Russian authorities plan to regulate the issuance and circulation of digital assets. This includes international crypto payments. According to the financial watchdog, the Rosfinmonitoring and the Ministry of Finance have taken over the task.
Rosfinmonitoring stated that organizations that conduct exchange operations using digital currency, its storage and transfer, as well as providers of virtual asset service should be subjected to regulation. She also suggested that their responsibilities include fighting money laundering.
The bill “On Digital Currency”, as it stands now, was submitted by the finance ministry in January and has been revised with input from other authorities. It provides for the establishment a domestic infrastructure to facilitate crypto asset trading. Russian regulators now focus on the settlement mechanism for cryptocurrency payment in foreign exchange.
Alexey Moiseev, Deputy Minister of Finance, announced this week that his department has reached an in principle agreement with the Bank of Russia on new legislation authorizing international cryptocurrency payments.
In September, the two institutions agreed that Russia could not live without cross-border cryptocurrency payments in the face mounting sanctions. The official was quoted by Kommersant and the RIA Novosti news agency.
We now have a bill that we have already signed with the central bank. It describes in general how to acquire cryptocurrency and what it can be used for.
RBC Crypto reported that Moiseev acknowledged that the issue of ‘entry to and exit from fiat’ still needs to be addressed. Experts will then need to identify the infrastructure Russia must have in order to make such cryptocurrency payments.
A draft law regarding crypto mining has been approved by the finance ministry and the central bank. It will legalize the activity. The deputy minister pointed out that the issue of whether miners should credit the digital coins they have minted to wallets in Russia or abroad is settled in favor of the second option.
Chief executive of Euro Pacific Capital and founder of SchiffGold, Peter Schiff is an economist and fund manager. He has used Twitter to poll the public about the current Bitcoin crash below $20,000
This survey by the gold bug Schiff suggests that the psychological mark of $20,000 may not be recovered by the top crypto and could go lower.
Schiff tweeted that he believed that there were many Bitcoin buyers below $20,000, but that there are more people who want to sell Bitcoin above $20,000.
To find out what his Twitter followers think, he set up a poll. 52.9% of those surveyed voted that there are more Bitcoin sellers than buyers.
16336 people have already voted within 13 hours of the launch.
Peter Schiff said earlier this year that he was close to getting it right with his bearish Bitcoin predictions. This happened in June, and again nine days ago in August.
It seems that there are still many buyers for #Bitcoin under $20K. There are many sellers over $20K. The market will run out of buyers before there are sellers. Which do you think will happen first?
Peter Schiff (@PeterSchiff). August 28, 2022
Spencer Schiff, the son of a Bitcoiner, reproached his father for spending too much time watching price. He acknowledged that not all Bitcoin holders spend as much time on it. Schiff Jr. called his father’s actions the “Bitcoin derangement Syndrome.” ‘
Schiff Sr. wished Spencer Schiff a happy birthday on Saturday. He also mentioned his love for Bitcoin. Schiff Jr. said that his attraction to BTC was not motivated by a passion, but rather because he believes that BTC can help make humanity more technologically advanced and prosperous.
In August last year Spencer Schiff said that he was all in on Bitcoin from the gold his father trusts and loves.
Santiment, an on-chain vendor of data, tweeted about Bitcoin’s movement above the $20,000 mark over weekend. He pointed out a correlation between Bitcoin’s price and whale wallets that have between 100 BTC to 10,000 BTC.
The tweet shows that the number of wallets has increased by103 over the last 30 days.
The growth in key whale addresses is a positive sign, #Bitcoin having danced to around $20,000 this weekend. The price of $BTC and the number of addresses holding 100-100k $BTC is correlated. They’ve increased 103 over the past 30 days. https://t.co/B7hjXi758z pic.twitter.com/0ozMBG7Oct
– Santiment (@santimentfeed). August 28, 2022
BTC’s first drop below $21,000 was caused by Friday’s speech by Jerome Powell, Fed Reserve chairman. It later fell to $20,000 after Powell spoke.
He said that the U.S. central banking will continue to be hawkish for a while. Both the stock and crypto markets fell heavily in response.
SkyBridge Capital founder and managing partner Anthony Scaramucci said that he believes the worst of crypto bear markets has passed after the collapse of crypto hedge fund Three Arrows and lender Celsius, and the bankruptcy of broker Voyager.
According to CoinDesk data, Scaramucci made these comments as bitcoin trades at $23,207 on Tuesday despite being down 66% since November’s peak.
Scaramucci stated that he believes the system has lost its leverage. Although bitcoin can slide, Scaramucci stated that he doesn’t believe it will fall below the $17,500 low reached in this cycle.
Scaramucci stated that bitcoin’s fair market value is $40,000 based on its adoption, wallet size and use cases. Scaramucci also stated that ether’s fair value is around $2,800.
Scaramucci stated that ‘we on the margin are net purchasers, as incremental cash enters our funds, we’re net sellers of those assets, because they’re fundamentally overvalued and technically oversold. He doesn’t think bitcoin will rise immediately, due to macroeconomic uncertainties. These are volatile assets. Scaramucci stated that people should have a view of these assets for at least four to five years.
According to Scaramucci, Skybridge’s Legion Strategies fund withdrawals are still halted. Scaramucci stated that the firm decided to preserve the fund’s composition after Morgan Stanley made a sell recommendation for the fund. About 20% of the fund was private investments.
“We must be fiduciary. Scaramucci stated that private investments cannot be too high for any of our clients. “I cannot let everyone out at this moment until I can have adequate fairness and balance within the fund.
Scaramucci reports that 18% of the fund was invested in crypto-related investments. This includes bitcoin and private investments made in companies like crypto exchange FTX.
Scaramucci stated that the fund is currently selling private investments. Scaramucci stated that once the investments are liquid, they will let anyone who wants to exit.
Scaramucci reiterated that the highest inflation rate in 40 years will soon fall. He stated that he believes the second half will surprise people as there has been a slowdown of consumption. People have enormous amounts of savings so there will be a slight but not severe recession. Scaramucci stated that there are more jobs than people searching for them.
The most recent World Bank (WB remittance data shows that Sub-Saharan Africa is once more the most costly region to send money to. The average cost for sending $200 to the region was 7.8%. This is 0.4% less than the 2020 figure.
Nigeria, which is responsible for the majority of the region’s remittances saw its inflows rise by 11.2 percent. The WB says that Nigeria’s policy of encouraging recipients to cash out on regulated platforms can explain the increase in the value and volume of remittances to Nigeria through formal channels. Other countries in the region saw significant increases in their inflows are Gambia (31%), Cabo Verde (23%), and Kenya (20.1%).
Globally, the average cost to send money across borders was 6% for the same period. The World Bank reports that both Sub-Saharan Africa as well as the global average transacting cost are much higher than the Sustainable Development Goal 10.3 target of below 3%.
Despite the efforts to reduce this number, it remains very high, and has remained so for many years. It is therefore unlikely that the United Nations SDG10.3 goal to reduce the transaction costs for migrant remittances by 3% by 2030 will be realized. The UN’s goal of eliminating remittance routes with costs greater than 5 percent seems impossible.
The high cost of sending money via formal channels, as well as the strict KYC standards that are often applied to them, force migrants to find more convenient and easier ways to send money. Some of the informal methods migrants use to send money to loved ones include couriers, cross-border truck drivers, and bus drivers. These informal methods come with their own problems, the most important being the security of funds.
Although cryptocurrencies weren’t initially designed to solve this problem, the growing use of cryptocurrencies by migrants to send money to loved ones proves that they can. The 2021 Geography of Cryptocurrency report from Chainalysis, which is a blockchain intelligence firm, will show that a growing number of African migrants could be using peer to peer crypto exchange platforms for sending money back home.
The data from the intelligence company suggests that $105.6 billion worth cryptocurrency was sent to African recipients between July 2020 – June 2021. Nearly 96% of these totals were cross-regional transfers.
Another metric in the report is the number of incoming transfer that are less than $1,000. This supports the claim that African migrants use digital currencies to send money home. Chainalysis reports that the number of such transfers surpassed the 200,000 mark in May 2020 for the first time and has remained above this level ever since. In fact, just 800,000. were transferred below $1,000 in May 2021.
Not only are cryptocurrencies faster and more secure than traditional channels, but they also cost less. It may cost up to $10 to send $100 from South Africa into Zimbabwe using regular corridors. However, sending $200 via the BC network costs $0.01 or less than one percent. Transferring the same amount on the Stellar network costs less than one cent. These two examples are just two of many that show that cryptocurrencies offer a better alternative than regular remittances channels.
While critics, especially those from advanced economies, are quick to point out the shortcomings of cryptocurrency, many migrants not only from Africa, but from all over the world are showing that cryptos can be more reliable than traditional channels. If cryptocurrency were to suddenly become the most widely used method of transferring funds between different jurisdictions, then it would be possible to achieve the SDG 10.3 goal that remittance costs below three percent well before 2030.
When dealing with cryptocurrency, regulators must be guided by facts and not misinformation. The regulation of cryptocurrency should not be about limiting their use, as the United Nations Conference on Trade and Development suggested in a policy brief.
Instead, regulators should encourage or promote the increased use cryptocurrency where it is being used. It is important to protect and encourage innovations that empower the poor or attempt to level the playing fields.
According to the most recent data from Cryptocompare, crypto investment products’ AUM fell to record lows during June 2022. According to Cryptocompare, the digital asset data company and regulated benchmark administrator, the AUM drop was mainly due to the uncertainties around the future of crypto lending firms like Three Arrows Capital.
The data indicates that crypto exchange-traded fund (ETFs), suffered the largest drop at 52.0% to $1.31 trillion in AUM. Trust products, which account for 80.3% market share, saw a 35.8% drop to $17.3 billion at the end of the month.
ETCs and ETNs fell by 36.7%, 30.6% and respectively $1.34 billion to $1.61 billion. Cryptocompare summarized the findings as follows:
All four product types recorded new records lows, with Trust products recording their lowest AUM since December 2020. ETCs AUM was at its lowest level since October 2020. ETFs and ETNs also recorded their lowest AUMs since April 2021 and January 2021, respectively.
The report also notes that 21 Shares Bitcoin Short ETP was the only digital investment product to have a positive 30 day return (31.8%) as at June 23. The ETP’s AUM was $16.5 million as of June 27, which is an unprecedented high for the product.
The report stated that the ETP had risen for three consecutive months and is now one of few products that seems to be taking advantage of current market conditions.
Contrary to 21 Shares, the largest outflows of BTC as well as ETH were recorded by Purpose and Coinshares ETPs during the same period.
‘Purpose Bitcoin Exchange Fund (BTCC) has sold 18,170 BTC, while 3iq Bitcoin ETFs (BTCQ), saw 7,384 BTC leave the fund (as at 24 June).
The AUM of both the Proshares Bitcoin Strategy ETF (BITO) and the NYSE Xchange exhibited drops of 56.7% & 57.1%, respectively, in June. According to the report by digital asset data firm, Proshares Bitcoin Strategy ETF ETF (BITO), the biggest inflow was after the purchase of 7,264 Bitcoin during June.
Data also show that 3iq Coinshares Ethereum ETF (ETHQ) had the largest outflow among all ethereum products in the period, with 26,499 ETH. Purpose Ether ETF, (ETHH), saw an outflow in June of 24,409 Ethereum.
The ministry announced that Regulations which allow crypto exchanges to be registered at the Astana International Financial Center AIFC to be serviced in Kazakhstan by second-tier banks have been adopted by a group consisting of representatives of the Ministry of Digital Development and the central bank, financial regulators, financial regulators, and members of the financial sector.
This initiative is part a project that aims to establish a regulatory framework that will allow Kazakhstan to develop its potential as a regional cryptocurrency hub. The pilot will run through 2022 and include crypto trading platforms licensed under the AIFC Financial Services Authority, a press release explains.
After China clamped down on cryptocurrency mining in May 2013, Kazakhstan attracted more than a dozen crypto miners. Bagdat Musin, Digital Development Minister, stated that the crypto industry does not just include mining, but also crypto exchanges and digital wallets. A high-ranking official from the government elaborated:
It works in the same way as other industries and can and should be used to benefit our economy. Crypto exchange is the next stage of financial technology development. We must make money.
Musin argued that Kazakhstan must create a fully-fledged digital ecosystem to allow the digital assets that were extracted from Kazakhstan’s electricity to be traded on local exchanges while the income is kept in the country.
The Digital Ministry stated that the pilot project would allow for the regulation of digital currencies. This will provide adequate protection for professional and retail investors. If the pilot project is implemented successfully, Nur-Sultan authorities plan to amend the country’s laws and the acts that govern the AIFC.
Nurkhat Kushimov, Director of AFSA, pointed out that the AIFC Financial Services Regulatory Committee now oversees all activities of fintech companies in Kazakhstan. He stressed that all entities applying for licenses are carefully checked and supervised. The official stated that the goal was to create a safe environment for only stable and trustworthy companies to operate in the market.
After a recent statement from the National Bank of Kazakhstan, which said it was closely monitoring the market but not yet allowing for legalization of cryptocurrency, the positive developments for the local crypto sector are a result of the National Bank of Kazakhstan’s recent statement. The monetary authority stated that it will capitalize on the innovation potential of crypto technologies.
John Waldron, President of Goldman Sachs and Chief Operating Officer, shared his outlook on the U.S. Economy at a Thursday banking conference.
He commented on the current economic situation and said that it was “among the most complex, dynamic environments I’ve ever experienced in my career.” He elaborated on the comments made by Goldman Sachs’ top executive:
Although we’ve been through many cycles, the combination of so many shocks to our system is something that I have never seen before is remarkable to me.
Waldron’s remarks echo a similar warning from JPMorgan Chase CEO Jamie Dimon who warned Wednesday of a ‘hurricane. He advised that you should be prepared.
The Goldman Sachs president noted that he would refrain from using ‘any weather analogies’. He also expressed concern about the risks of inflation, changing monetary policies, and the Russia-Ukraine conflict.
We anticipate that the economic climate will be more challenging in the future. We are witnessing a more difficult capital-markets environment.
Goldman’s executive named several other alarming economic factors, including a commodity shock as well as unprecedented amounts of monetary stimulus.
A growing number have expressed concern about the U.S. economic state and predicted that there will be a recession.
Elon Musk , Tesla CEO, stated that he feels’super bad’ about the economy this week. President Joe Biden responded. Musk stated that we could be in a recession for 12 to 18 more months .
Other than Musk, Soros Fund Management CEO Dawn Fitzpatrick and Big Short investor Michael Burry have also warned of a coming recession. Rich Dad Poor Dad author Robert Kiyosaki predicted that the markets would crash and that civil unrest and depression are on their way.
China used to be the largest crypto mining hub in the world, accounting for between 65 and 75% of the total “hash rate” (or processing power) of the bitcoin network.
According to Cambridge University data, the country’s share in global bitcoin mining capacity dropped to zero between July and August 2021 after authorities launched a new crackdown on cryptocurrency.
China decided to end crypto mining. This is a power-intensive process that allows for the creation of digital currency. Many miners fled to countries bordering China, such as the U.S. or Kazakhstan.
CNBC has reported that underground mining operations have emerged in China. Miners are taking care to avoid Beijing’s ban.
The new research by the Cambridge Centre for Alternative Finance has shown that Chinese bitcoin mining activity is on the rebound. Data from Cambridge researchers shows that China accounted for just 22% of total bitcoin mining market by September 2021.
This means that China is now a major global player in bitcoin mining, second only to the U.S. which eclipsed China last year as the biggest destination for the sector.
One caveat: This research method relies on aggregate geolocation of large bitcoin mining pools’, which combine computing resources to more efficiently mine new tokens. It is used to identify where activity is concentrated within different countries.
Researchers said that this approach could be susceptible to “deliberate obstruction” by bitcoin miners who use a virtual private networks (VPNs) to hide their location. VPNs allow users to route traffic through servers in other countries, which is useful for those living in China or other countries where internet access is restricted.
They added that this limitation would “only moderately impact” the accuracy of their analysis.
Unlike traditional currencies, cryptocurrencies are decentralized. This means that the distributed network of computers is responsible for processing transactions and creating new currency units.
So-called miners must agree to a bitcoin transaction in order to facilitate it. This involves complex calculations in order to solve a puzzle. The blockchain is a network of miners that allows for more complicated transactions.
The first person to solve the puzzle wins a new set of transactions on the blockchain. They also get rewarded with bitcoins.
This way of reaching consensus, also known as “proof of work”, consumes a lot more energy than whole countries like Sweden and Norway.
China has repeatedly warned about crypto. China’s most recent crackdown on crypto was undoubtedly the most severe.
The second-largest economy in the world was facing a prolonged energy shortage that resulted in numerous power outages.
China remains heavily dependent on coal and is investing more in renewable energy to reduce its carbon footprint by 2060. Authorities consider crypto mining a potential hindrance to this plan.
The country is now the second most popular destination for those looking to mine bitcoins. The bitcoin price is down over 50% since November’s peak, making it less lucrative.
CNBC was unable to reach the People’s Bank of China and China’s National Development and Reform Commission immediately for comment.
Investors seeking clues to bitcoin’s recent failure despite continued accumulation of the Luna Foundation Guard, (LFG), may wish to examine the ever-growing list macro risks and what’s going on in traditional markets.
According to CoinDesk data, the world’s biggest cryptocurrency dropped below $42,000 during European trading hours. This was the lowest level since March 22, and extends the fall from the March high of $48,240. LFG added $173,000,000 in bitcoin to its wallet this weekend, increasing its total holdings by almost 40,000 BTC.
According to Noelle Acheson (head of market insights at Genesis Global Trading), the weakness could be due to traditional investors not following LFG’s lead considering the many economic and political uncertainties stalking risk assets. Genesis Global Trading is owned by CoinDesk parent Digital Currency Group.
Acheson stated that while the DXY strength is a part of the overall picture, there’s more market uncertainty, macro concern, and a greater focus on what rates will do in a Telegram chat.
According to TradingView data, the dollar index, which measures the value of the greenback against a basket major currencies, reached two-year highs over 100 today. This brings the year-to date gain to 4.3%. Global reserve currency rose 1.5% this month.
Kevin Kelly, global head of macro strategy and co-founder at Delphi Digital, believes that the greenback and bitcoin are in a very inverse relationship. Kelly stated that 2017 was one of the worst years in the history of the dollar and that it coincided with a large run in bitcoin in March during an analyst call. “We saw bitcoin rise in the early 2021.” This was due to the dollar weakness.
Blofin volatility trader Griffin Ardern stated that when the DXY reaches highs and climbs further, it often indicates further declines of other assets, such as the stock market or cryptocurrencies.
This is especially true now that the dollar rally is being fuelled by hawkish Federal Reserve officers, who call for an increase in interest rates and a greater balance sheet runoff to reduce inflation. For risk assets such as bitcoin, tightening policy is considered to be bearish.
A Reuters poll indicates that the Fed will likely increase rates by 50 basis point during the May and Juni meetings. This follows a 25 basis point increase in borrowing costs last month. The U.S. 10-year Treasury yield is now at 2.7%, a new record.
Concern is also raised by the cryptocurrency’s vulnerability to equity markets. As liquidity is decreasing, big tech is experiencing difficulties. This is due to markets pricing tighter by the Fed. Acheson also noted that there are more reports of tech companies closing down, laying off employees, and/or having dwindling term sheet.
Tech stocks could be in for a major correction, according to Arthur Hayes (co-founder and former CEO at BitMEX, a crypto spot and derivatives exchange).
Inflation is becoming more entrenched around the world with the ongoing Russia-Ukraine conflict, which leaves virtually no chance for central banks to resort to liquidity-pumping strategies anytime soon.
If this isn’t enough, markets may be kept on edge by Marine Le Pen’s win in France’s presidential election.
European stock futures fell today after polls revealed that Le Pen and Macron were the top vote-getters in Sunday’s first round. 27% and 24% respectively. Some investors are concerned that Macron’s narrow lead could be closed by Le Pen consolidating anti-Macron votes prior to the final round on April 24.
“Adding to the effect of war in Europe, the results of yesterday’s voting in France have been released, which could – depending upon how the next round on April 24 goes – cause more currency turmoil,” Acheson said.
“And with so much uncertainty, especially considering crypto assets’ history volatility, macro investors are choosing not to invest until they have enough signals to make directional bets with conviction,” Noelle said.
Warren Buffett disciple Joel Greenblatt doesn’t own bitcoin because he believes there’s no intelligent way to value it
Joel Greenblatt, a veteran investor, has never bought any Bitcoin because he doesn’t believe there’s an intelligent way of valuing the cryptocurrency.
In a Tuesday episode, Gotham Asset Management’s co-CIO stated that Bitcoin is not going to earn any money.
“It’s speculation to me. It is not something I can value. He said that he was not saying that people will make money by speculating on bitcoin or gold.
It’s not an investment for me because it’s too expensive. It does not have any intrinsic value. It does not earn any income.
Greenblatt is well-known for providing seed capital to Michael Burry, the ‘Big Short’ investor, to launch Scion Capital. Between 1985 and 1994, when he was managing Gotham Capital, he averaged annual return of 50%. Greenblatt attributes his success to the investing strategies of Warren Buffett, Ben Graham and others.
Berkshire Hathaway CEO Buffett has criticised bitcoin, calling it ‘rat poison squared and’ and saying that it ‘doesn’t produce anything’.
Greenblatt, value-investment guru, said that he was wrong to believe bitcoin would ever reach the dizzying heights it has. He said that he is committed to sticking with what he knows.
Bitcoin reached $47,000 at the peak of its trading. This was due to bullish market sentiment and a wider rally in global asset prices. This is believed to be the start of a strong bullish market.
Greenblatt stated that he doesn’t feel guilty about it and added that he felt disciplined for not participating in the crypto craze.
‘And of course, you’re gonna miss thousands of things that you woulda-coulda-shoulda bought. If you focus on the things you are working on and they succeed, this is what you need to do.
Greenblatt doesn’t appear to be an active investor in bitcoin, but his opinion about the most popular cryptocurrency is positive.
“People have tried making a case for me about the different uses of bitcoin or why I should remain,” he said. He said that he couldn’t be dismissed.
“I’m saying, “Gee, this is so hard for me to understand.” It’s impossible to predict if it will go higher or lower.
He said that bitcoin can be compared to high-end art and that some pieces may not be as valuable in the future.
He said, “It’s all in the eye of one’s eyes.”
According to data from coinGecko, Bitcoin is still 31% below its November record of $69,000.