USDC’s ‘Breakthrough’ Use-Case, US Govt. to Distribute Aid to Venezuela via the Stablecoin

With the support and licensing from the US Government, Circle is providing foreign aid through the USDC stablecoin to the people of Venezuela. Circle said,

“While this may be the first time, it will no doubt not be the last as global stablecoins firmly arrive on the world stage as a foundational infrastructure in the future of the international monetary system.”

USDC is the fastest-growing stablecoin of 2020, growing 500% in the past 8 months, with a market cap of over $2.8 billion.

In an announcement on Friday, Circle said it has been “approached” to help the “legitimate elected government of Venezuela” to distribute the financial aid to front-line medical workers in the country who, besides coronavirus, are also battling with hyperinflation, international sanctions, and economic collapse under the Nicolas Maduro regime who had launched his own oil-backed crypto petro.

After imposing sanctions on the Maduro regime, the US government seized Maduro and his government’s assets, which they now seek to get in the hands of the Venezuelans fighting COVID-19, for which they have turned to blockchain and fintech.

In collaboration with the Bolivarian Republic of Venezuela, led by President-elect Juan Guaido and U.S.-based fintech innovator Airtm, aid will be distributed by leveraging dollar-backed USDC.

The Guaidó government will basically use the seized funds to mint USDC, which will be then sent to Airtm, a blockchain-based bank and dollar-denominated payment platform that powers digital payments throughout North, Central, and South America.

The USDC will then be sent to Venezuelan healthcare workers’ accounts as AirUSD — Airtm’s stablecoin-backed dollar token.

“All of this is powerful, inspiring, and underscores the ability of the internet and digital currency to transform… how value and money moves,” said Circle adding that

“it marks a historic moment where in order to execute on US government foreign policy objectives, economic and political leaders have turned to stablecoins.”

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Author: AnTy

Louisiana Senate Proposes Virtual Currency Businesses Act; Crypto Companies Would Need to Register

A virtual currency business licensing bill (HB701) sponsored by state Rep. Mark Wright was cleared unanimously by the state House of Representatives and now has been forwarded to the Senate Committee on Commerce, International Affairs, and Consumer Protection.

If the bill is passed by the Senate, Louisiana would become the first state in America to approve crypto licensing for virtual currency businesses.

Rep Mark Wright has been a steadfast advocate of digital currencies. Back in 2019 itself, the Rep.Wright asked the OFI to study the various nuances of digital assets and regulations to govern their use. Back then, he introduced another crypto bill that failed to pass the House committee.

If HB701 is approved, crypto businesses would be required to apply to the state’s Office of Financial Institutions (OFI), pay a non-refundable fee, and submit their business premise along with experience, general fitness, and character for the investigation.

OFI estimated that the application charges could be around $2,000 and the annual renewal of the license would cost $1000. It is estimated that the bill would cost the state $150,000 in the first year and around $1.3 million over the next 5 years.

Individuals dealing with less than $35,000 in capital would not be required to obtain an operating license, and would only be required to be registered with the OFI.

The New Bill is Derived From Virtual Currency Business Act (VCBA)

The new virtual currency business licensing bill seems to be derived from the Virtual Currency Business Act (VCBA). VBCA has been drafted by the non-partisan Uniform Law Commission (ULC), which is known for drafting model laws.

These laws are meant to bring statutory uniformity across states and currently, Oklahoma, Hawai, and California are looking to implement a version of VBCA.

Andrew Hinkes, a lawyer by profession explained how ULC formulated laws work:

“The ULC releases model laws which sometimes are quickly adopted by multiple states and sometimes are not adopted at all.

State legislatures ultimately make policy decisions for their states and decide whether model laws are appropriate.”

However, the bill sponsored by Rep. Wright is significantly different from the ULC drafted VBCA bill.

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Author: Rebecca Asseh

Iran’s Ministry of Industries, Mining, and Trade Grant More Than 1,000 Crypto Miners Licenses

Iran is regulating crypto miners after a new licensing regime has been introduced by the country’s government.

According to an official representative from the Iranian ICT Guild Organization (IIG), which is a body that represents Iran’s computing sector, the Ministry of Industries, Mining and Trade has given more than 1,000 licenses to crypto miners.

The New Regulations Failed to Attract Foreign Investments

Amir Hossein Saeedi Naeini, also an IIG representatives, said that even though the cryptocurrency mining operations are now regulated in the country, this hasn’t attracted too many foreign investments. These are exactly his words, from local media reports:

“Our studies show that the crypto mining industry has the potential to add $8.5 billion to the economy. [But] most potential investors have left for neighboring countries, because they offer incentives for crypto miners.”

Mining Operators Attracted to Iran

The mining industry in Iran has evolved greatly over the past few years, seeing operators are very attracted to the country’s state-subsidized tariffs on electricity. There are thousands of members operating on the most popular Iranian mining channels. Besides, last year, the government of Iran came with new legislation for crypto mining to be recognized as a legitimate business. The draft proposal says operators need to submit details about their mining activity in order to receive a license that they need to renew every year.

Licensing Regime for Big Operators Only

The Minister of Industry, Mine and Trade approved the licensing regime in the summer of 2019. The licenses are being given only to mining farms that use over 30 kilowatts of electricity, meaning small household operators can’t get one. Before licensing, mining was conducted in fear because the non-compliance penalties were very high. Those who were caught not complying had to face big fines and their equipment was confiscated, not to mention some of them even ended up in jail. In June 2019, over 1,000 mining rigs have been confiscated from only 2 operators.

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Author: Oana Ularu