will double down on its efforts in Malaysia, vowing to work closely with MX Global and other local trading platforms. The goal of the initiative is to accelerate crypto adoption in the region and raise awareness among Malaysians.　　Datuk Fadzli Shah – CEO at MX Global – stated that his company believes crypto represents the future. He also expects to see the industry functioning under appropriate rules.　　“Working closely with the Securities Commission, we want to ensure that the products that we introduce to the Malaysian market are worthy and safe for the investors to participate in this global wave of innovation,” the exec added.　　Additionally, Shah praised

2022-06-08Deep Dive

Citigroup CEO: Europe More Likely to Head Into Recession Than US

Citigroups CEO on Global Recession　　Citigroup CEO Jane Fraser warned about the health of the global economy Friday, Reuters reported. Citi is the third-largest and most globally-focused U.S. bank.　　Speaking at an investor conference in New York, she talked about how “the three Rs” are affecting the global economy, stating: “It‘s rates, it’s Russia, and its recession.”　　Fraser explained that Europes energy problems are “really having an impact on a number of companies in certain industries that are not even competitive right now.” She added that “some of them are shutting down operations … because of the cost of electricity and the cost of energy.” The Citi executive opined:　　Europe definitely felt more likely to be heading into a recession than you see in the U.S.　　Major central banks are already planning interest rate hikes to fight against inflation, preparing for the first round of global quantitative tightening. The move is expected to restrict credit and add stress to an already-slowing world economy.　　Commenting on the European Central Bank (ECB) action, Fraser said: “It feels like the ECB is a few months behind where the Fed has been in getting its arms around inflation and without quite the same flexibility that U.S. has.”　　In the U.S., Fraser

2022-06-08Deep Dive

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