“Netherlands Must Ban Bitcoin Now,” says Director for Economic Analysis

Pieter Hasekamp is calling for a complete ban on crypto — mining, trading, and holding because they are only good at privacy which is used by criminals, while government money works just fine with “hardly any currency devaluation…although inflation is now slowly picking up,” he said.

The director of the Dutch Bureau for Economic Analysis is calling for a complete ban on the mining, holding, and trading of Bitcoin and other cryptocurrencies.

This comes after crypto trading platform Bitonic won its case against the Dutch Central Bank last month regarding the apex bank’s wallet verification requirement. The regulator formally acknowledged at the time that its requirement was unlawful and should have never been called for the purpose of crypto exchange platform registration.

Now, today in an opinion piece on the local publication FD which had 3.72 million visitors in May, Pieter Hasekamp, director of the Central Planning Bureau, said the bursting of the crypto bubble is inevitable, and the Netherlands needs to act now, or the consequences of the crash will be “too great.”

Pointing to Gresham’s law, “Bad money crowds out good money,” Hasekamp said Bitcoin fits this pattern with cryptos exhibiting “all the hallmarks of “bad money”’ — unclear origin, uncertain valuation, and shady trading practices.

That’s Not Going to Happen

According to Hasekamp, cryptocurrencies do not fulfill the three functions of money, while government money “scores well in terms of value retention.”

Interestingly, the buying power of one euro (1€) has depreciated by a whopping 30% between 2000 and 2020 from 1€ to 0.7€. Hasekamp wrote,

“In recent decades, there has been hardly any currency devaluation. Although inflation is now slowly picking up, few people believe that we are returning to the figures from the 1960s and 1970s.”

All in all, the current monetary system works very well in practice, he said while arguing further improvements are conceivable through central bank digital currencies (CBDC).

While fiat currencies work so well, private cyber currencies “perform far worse than public money on all counts,” he added.

But Hasekamp did find one area where cryptocurrencies do better, and that’s in the privacy aspect, and “that anonymity is exactly what makes them attractive to criminals.”

As for its use as a store of value, Haskamp wrote that it is based on the hope that cryptocurrencies will one day replace real money, “but that’s not going to happen.” He wrote,

“Cryptocurrencies are essentially neither money nor a financial product, but… a contagious story in which people believe because other people believe in it. Gresham’s law is replaced by Newton’s law: what goes up must come down. The ultimate collapse of the crypto bubble is inevitable.”

As countries take steps to curb the crypto hype, Hasekamp wants the Netherlands to move fast and “ban Bitcoin” because “whoever moves last is the loser.”

He points out how China has already made its move by banning several crypto activities while the Netherlands is lagging behind. While the Central Planning Bureau concluded in 2018 that stricter regulation was not yet necessary, cautious regulation can now “backfire,” he said.

Regulation simply “legitimizes crypto as a bona fide financial product. Recent developments show that it is time to act: the longer we wait, the greater the negative consequences of the eventual crash,” said Hasekamp.

As such, he is recommending a total ban on the production, trading, and even possession of cryptocurrencies.

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Author: AnTy

Former PBoC Vice-Chair Says the Backend Infrastructure for China’s Digital Yuan is Complete

China’s much anticipated Digital Yuan backend development is complete, according to Wang Zhongmin, the former Vice-Chair of the PBoC National Council for Social Security Fund. Wang made this announcement during the virtual 2020 FinTech Forum that was held by Beijing’s Fintech 50 Forum in collaboration with Tencent FinTech Research Institute.

The initiative, which began around five years ago, is in its sunrise phase following a pilot in 4 Chinese cities. Going forward, PBoC is optimistic about replacing the fiat renminbi (RMB) in circulation with a digital yuan.

It, therefore, follows that Wang’s sentiments could signal an earlier integration with China’s monetary system. Notably, China fast-tracked the development of its PBoC backed digital currency after Facebook announced Libra last year.

With crypto assets on the rise, China is looking to emerge as a leader in this space, hoping to replace the U.S dollar as the world’s reserve currency.

According to Wang, the digital yuan would not only serve as a digital base currency but also a payment ecosystem that accommodates other crypto-assets and sovereign currencies. Its integration is, therefore, expected to spur greater cooperation and competition in the digital currency space while maintaining oversight.

Also, the move towards a digital yuan is in line with measures against the spread of COVID-19. Wang was keen to note that both governments and private entities have since taken into consideration digital payment tech.

Other notable jurisdictions that have moved to support a CBDC include Italy; the country’s banking association (ABI) recently said that they are ready to take part in the piloting of a digital Euro.

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Author: Edwin Munyui

IOHK Reboots Byron Codebase, A Big Step Towards Cardano’s Shelley Blockchain Upgrade

IOHK Team has released a statement that the Byron upgrade is now complete. As per a press release, the upgrade will allow a seamless changeover to the Shelley mainnet. The upgrade will now make Cardano (ADA) be fully decentralized.

The new Byron upgrade or reboot that is set to be rolled on Mar. 31, 2020. This is the most significant software upgrade on Cardano since it was launched back in 2017.

IOHK Team explained that the new release means the entire design of all elements within the Cardano (ADA) blockchain. The upgrade will enhance various elements such as the Cardano’s node performance, the wallet backend, the Cardano wallet as well as Daedalus wallet itself.

The team stated that one of the most significant aspects that come with the Byron reboot is the reorganization of all the logics of the interaction among the blockchain components. The fresh release will make the codebase modular, which will separate the ledger, components of the network node as well as consensus. As a result, this will allow “any one of them to be changed, tweaked, and upgraded without affecting the others.”

The new release means that Cardano (ADA) network is increasingly moving just inches to the launching of the Shelley mainnet. The upgraded Byron network, the system will now have the capacity to support every Shelley feature in addition to various future developments.

The fresh node update is set to be launched to more cores as well as relay nodes on top of the Cardano mainnet for the coming few weeks. This will be followed by more reboot improvements as well as a Daedalus beta in the future.

[Also Read: IOHK Releases Ouroboros Hydra Protocol to Improve Micropayments on Cardano Network]

IOHK CEO, Charles Hoskinson, explained that the release of an upgraded Byron will enhance the overall performance of the Cardano network. He also explained that the upgrade will also improve the transaction throughput capacity. The network is also going to handle an increased demand as well as more transactions every second.

Hoskinson also expounded that the new codebase will allow the Cardano system to be operated using less costly computational equipment that has a weak internet connection. Hoskinson also said,

“I am extremely proud of the IOHK developer team’s endeavours to rewrite the Byron era node from the ground up. Their work represents a significant investment in the network-critical infrastructure required to support the Shelley era of Cardano as we move forward on our mission to build a global-scale financial and social operating system.”

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Author: Joseph Kibe

HSBC Becomes The First Bank To Complete Transaction On We.trade Blockchain Platform

HSBC, a multinational bank, has recently become the first bank to complete a blockchain transaction on the European We.trade platform. The project, which was started back in 2017, has only recently started its second round of pilot tests.

According to the reports, the bank made a transaction for its client Beeswift with Rabobank, a Dutch bank. We.trade is based in Dublin and it uses the Hyperledger Fabric technology as a basis for its technology.

With the aid of blockchain technology, the bank is able to make transactions in Europe while tracking them. The goal of the platform is to facilitate international trade between European companies using the blockchain. The platform is also set to offer trusted access to counterparties during online transactions and the equivalent of letters of credit.

This is far from the only blockchain platform in which HSBC is involved at the moment. For instance, the bank has already used Voltron, a blockchain project that is backed by R3’s Corda technology and was based in the United Kingdom.

By using Voltron, HSBC affirmed that the time of the transactions was reduced in at least 40%, a considerable improvement. Representants from the bank believe that the blockchain technology can be responsible for cutting several costs of the transactions and taking them to a whole new level.

We.trade is backed by several banking institutions which are present in the European continent. These companies are the Deutsche Bank, Société Générale, Banco Santander, Rabobank, CaixaBank, Nordes, Natixis and, obviously, HSBC. The other banks are set to use the platform as well in the coming months.

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Author: Hank Klinger

Congressman Warren Davidson: SEC Is Taking a “Third World” Approach to Crypto Regulations

Congressman-Warren-Davidson-SEC-Is-Taking-a-Third-World-Approach-to-Crypto-Regulations
  • The SEC is still working to establish complete regulations regarding the cryptocurrency industry.
  • Congressman Warren Davidson believes that the lack of urgency is holding back the United States.

Even with the stance that the Securities and Exchange Commission (SEC) has officially taken in the cryptocurrency community, there are still plenty of lawmakers that do not agree at all. Republican Congressman Warren Davidson is easily one of those people, criticizing the SEC for taking a “third-world, developing-economy approach.”

As Davidson explained, the approach being taking by the SEC is causing the entire United States to be left behind in the progress of the crypto industry.

The comments by the congressman were made at the recent inaugural meeting of the House Task Force on Financial Technology on June 25th. During the meeting, Davidson questioned why there is not any urgency for the regulations to be established for cryptocurrency for more clarity. The industry is becoming impatient and frustrated, because there is so much waiting on these regulations to be established.

As the SEC wastes the time of the cryptocurrency community, there are many businesses that are taking their activities outside of the United States to give them a place that offers more certainty in their regulations. He explained that certainty is necessary in the industry that there are certain actions that a cryptocurrency needs to take to be officially called an asset.

In response to the heavy criticism, the SEC’s Valerie Szczepanik defended the authority, saying that they have been “quite clear” about where they stand on cryptocurrencies.

Her statements should hold some weight, since she is the senior advisor for digital assets with the SEC, which was a position that was created with the intention of dealing with the cryptocurrency industry. Still, the rest of the industry has yet to agree. Szczepanik explained,

“We’ve put out guidance at least on [initial coin offerings] beginning in 2017 about how we apply the law to the issuance of digital assets. We’ve put out a number of statements since then. So, we believe that the guidance is clear.”

Even with these statements, Szczepanik recognized that the cryptocurrency and blockchain industries are still fairly new, which has put the SEC behind on their ability to keep up with the technology. She said that the current laws in place “are flexible, principles-based, and very broad.”

She reassured that this is hardly the first time that the market has been introduced to a new technology in need of regulation, adding that the SEC “regulate[s] around activity and conduct.”

The Token Taxonomy Act was introduced by Warren Davidson in December 2018, and again in April this year. This act would chance the Securities Exchange Act to explicitly remove cryptocurrency from its coverage. He added that imposing highly restrictive laws could ultimately prevent the industry from its innovative nature.

The vicious comments from Davidson are much like that of the SEC’s “Crypto Mom,” better known as Hester Peirce. She stated that the SEC should’ve already approved the use of a Bitcoin ETF, adding that this restrictive approach from the SEC is putting the United States at a significant disadvantage. He added, “That’s not a healthy state of being.”

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Author: Krystle M