ProBit Bits — ProBit Global’s Weekly Blockchain Bits Vol. 59

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 Stablecoin CEO Testifies Before U.S. Congress

Circle CEO, Jeremy Allaire, stood before U.S. Congress on the 13th of June in a bid to implore the American government to urgently finalize stablecoin regulation. In remarks posted on the Circle website, Allaire urges Congress to “lead the development of global rules that will determine how our own currency moves around the world.”

In a presentation to the US House Financial Services Committee, Allaire endorsed but also highlighted the need for specific improvements to the current draft bill titled “The Future of Digital Assets: Providing Clarity for the Digital Asset Ecosystem.” He urged federal enforcement of standards, and advocated for easier access to Federal Reserve account services for stablecoin issuers. The 52-year-old CEO suggested that stablecoin intermediaries should be required to hold stablecoins with chartered qualified custodians.

Circle is best known for creating the USDC stablecoin in collaboration with Coinbase. While Allaire has asserted in the past that USDC’s shrinking market share is down to regulatory missteps, his latest comments to Congress indicate a warmer, more conciliatory approach to working with lawmakers for the betterment of the crypto landscape in the U.S. Other prominent crypto figures who testified at the hearing include Emin Gün Sirer, founder and CEO of Ava Labs, and Aaron Kaplan, founder and Co-CEO of Prometheum.

 HKMA Pressures Banks To Take On Crypto Clients

The Hong Kong Monetary Authority (HKMA) is urging banks, including HSBC and Standard Chartered, to accept crypto exchanges as clients, even as the US intensifies its crackdown on the crypto industry. During a recent meeting, the HKMA questioned UK-based lenders and Bank of China about their reluctance to onboard crypto exchanges. The HKMA emphasized that due diligence should not create an undue burden, especially for those seeking opportunities in Hong Kong. While banks in Hong Kong do not have a ban on crypto clients, they are hesitant due to concerns over potential legal issues such as money laundering.

This pressure from the HKMA highlights the challenges faced by Hong Kong in its efforts to position itself as a global hub for the crypto industry, particularly after several high-profile collapses like FTX. Despite this, the HKMA is encouraging banks not to fear the crypto industry and to embrace crypto exchanges.

 EU Government Sets Out AI Legislation

The EU AI Act, a comprehensive legislative framework for regulating artificial intelligence (AI) in the European Union, has been approved by the European Parliament. The primary objective of the act is to promote the use of ethical and trustworthy AI while safeguarding fundamental rights and democratic values. It includes bans on certain AI services and products, such as biometric surveillance, social scoring systems, predictive policing, and untargeted facial recognition. However, generative AI models like OpenAI's ChatGPT and Google's Bard can continue operating as long as their AI-generated outputs are clearly labeled.

The act also establishes a classification for high-risk AI systems that have the potential to cause harm or influence elections. These systems will be subject to further governance and regulation. This development comes shortly after the implementation of the Markets in Crypto-Assets (MiCA) bill, which regulates the cryptocurrency sector.

Notably, industry leaders, including OpenAI CEO Sam Altman and Ripple's managing director for Europe and the UK, have expressed their support for these regulations, emphasizing the need for responsible AI and a level playing field in the crypto industry within Europe.

 Brazil Moves To Monitor Domestic Crypto Players

In keeping with global developments around crypto regulation, Brazil’s President, Luiz Inácio Lula da Silva, has given the country’s central bank significant oversight of cryptocurrencies by signing into law Decree no. 11.563. The new law will come into effect from June 20, 2023, and is intended to put crypto projects under the purview of the Brazilian Securities and Exchange Commission (CVM).

One major gray area, however, is the fact that the law does not clearly stipulate the criteria for projects to qualify as securities; a pre-condition for tokens to be regulated by the CVM. This stands in contrast to the recent remarks by the U.S. SEC, which has

As a country with a large crypto user base (and the largest in South America), analysts have welcomed the development of a regulatory framework for token projects and increased cooperation with the central bank.  

Bitcoin Miner Gets Lucky By Solving $160,000 Block

A solo Bitcoin miner struck crypto gold when they successfully solved the 275th block of the Bitcoin blockchain on the Solo CKPool platform. With a block reward of 6.25 BTC, the miner in question beat odds of one in 5,500 to earn an equivalent of approximately $160,000. The block, which would statistically take 450 years to mine, was solved in 10 minutes. CKPool devs speculate that the miner was using an S9 Bitmain Antminer unit, a machine which was first released in 2017 and since been surpassed by newer, superior mining machines.

Despite this outlier event, the steady rise in miner competition has led to a consistent increase in hashrate, making mining gains harder to come by. Satoshi Nakamoto, the founder of Bitcoin, anticipated the escalation of mining difficulty as new miners joined the network.

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