White House Officials Strive for Mitigating Crypto Risks
Last week, White House officials called on regulators to continue efforts to launch or develop public awareness programs to make more users understand the risks of buying cryptocurrencies. They also charged Congress to expand regulators’ powers to prevent misuses of customers’ assets, mitigate conflicts of interest and strengthen transparency and disclosure requirements for cryptocurrency companies to enable investors make informed decisions about risks. The lawmakers could also strengthen penalties for violating illicit finance rules and subject cryptocurrency intermediaries to bans against tipping off criminals, the officials noted. Other measures could include funding greater law enforcement capacity and limiting cryptocurrencies’ risks to the financial system in line with the Financial Stability Oversight Council report.
Ted Cruz Presents Introducing Crypto Payments to Capitol Buildings
Meanwhile, around the same period, Sen. Ted Cruz (TX-R) proposed a resolution requesting vendors within the Capitol area to work with payments providers that accept Bitcoin. If accepted, the proposal—which was submitted as a concurrent resolution and referred to the Committee on Rules and Administration—would see restaurants, gift shops, and vending machines within Capitol Buildings accept cryptocurrencies such as Bitcoin as payment for goods. Amongst other things, the move would enable targeted users, including US lawmakers, to purchase their on-the-go snacks with cryptocurrencies.
Like Binance, Coinbase Fined by The Netherlands’ Central Bank
Last week, the Dutch central bank imposed an administrative fine on Coinbase Europe for providing crypto services in the Netherlands in the past without registration. The exchange was fined €3,325,000 for non-compliance with the law.
Binance suffered a similar fate last April when the Dutch apex bank fined the largest crypto exchange by market cap the same amount for the same offense.
The apex bank says companies that want to offer crypto services in The Netherlands are required to register with DNB under the Anti-Money Laundering and Anti-Terrorist Financing Act (Wet ter voorkoming van witwassen en financieren van terrorisme – Wwft).
Also, like Binance, DNB did reduce the fine by 5% because Coinbase had always intended to obtain registration with DNB before it got registered in September 2022.
Tesla Now Staying True to Hodl?
Tesla’s recent Q4 2022 financial report shows that the automaker did not sell any Bitcoin for the period. This, in contrast to its Q2 2022 earnings report which reflected large outflows of BTC, incurring a net loss of $140 million.
Tesla’s BTC sales reflected in the Q2 2022 report marked an about-turn for CEO Elon Musk, who is on record stating in 2021 that the company would not sell any of its Bitcoin holdings. Musk has been identified as a major crypto influencer, especially for the digital assets the automaker holds. Despite parting with 75% of its Bitcoin holdings—or an estimated 29,060 Bitcoin—earlier in 2022, the EV manufacturer still holds $184 million worth of BTC. With the latest figures in the Q4 2022 report showing no sign of BTC sales, Musk looks to finally be making good on his promise of not offloading any further digital currency.
Chinese Crypto Entrepreneurs Head for Singapore
A New York Times report suggests that a large number of Chinese crypto entrepreneurs have relocated to Singapore. The report comes as a CoinShares analysis shows that Hong Kong saw outflows from long investment crypto products (US$11m) last week at a time when digital asset investment products recorded $37m worth of inflows in general. Hong Kong continues to attract crypto entrepreneurs even though the special administrative territory is considered in some quarters to have policies that are difficult to separate from Beijing’s.
USDC Launches Cross-Chain Transfer Protocol
Last week, USDC launched Cross-Chain Transfer Protocol (CCTP) as a permissionless on-chain utility that can burn native USDC on a source chain, and mint the same amount on a destination chain. CCTP removes the need to use a conventional “lock-and-mint” bridge, which would otherwise lock native USDC on a source chain—incurring a potential security risk—and then mint a synthetic/bridged version of USDC on the destination chain. It will afford developers the opportunity to build novel cross-chain apps. It will also provide users with an efficient way to transfer USDC across chains and to create a somewhat seamless transaction experience for the user.
TON Community Moves to Suspend Inactive Wallets
It was disclosed last week that a vote would be held starting February 21 on the TON blockchain for validators to decide whether inactive miners' wallets—which make up about 21.3% of the total coins—are to be suspended. Inactive wallets are those which took part in Toncoin's distribution phase that ended in June 2022, and have never made an outgoing transaction ever since. As of 18 January 2023, there are 195 inactive wallets with their balance adding up to 1.08 billion Toncoin. Should the vote pass, the suspension of affected wallets from making transactions would last for four years.
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