US Fed Chair Jerome Powell Rules Out The Private Sector in Creation of a Digital Dollar

Jerome Powell, the U.S Fed Reserve Chairman, has said that private entities should not be part of the creation process of a digital dollar. Appearing before the House Financial Services Committee on June 17, the Fed Chair highlighted that monetary policy functions should be left to the central banks regardless of the operating ecosystems.

On the digital dollar progress, Powell noted that the Fed owes it to the public to be up to speed with developments in the space. Consequently, the financial watchdog has emphasized understanding the intricacies of digital assets to evaluate their public good.

Private Entities Ruled Out of Digital Dollar Creation

Earlier this year, a digital dollar proposition was launched by the former CFTC Chairman, Christopher Giancarlo, together with other notable stakeholders in the financial services industry.

This recommendation had proposed private entities and the Fed to work together towards creating the digital dollar. According to the suggested layout, this digital currency would leverage the current U.S banking system to provide two-tiered services with the Fed’s backing.

This issue was raised as a question to Powell by Rep. Tom Emmer (R-MN) hence triggering the clarification on monetary policy functions. In his opinion, a collaboration with the private sector would invalidate the idea of the public good:

“The private sector is not involved in creating the money supply. That’s something that the central bank does. […] I don’t [think the public would welcome the idea that private employees who are not accountable solely to the public good would be responsible for something this important.”

Notably, Powell also addressed some shortcomings with the proposition of a digital dollar. One of the main concerns is striking a balance in what would be a fair oversight of the digital dollar.

According to Powell, there are a lot of questions when it comes to transactional privacy, which means it would be difficult to cap where the Fed’s control ends. However, he was keen to reassure the House Financial Services Committee that the Fed will not shy away from something beneficial to the world’s reserve currency, U.S. dollar.

China on Sunrise Phase

As the U.S continues to debate on the value proposition of a digital dollar, China has already launched a pilot for the digital renminbi (RMB). This initiative had been in the works for around five years and is quite promising, given China’s extensive use of mobile app payments such as Alipay and WeChat.

It, therefore, follows that a complete sweep up of fiat money within China’s economy in replacement with the digital yuan could soon be a reality. Despite this progress, China is not guaranteed to displace the U.S dollar as a reserve currency given its substantial market dominance. Also, the Euro is still significantly ahead of the CNY in FX markets.

Read Original/a>
Author: Edwin Munyui

Bitcoin Unique Active Entities Signals Market Participants Returning to the Network

  • Bitcoin active entities trending upward in 2020 but 16% drop recorded in entity-adjusted transaction volume

Last week, Bitcoin managed to breach $10,000 mark again but it didn’t stay there long and went below $9,500 yet again. During the past week, bitcoin price suffered a rapid drop and has now leveled out around $9,600.

Does this mean, we have reached the local top for the time being or another rally could be seen in the coming days? From the fundamentals’ perspective, the network activity also suffered stagnation and ”meaningful decreases,” said crypto data provider Glassnode.

A 16% drop has been recorded in entity-adjusted transaction volume since last week. This metric filter out transactions in which BTC doesn’t change hands, as such providing a clear signal of actual economic activity.

This sharp decrease suggests, “at least on-chain, economic activity may be slowing down.”

Another metric, aSOPR (adjusted spent output profit ratio) has dipped below 1 again but a quick recovery would support the bullish narrative. However, if it stays below for too long, it would indicate that Bitcoin has hit a local top.

Bullish Signals

Meanwhile, the number of unique active entities has been on the rise in 2020, for the first time since the price peak in mid-2019.

“This is a potential sign that Bitcoin market participants are returning to the network, with more participants actively transferring BTC on-chain.”

However, despite this general up-trend, the past week has also seen a decrease in active entities on-chain. Corresponding with the rapid 6% price dip in BTC price late on Wednesday resulted in an overall decrease in on-chain activity over the past week, which “may trigger some concern.”

One concession is that a similar pattern was seen in late January, a drop in active entities and price, before they both quickly recovered into an upward trajectory.

Going into the weekend, an uptick in the number of unique active entities can be seen, which is a positive sign. Another positive metric this week has been Bitcoin’s Reserve Risk which is at low levels indicating “an attractive risk/reward ratio for investing in Bitcoin.”

Moreover, addresses with balance equivalent of and more than 0.01 BTC and 0.1 BTC keeps on growing, “hitting new ATHs again and again,” which is yet another bullish signal. The number of addresses holding 1+ coins has reached an all-time high of 788,800, surpassing the previous ATH of 788,767 recorded on 23 October 2019.

Read Original/a>
Author: AnTy

Liechtenstein Blockchain Act Approved By Parliament; Improved AML And Investor Protection

The Tokens and Entities Providing Services Based on Trusted Technologies (TVTG), also called the Blockchain Act, was passed in agreement with all the members in the Parliament of Liechtenstein. With the introduction of the Act, it tends to provide the users of blockchain technology a greater legal certainty and support the digitized economy positively. The Act is meant to govern all activities that are attainable on technical systems to provide legal certainty.

The Act received a green flag on the October 3rd but is said to enter force from January 1st, 2020. The parliament believes that this act will make Liechtenstein the first country to possess a comprehensive regulative understanding of the token economy. The law aims to remove the prevailing risks of Cryptocurrencies, to offer legal certainty and security but without imposing limiting restrictions and with that provide a reliable framework for a whole economy of digital and digitized assets. Most importantly the Blockchain Act shall provide each possible asset with tokenization, digitize it and listing it on a Cryptocurrency Exchange. This is often expected to facilitate the exchange and additionally storage of possession.

Co-author and attorney of the Act – Thomas Nägele, shared the news about the Act on his social media profiles to his followers. Mauro Casellini, the CEO of Bitcoin Suisse in Liechtenstein, has precisely explained to us the significance of the Act as –

“The TVTG not only creates legal certainty for all market participants but also heralds a new era, the token economy. With its pioneering role, Liechtenstein proves once again that it is the ideal location for FinTech and Blockchain companies and thus for us too, in the heart of Europe.”

Crypto companies move to Liechtenstein

Due to the friendly approach of the Blockchain Act, Liechtenstein was able to attract several new crypto companies to its land, according to a report by Cointelegraph. Cryptocurrency trading firm Bittrex has shared to introduce its new trading platform – Bittrex Global. Bittrex chose to establish the headquarters of the platform in Liechtenstein because of the small country’s regulative understanding of digital currencies and blockchain technology.

Read Original/a>
Author: Sritanshu Sinha