Among the most exciting of Bitcoin news updates to make front-page headlines recently is this: digital currency continues to gain traction among traditional investors, many of whom are adding digital assets to their brokerage accounts and from institutional investors.
What’s more: cryptocurrency firms also are joining the Forbes Fintech 50 in record numbers.
However, some agencies and policymakers believe cryptocurrencies still pose a significant risk and need more regulation. This concern is heightened by the large numbers of hackers, fraudsters, and insider traders who continue to permeate the industry.
In this post, Crypto News Talk round provides a brief roundup of the biggest stories shaking up crypto’s biggest player and how these recent Bitcoin news updates are affecting the industry:
1. BlackRock Partners with Coinbase, Launches Spot Bitcoin Trust
BlackRock, a U.S.-based multinational investment management corporation, has recently partnered with Coinbase. The world’s largest asset manager has also launched a spot Bitcoin private trust for U.S.-based investors. The development is a sign that traditional institutions are increasingly embracing cryptocurrency markets.
The company has researched four areas of digital assets that it believes can benefit its clients and broader capital markets. These four areas include permissioned blockchains, stablecoins, crypto assets, and tokenization, according to Coindesk. As part of the partnership signing with Coinbase, BlackRock customers will have access to Bitcoin through its Aladdin portfolio management software. Bitcoin is the largest cryptocurrency by market capitalization.
BlackRock expects to expand access to other digital assets in the future.
According to Bloomberg, the trust is a shift from four years ago, when BlackRock said it hadn’t heard from any clients interested in investing in digital assets.
2. UN Urges Banning Banks from Holding Crypto Tokens
The UN Conference on Trade and Development (UNCTAD) urges governments in developing countries to ban banks from holding cryptocurrencies. It also encourages countries to restrict crypto usage, citing risks to collecting taxes, monetary policy, financial stability, and other factors. UNCTAD released its regulation recommendations in three policy briefs on Wednesday, August 10.
UNCTAD urges the following actions to curb the expansion of cryptocurrencies in developing countries.
- “Ensure comprehensive financial regulation of cryptocurrencies through regulating crypto exchanges, digital wallets, and decentralized finance, and banning regulated financial institutions from holding cryptocurrencies (including stablecoins) or offering related products to clients.”
- “Restrict advertisements related to cryptocurrencies, as for other high-risk financial assets.”
- “Provide a safe, reliable and affordable public payment system adapted to the digital era.”
- “Agree and implement global tax coordination regarding cryptocurrency tax treatments, regulation, and information sharing.”
- “Redesign capital controls to take account of the decentralized, borderless, and pseudonymous features of cryptocurrencies.”
The organization’s latest figures show that cryptocurrency is particularly popular in Russia, Ukraine, and Venezuela. Geopolitica suggests some of its popularity could be because it bypasses international sanctions, such as those resulting from the Russian invasion of Ukraine. As of November 2021, 41 developing countries had prohibited banks from dealing in crypto or prevented exchanges from offering crypto to retail investors, and nine have banned crypto outright, the report said.
3. Musk Announces Support for Dogecoin After Dumping Bitcoin
Elon Musk, Tesla Motors CEO, will continue to support the Dogecoin digital currency, despite warnings by some financial experts that all cryptocurrencies pose significant risks. Musk is responsible for the resultant price swings of Bitcoin and Dogecoin over the past year.
Musk added $1.5 billion of Bitcoin to Tesla’s balance sheet in early 2021, causing prices to reach an all-time high. Tesla then sold almost all company BTC assets last month, causing its price to dip further.
4. Power Demand Drops on Bitcoin Network As It Shifts To Renewable Sources
In recent weeks, the Bitcoin network has seen a 20 percent drop in power demand, mainly because of its shift to renewable energy sources. Bitcoin has been shifting to renewables in response to a cryptocurrency mining crackdown by the Chinese government.
According to FinboldThe Bitcoin network’s global hash rate dropped from 15.80 GW of power per day in May 2021 to 10.49 GW on August 9. Electricity demands have followed a similar trend.
5. As Inflation Slows, Crypto Markets Accelerate
US inflation slowed to 8.5 percent in July, according to a Consumer Price Index report released on Wednesday, August 10. Crypto markets rose when the CPI was announced, with Bitcoin and Ether leading the way, according to Coindesk. In June, the CPI indicated an inflation rate of 8.7 percent, the highest rate in four decades.
Traditional market securities also jumped when the government announced the CPI.
6. Central African Republic Becomes Second To Adopt Bitcoin as Legal Tender
Central African Republic has become the second country to adopt Bitcoin as legal tender. IHS Market says the move likely is spurred by the CAR’s deepening security relations with Russia and movement away from French influence.
Its decision will likely provoke sanctions from the CEMAC region of which it is a part. The CEMAC region includes Cameroon, Chad, CAR, Equatorial Guinea, Gabon, and Congo-Brazzaville. In May, the region’s central bank banned the use of cryptocurrencies in any CEMAC region financial transactions. The decision also could jeopardize CAR’s standing with the IMF, which is opposed to adopting Bitcoin as legal tender. The CAR participates in an IMF staff-monitored program (SMP) to finance pressing socioeconomic needs.
El Salvador became the first to adopt Bitcoin as legal tender in September 2021. El Salvador also recognizes the US dollar as legal tender.
7. Bitpay Announces Cash Back Rewards
Bitpay has announced that its prepaid card users can now receive cashback rewards for using their card while shopping with certain merchants. The company has partnered with Cardlytics (Nasdaq: CDLX) to offer up to 15 percent cash back at merchants such as Adidas, Costco, H&M, Office Depot, Shake Shack, and Sam’s Club.
Bitpay cards are currently tied to MasterCard’s financial system. Bitpay supports various digital currencies, including Bitcoin, Ether, Dogecoin, and others. Crpto.com, a competitive prepaid card, already provides cash back rewards.
8. Ethereum Merge Expected On September 19
According to Bitcoin.com, the long-awaited Ethereum Merge will finally take place on September 19. The Merge was successfully implemented on the final test net, Goerli, on Wednesday, August 10.
The Merge will transition Ethereum to a proof-of-stake network rather than a proof-of-work network, eliminating miners’ need to add blockchain data. Ethereum says the transition will dramatically reduce its environmental impact. Bitcoin and other popular crypto coins still use the proof-of-work algorithm on their networks.
9. Hackers Have Stolen $1.4 Billion Using Cross-Chain Crypto Bridges
According to CNBC, hackers have stolen more than $1.4 billion this year using crypto bridges, which link blockchain networks together. The bridges enable users to swap crypto tokens quickly.
The cross-chain bridges are less protected than the centralized exchanges and create opportunities for stolen funds. Hackers netted the most significant single haul of $615 million from Ronin, a bridge supporting the nonfungible token game Axie Infinity, which lets users earn money as they play, CNBC said. They also stole $320 million from Wormhole, a bridge backed by Jump Trading, a Wall Street trading firm. In June, they stole $100 million from Harmony Horizon’s bridge, and in August, they seized $200 million from Nomad.
10. Metaverse Crypto Use Carries Greater Risk, Says Bank of England
Adopting crypto assets in the Metaverse may pose risks to financial stability. It would also require “robust consumer protection” frameworks, according to staffers at the Bank of England.
The Metaverse worlds could be sites of large volumes of transitions via tokens such as Bitcoin and Ether, BOE researchers Owen Lock and Teresa Cascino said. The greater the number of transactions, the larger the impact on real-world financial stability, the pair said. They urge regulators to address these issues before the Metaverse is fully developed. The two researchers envision a Metaverse world where individuals spend increasing amounts of time attending virtual concerts, buying and trading non fungible tokens, and using virtual services.
Several major companies are pioneers in the Metaverse. They include:
- Meta (Facebook)
- Epic Games
- The Sandbox
11. Institutional Investors Are Warming to Cryptocurrency
Institutional demand for actively managed cryptocurrency assets is increasing, according to the Institutional Investor. Abra, a crypto-focused wealth management platform, has created Abra Capital Management, an asset management division designed to meet the need. The new division allows investors to access five actively managed funds with digital assets. Three funds will focus on crypto market opportunities for stablecoins, Bitcoin, and Ethereum. The other two will focus on early-stage token and equity opportunities.
Another sign of institutional interest is that significant pension funds are beginning to include crypto allocations. Currently, digital assets make up a small share of portfolios.
12. SEC Says Crypto Startup Must Register Tokens
The US Securities and Exchange Commission has given Bloom Protocol nine months to register its crypto tokens as securities. If the crypto startup fails to register its tokens by the deadline, it will face a $31 million fine.
The SEC says Bloom violated the Securities Act during its initial coin offering in November 2017. Bloom raised $30.9 million from 7,400 global investors from its token issuance, according to Blockworks. The SEC says the company promoted its tokens as investment contracts. Bloom describes itself as a blockchain-powered solution for credit scoring that aims to reduce the risk of identity theft, Blockworks says.
13. Twitter Influencer Tips Off Authorities in 1st Crypto Market Insider Trading Case
A tweet by Twitter influencer Cobie started an investigation that led to an arrest in the first insider trading case on crypto markets. In that case, the US Attorney’s Office for the Southern District of New York is indicting a former Coinbase employee, Ishan Wahi, for tipping his brother and a friend about assets that would soon list on Coinbase, according to the Verge. The two then traded on the information, the Verge says.
On April 12, Cobie tweeted: “Found an ETH address that bought hundreds of thousands of dollars of tokens exclusively featured in the Coinbase Asset Listing post about 24 hours before it was published, rofl.” The indictment says Cobie was tweeting about a wallet owned by Sameer Ramani, Wahi’s friend. According to the indictment, Ramani and Nikhil Wahi bought at least 25 assets before the listing announcements.
14. Nine Cryptocurrency Companies Make Fintech 50
Forbes’ list of the Fintech 50 includes a record nine cryptocurrency companies. Together, the nine companies have raised more than $6.5 billion in venture capital, Forbes says on its site.
The highest-ranked crypto company is the crypto exchange FTX. FTX raised $1.5 billion in private funding last year and an additional $500 million in January. Its valuation has skyrocketed from $1.2 billion to $32 billion. Forbes says it is now the third most valuable U.S.-based private fintech.
Other cryptocurrency companies to make the list were:
- Open Sea, an NFT marketplace
- Alchemy, a developer platform
- Chainalysis, which helps governments analyze blockchain data for illicit transactions
- Ava Labs, which created the Avalanche blockchain
- TRM Labs, a Chainanalysis competitor
- Circle, creator of USD coin
- Fireblocks, an institutionally focused crypto custodian
- Paxos, builder of the crypto brokerage backbone for Paypal and Venmo
15. Celsius’s Bitcoin Sales Need More Transparency, Says Justice Department
The US Department of Justice opposes a bid by bankrupt Celsius Network LLC to sell its mined Bitcoin and other assets. It says Celsius needs more transparency about its operations and assets before making sales.
When the crypto lender filed for bankruptcy in July, it owned more than 80,000 mining rigs, 43,632 of which were operational, Bloomberg says. The company says it stopped monetizing its operations after it declared bankruptcy. However, the bankruptcy trustee says the company is unclear about why the rigs are not operational and whether it intends to use Bitcoin to buy new rigs, repay its $750 million inter-company loan, or for other purposes.
16. Genesis Secures 708 MW for Bitcoin Mining
In the first six months of 2022, Genesis Digital has secured 708 MW of energy for mining Bitcoin. The power capacity spreads across several sites in Texas, North Carolina, and South Carolina.
Within the last 14 months, Genesis gained the means to finance the expansion when it raised more than $650 million. Paradigm Ventures and Kingsway Capital led the two funding rounds.
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