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Coronavirus Pandemic to Trigger CBDC Development Globally

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The Bank of International Settlements (BIS) anticipates the effect of the coronavirus pandemic on retail payments to trigger positive development of CBDC globally. BIS is a Swiss-based international organization comprised of 60 central banks. The organization has released several reports centered on decentralization, cryptocurrencies, and central bank digital currencies (CBDC). CBDCs refer to state-issued cryptocurrencies, whose legal tender depends on the regulatory structure of a government.

Coronavirus impact on global payments

BIS ‘latest June 24 report suggests that the coronavirus pandemic has inflicted extreme changes in retail settlements. In addition, the report outlines the advantages and disadvantages of the current payment systems.

The report, for starters, highlights the rapid deterioration of fiat payments due to the risk of transmitting the virus between traders and consumers. And the economic uncertainty has caused “precautionary holdings” in fiat, leading to a decline in daily cash transactions.

Around the same time, restrictions levied by national governments, such as closing down tangible shops, have contributed to a steady decline in payment settlement on e-commerce. Besides, the fall in travel has led to a decrease in international visa transactions, and a substantial decline in remittances from migrants.

BIS says both of these changes show the benefits and limitations of the current payment system. Digital payment systems, on the other hand, have made it possible for many commercial operations to operate given the great disruption to daily activities.

“The crisis has amplified calls for greater access to digital payments by vulnerable groups and for more inclusive, lower-cost payment services going forward.”

Opportunity for CBDC development globally

In this regard, the BIS report outlines that CBDC development is globally at the frontier of policy opportunities “for central financial authorities;” could amount to a sea change. ” It notes that a successful CBDC could provide” a new, secure, trusted, and widely accessible digital payment method.

The BIS also noted that it would continue to offer its assistance to central banks worldwide in CBDC research and design. The organization has demanded global cooperation to ensure that post-COVID-19, future changes in international payments will be less split, more comprehensive, and more productive.

Supreme Court of US Moves to Curb SEC’s Control Over Penal Fines on Crypto Firms

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The United States Securities Exchange Commission (SEC) has been limited in penalizing irregularities with fines. The Supreme Court of US ruled on June 23 to restrain the amount of fine that the watchdog can inflict on crypto and blockchain-related companies.

The ruling of the U.S. apex court in the National Law Review states that the SEC can not impose fines (disgorgement) that exceed the profits generated by illicit proceeds. In addition, penalties may only be imposed for the benefit of victims, not as penal damages.

The new ruling will apply in the course of the proceedings to all litigants. Still, to cryptocurrency and blockchain companies, this is a strict definition of the penalty that must be equivalent to the offense when it comes to financial penalties. The SEC is already restricted by a five-year limitation period when it is imposed.

Substantial fines forced by the SEC in the past

In May, the SEC, in a case against BitClave, ordered the startup to refund $25.5M to investors after finding the firm guilty of distributing unregistered securities. The lawsuit also included $3.8 million in fines and interest. Moreover, the authority also indicted an ex-pastor and his wife for pilfering $500,000. Part of the amount was gained through a fraudulent cryptocurrency offering backed by a mineral water firm.

In that case, the SEC imposed fines equivalent to the stolen funds, on top of interests and civil penalties. The total amount exceeded the $500,000 that the two allegedly defrauded investors. However, the latest Supreme Court ruling would have inflicted a $500,000 fine, the amount reportedly stolen by the couple.

Supreme Court of US ruling leniency

In fact, under the new ruling, if the couple had used some of the ill-gotten funds in the water business that supported the offer, the amount spent would have been subtracted from the total amount after the SEC had fixed the due penalty.

The SEC is one of the most active financial regulators in the United States. The authority is always combating fraudulent schemes in the blockchain and cryptocurrency space.

The Referral Program of Traxalt and Bitfoliex is Back!

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Many of you were wondering when the Referral Program was going to be live again. Traxalt, in alliance with bitfoliex, recently announced that the Program will be available from June 22nd, 2020. These are very awaited news for the Traxalt community, as it is a chance to start living and sharing the Traxalt Experience.

The main objective for the Referral Program is to grow and strengthen the Traxalt community so that it has more chances to become a stablecoin once it is listed for trading in exchanges. The program continues in bitfoliex, as it is one of the most secure and user-friendly digital wallets available.

The Referral Program basically consists of inviting new members to join bitfoliex by opening and verifying an account through a referral code, and in return, they will get a Traxalt airdrop as a welcome reward. The main message of the Referral Program is sharing an experience with Traxalt, so the person who invites a new member will also receive a Traxalt airdrop as a reward. Mostly, it is a win-win experience.

The Traxalt airdrops are the following:

  • The referring person will receive an airdrop of 0.015 TXT for each new user who registers with bitfoliex and completes the verification process.
  • The referred person will receive an airdrop of 0.035 TXT as an incentive after completing the verification process.

The Traxalt community had an increase of +100K TXT holders during the months that the Referral Program was active. So, the main goal for the Program now, is to grow this community even bigger and stronger.

If you want to join the Traxalt community and want to participate in the Referral Program, you can get your referral code by watching the step-by-step video here (YouTube bitfoliex Platform).

Let’s keep working together! And remember, the more we share, the more we have.

#ShareTheTraxaltExperience

 

 

Brazil Central Bank Suspends WhatsApp Payments

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It’s been less than a month since Facebook launched WhatsApp payments in Brazil. On 23 June, the  Brazil Central Bank suspended the WhatsApp-based payment system according to Bloomberg’s report.

The Brazil central bank has moved to suspend the new payment system to ensure competition in the payment system industry. The financial watchdog will use the suspension to analyze the system’s potential risks to its payment infrastructure while checking whether WhatsApp complies with the regulations.

 “The decision aims to preserve an adequate competitive environment, that ensures the functioning of a payment system that’s interchangeable, fast, secure, transparent, open and cheap,” the monetary authority said in a statement on its website.

Facebook’s payments aspirations heartbreak

The suspension of WhatsApp payments by Brazil Central Bank is the second setback to Facebook’s market ambitions for payments. Although the beta version of the payment system was launched in WhatsApp’s largest market (India), Facebook still faces regulatory barricades that shut down a broader launch.

WhatsApp hopes that its payment system will be used by individuals to settle business transactions and to transfer funds between individuals. For individuals, the service would be free of cost, while businesses would be charged 3.99 percent as processing fee. In addition, the system has undergone pilot testing in both Mexico and India.

Brazil Central Bank surprises WhatsApp

In WhatsApp’s largest markets, India and Brazil, the messaging service has been identified as the leading online identity. According to Bloomberg, more than 5 million tradesmen use the WhatsApp brand. In addition, Bloomberg notes that the messaging giants were shocked by the decision of the  Brazil central Bank since they were in regular contact with each other.

WhatsApp had debuted a test program for WhatsApp Pay in Brazil a month before it was launched. The primary goal of WhatsApps is to provide a digital payment system to all users of WhatsApp in Brazil using an unlocked method. The report also notes that it intends to support the instant payment system of the central bank. The payment system will be launched in Brazil by the end of the year.

 

Here’s Why Ethereum ‘May or May Not’ Incurr Profit from DeFi’s Growth

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For any Ethereum cryptocurrency proponent in space, the growth of DeFi over the last few days may trigger a sense of optimism in their minds. The DeFi ecosystem was given a new lease of life as on 21 June, with DeFi’s total value in terms of the US dollar surpassing its all-time high by $1.48 billion.

At the time of the press, the TVL valued stood at $1.51 billion, according to the DeFi pulse website. However, the same community is currently wondering about the ineffective translation into Ethereum’s price.

Besides a minor surge witnessed on 23rd June, the largest altcoin is yet to exhibit any of the positives outlined by DeFi’s surging run in terms of market growth.

According to Ryan Sean Adams, Ethereum proponent, and Bankless author, DeFi’s success manifesting into eventual spike for ETH’s valuation can be argued from the perspective of both the hopeful, and skeptic.

Adams’s recent subtract suggested that Ethereum bulls eyed the potential of DeFi from a long-term perspective. DeFi has been relevant in the ecosystem for only about a year and half and the profit cycle of decentralized finance apps will eventually impact Ethereum cryptocurrency’s price as well.Ethereum cryptocurrency would not face a case of ‘getting replaced’ with stablecoins or tokenized Bitcoins such as WBTC since ETH needs to be locked up as collateral as a trading pair.

Lastly, the subtract added,

“Layer two scalability is hitting mainnet now and Eth2 is just as far along as any competitor. Finance is a game of network effects and Ethereum’s lead over competitors isn’t just growing it’s accelerating. Competing chains will be sidechains of Ethereum.”

However, the Ethereum cryptocurrency bears analyzed the space from a different point of view.

Countering the exact point, the bearish narrative remains that the profits on DeFi are unlikely to translate into Ethereum cryptocurrency’s growth and Ether will never be used as a capital asset, rather remain as a utility token in the space.

The issuance of USDT is concerning because it takes away the monetary utility of ETH in a way that Tether appears to have higher stability to hold or raise funds on Ethereum cryptocurrency. Plus, the complexities with gas prices continue to be alarming for the space as transaction fees mistakes over the past month, resulting in dire losses.

Is Ethereum cryptocurrency going to incur profits from DeFi?

The jury is still out on this development. Considerable arguments on both sides suggest that DeFi is still at a nascent stage in terms of real-world applications and functionality. Hence the plot forEthereum cryptocurrency and its base token Ether may be profitable in the near future, but nothing is set in stones at the moment.

Italian Banks Express Desire to Test Digital Euro

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According to the recent report, Italian banks have expressed their desire to explore the European Central Bank Digital Currency. The Italian Banking Association (ABI), composed of 700 financial institutions, wants to accelerate the general implementation of the CBDC, which is backed by the European Central Bank ( ECB).

In regards, ABI has also handed out ten recommendations for a European digital currency during its Thursday announcement. The initial advice, which is the most important, suggests comprehensive complaisance with the appropriate European regulatory structure. On top of this, ABI also suggested financial sustainability as another crucial area.

Digital currencies are beneficial

The association also highlighted some advantages of a CBDC. It noted:

“A programmable digital currency represents an innovation in the financial field, capable of profoundly revolutionizing money and exchange. This is a transformation capable of bringing significant potential added value, particularly in terms of the efficiency of the operating and management processes”.

The development of a central bank cryptocurrency can aid in positioning Italy at a favorable spot to have proper administration of the country’s digital landscape. The features of the digital Euro can offer additional security to the financial system, on top of eliminating the inconveniences related to critical financial transactions like transferring of funds.

Furthermore, digital currencies can help a country achieve a completely cashless economy. This is particularly cost-effective since the cost of developing fiat currencies will be slashed or wholly abolished.

Italian banks dawn of innovation

The announcement highlighted the fact that digital currencies are programmable positions them as crucial innovations in the finance sector. ABI stated that Italian banks believe that the development of digital currencies will immensely revolutionize money and the financial system altogether.

Italy has joined several other countries that have expressed the desire to deploy a central bank digital currency. Early this year, the Bank of France asked the public to submit proposals for the possible experimentation of a CBDC. Furthermore, South Korea also established a panel early this month to research digital currencies. 

Bitcoin is Trading at “Fair Market Value” as Tokens Breaches Past $9500

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The last-24 hours were relatively positive for the largest digital asset. After spending more than a week under $9,500, Bitcoin has surged by 4.16 percent over the past 36 hours, and the asset is currently valued at $9653.

 

ETH 21

As observed in the above chart, the consolidation under $9,500 was fairly evident until yesterday, when prices rose significantly. Although the volatility level was rather low, the asset was able to break away from the sideways monotony.

Group 185

Now, glassnode’s weekly insight underlined a few positives for the BTC ecosystem as well. According to the report, Bitcoin sat firmly in the bullish regime as the positive inclination suggested stability in on-chain and off-chain activity.

Another important metric highlighted in the report is the Bitcoin Realized Cap. At press time, Bitcoin’s realized cap had reached an all-time high of $106 billion, breaking its previous peak just before the market crash in March.

Bitcoin’s Realized Cap is defined as the total amount of Bitcoin on the market calculated by the price of Bitcoin when the funds were last moved to the market.`

Now, a consistently high and improved Realized cap suggested that the valuation of Bitcoin had space to improve its price point without being overvalued on the market. In terms of the actual market economy that weighs on each token’s market value and realized value, Bitcoin remained on the right side of the industry.

Group 186

The realized cap was further explained by the help of the Bitcoin MVRV Ratio. As observed in the above chart, the MVRV ratio was relatively low at the time when it indicated that Bitcoin is currently being traded near to its “fair value” which is directly related to its realized price.. The report added,

“When the market value (i.e. price) drops below the realized value, this implies that bitcoin is being traded at below “fair value”.”

UK-Based Crypto Firms Receive Closure Threats from FCA

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The UK-based crypto firm received a reminder from the Financial Conduct Authority on 22 June regarding the submission of completed registration forms before the end of the month. The Authority intends to create adequate time for the processing of applications before the registration deadline of January 2021.

The FCA is responsible for overseeing the efforts of the United Kingdom to combat financial crimes such as money laundering and terrorist financing. Besides that, earlier this year, on 10 January, the Authority assumed jurisdiction over more power over virtual assets.

“Any businesses that started carrying on business in the UK immediately before January 10 2020 and are not registered by the FCA by the January 10 2021 deadline will have to cease carrying on business. Any new businesses which began operating after January 10 2020 must be registered with the FCA before carrying out any business,” wrote the FCA.

FATF and AMLD5 implementation in Europe

The Fifth Anti-Money Laundering Directive came into force in the United Kingdom on 10 January. The Directive, which will be implemented in all European union member countries, is intended to restrict crypto-related companies. The AMLD5 extended the realm of knowledge-your-customer (KYC) that crypto-exchanges should undertake.

UK-based crypto businesses should also register with the Financial Conduct Authority and should also be verified by the authority. Digital currencies are popular with criminals for a valid reason; their privacy features. According to a report by the research firm Cypher Trace, 0.69 percent of all cryptocurrency transactions in UK-based crypto firms originally came from criminals.

UK-based crypto firms to comply with new regulations

The FCA is tightening loops to commit such financial crimes in the United Kingdom. The authority highlighted that it is motivated to oversee UK-based crypto firms that are compliant with the new AMLD5 directive and FATF regulations; the body will take the necessary response if the firms fail to comply with all the new rules.

Furthermore, UK-based crypto firms should also comply with the new regulation in the industry. The Financial Action Task Force (FATF) proposed that crypto firms abide by the “travel rule.” FATF is an international multi-governmental authority; tasked with combating organized crime, corruption, and terrorism. 

Corporate Credit Card Info, Personal Data Leaked in Cognizant Ransomware Attack

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Cognizant cyber solutions firm has notified both employees and the California state regulators that the majority of private information that was compromised during the April Cognizant ransomware attack involved corporate credit cards. The credit cards were issued to the firm’s employees.

Back in April Maze attackers orchestrated the Cognizant ransomware attack. The firm has now notified its employees that their private information, such as company corporate credit card names and account numbers, has been leaked.

“A limited amount of personal data (of associates) was compromised before the attack was contained on May 1. Vast majority of the information consisted of names and account numbers (and no other personal information) from some American Express cards,” Cognizant wrote in a corporate letter to the employees.

The technology solutions firm is expected to be impacted by $50-$70 million in generated revenues during this quarter. Furthermore, the Cognizant ransomware attack has been reported to the Federal Bureau of Investigations (FBI) for investigations.

As of now, there are no details on whether the attack only affected employees in the United States or employees from other geographical locations. However, the firm has informed the affected employees that they will receive access to credit card monitoring, dark web monitoring, and free restoration of services.

Moreover, the firm also noted that some employees’ data beyond the corporate credit card info had been leaked.

“The small number of associates who have had other kinds of personal information exposed will be notified directly by June 24, 2020, and will also receive complimentary identify theft protection,” the firm allegedly stated.

Details of the leaked personal information include tax identifications, social security details, passport information, driver’s license details, and many more. Cognizant has allegedly filed two statements with California authorities regarding the Maze ransomware attack. The initial letter is directed to employees regarding the attack, while the second one is directed to the affected persons.

PayPal Seeking Crypto Engineers Amid Alleged BTC Consolidation 

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PayPal is looking to hire experts in blockchain and cryptography, as the word in the streets is that the international payment system seeks to integrate direct crypto purchases into its more than 300 million users. The roles of the open positions can be accessed publicly through the job board of the firm.

The most exciting opening is a job titled Technical Lead – Crypto Engineer.” The job listing outlines that the candidate will oversee “new initiatives for PayPal global with a focus on agility, time-to-market, and innovation. The role includes designing, developing, and maintaining key crypto products/features targeted towards availability, performance, and scalability of PayPal services.”

The next opening will be for a blockchain research engineer who will perform his duties with PayPal’s research team. These job openings are live on the job boards of the platform. At the same time, the cryptocurrency community is thrilled by the rumors that PayPal is finally set to give in and join the cryptocurrency industry.

The requirements for the position outlines several skills that converge with the development of Bitcoin. Some of the outlined skills include experience with C++, asymmetric cryptography, and cryptographic libraries. Bitcoin consolidation with PayPal might be imminent. 

PayPal crypto integration rumors

According to a report by Coindesk, PayPal is planning to launch direct crypto sales to its over 300 million users. In the meantime, PayPal can only be used as a means to withdraw funds from crypto platforms such as Coinbase. Launching direct cryptocurrency sales will be the first of its kind for the global fintech company.

Although PayPal refused to disclose further information on the plan. Moreover, one of the well-placed sources noted that it is not clear how many digital currencies the platform will support. Another source claimed that the buying and selling of cryptos could be launched on the payment platform within the next three months.