Paraguayan Senate Passes Bill to Regulate Crypto Trading and Mining

The Senate of Paraguay has passed a bill that will regulate the trading and mining of cryptocurrencies in the country.

Paraguayan Senator Fernando Silva Facetti, one of the three authors of the bill, confirmed this on Twitter, saying Paraguay’s Chamber of Deputies will discuss the bill next year.

After an “intense debate” that the Senate approved the bill that regulates the industry and commercialization of crypto assets, said Facetti.

In July, Paraguayan congressman Carlos Rejala presented a bill to regulate crypto ownership and registration of crypto mining operators.

Paraguay’s low cost of electricity is the main attraction for crypto mining companies. Besides being the lowest in the region at around $0.05 per kilowatt-hour, the South American country produces 100% of its energy via hydroelectric sources.

The bill states that Paraguay only consumes a third of the energy it produces, and regulating crypto mining activity could help them consume “thousands of megawatts” that they currently have in “surplus.”

With the new legislation, Facetti said, Paraguay aims to recognize crypto mining as an industry and establish the grounds to guarantee access to energy and requirements for the formalization of an expanding sector.

He further said, for crypto transactions, the National Securities Commission (NSC) will establish the registration requirements for intervening agents for negotiation, compensation, custody, and intermediation in the securities market.

The bill proposes a registry for any individual and the legal entity seeking to provide crypto trading and custody services.

According to the bill, the country’s Industry and Commerce Secretariat will supervise crypto mining along with the NSC, Anti-Money Laundering Office, and National Electricity Administration.

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Author: AnTy

El Salvador’s Law Making Bitcoin Legal Tender to Take Effect in September, Paraguay to Follow

El Salvador’s President Nayib Bukele said in a national address that a recently passed law making bitcoin legal tender would take effect on September 7, noting that its use will be optional.

The countries’ Congress has already approved the proposal to embrace the cryptocurrency with a supermajority, making El Salvador the first country in the world to do so. Bukele said,

“The use of bitcoin will be optional, nobody will receive bitcoin if they don’t want it… If someone receives a payment in bitcoin, they can choose to automatically receive it in dollars.”

Salaries and pensions will also continue to be paid in USD, he added.

“One of the reasons we passed the bitcoin law is precisely to help people who send remittances,” said Bukele, adding the usage of crypto for remittance will eliminate the high cost of commissions involved in sending money across borders.

El Salvador relies heavily on money sent back from workers abroad. Remittances to the country made up nearly $6 billion, about a fifth of its gross domestic product (GDP) in 2019, one of the highest ratios in the world, showed World bank data.

According to Kenneth Suchoski, US payments and fintech analyst at Autonomous Research, less than 1% of the volume of global cross-border remittances are currently in cryptocurrency, which is expected to account for a larger share in the future.

On Thursday, Athena Bitcoin said it plans to invest over $1 million to install 1,500 crypto ATMs in El Salvador, especially where residents receive remittances from abroad.

President Bukele “presented us with a tough challenge of 1,500 ATMs, we will go for that, but in phases. We are a private company and we want to ensure that our development in the country is sustainable,” said the firm’s director for Latin America Matias Goldenhörn.

Athena installed its first crypto ATM in the country’s El Zonte beach as part of an experiment called Bitcoin Beach.

Amidst this, Paraguay is working on becoming the second country in the world to accept Bitcoin as legal tender.

Lawmaker Carlos Rejala is leading a bid to implement legislation to make Paraguay the second country to follow in El Salvador’s footsteps. Rejala announced on Twitter that he would be introducing a bill in the national Congress in July.

The bill that will be published on July 14 and seek to establish Bitcoin as legal tender will also introduce measures to make Paraguay a hub for foreign crypto investors.

Rejala first outlined his vision early this year when he said he was working with the crypto community in the country to make it a hub for the crypto investors and “subsequently to be placed among the ones on the cutting edge of digital technology.”

Juanjo Benitez Rickmann, the CEO of crypto exchange Bitcoin.com.py, then confirmed that he collaborated with the congressman to make Paraguay a crypto-friendly country and take “advantage of the renewable and inexpensive energy provided by hydroelectrics.”

Rejala, too, has emphasized Paraguay’s access to renewable energy as an impetus for attracting investment. Nearly 100% of the country’s electricity needs are served by hydroelectric plants, while 90% of all energy it produces is exported to neighbors Brazil and Argentina. Rejala while speaking to La Nación newspaper on Friday said,

“We are proud that since we announced that we are working on a bill that legalizes the use of digital assets… as legal tender in Paraguay for any type of commercial transaction, various Paraguayan companies have already joined and taken a step forward into the new era of transactions.”

Last week, a Paraguay-based large entertainment holding company said that 24 of its businesses would start accepting crypto as payment options from July.

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Author: AnTy

Germany Passes Law to Allow Electronic Securities on Blockchain

Germany, the largest economy in Europe, has passed a law that will allow all-electronic securities to be recorded and traded based on blockchain technology. According to Reuters’ report, this is part of a more effective strategy by the country’s Finance Ministry to integrate existing ecosystems with blockchain.

The newly passed legislation does away with paper certificate requirements for selling securities within Germany’s financial markets. Stakeholders who pivoted towards this shift cited lengthy administrative processes that have often been a barrier.

While the paper certificate may have acquired sentimental value, the future belongs to an electronic version, according to Olaf Scholtz, Germany’s Minister of Finance. Scholtz said that,

“The paper certificate may be dear to some for nostalgic reasons, but the future belongs to its electronic version.”

Meanwhile, Germany is still making significant strides in the nascent crypto industry has released new guidelines that recognize crypto assets as financial instruments earlier this year. Its second-largest stock exchange, Börse Stuttgart, is also working to integrate security tokens to shift to virtual assets.

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Author: Edwin Munyui

Pakistani Province Passes Draft Bill to Legalize Cryptocurrency Trading And Mining

In Pakistan, a province in Khyber Pakhtunkhwa passed a law that makes cryptocurrencies and mining legal in the region.

According to a Provincial Assembly (MPA) member, Dr. Sumera Shams, the move will enable the country to position itself better to compete favorably with the digitized world.

A few weeks ago, the Pakistani Securities and Exchange Commission set a motion to introduce a regulatory framework for cryptocurrencies. But it seems the government is trying to speed things up pretty quickly with the recent developments in the sector. Pakhtunkhwa tweeted,

“Indeed #Pakistan progressing towards digitalisation to compete the world.”

Zia Ullah Bangash, an advisor to the Pakistani government, provided a picture of the signed proposal to confirm the news. The proposal was signed by ministers and advisors and addressed to the chief of the province.

The crypto legalization move by the KP province can influence other regions to follow in that direction.

Legalizing cryptocurrency will speed up its adoption

The KP parliament urges the Pakistani government to quickly approve the motion to ensure that the region is not left behind in the growing digital currency frenzy.

With the proactive steps, proponents of the policy think it will stay ahead of its neighbors regarding cryptocurrency adoption.

Based on earlier reports, Pakistan already has an adequately regulated framework for digital currencies. But cryptocurrency proponents in the country had a setback when the Pakistan government banned crypto trading in April.

With Bitcoin illegal in the country, authorities descended on crypto holders and miners. At the turn of the year, the Pakistani Federal Investigation Agency clamped down on two crypto mining farms in the Shangla district of Khyber Pakhtunkhwa.

But in a published report on November 6, the Pakistan Securities and Exchange Commission brought more clarity about its stance on cryptocurrency.

The regulatory agency also said it is prepared to listen to a “do no harm” approach when dealing with digital assets.

Pakistan looking to stay ahead of neighbors

But with this upturn of the decision to open the crypto market once again for business, Pakistan may likely be the first to legalize cryptocurrencies and mining among its neighbors.

A vocal crypto enthusiast and television host, Waqar Zaka, said he wants to take the same proposal to Punjab and Balochistan. He said he wants to help the region pass the same policy in Pakistani’s other provinces.

He says if the federal government doesn’t review his proposal, he intends to appear in the Sindh High Court on December 17.

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Author: Ali Raza

YFI Opening the ‘Floodgates for BTC Hodlers into DeFi’ as it Adds ‘Curve sBTC yVault’ to Yearn.Finance

YFI has passed the latest proposal “YIP 39 – Curve sBTC Pool LIP-Tokens yVault” with 98% votes and 40.48% quorum. The weight of Curve sBTC will increase from 17% to 48% on Thursday.

This development would bring a lot of Bitcoin to Ethereum, which has already reached 46,694 BTC worth $534 million.

The idea of the YIP-39 proposal is to capture the $214 billion in AUM from bitcoin holders by allowing them to “passively grow their BTC holdings.” This would be done by using voting power to increase sBTC pool CRV returns and create a Vault for sBTC Curve Pool LP-token holders — which works almost identically to the yYFI and yCRV vault — who deposit renBTC / wBTC / sBTC in Curve Pool.

“Harvest CRV, sell it for more LP-tokens or renBTC, which is then re-deposited to create, distribute and compound LP-token growth,” states the proposal.

With the YIP-39, the YFI community aims to generate “significant goodwill from Bitcoin holders,” by presenting them with other use cases of the holdings.

It also mentions how currently the most confident BTC holders are only depositing and recycling or farming CRV.

“This can become a black hole for BTC deposits into Curve via renBTC and LP tokens into yVault for passive returns and governance fees,” it adds.

Move where the Money Is

For quite some time now, the YFI community has been discussing bringing BTC, the standard in the crypto world, to Yearn.Finance, which “would open the floodgates for BTC hodlers into defi.”

The rationale behind this has also been to bring a “greater” share of CRV rewards and wBTC revenue into the fold and to maximize AUM to get “governance control of other platforms.”

While “pure” bitcoiners will prefer to keep their BTC in multi-sig and not earn yield and some will go for crypto lenders BlockFi and Aave’s Lend, “there is a huge cohort of btc holders who want yield and will move to where the money is,” noted analyst Ceteris Paribus.

However, there are risks given that the “experimental” projects of DeFi continue to see a loss of funds along with the “Ethereum/smart-contract/synthetic risk.”

But there is also the advantage of higher yield, currently ~50%, maybe >100% soon, and not to mention there is no need for KYC.

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Author: AnTy

New Law Bans Anonymous Wallet Deposits To Curb Illicit Activities in Russia; Must KYC

The Russian government has passed a ruling to ban anonymous deposits into online wallets to curb illicit use of these anonymous funds. The banning would supposedly affect almost 10 million people who use different online wallet services such as Yandex, WebMoney, PayPal, and Kiwi.

People use these online payment and wallet services anonymously, where they top-up their wallet with a certain amount and then proceed to use it for different purposes, including buying of cryptocurrencies.

The government hopes to curb financing of terrorism and the illegal drug trade, which has been a growing concern given almost 10 million people make use of these online payment portals to make anonymous deposits to these online wallets.

The Russian government has been cautious about legalizing crypto use in the country since they believe legalizing crypto as a legal tender can undermine their sovereignty on issuing cash. However, Antonina Levashenko, an economist by profession, believes the measures taken against anonymous crypto wallet deposits won’t affect the blockchain space and the progress made in the decentralized ecosystem. Levashenko explained,

“Will it affect cryptocurrencies? Currently, these changes have been implemented only about electronic money by the amendments to the law on the national payment system. But shortly, undoubtedly, yes. FATF standards are always applied to new technologies by analogy: if at first the standards were spelled out for classic bank accounts, then they were first extended to electronic wallets and prepaid cards, and then to virtual wallets for cryptocurrencies, ”

Experts Believe the Impact of Ban Would be Minimal

Maria Stankevich, an EXMO crypto exchange business development manager, believes the current ruling by the government would only impact those exchanges which haven’t been following the compliance set by the regulatory authorities. She also noted that the current ban would force bad actors to either shut their operations or make changes to incorporate the compliance guidelines set by the authorities. Stankevich explained,

“A small insider: one large payment system … at one time refused us after a long passage of all compliance procedures. Colleagues explained this by the fact that despite the strong anti-money laundering and anti-fraud procedures, our exchange can replenish an account through the named payment systems, which, in turn, can be replenished with cash. This means that no one can trace the origin of these funds, which contradicts all the policies of this payment giant. We were distraught then but hoped that someday such a law would be adopted.”

Just last week, President Putin has signed a law for Law on Digital Financial Assets, which prohibits the use of bitcoin and other cryptocurrencies as a means of payment. The rules and guidelines related to the new Law on Digital Financial Assets would come into practice by January 1st, 2021.

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Author: James W

Russia Legalizes Cryptocurrencies for Savings and Speculation But Bans Use as Payment

Russian lawmakers passed a bill on Wednesday that gives cryptocurrencies legal status but, at the same time, banned them from being used as a means of payment.

Duma, the lower house of parliament, approved the bill on digital financial assets in the third and final reading. Anatoly Aksakov, who heads the Russian Banking Association and a financial committee in the Duma, as to what a cryptocurrency is now defined in law, said,

“Essentially the cryptocurrency is a complex of digital data, a digital code or a reference, that is stored in the information system.”

The bill has to go now to the upper house of parliament and then to the Kremlin, which is just a formality. The bill will come into force in January 2021.

“Possession of digital currency, its acquisition and transfer by legal means are allowed only if declared,” said the central bank on the new bill. “The draft law introduces the definition of a digital currency, which cannot be a means of payment,” it said.

Russia changed its stance on cryptos in 2018 and promised to regulate the market. However, the regulation had been delayed ever since. At one point, the lawmakers drafted a version of a bill that made trading in cryptos and issuing them illegal.

With the latest draft, cryptos are now kind of like property that one can buy, sell, and invest in but can’t be accepted as a means of payment.

The bill says the issuance of crypto in the country should be regulated by other laws that Aksakov says could be passed during the next parliamentary session in the fall, which ends in late December.

The DFA bill provides the foundation for the crypto legislation in Russia, and the actual regulatory framework for crypto will be defined in the “On Digital Currency” bill.

Many say the current bill doesn’t change anything for the crypto industry in the country, and the DA, which is still in discussion, might “come as a surprise.”

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Author: AnTy

Hong Kong Passes Limited Partnership Funds (LPF) Bill Including Investment in Digital Assets

Last week, “Limited Partnership Fund Bill” was passed by the Legislative Council of the Hong Kong Special Administrative Region. The bill that aims at attracting private equity, real estate and venture capital funds to set up and operate in Hong Kong also covers investment in digital assets.

The bill will come into operation on August 31st, 2020.

With this bill, Hong Kong has established a new regime for investment funds to be registered in Hong Kong in the form of limited partnerships. It was first introduced in March to provide an alternative investment vehicle for private fund managers raising funds or investing in Asia.

Under this new regime, investment managers need to be licensed by the SFC (Securities and Futures Commission), ensure proper custody of assets, annual audits of independent funds, and be compliant with the AML/CFT.

“Major jurisdictions waking up to regulated Bitcoin products. Great progress in Hong Kong!” noted Gabor Gurbacs, digital asset strategist at VanEck.

The definition of “fund” in the Bill covers, but not limited to, Venture capital, Private equity, and M&A funds, Real Estate Fund, Infrastructure and project funds, Special circumstances fund, Mixed Fund, Non-performing asset fund, Credit Fund, and Funds invested in digital assets such as cryptocurrencies and virtual assets.

Fully Regulated Bitcoin Fund

Today, MV Index Solutions GmbH announced that in partnership with CryptoCompare, it had licensed the MVIS CryptoCompare Bitcoin Index (MVBTC) for its recently launched Bitcoin fund which is available only to institutional and professional investors.

“We are pleased that our Digital Asset Indices continue to be popular and that we are now also the underlying index or Hong Kong’s first regulated cryptocurrency fund,” said Thomas Kettner, Managing Director at MV Index Solutions.

“This will help to strengthen the status of digital assets as an asset class and fulfills the needs of institutional investors.”

The licensing is part of the broader push to bring institutional-grade fund products to investors looking to gain exposure to bitcoin and other cryptos.

“With the launch of their fully regulated Bitcoin fund, VSFG and Arrano Capital will help further the adoption of digital assets that fulfil the needs of institutional investors,” said Charles Hayter, CEO, and Co-Founder of CryptoCompare.

Hong Kong & Bitcoin

Not long back, bitcoin got really popular and increasingly in use in Hong Kong; however, lately, there hasn’t been any major capital flight out of it.

While crypto ATM Genesis Block Hong Kong seeing its volume doubling, no such spike can be seen on P2P platforms LocalBitcoins or Paxful.

While Nic Carter of Coin Metrics says, “unencumbered access to the financial system isn’t guaranteed,” Matthew Graham, CEO of Sino Global Capital, points out that “HKD is freely convertible” and as such doesn’t see it as a big use case.

They may not be using Bitcoin but seem to be using stablecoins as the trading volume between Hong Kong dollars and USD pegged USDT has been seeing a surge in June on fiat-to-crypto trading platform TideBit. This could be attributed to the national security law enacted by China on June 30.

However, much of trade happens over-the-counter (OTC) in mainland China and Hong Kong, so it’s hard to know the real trading volume and interest in stablecoins and digital assets.

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Author: AnTy

U.S Senate Sanctions Following the Hong Kong Security Law Could Affect Crypto Brokerages

The U.S Senate sanctions that were passed in response to the Hong Kong security law might affect crypto brokerage operations.

Dubbed the ‘Hong Kong Autonomy Act,’ this senate bill aims to reprimand China for eroding the city’s autonomy, which had long favored its position as a financial hub. According to the new security law, Hong Kong’s freedom of expression has been infringed to the extent of not being allowed to criticize the Chinese Communist Party (CCP).

With the U.S acting as the leader of the free world, a counter move on this infringement was to be expected. Now that the Senate has already given the green light; the U.S government can now move to limit its foreign registered subsidiaries in Hong Kong from providing access to the dollar ecosystem. These limitations will be in situations where the other party is undermining Hong Kong’s autonomy. However, the bill did not specify what criteria would be used to arrive at such decisions, leaving this to the U.S Treasury.

The Effect on Crypto Brokerages

These moves by the U.S senate and CCP could have a significant toll on crypto brokerages operating in Hong Kong. The city has long been a link between mainland China crypto businesses and international markets, given its friendly nature towards digital assets. This link has since motivated mainland China-based crypto exchanges such as Huobi and OKCoin to set up in Hong Kong.

While their operations are majorly in Asia, access to the dollar ecosystem is fundamental for liquidity and other aspects. According to the president of Hong Kong’s Bitcoin Association, Leo Weese, a move to curtail liquidity provision would be catastrophic for the Hong Kong-based exchanges:

“The most successful cryptocurrency companies here are dependent on their access to the U.S. dollar system … They move money around, they are big brokers, and if they somewhat lose that access, they are in trouble.”

Weese’s sentiments were seconded by other stakeholders in this market, including Genesis Block’s chief trader, Charles Yang, who noted that reliance on U.S banks for dollar settlements is inevitable. Consequently, the ongoing friction puts their business at more risk.

“If there is any further friction from the U.S. policy, it could be very damaging to our business.”

Hong Kong’s Financial Dominance in Limbo

While the new security law doesn’t intend to change Hong Kong’s financial status, this could quickly change, according to Weese.

“I think for now there is no intention to mess with Hong Kong’s financial system and scare companies away, but of course things could quickly change.”

As both the CCP and U.S continue to fine-tune their stance on this development, a move to Beijing as China’s financial hub will mean more scrutiny by the government. This might, in turn, make wire transfers and other financial services expensive and slower compared to the autonomy that preceded business in Hong Kong.

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Author: Edwin Munyui

“Economy Dying, Fed Incompetent,” Invest In Gold, Silver, Bitcoin: Rich Dad Poor Dad Author

Last week we reported Congress passed another $3 trillion coronavirus relief package after having spent $3 trillion already. But this won’t be enough and according to Fed chairman, Jerome Powell, both Congress and Fed would have to do more.

But worry not, because Fed isn’t out of ammunition, “not by a long shot.” They have interest rates to slash or better yet the unlimited money printing that they have already been doing. As Powell said on Sunday on CBS News,

“As a central bank, we have the ability to create money digitally.”

But not everyone agrees with Powell’s tools to prop the economy back. “ECONOMY dying. FED incompetent. Next BAILOUT trillions in pensions. HOPE fading,” said ‘Rich Dad, Poor Dad’ author Robert Kiyosaki.

According to him, the three investments to “prepare for the worst” are bitcoin, gold, and silver. And he expects all three of them to experience a jump in price in the coming years. As per his prediction, gold will rise 43% within a year to $3,000 and silver 135% to $40 in five years.

Bitcoin, the deflationary cryptocurrency with a limited supply, is expected to jump the highest 665% to $75,000 in the next three years.

Kiyosaki has long been a bitcoin supporter and has been calling for investing in these scarce assets.

While the money supply only continues to rise, last week, Bitcoin had its third halving that cut down miners’ reward in half and reduced its inflation to 1.8%.

“The rest of the world needs to either keep printing money or see their own currency eroding drastically in front of the unbeatable dollar,” said Jean-Marie Mognetti, chief executive officer of CoinShares.

“Bitcoin, a digital currency whose supply is programmatically defined to reduce until it reaches its maximum supply, would seem to be the perfect hedge for any institutional investor portfolio.”

Recently macro investor Paul Tudor Jones also became a bitcoiner and has almost 2% of his assets in the digital asset which according to him is an inflation hedge.

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Author: AnTy