Crypto Guides, Knowledge & Insights

Crypto-Friendly Special Economic Zone in Honduras Adopts Bitcoin as Legal Tender

Bitcoin Operates as Legal Tender in Próspera　　Próspera, a special economic zone located on the island of Roatan in the Western Caribbean and the Northern Corridor of Honduras, announced Thursday that it has adopted bitcoin as legal tender. Referring to Próspera as “crypto-friendly,” the announcement details, “Bitcoin and other cryptocurrencies effectively operate as legal tender within its jurisdiction.”　　A spokesperson for Próspera told Bitcoin.com News:　　Próspera has no capital gains taxes, which means that bitcoin and other cryptocurrencies effectively operate as legal tender in the jurisdiction.　　“Residents and businesses in Próspera may transact using bitcoin, Honduran Lempiras, U.S. dollars, or any other currency of their choice without triggering capital gains tax liabilities on transactions,” the spokesperson added.　　The announcement notes:　　Unlike most other jurisdictions, transactions in bitcoin and other cryptocurrencies are not subject to capital gains taxes.Issuing Bitcoin Bonds　　Próspera also announced that starting Thursday, “municipalities, local governments, and international firms can issue bitcoin bonds” in its jurisdiction “to attract foreign investments.”　　The special economic zone noted that bitcoin bonds issued through Próspera “will comply with world-class standards for AML [anti-money laundering] and KYC [know your customer].”　　El Salvador, a neighboring country of Honduras, made bitcoin as legal tender in September last year alongside the U.S. dollar. The countrys

2022-04-09Deep Dive

Federal Reserve may purposely force down crypto prices

Bill Dudley, former president of the Federal Reserve Bank in NY and chief economist at Goldman Sachs, believes that “to be effective, [the Federal Reserve] will have to inflict more losses on stock and bond investors than it has so far.”　　Why the Fed may push down tech and crypto　　The Feds tools to push stocks down are focused on raising interest rates and tightening financial conditions. These tend to directly affect the price of risk-on assets such as tech stocks and crypto. On Wednesday, April 6th, the minutes of the latest Fed meeting were released, and immediately tech stocks dropped, with the Nasdaq falling 315 points. Some stocks, such as Cloudflare, gapped down almost 10% on the news. While the internet networking company may not be a crypto project, it does have a vital role in keeping web3 infrastructure online. Amazon AWS and Cloudflare are centralized bottlenecks in the blockchain revolution, with 20% of all internet traffic passing through the Cloudflare CDN network.　　Dudley explains that short-term interest rate hikes do little to affect most people in our modern society. This is because many mortgages are tied to fixed rates over a long period, especially in the US. He believes that market

2022-04-08Deep Dive

Can Bitcoin Hashrate Reach 300 EH/s By End Of 2022?

The Bitcoin hash rate has come a long way from the China crackdown that saw it fall by 50% in a matter of weeks. Its recovery has not only been swift but has been strong in the same regard. It continues to do well in terms of growth. However, with the growth has come expectations of where this metric might finish in the year 2022. Analysts have put this number at 300 EH/s by the end of the year but can bitcoin achieve this in the next 8 months？　　Hash Rate Needs To Rise　　The bitcoin hash rate is not doing badly compared to where it was last year. With its fast growth at the beginning of the year, it has been able to push past 200 EH/s. However, with momentum slowing down over the past two months, this number has not risen by much. This now raises the question of how much the hash rate must grow on a monthly basis for it to be able to hit the 300 EH/s figure by the end of 2022.　　With its current figure at 200 EH/s, the bitcoin hash rate would need to continuously rise at a rate of 5% per month to be

2022-04-08Deep Dive

Bank of Russia Rejects Idea of Using Cryptocurrency to Circumvent Sanctions

Employing Bitcoin to Evade Sanctions Not Possible, Central Bank of Russia Says　　Bank of Russia considers it impossible to use cryptocurrencies to circumvent financial restrictions imposed over the military conflict in Ukraine. That‘s according to a statement by the central bank’s First Deputy Governor Ksenia Yudaeva, issued in a reply to a proposal by a member of the State Duma, the lower house of Russian parliament.　　Anton Gorelkin, a lawmaker from the ruling United Russia party, had suggested that Russian companies and individual entrepreneurs should be allowed to make payments in digital currencies, including for settlements with foreign partners. He thinks the establishment of a Russian national crypto infrastructure in response to the sanctions introduced by the West is inevitable.　　Central bank officials are convinced, however, that transfers of large amounts of money in cryptocurrency by Russian businesses would not be feasible. Quoted by the RIA Novosti news agency, Yudaeva pointed out that regulatory authorities in the EU, U.S., U.K., Japan, and Singapore have started to implement preventive measures.　　Digital asset platforms such as crypto exchanges are also adopting restrictions amounting to denial of access to funds for Russian users, she added. And even in jurisdictions where crypto payments are not banned at the

2022-04-08Deep Dive

What Is Behind Norway’s Booming Bitcoin And Crypto Interest?

In the fourth survey about crypto adoption ran in Norway by Arcane Research and Ernst & Young (EY) in 2018, they find that the industry is booming in the country with the levels of ownership that have doubled from 5% to 10%. Moreover, bitcoin miners seem to be attracted to several traits of the country.　　Crypto Is Booming In Norway　　Arcane Research shows in its latest weekly update data from a survey conducted by themselves and EY. The study found that at the moment around 420,000 Norwegians currently own cryptocurrencies. This translates to 10% of Norways adult population owning digital assets, an increase of 120,000 people or 7% since 2021.　　Arcane Research Weekly Update　　The gender gap in crypto adoption seems to be closing in the country. Norwegian females are showing higher interest in crypto this year with a rate of crypto ownership that doubled from 3% in 2021 to 6% in 2022.　　63% of the surveyed females said to have purchased crypto for the first time between 2021 and 2022, with a 24% share happening in the first months of this year alone, which indicates the increasing interest.　　Arcane Research and EY survey　　Similar to several studies that research levels and demographic traits of crypto adoption

2022-04-08Deep Dive

JPMorgan CEO Jamie Dimon to Shareholders: Decentralized Finance, Blockchain Are Real

JPMorgans Jamie Dimon Praises Defi and Blockchain　　JPMorgan CEO Jamie Dimon recognized the merit of decentralized finance (defi) and blockchain technologies in his latest annual letter to shareholders, published Monday.　　While talking about his companys investments in technology, Dimon said:　　Decentralized finance and blockchain are real, new technologies that can be deployed in both public and private fashion, permissioned or not.　　The CEO elaborated: “JPMorgan Chase is at the forefront of this innovation. We use a blockchain network called Liink to enable banks to share complex information, and we also use a blockchain to move tokenized U.S. dollar deposits with JPM Coin.”　　According to its website, 39 countries are now covered within the Liink network. More than 25 of the worlds leading banks have signed up to participate and over 400 leading institutions have signed letters of intent to join. The global investment bank said that it “established Liink to find more efficient ways to transfer data through custom applications.”　　JPMorgan explained that “JPM Coin is a permissioned, shared ledger system that serves as a payment rail and deposit account ledger, enabling participating J.P. Morgan clients to transfer US Dollars held on deposit with J.P. Morgan.” The coin “facilitates real-time value movement, helping to solve common

2022-04-08Deep Dive

Metaverse Will Be Most Popular Place to Buy, Trade, Store Cryptocurrency, Survey Shows

Survey: Metaverse Will Be the Most Popular Place for Crypto　　Nasdaq-listed Agora (NASDAQ: API), a video, voice, and live interactive streaming platform, conducted a survey on the metaverse and published the results Tuesday.　　The company asked 300 U.S.-based developers a set of questions “to learn more about what they thought about the metaverse and what we will see in the coming years,” Agora detailed. Developers were surveyed because for them, “the growth of the metaverse allows the development of new communities and allows them to better connect with users,” the company explained.　　According to the results:　　57% of respondents think that the metaverse will become the most popular place to buy, store and trade cryptocurrency, while 18% disagree and 25% feel neutral.　　In addition, 70% agreed that “cryptocurrency and blockchain technology advancements will be critical to shaping the future of the metaverse,” while 9% disagreed.　　Regarding non-fungible tokens (NFTs), “The majority of developers are bullish on NFTs and believe they will become the biggest [currency] in the near team,” the survey results note.　　Survey participants were also asked who they think will own the metaverse. 55% of respondents said Meta (formerly Facebook), 9% said Google, 7% said Microsoft, 6% said Apple, and 5% said Amazon.　　Meta recently filed

2022-04-08Deep Dive

Bitcoin to be accepted by McDonald’s and Walmart via Lightning Network

Jack Mallers, founder of Zap, is bringing Bitcoin back to its roots with an announcement that his Lightning Network wallet, Strike, has partnered with Shopify, NCR, and Blackhawk Network. According to Mallers, any website that uses Shopify online card transactions can now process payments using Bitcoins Lightning Network. The partnership is live right now and a massive step toward the mass adoption of Bitcoin.　　“Any online merchant that uses Shopify can accept payments without the 1949 boomer network, receive it instantly, cash final, no intermediary no 3% fee”　　During the presentation, a slide appeared listing some of the biggest retailers in America, including McDonald‘s, Walmart, Home Depot, and Best Buy. According to their websites, Blackhawk and NCR also serve Starbucks, Chipotle, El Corte Ingles, Lowe’s, Staples, Woolworths, and thousands of other global retailers. We will have to wait for more details to understand exactly when and how some of these retailers will start accepting Bitcoin. However, Maller claims that over 400,000 storefronts will now accept Bitcoin via the Lightning Network.　　The Lightning Network adoption　　Over the past few weeks, Robinhood, Kraken, and Bitpay have integrated the Lightning Network. The Lightning Network is a layer two solution for the Bitcoin blockchain that uses smart contracts

2022-04-08Deep Dive

FDIC Asks All Banks to Report Crypto Activities

A top U.S. banking regulator has asked banks to report on their “crypto-related activities,” citing potential “safety and soundness risks as well as financial stability concerns” resulting from exposure to crypto assets.　　On Thursday, the Federal Deposit Insurance Corporation (FDIC) issued a financial institution letter – a letter sent to CEOs of FDIC-insured banks – requesting that banks should notify their regional FDIC director of their crypto activities. This request applies to both current and future crypto-related activities.　　According to the letter, the FDIC will review the information, ask more questions if necessary, and then issue “relevant supervisory feedback.”　　The new reporting requirements are a step-up from previous FDIC statements on crypto.　　Under Acting Chair Martin Gruenberg, the banking regulator has issued warnings about the potential for the “rapid introduction of…digital asset products into the financial system” to pose systemic risks. In February, Gruenberg said the FDIC and other regulators needed to provide “robust guidance” to the banking industry on how to manage the risks posed by crypto.　　Thursdays letter is a signal that the banking regulator is now getting serious about cracking down on crypto.　　Because the vast majority of banks – including every national bank – in the U.S. are FDIC-insured, the new requirements

2022-04-08Deep Dive

U.S. crypto regulations should be ‘tech neutral,’ says Janet Yellen

The U.S. Treasury secretary Janet Yellen highlighted the need for new cryptocurrency-focused regulatory frameworks “designed to support responsible innovation while managing risks” in her remarks during an April 7 speech at American University.　　According to a report published by Associated Press, this was Yellens first crypto-related speech since President Joe Biden signed an executive order on digital assets on March 10.　　“Our regulatory frameworks should be designed to support responsible innovation while managing risks — especially those that could disrupt the financial system and economy,”　　Yellen noted, adding:　　“As banks and other traditional financial firms become more involved in digital asset markets, regulatory frameworks will need to appropriately reflect the risks of these new activities…To the extent there are gaps, we will make policy recommendations, including assessment of potential regulatory actions and legislative changes.”　　Equal protection regardless of medium　　Bidens “Executive Order on Ensuring Responsible Development of Digital Assets” has delineated several key directions for crypto regulation, including customer protection, systemic financial and security risk mitigation, equitable access to financial services, support for technological advancements, and others.　　In her speech, Yellen similarly echoed a lot of those points. Notably, she also opined that potential crypto regulations should be “tech neutral” — meaning that consumers of various financial

2022-04-08Deep Dive

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