US Banking Regulator FDIC Is Looking into Stablecoins’ Eligibility for its Deposit Insurance

US Banking Regulator FDIC Is Looking into Stablecoins’ Eligibility for its Deposit Insurance

The Federal Deposit Insurance Corp. (FDIC) is studying whether certain stablecoins might be eligible for its coverage. The discussions are only in the preliminary stage yet, reported CoinDesk citing five people familiar with the knowledge.

Reportedly, the agency is analyzing what pass-through FDIC insurance looks like for the reserves stablecoin issuers hold at banks. Such coverage makes the holder of the tokens eligible to be insured by the FDIC up to the standard deposit insurance amount of $250,000.

The agency is further looking into what direct deposit insurance would look like for banks that want to issue stablecoins.

“This is all part of a process by which they are trying to bring stablecoins into the banking system in a responsible manner,” one insider has been quoted as saying. “It depends on what’s backing the stablecoins.”

The insider added that if stablecoins are backed by reserves at the Federal Reserve for cash, then that would be a deposit but not if it’s backed by the Treasury.

Last week came the report that the Biden administration is looking to regulate stablecoin issuers as banks and is prepared to issue a report on them by the end of the month.

As we reported, the BIS also put out a proposal for public consultation this week, which aims to apply the same principles as those followed by the financial market to “systemically important” stablecoins.

Another report on CBDC from BIS earlier this month said significant stablecoin adoption could lead to “excessive market power” and fragmentation in the payments ecosystem.

In an interview with Forbes, former Securities and Exchange Commission (SEC) Chairman Jay Clayton shared his views on whether stablecoins should be considered securities. This is what he has to say:

“A stablecoin that promises $1 back to you, in exchange for the coin, and is backed by cash is one item. Such a coin that is backed by commercial paper, whether it’s 30, 60, or 90 days, sure looks like a money market mutual fund to me. So the second element really looks like a security. We have decided that a pooled vehicle of commercial paper that you use for daily liquidity is a money market mutual fund and should be regulated as such.”

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Author: AnTy

1Inch Moves to Arbitrum For Faster Throughput And Lower Gas Fees

Ethereum multi-chain solution, Arbitrum One is seeing major adoption by the day. The latest protocol looking to tap into lower fees and faster transactions is 1Inch Network.

1Inch Moves To Arbitrum

According to a Wednesday tweet, popular decentralized cryptocurrency exchange (DEX) aggregator 1Inch Network announced support to Ethereum layer-two scaling solution Arbitrum.

The move is expected to give 1Inch users and DeFi proponents lower transaction costs, higher transaction speeds, and fast withdrawals.

Much like the former Matic Network, Arbitrum uses roll-ups and sits atop the Ethereum network. It is tasked with bundling transactions together and validating them before adding them to the main Ethereum network.

This technology greatly aids the Ethereum network to continue operating as the older decentralized applications (dApps) platform battles with the twin challenges of network congestion and high gas fees.

Arbitrum’s lower gas fees and higher throughput would benefit 1Inch users known to use the DEX aggregator to search for competitive prices across several exchanges.

Commenting on the recent integration with 1Inch, CEO of the development team behind Arbitrum, Offchain Labs Steven Goldfeder said;

“The Arbitrum One ecosystem is vibrant with many excellent and high volume DEXes, and we’re very excited to have 1Inch users join as a DEX aggregator.”

1Inch also stated in the announcement that a total of seven protocols would be available once it launches on Arbitrum. This includes the 1Inch Limit Order Protocol, UniSwap, BalancerLabs, BreederDodo, SushiSwap, SwaprEth, and WETH, with more expected in the future.

Arbitrum Making Waves Despite Being A Newbie

Like several Optimistic Rollup solutions, Arbitrum is built with the same code that operates on the Ethereum network. This enables development teams to easily cross-compile smart contracts on both networks, and it also ensures full compatibility between the Ethereum network on smart contracts and the Web3.0 interface levels.

Meanwhile, Arbitrum has been a major success since launching on August 31. The layer-two scaling solution has seen growing adoption from major protocols, most especially from the DeFi-facing sub-sector.

Also, its lower fees and faster transaction speed has lured non-fungible tokens (NFTs) enthusiasts who have now shifted their attention to the newcomer. According to data from L2 Beat, over $2 billion total value locked (TVL) have been processed through the Arbitrum protocol.

This has been due to surging interest in viral internet sensation NYAN. The digital meme token, which shows a rainbow-themed Nyan cat, has been in hot demand as digital collectible fans look to farm the ERC-20 token.

Developed by an anonymous developer, NYAN is meant to generate buzz about the Arbitrum network and encourages investors to lock up tokens on Arbitrum to receive rewards, according to a September 8 tweet.

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Author: Jimmy Aki

World’s Largest Index Provider Is Looking Into “Direct Exposure” to Cryptocurrencies says CEO

World’s Largest Index Provider Is Looking Into “Direct Exposure” to Cryptocurrencies says CEO

Henry Fernandez, Chairman, and CEO of the world’s biggest index provider MSCI Inc. which is also developing some cryptocurrency indices and products, said in an interview with Bloomberg that they are actively looking into the crypto space.

“We’re still exploring a variety of options and talking to a number of partners, but we’re very bullish on digital assets on the blockchain technology associated with it, obviously including cryptocurrencies. I think they have a role to play in the world. And we’re looking at that. We’re looking at it from the point of you know about direct exposure to the various types of currencies.”

In June, Fernandez had said that the global securities index publisher is considering offering indices based on crypto assets and has been talking to experts about it.

MSCI publishes popular indexes for equities and other securities, which helped asset managers and investors allocate $14.5 trillion in assets globally by the end of last year.

In its recent expansion of offerings, MSCI launched 20 thematic indexes on “megatrends” in China this year to help investors guide their capital into projects in alignment with the Chinese government’s policy goals.

In this week’s interview, besides talking about crypto, Fernandez also shook off concerns about the “investability” of Chinese stocks following Beijing’s recent regulatory crackdown, pointing to previous instances where markets rebounded in the aftermath.

Regulatory compliance has weighed on China “every three, four, five years and obviously the markets have sold off at the time. But very quickly afterward, the markets have recovered and gone through to new heights,” he said.

“There is a lot of criticism on China in terms of lack of compliance,” and it is now going through a corrective phase, Fernandez said, adding: “Countries go through periods like this.”

China also cracked down on cryptocurrency mining and leverage trading in the country that led to a deep sell-off in the crypto asset prices in May and June; however, since then, they have rebounded sharply and are now making moves towards their all-time highs.

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Author: AnTy

Australian ‘Buy Now, Pay Later’ Firm Looking to Allow Users to Trade Crypto on Customer Demand

Australian ‘Buy Now, Pay Later’ Firm Looking to Allow Users to Trade Crypto on Customer Demand

Zip Co Ltd, an Australian buy now, pay later (BNPL) firm, explores the option to allow its users to trade cryptocurrencies.

Trading in crypto using Zip digital wallets was one of most requested new product features from users, said co-founder Peter Gray on Thursday.

Zip said it would likely launch the new service in the US first and then in the next 12 months in Australia. The US is driving its fourth-quarter growth and is set to soon become its biggest market by volume.

The company’s fourth-quarter volumes and revenue doubled, with transaction volumes hitting A$1.76 billion ($1.29 billion) in the June quarter and volume at its US unit quadrupled.

Zip’s Australian user base is mature, with about 30% of adults having a BNPL account.

This attempt by Zip to go into crypto is also propelled by the company’s established competitors like Afterpay and Klarna expanding into more countries and planning new offerings like a banking app. The BNPL sector is also attracting the giants like PayPal and even Apple.

“We know our younger generation of customers seek additional products and services that are relevant to them,” Gray told Reuters. The company itself is also looking at expansion in Europe and the Middle East.

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Author: AnTy

Bitcoin’s the Way to Go As Inflation Records Its Highest Jump in 13 Years

The USD is getting a boost from high inflation concerns, with traders now looking forward to the Fed Chair’s testimony this week. Blackrock CEO is also concerned about inflation which he says “is going to be more systematically,” noting asset owners are the biggest beneficiaries of monetary policy.”

The US dollar continues to be perched above 90 since early last month, now aiming for 93 after data showed that US inflation for June is coming in hotter than expected. Just like the greenback, US Treasury yields also responded to the inflation data with a sharp rise.

US consumer prices rose by the most in 13 years last month as the economic recovery continues its momentum.

The rate of inflation in the 12 months ended in June jumped to 5.4% from 5%.

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However, this is to be expected as up until recently, there was a tight lockdown in the country, and still, not everything is open or operating at a standard rate. The rapid recovery of the economy is having an unwanted side-effect, higher inflation.

Transitory or Not?

In June, the cost of living jumped by the most significant amount, 0.9%, more than expected, since 2008 as inflation spread more broadly through the US economy, raising questions whether this spike in prices will subside as quickly as the central bank is predicting.

While the cost of used cars accounted for over one-third of this increase, prices for food, energy, clothing, hotels, and plane tickets also rose sharply, which also fell sharply in the early stages of the coronavirus pandemic last year.

Another measure of inflation that omits volatile food and energy also surged 0.9% in June, with the 12-month rate increasing to 4.5% to stand at a 29-year high.

While the component not associated with the used car market being twice as large, used car prices should also “probably be seen as some sort of bellwether in this case, instead of something to be ignored,” wrote analyst Mati Greenspan in his daily newsletter Quantum Economics.

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Blackrock CEO Larry Fink is also concerned about inflation. “It is my view that inflation is going to be more systematical. I believe it is a fundamental, foundational change in how we navigate economic policy,” he said in an interview with CNBC.

He further noted that with interest rates low, savers are getting slammed while “asset owners are the biggest beneficiaries of monetary policy.”

Market Reaction

Traders are now looking forward to Federal Reserve Chairman Jerome Powell’s testimony before Congress on Wednesday and Thursday for any signals on potential tapering. Fed officials first made a surprise shift in tone last month about the possibility of US stimulus withdrawal that boosted the dollar in recent weeks.

Powell, however, has repeatedly been stating that high inflation will be transitory as supply chains normalize and adapt.

The stock market waved off these latest figures, with the S&P 500 seeing a slight drop after roaring to new all-time highs on Monday. Greenspan said,

“The stocks really are in a euphoric mode right now, and investors will accept any reason to continue buying the rally.”

Cryptocurrencies meanwhile remain on the back foot since late May when they first started selling-off with the total crypto market cap now at $1.34 trillion.

This week, the crypto market is experiencing losses across the board, with Bitcoin doing its thing and trading above $32,500, recovering some from its fall to $31,565 in the last 24 hours and Ether at just above $1,900 after falling to $1,860.

While down in the past two months, in the past year, when commodity prices rose between 20% to 107%, Bitcoin rallied 250%.

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Author: AnTy

69,000 Bitcoin worth $3.6 Billion Lost in South African Crypto Scam

It is suspected to be a money-laundering operation for international players. While South Africa’s FSCA is looking into Africrypt, they don’t have jurisdiction as crypto assets are not legally considered financial products.

A whopping 69,000 Bitcoin worth $3.6 billion has been lost in a scam by cryptocurrency investment platform, Africrypt.

A pair of South African brothers have been reported missing with the money. A Cape Town law firm, Hanekom Attorneys, hired by investors has reported the matter to the Financial Sector Conduct Authority (FSCA), the SA Reserve Bank, and the Hawks, an elite unit of the national police force.

Back in April, when the price of Bitcoin surged to an all-time high of about $65k, the elder brother, Africrypt Chief Operating Officer Ameer Cajee, said the company had been a victim of a hack. He then asked the client not to report the incident to lawyers and authorities, saying it would slow down the recovery process of the missing funds. Their notice from April 13 reads,

“We urge all clients to please be patient as we attempt to resolve the situation at hand. It is understandable that clients may proceed the legal route. but we ask clients to please acknowledge that this will only delay the recovery process.”

This made the investigators suspicious, and Hanekom Attorneys, along with a separate group, has started liquidation proceedings against the exchange.

“Africrypt employees lost access to the back-end platforms seven days before the alleged hack,” said Hanekom Attorneys.

According to the investigation, the pooled funds of the platform were transferred from South African accounts and client wallets to other large pools of bitcoin while using mixers to make them untraceable.

A Money-laundering Operation?

Founded in 2019, Africrypt’s website is now down, which used to state,

“Africrypt’s astronomical growth from a one-man operation running out of a bedroom, to one of Africa’s largest and most successful Al trading companies in only a few years.”

According to Darren Hanekom of Hanekom Attorneys, the fact that such a low-key crypto company had crypto assets of nearly R50 billion, it is unlikely all these funds came from South Africans, rather more likely be a money-laundering operation for international players.

Additionally, clients were requested to sign an investment agreement with Hong Kong-based RaeCreateWealth Limited, which also raises suspicions.

Customers were also required to deposit funds into an FNB account which would then be used to purchase BTC, often on Luno, and after that, the crypto would be broken up and mixed with other transactions.

Just last year, another South African Bitcoin trader, Mirror Trading International, collapsed in what was called the biggest crypto scam of 2020, involving 23,000 digital coins worth about $1.2 billion.

But Africrypt is three times bigger than Mirror.

In January this year, the daily value of crypto-asset trading exceeded 2 billion rands ($141 million) for the first time in the country.

While FSCA is looking into Africrypt, the regulator’s head of enforcement, Brandon Topham, said they are currently prohibited from launching a formal investigation because crypto assets are not legally considered financial products.

“We don’t have jurisdiction, but we are looking at complaints to see if there is a financial product hidden in there,” said Topham.

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Author: AnTy

eBay CEO says Company Is Looking at Crypto as Payment Option & Selling NFT on the Platform

eBay CEO says Company Is Looking at Crypto as Payment Option & Selling NFT on the Platform

eBay is keeping an eye out after reporting a weak second-quarter profit forecast as it faces stiff competition from Amazon while the total crypto market cap aims for $2.4 trillion.

eBay Inc. is looking at new payment options for its customers, and that includes Bitcoin and other cryptocurrencies, said chief executive officer Jamie Lannone in an interview with CNBC on Monday.

“We are always looking at the most relevant forms of payment and will continue to assess that going forward. We have no immediate plans, but it (cryptocurrency) is something we are keeping an eye on,” eBay said in a statement.

Last week, eBay reported a weak second-quarter profit forecast as it faces stiff competition from Amazon. The shares of eBay (EBAY) recorded a 2.4% increase today, which has been down 14% from mid-April.

The eCommerce firm further explores a “number of ways” to get involved in non-fungible tokens (NFTs), Lannone said.

“We’re exploring opportunities on how we can enable it (NFTs) on eBay in an easy way,” Lannone said on Reuters. “Everything that’s collectible has been on eBay for decades and will continue to be for the next few decades.”

NFTs exploded in popularity this year, and last month they were starting to lose traction with prices of digital art and volume dropping, but they seem to be making their comeback now.

“The bubble isn’t crypto, the bubble is everyone else realizing holy shit crypto is here to stay wtf can we do to get in on it,” noted popular trader Loomdart, who is also an advisor to eGirl Capital. It is also a “great” way to onboard new people, he added.

Already many companies are accepting Bitcoin as a payment option, such as Tesla. Both Visa and Mastercard have also taken steps towards integrating crypto in their payment systems.

Payments giant PayPal has already integrated crypto into its system by allowing its users to buy, sell, and hold crypto along with a crypto checkout service. PayPal-owned Venmo also introduced a crypto feature on its app last month.

“Demand on the crypto side has been multiple-fold to what we initially expected,” stated PayPal CEO Dan Schulman.

Amidst this, Digital Currency Group (DCG), the parent company of Grayscale, announced that they are going to purchase up to $750 million worth of GBTC, 3x the original $250 million they were planning to buy.

As of April 30, 2021, DCG has purchased $193.5 million worth of shares of GBTC, it said in a statement.

The market is currently euphoric, with Bitcoin near $58,000, Ether constantly making new highs hitting $3,300 today, and the total crypto market cap set to hit $2.4 trillion.

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Author: AnTy

Retail Investing Behemoth Is ‘Closely’ Looking at Crypto Market; Awaiting ‘More Regulatory Clarity’

Retail Investing Behemoth Is ‘Closely’ Looking at Crypto Market; Awaiting ‘More Regulatory Clarity’

Operating nearly 32 million brokerage accounts with over $7 trillion in client assets, Charles Schwab says they will be highly competitive and disruptive when that comes.

Charles Schwab is looking “closely” and “cautiously” at the cryptocurrency market, said the head of the brokerage on Thursday, adding that they are awaiting more guidance from regulators before offering crypto capabilities on its platform.

It has been exploring the launch of crypto brokerage since last month, and as we reported, it has been seeking a compliance director for its futures and forex team that involves crypto aspects.

“We would like to see more regulatory clarity,” Schwab Chief Executive Officer Walt Bettinger said on a call with analysts.

“And if and when that comes, you should expect Schwab to be a player in that space in the same way it has been a player in other investment opportunities across the spectrum.”

The US Securities and Exchange Commission (SEC) has yet to provide any clear rules and regulations regarding digital assets, but with crypto-friendly Gary Gensler being the new chairman, “guidance and clarity” is expected soon.

One of the largest retail brokerages and retirement account providers in the industry, Charles Schwab added a record 3.2 million new clients in the first quarter of 2021, more new accounts than the entire 2020.

The company said it now operates nearly 32 million brokerage accounts and has more than $7 trillion in client assets.

The retail investing behemoth also said it is closely watching for any new developments on the regulator front regarding whether they allow a crypto-based investment-oriented product like an exchange-traded fund (ETF). “We recognize a bit, I’d say, well, what’s going on,” Bettinger said.

“If Charles Schwab, the company, decides to participate in the crypto market, we will be highly competitive, we will be disruptive, and we will be client-oriented.”

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Author: AnTy

Miami-Dade County Task Force Is Looking at Ways for Residence to Pay Taxes Using Crypto

Miami-Dade County Task Force Is Looking at Ways for Residence to Pay Taxes Using Crypto

Florida-based county launches crypto task force to explore the possibility of paying state taxes using Bitcoin and cryptocurrency.

In a letter first made public by Miami New Times, Miami-Dade County commissioner Cohen Higgins brought up a resolution to set up a crypto task force that will investigate the possibility of paying state taxes and service fees using cryptocurrencies. The resolution was presented to the Miami-Dade’s Infrastructure, Operations, and Innovations Committee to establish a 13-member team.

The task force aims to find feasible ways residents could pay for their taxes and other county fees using cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC). The letter further lined out the membership, organization, procedures, establishment, and task force functions.

BTC -2.76% Bitcoin / USD BTCUSD $ 61,606.31
-$1,700.33-2.76%
Volume 83.8 b Change -$1,700.33 Open $61,606.31 Circulating 18.68 m Market Cap 1.15 t
4 h Miami-Dade County Task Force Is Looking at Ways for Residence to Pay Taxes Using Crypto 4 h UK Hedge Fund Brevan Howard Plans to Invest 1.6% of $5.6B Capital in Cryptocurrencies 5 h Canada Launches First Inverse Bitcoin ETF to Short BTC Futures Without A Margin Account
ETH -3.62% Ethereum / USD ETHUSD $ 2,440.76
-$88.36-3.62%
Volume 36.12 b Change -$88.36 Open $2,440.76 Circulating 115.5 m Market Cap 281.9 b
4 h Miami-Dade County Task Force Is Looking at Ways for Residence to Pay Taxes Using Crypto 4 h UK Hedge Fund Brevan Howard Plans to Invest 1.6% of $5.6B Capital in Cryptocurrencies 8 h Crypto Lender Celsius Suffers Data Breach Through Third-Party Mailing List
LTC 7.78% Litecoin / USD LTCUSD $ 312.13
$24.287.78%
Volume 11.86 b Change $24.28 Open $312.13 Circulating 66.75 m Market Cap 20.84 b
4 h Miami-Dade County Task Force Is Looking at Ways for Residence to Pay Taxes Using Crypto 1 d Grayscale Bitcoin Trust (GBTC) Is Fast Approaching World’s Largest Commodity ETF, GLD with $57B AUM 3 d CoinShares is Launching an XRP ETP (XRPL) as the Digital Asset Nears $2

The commissioner called on the committee to embrace cryptocurrencies, and they “have reached a point that merits evaluation” in order not to miss “potential opportunities such as efficiency and cost-saving.”

The committee passed the letter on Thursday noon but still awaits the final committee decision by the full county commission.

The Miami-Dade County has recently caught several eyes in the crypto circles with a multi-million deal being struck with FTX crypto exchange. The exchange became the first crypto entity to sponsor a major professional sports venue as Miami Heat grounds switched from AmericanAirlines Arena to FTX Arena.

Miami Mayor Francis Suarez has also been at the forefront to enact Bitcoin-friendly laws in the city and has urged other administrators to follow suit. He announced a new CTO role in his management, a position that will overlook the city’s growth as a fintech hub and boost “Big Tech” companies relocating to Miami. He also previously stated Miami’s plans to add Bitcoin to its balance sheet.

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Author: Lujan Odera

The Times Is Looking to Hire A CFO Who Has “Comfort with Bitcoin and Cryptocurrency”

The Times Is Looking to Hire A CFO Who Has “Comfort with Bitcoin and Cryptocurrency”

Media company Times is hiring for a crypto-friendly Chief Finance Officer, per its LinkedIn post.

With a focus on building a “better future” in the current environment where the media industry is undergoing rapid evolution, one of the requirements for the CFO is to have a “Comfort with Bitcoin and cryptocurrencies” to guide Times’ transformation.

As we have been seeing, ever since MicroStrategy put Bitcoin on its balance sheet in the second half of last year, corporations like Tesla and Square, among many other smaller ones, have jumped on this trend to protect their funds against fiat debasement.

It is possible that The Times will release a similar announcement of adding the leading cryptocurrency to its Treasury.

Recently, Times interviewed MicroStrategy CEO Michael Saylor, who explained that his mission is “to fix the balance sheets of the world.”

In December 2018, Times featured Bitcoin proponent and Chief Strategy Officer at the Human Rights Foundation, Alex Gladstein’s “Why Bitcoin Matters for Freedom.”

Responsible for the company’s investments, budgeting, and financial reporting to drive their financial strategy and growth trajectory, proactively research economic trends, monitor performance and compliance with global, federal, state, and local financial requirements, the candidate is further required to have 7+ years experience besides being crypto-friendly.

The candidate also needs to have a proven record of success managing a central finance function, skills to drive disciplined planning and forecasting, understanding of advanced accounting, regulatory issues, tax planning, and working knowledge of dynamic ways to build a business.

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Author: AnTy