Putin Approves Cryptocurrency Bill, Stopping Russians From Using Bitcoin for Payments

On Friday, Vladimir Putin, Russia’s president, signed one of the two digital assets bills into law, Russian media outlet RIA reports.

The new law was passed by Russia’s parliament, Duma, last week and states that firms can provide virtual securities on blockchain platforms provided they are well registered with the country’s central bank, Bank of Russia, as issuers as well as meet various provisions.

The new law also states that decentralized cryptos are taken to be a form of property that should be declared by the holders for taxation purposes.

The bill notes that as a property, cryptocurrency cannot be used to pay for goods and services in the country. However, businesses accepting crypto payments have until January next year to adjust to the new development.

According to RIA, the bill seems like a mild version of what was essentially proposed. Russian parliamentarians had developed a new proposal of the bill which would render any entity providing or trading cryptocurrency illegal in the country.

The first draft of the bill highly represented the skeptical stance that has been advanced by the country’s central bank. It led to widespread condemnation from the crypto community as well as from the country’s Ministries of Economic Development and Justice.

The law also states that Russian residents will now have a chance to challenge any transaction involving the digital currencies in a court of law provided the plaintiff has proof of transaction and is a crypto holder.

The Russian parliament is currently working on a more comprehensive digital bill that will touch on various issues regarding digital currencies. The bill is expected to be discussed and passed before the end of the year. However, no specific details on dates have been disclosed to the public.

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Author: Joseph Kibe

Cloudflare Outage Took Down Much of the Internet But Bitcoin Kept Running

Several websites were unavailable Friday after Cloudflare Inc. suffered an outage. The company said the problem had been fixed.

Cloudflare provides services like security, load balancing, video streaming, and domain registration for the internet.

In its official statement, the company said the outage was not the result of an attack, and after addressing the root cause, the incident was resolved.

The outage affected 12 data centers in the US and Europe, affecting several online businesses, including Shopify, Discord, League of Legends, Politico reported disruptions.

In the cryptocurrency space, crypto exchanges, including Bittrex, FTX, and Poloniex, websites like Coinmarketcap, and Crypto.com and uphold wallets were also down.

However, Bitcoin remained unaffected with its 99.98% uptime.

The only time bitcoin network was down was in August 2010 when a block with the largest number of total transaction inputs was mined and broadcasted, but some bitcoin nodes rejected it, causing an unexpected fork of the blockchain.

To restore a canonical chain, Slush and BTCGuild downgraded their nodes so their pools would reject the larger block. As such, the transaction doesn’t exist today, and neither does the bitcoins created by that block.

Bitcoin continues to run interrupted; however, “the Cloudflare DNS outage can be seen reflected in the rate of bitcoin transactions broadcast, presumably because popular web wallets became inaccessible,” said Jameson Lopp, co-founder, and CTO at Casa.

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Author: AnTy

Hope for Bitcoin ETF Approval? SEC Chairman Jay Clayton’s Departing Will Be ‘Massive’ for Crypto

On late Friday night, US President Donald Trump said he will nominate the Securities and Exchange Commission (SEC) Chairman Jay Clayton to serve as the next United States Attorney for the Southern District of New York.

“For the past three years, Jay has been an extraordinarily successful SEC Chairman, overseeing efforts to modernize the regulation of the capital markets, protect Main Street investors, enhance American competitiveness, and address challenges ranging from cybersecurity issues to the COVID-19 pandemic,” said Attorney General William P. Barr

On Clayton’s nomination.

This appointment will be effective on July 3.

Clayton will be replacing Geoffrey Berman as the top federal prosecutor in Manhattan who said he will not resign from his position and will only step down when a successor is confirmed by the Senate.

Berman oversaw several prosecutions of Trump’s top allies including his personal lawyers.

This may, however, turn out to be a good thing for bitcoin.

“The SEC chair is one of the most important U.S. officials for crypto regulation. Chairman Clayton’s replacement will have a massive impact on the industry (for better or worse). Our chance at ETF approval & clarity on a wide range of issues for years to come hangs in the balance,” said Jake Chervinksy, general counsel at Compound Finance.

Under Clayton, all the Bitcoin ETF application has been rejected on the ground of market manipulation. Just this week, a new proposal from WisdomTree is filed for an exchange-traded fund (ETF) with 5% exposure to bitcoin.

A Bitcoin ETF is expected to protect retail investors from paying a drastic premium to get crypto exposure. Grayscale retail investors are currently paying a 20% premium on BTC and a whopping 750% premium on ETH products.

Moreover, it means investors won’t have to get a wallet or go through a miner. An ETF would broaden the scope of potential Bitcoin investors which could serve as a hedge during volatility in the equity market.

“It would broaden the breadth of investors in BTC. This is important because some investors view Bitcoin as a safe haven when equity markets become volatile and/or move into a bear market environment. A Bitcoin ETF would be an easy and inexpensive way to hedge various market conditions,” Richard Keary, the founder of Global ETF Advisors LLC, told OKEx.

Galaxy Digital CEO Mike Novogratz also shared a hope over a possible Bitcoin ETF approval in the future if we get a crypto-friendly chairman or chairwoman.

There is even a possibility that SEC commissioner Hester Peirce aka ‘Crypto Mom’ may also move up the ranks to fill the position. The moniker ‘Crypto Mom’ came after she dissented on the SEC’s decision to reject a Bitcoin ETF application.

Just this month, Peirce was tapped for a second term that will last through 2025. She has been one of the most prominent crypto advocates who proposed a safe harbor for crypto startups looking to issue tokens.

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Author: AnTy

IOHK CEO, Charles Hoskinson, Talks Cardano Market Prospects Following Shelley Launch

  • In an interview on Friday, Charles Hoskinson, Cardano’s founder and CEO of IOHK, spoke on the importance of price in the longevity of blockchain projects highlighting ADA’s 50% move on Shelley’s launch announcement.
  • Can ADA cement its place on the tenth position winning the battle of proof-of-stake (PoS) tokens?

Hoskinson: “Market will basically decide what the standards are”

Price is not always a revered matter in some sections of the blockchain development community, who believe that the benefits of the platform outweigh the speculation in price. However, Charles differed with this opinion stating that the markets have the power to decide the appreciation of a company as they are also customers of the product.

Over the years, the cryptocurrency market has shed off and accepted several currencies in the top ranking lists, Bitcoin (BTC) being the only constant since launch. Some of the projects such as Peercoin, the first blockchain to employ staking mechanism, and Primecoin, an improvement on BTC’s scalability and transaction fees, have faded into oblivion.

Despite the earlier projects offering a tangible solution, the market failure stifled development setting newer projects such as Cardano (ADA) and Tezos (XTZ) to take over the staking market and Bitcoin forks, Bitcoin SV (BSV), and Bitcoin Cash (BCH) to swallow the alternative Bitcoin market. Charles Hoskinson said,

“Ultimately people do what they make money with, the market will basically decide what the standards are.”

Market is king

In an interview with CoinDesk, speaking about Cardano, Hoskinson believes a high price is beneficial to motivate its community on the utility and inherent value of developing the platform. This strengthens the price even further. However, over the years the crypto market has shown its randomness in picking winners and losers and Hoskinson is wary of the fact.

The crypto market field does not reflect the project’s development progress but rather a speculation ring of trades. The growth of Dogecoin, a meme token, to a current market capitalization of $320 million is a clear indication of the “market is king.”

Charles further explained that he didn’t expect Ripple-backed XRP and Tether (USDT) to reach their current multi-billion market capitalization at their launch. He said,

“The things you think may gain traction and become a big deal, they could be yesterday’s news, and other things that you don’t think are going to be a big deal, end up becoming huge.”

Cardano starts the launch of the Shelley upgrade

Less than a month since Charles announced the launch of the Shelley upgrade on Cardano would be deployed in 2020, the process has started with the final upgrade expected to be complete and running on June 30th. In light of the launch, the price of Cardano rose to an 11 month high – a prospect that Charles believes will propel the blockchain to compete with the very best projects in the field. He said,

“There’s a very strong possibility that we will be very competitive price-wise with the rest of the crypto market.”

Over the past 24 hours, Cardano, ticker ADA, and Tezos, ticker XTZ, have exchanged the 10th position on Coinmarketcap multiple times. Cardano currently claims it with a total market cap of $2.21 billion, currently trading at $0.085288 on major exchanges at the time of writing.

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Author: Lujan Odera

US Fed Balance Sheet Jumps $7 Trillion & Congress Passes $3 Trillion Relief Package

On Friday, House Democrats passed a $3 trillion coronavirus relief package.

This bill includes a second round of $1,200 direct payments to individuals, up to $6,000 per household. Almost $1 trillion are for cash-strapped local and state governments while $200 billion for essential workers’ hazard pay.

It further involves $600 per week for federal unemployment insurance benefit, $175 billion in rent, mortgage and utility assistance, and $10 billion in emergency small business disaster assistance grants.

The repeal of the $10,000 cap on state and local tax deductions for tax years would be most beneficial to higher-income taxpayers.

Economy facing “significant” vulnerabilities

Elsewhere, the US Federal Reserve’s balance sheet has reached $7 trillion, growing by $213 billion in the week ended May 13 which equals a record 32.2% of US GDP.

Before the Fed started its bold emergency action on March 15, the assets stood at $4.31 trillion.

The Fed also warned this week that the financial sector faces “significant” vulnerabilities due to this pandemic.

The coronavirus pandemic continues to wreck the country with the US having more than 1.48 million cases and more than 88,000 lost their lives to this virus.

Already, over 36 million people have filed for jobless claims since the crisis started.

Deflation not inflation the bigger risk

Fed and Congress injecting trillions of dollars into the economy might feel like preparing for inflation with easy money floating in the economy. But Bank of America is expecting deflation.

Core CPI prices that have historically fallen both during and after recession dropped 0.45% in April, the weakest point since first created in 1957.

A drop in producer prices, another indicator of near-term deflation has also fallen 1.5% over the last two months. BofA wrote,

“Items that are most in demand due to the shutdown – groceries, cleaning products, PPE etc. have risen in prices. Less visible [to consumers] are the numerous falling prices.”

As such, the COVID crisis and policy response to it are “deflationary” — a bigger risk in the next couple of years than inflation.

Social Capital CEO Chamath Palihapitiya shares the same opinion as he said, Fed’s stimulus policies risk “accelerate a really bad deflationary supercycle.”

Central-bank liquidity prime catalyst to relaunch bull markets

The risk of deflation is why the likes of macro investor Paul Tudor Jones are looking at bitcoin, which is an uncorrelated asset. Currently trading around $9,400, BTC has risen 144% since its bottom and is up over 28% YTD.

According to Mike McGlone, Senior Commodity Strategist at Bloomberg Intelligence bitcoin would also be the one to sustain its higher prices given that it has a supply shock recently while continuing to see an increase in demand.

Meanwhile, the likes of Billionaire hedge fund investor David Tepper believes the stock market is overpriced, the most since 1999.

And although the bottom might be in, they can still “fall significantly” from their current levels.

“The market is too damn high,” tweeted Palihapitiya earlier this week. Since their bottom on March 23, both Dow Jones and S&P 500 are up nearly 28%.

Some meanwhile also believe stocks are “absolutely on the brink of an epic meltdown.”

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Author: AnTy

Square to Allow Users to Deposit Coronavirus Stimulus Relief Payment Directly to Cash App

The Internal Revenue Service and the Treasury Department launched a new web tool on Friday that will allow those Americans who don’t file a tax return or had too little income to file to register for stimulus payments.

The IRS also shared that the stimulus payments will be distributed to most Americans from next week. IRS Commissioner Chuck Rettig in a statement said,

“People who don’t have a return filing obligation can use this tool to give us basic information so they can receive their Economic Impact Payments as soon as possible.”

If a US citizen or permanent resident made less than $12,200 or in case of a married couple $24,400 or didn’t file an income tax return in 2019, one can still apply for the $1,200 ($2,200 to married couples) and $500 per child stimulus.

According to the IRS, 80% of Americans are eligible to receive the stimulus payment.

Square’s Cash app now offers account and routing numbers to allow people to receive and deposit their stimulus payment directly to their Cash App balance. As per the official blog, to find them, you can tab the Banking tab on the bottom left of your Cash App home screen or get them by activating your free Cash Card.

“Get your $1,200 even if you didn’t file a tax return in 2019,” tweeted Twitter and Square CEO Jack Dorsey.

“Simple and fast instructions on how to get your $1,200 stimulus check from US govt (and yes, you can deposit it directly to cash app for instant use, no bank account needed).”

This stimulus program is in response to the unprecedented downturn the US economy is experiencing due to the coronavirus pandemic outbreak that has the states in a lockdown.

The US government is injecting cash into the economy and this is the CARES Act stimulus where these economic impact payments are being given directly to regular people for the first time in a long time.

And Cash app is helping people get it for instant use faster. The Cash app also allows its users to buy and sell BTC straight from its app. Last month, in an investor call, Square’s CFO Amrita Ahuja said they have been seeing “accelerated” adoption and “engagement” in Bitcoin during this market turmoil.

The company reported over $178 million in Bitcoin purchases volume in 4Q19 and over $516 million worth of BTC sales in 2019.

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Author: AnTy

What Caused Bitcoin to Fall Back Below $7,000?

While the stock market is closed today on the occasion of Good Friday, crypto markets are open like they are always. And they are in the mix.

Source: Coin360

After trading above $7,000 for the better part of the week, yesterday, we fell below this level and are still trading down around $6,850.

As we reported, before this dump, a huge amount of BTC was transferred to the crypto exchanges which indicated an incoming sell-off and we got one.

Bitcoin flows into and out of exchanges can tell a lot about the potential crypto market activity. As we saw during March’s massive sell-off when BTC price fell by 50%, a total of 80,000 BTC went into crypto derivatives platform BitMEX between March 12th and 13th. 52,000 BTC also moved out of BitMEX where the price of bitcoin dropped to $3,600 compared to $3,850 on other exchanges.

According to crypto data tracker, Coin Metrics, this time, 1,000 BTC were deposited on Huobi exchange just before the price dropped below $7k.

Source: Coinmetrics

Crypto data analyzer Glassnode also noted that a whopping 150,000 BTC spike in raw volume was recorded on April 11. This volume, however, was caused by the change from an in-house transaction on crypto exchange Bitfinex.

The total raw volume has been 216,244 BTC worth $1.49 billion and change-adjusted volume was 38,179 BTC worth $263 million.

Funds movement on exchanges presented us with a potential upcoming movement in the market which this time translated into a drop in price. However, Bitcoin is still over 75% above the low we put in mid-March. Analyst Mati Greenspan said,

“Bitcoin has remained remarkably stable in the last few weeks and if we zoom out on the chart we can see something quite comforting. The level that it’s trading at now, similar to the stock market, is a level that would have been deemed quite normal throughout 2018 and 2019.”

“This is happening with the third halving only a month away.”

The halving is now officially just a month away, with the estimated date May 11 as miners continue to add more hash power to the Bitcoin Network.

Since falling to about 94 Th/s on March 22, we have recovered 12.5%. The growing hash power is also because of the halving experienced by Bitcoin Cash and Bitcoin SV. Previously BTC accounted for 97% share of hash rate which has now increased to 99% while both BCH and BSV’s share that was just 3% further fell to 1%.

As for the price which is trading at a significant discount compared to the historical trend and the Stock-to-flow model, “BTC price will take some time to crawl towards model value (like after Nov2012 and Jul2016 halving),” said analyst PlanB.

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Author: AnTy

Treasury Bill Yields Turning Negative Is “Mega Bullish for Bitcoin,” Says Macro Trader

Global stock markets surged higher on Friday after central banks around the world unleashed a torrent of stimulus measures to cushion the shock from coronavirus (Covid-19). With US stock futures sharply higher, Wall Street is expected to have yet another big swing.

Asian stocks closed with gains while European markets were on track to their second positive session in a row today.

The rally came after central banks including the US Federal Reserve, the Bank of England, and European central banks announcing huge new injections of funds into financial markets.

After closing with modest gains on Thursday, the S&P 500 was up about 0.5%, the Dow Jones Industrial Average 1% and the Nasdaq Composite ended 2.3% higher. Now, today the Dow futures jumped 4%, Nasdaq 4.5%, and S&P 500 futures gained 3.4% signaling another green day for Wall Street.

According to Jurrien Timmer, director of global macro at Fidelity Investments, markets are “very oversold” with much “forced selling” going on.

“We’re at the levels of ’08, of ’87 crash, 1970, even 1929, 1930,” he said, “So you can count almost, on one hand, the times that we’ve been this oversold.”

The fastest, sharpest decline in Treasury yield

Earlier this week, government bond yields cascaded to record lows amidst the liquidity issues in a sign of frightened investors flocking to safety.

“It’s the fastest, sharpest decline we’ve ever seen. It’s been contagious across all asset classes — bonds, credit, commodities, you name it,” said Timmer.

Last weekend, the Fed slashed interest rates to between 0 and 0.25% in response to the coronavirus outbreak. It’s “unbelievable,” said billionaire investor Warren Buffett.

The US Treasury bills dipped below zero as those maturing in one or less months are being seen as more like cash as they are easier to trade as “People are desperate for cash,” said Kathy Jones, chief fixed-income strategist at Charles Schwab.

“What you are seeing today is an example of a flight-to-safety on a massive scale,” said Jones.

While the yield on the one-month Treasury bill maturing in April slipped to minus 0.003%, those maturing in May fell to minus 0.020%.

Bullish for Bitcoin

Treasuries yield falling into negative territory has macro trader Dan Tapiero, co-founder of Gold Bullion International bullish on bitcoin.

Trader Mr. Anderson also believes the next high bitcoin won’t have any “bubble excuses’ but “It will happen in the face of currency wars & a negative-yielding environment, & unlimited QE. When it happens it will introduce the world to BTC.”

In a massive move up, Bitcoin is flying today, going as high as $7,139, up 60% from Monday’s lowest point of $4,445.

Just like bitcoin took a hit of about 50% in about two days, the same way bitcoin has recovered 85.4% of the losses since hitting the low of $3,850 last week.

“I can not express how bullish I am on bitcoin. We are at risk of losing the entire system right now. I know they will find a way to save it but all trust is lost. Gold guys/girls – you’ll be fine too. It’s just that BTC has bigger upside, by far but is riskier than gold,” said Raoul Pal, the CEO and founder of Global Macro Investor.

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Author: AnTy

Australia Releases Roadmap To A ‘Blockchain-Empowered Future’

The Australian government will release its national blockchain roadmap on Friday, February 7, after almost a year of preparations.

It’s been about a year since the Ministry for Trade, Tourism and Investment and the Ministry for Industry, Science and Technology in Australia have made the announcement for the country’s national blockchain strategy that aims for global leadership and focuses on the wine, finance and banking sectors.

Domestic Wine to Receive Special Attention

Talking about the development of the program, Karen Andrews from the Ministry for Industry, Science and Technology mentioned the 5-year blockchain will highlight the work of researchers, startups, and regulators.

Since the wine sector in the country is set to have the AU$259.4 billion ($175 billion) worth, Andrews said blockchain technology is capable of strengthening export opportunities, seeing manufacturers will be able to trace their goods, especially when it comes to wine labeling and exports. 2,000 wine exporters in Australia ship to 123 destinations all over the world.

How Much Did Australia Spent on Blockchain?

The Australian government hasn’t yet allocated funds for the blockchain roadmap implementation. As it was noted in March 2019, some previous investments made by the liberal national government of Prime Minister Scott Morrison helped fund the Digital Transformation Agency in 2018-2019 with AU$700,000 (approx. $500,000) to explore what benefits the use of blockchain would bring to government payments.

It also funded Standards Australia with AU$350,000 (approx. $250,000) to create a set of guidenance for international and standardized blockchain standards.

How Much Other Countries Spent on Blockchain

The science and technology multi-stakeholder operation Centre for the Fourth Industrial Revolution UAE, together with the World Economic Forum and the Dubai Future Foundation, has released in January this year a paper that says deploying blockchain technology can save the United Arab Emirates (UAE) over $3 billion.

In the meantime, an important firm in Russia has recently decided to cut the country’s spending on blockchain development by half. The government-backed company Rostec wants to spend only 28.4 billion Rubles ($453.2 million) for developing blockchain technology by 2024, and not 55 billion ($877.8 million) or 85 billion Rubles ($1.3 billion), as it initially said it would.

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Author: Oana Ularu

Chainalysis Report: With A ‘High Degree of Certainty,’ BitForex is Faking Its Trading Volume

Chainalysis has released on Friday a report that’s saying the crypto exchange BitForex may fake its trading volume.

The report also presents how for every Bitcoin (BTC) that has been recorded on-chain from January to November, BitForex claims trades of 40,000 Bitcoins, which is comparable to the average of major exchanges, at about 6 Bitcoins being traded to one on-chain.

BitForex Didn’t Comment on the Report. Philip Gradwell, the Chainalysis chief economist and the report’s compiler said:

“There should be a relationship with the bitcoin moving onto the exchange and how much it is traded.”

The report was shown at the New York Chainalysis Links conference and didn’t receive any response from BitForex.

New Tools for Tracking Trading Volume Suspicious Activity

The report made by Chainalysis comes after entities in the crypto world have put more pressure on exchanges suspected to fake trading volume. There are new tools and metrics to identify fakers. More than this, a report made by Bitwise Asset Management and presented in March at the Securities and Exchange Commission says that almost 95% of the reported Bitcoin trading volume doesn’t present the situation accurately. This means BitForex’s fake trading volume is only a small part of a much bigger whole.

The ratio reported by the company is very high when compared with one of 10 other exchanges, when its Bitwise 10, the leading exchanges’ metric, the volume is being analyzed. While the average ratio is 6:1, BitForex’s is 40,000:1.

Exchanges Gain More Popularity When Their Trading Volume is Ranked High

Gradwell said in an interview that exchanges become more popular and gain new users when their trading volume is highly ranked. Just like with search engine optimization (SEO), where digital strategies are being used for websites to rank higher on Google, the exchanges are increasing their visibility with a high-ranking trading volume. This is what determines them to manipulate their data. Here’s what Gradwell had to say further about the matter:

“It’s really going to degrade the trading experience. If you’re a new entrant to crypto, and you think you’re going to a popular exchange – that actually has faked volume – it’s not going to be a very liquid exchange. You’re not going to get the best prices or be able to buy or sell quickly.”

BitForex Failed 5 Out of 6 Tests Conducted by Alameda Research

Market manipulators, researchers, and investigators are choosing BitForex because it has comparably lax standards, as it practices transaction mining. The Chainalysis report is not the only one saying the company is issuing fake reports, seen in July, Alameda Research made an exchange volume report on 48 crypto exchanges, and BitForex failed 5 out of 6 of its tests. Chainalysis looked in 2018 at 12 of the exchanges suspected to fake trading volume, when it also examined Huobi and Bithumb. After the final report, the ratios in volume started to have more consistency, just like the ones of market leaders.

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Author: Oana Ularu