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PayPal Enables Crypto Transfer For US Customers

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American multinational fintech firm PayPal finally announced that its users will now be able to transfer cryptocurrency from their accounts to other wallets and exchanges. The recent move came amidst growing customer demand, it said.

As per the press release, the new functionality will allow PayPal customers to transfer supported coins into their own, move crypto from its app to external crypto addresses including exchanges and hardware wallets and send crypto to other users “in seconds.”

Customers, however, have to bear the network fees for external transfers, which depend on the blockchain and vary depending on the crypto asset. Internal transfers will carry no fees, it added.

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PayPal Enables Crypto Transfer For US Customers 2

Jose Fernandez da Ponte, SVP and general manager of blockchain said, “If users have crypto somewhere else and want to consolidate, they can bring it to PayPal from external addresses. They can also send crypto to anyone who is in the PayPal system.”

PayPal’s tryst with crypto began in October of 2020 enabling users to buy, sell, and hold crypto.

At Consensus last year, Fernandez da Ponte confirmed that offering its users the ability to transfer would be next and termed a natural conversion in a fast-changing fintech landscape.

PayPal To March Ahead Undeterred By Market Turmoil

Despite the rough market condition in the crypto space, Fernandez da Ponte believes that the payment giant is moving in the right direction “as people are still adopting cryptocurrencies.”

“This move shows we’re in this for the long term,” Fernandez da Ponte added. “I think it’s important to stay the course and continue to invest in the space.”

The latest feature is currently available to US users and for security reasons, the platform has implemented an additional identity verification process for users before they can transfer any crypto.

Additionally, the rollout will be a gradual one and would be extended to others who have completed the identity verification process in the coming weeks.

According to sources, PayPal was able to offer the new functionality after transitioning from a “conditional” BitLicense to a “full” one after obtaining permission from the New York Department of Financial Services.

Dissecting US’s Leaked Crypto Draft Bill; The Good & Not So Good

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The 600-page copy of the US’s leaked bill focuses on regulators’ concerns surrounding decentralized finance [DeFi], stablecoins providers, decentralized autonomous organizations [DAOs], and crypto exchanges.

The documents titled “EMBARGOED” were posted on Twitter by a user Slam and soon became a hot topic among crypto Twitterati. Some users however pointed out that the draft was earlier reported by local news outlet Barron’s a few days back.

According to the June 3 coverage, the bill contains substantial changes co-authored by Senators Cynthia Lummis [Wyo.] and Kirsten Gillibrand [N.Y.]. It is unclear at the moment if the leaked bill is the newest spin of the earlier versions or is completely different.

Having said that Adam Cochran, Partner at Cinneamhain Ventures tweeted a detailed thread highlighting the key aspects of the draft as well as offered his insight.

In the latest draft, regulators seemed to put more emphasis on all crypto-related firms to get legally registered, or else, it will be viewed as “personally taxable”.

Cochran also cautioned that anon-run projects, non-regulated DAOs, and DeFi might face difficulties to comply with the law.

The bill seeks to offer more clarity on securities laws. Under the Commodity and Futures Trading Commission or CFTC definition -“If there is any debt, equity, profit revenue, or dividend of any variety, then it is now expressly not a digital asset commodity”.

The exec pointed out that strict regulatory oversight might lead to an increase in compliance costs which according to Cochran might, in turn, ensure a better listing and prevent trading violations.

US Draft Bill would provide clarity on a lot of things?

“Bankruptcy definition changes are a win for users making it clear assets deposited would get returned to users and not liquidate,” he added.

Another aspect, the expert noted is the proposed bill would grant depository institutions the right to issue stablecoins which he claimed would provide much-needed clarity on compliance requirements and penalties.

Cochran then concluded his post by saying that the draft bill is still incomplete and there would be further inputs from various lobby groups who would help stitch it into its final shape.

He then stated, “If it passed in this form it’s good in the LONG term for big entities, but super painful near term for 99% of crypto.”

US: Fidelity Investment’s Bitcoin Retirement Plan Stirs Political Storm

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In the US, Cryptocurrency has become the latest political flashpoint. Last month Fidelity Investments’ announcement of offering bitcoin as an investment option in its 401(k) plans by the middle of the year, ruffled a few feathers.

One of them is the long-time crypto critic Sen. Elizabeth Warren who expressed concern that the investment firm might be exposing clients to a “risky and speculative gamble.” 

Republicans defended Fidelity by accusing Democrats of “governmental overreach and infringing on Americans’ free-market rights.”

On 20th May, Republicans floated a new bill dubbed “The Financial Freedom Act” which aimed at preventing the Labor Department from restricting investment options available to employees in self-directed retirement accounts.

The proposed bill if passed might enable Americans to add cryptocurrency to their 401[k] plans if they choose to do so. 

Interestingly, the decision by Fidelity followed after the Labor Department warned that firms investing their employees’ contribution plans in digital assets including Bitcoin, would invite legal action.

In a notice dated March 10, the DOL Employee Benefits Security Administration said fiduciaries “must exercise extreme care” before including direct investment options in crypto. 

Fidelity objected to that guidance, and shot out a letter saying that the DOL failed to provide information on how fiduciaries can “fulfill their fiduciary duties in assessing cryptocurrencies.”

US’s DOL vs Fidelity

Remaining defiant, the investment firm has announced that it will allow customers to put 20% of their savings into bitcoin; other cryptocurrencies will likely be added later. 

Sen. Tommy Tuberville, R-Ala who also oversaw similar crypto-friendly legislation stated,

“The government has no business standing in the way of retirement savers who want to make their own investment choices,” Tuberville said. “When you’ve earned your paycheck, how you invest your money should be your decision. Our legislation makes sure that is the case.”

While Republicans and Democrats might exploit crypto for political mileage, one thing is certain, crypto has broadened the scope of investment among individuals of all ages.

Not just biggies but even lesser-known firms have been instrumental in making virtual currencies more mainstream.

A Nebraska-based crypto wallet firm Exodus pays its staff in bitcoin. One of its employees, Denver native Alyssa Howell managed to finance a house and save for retirement with her cryptocurrency earnings.

Latest Russian Sanctions Round by the US Goes for Bitcoin Mining Company

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The US Treasury Department stated on Wednesday that it had broadened its list of sanctions to include firms and persons who are suspected of assisting Russia in evading the impact of economic sanctions placed on the country.

Treasury sources said the agency is now focusing on Russian commercial bank Transkapitalbank and a network of more than 40 people, including tycoon Konstantin Malofeyev, who they say helped the Kremlin avoid a wave of economic sanctions.

The Biden administration also stated it is tightening down on enterprises that help Russia monetize its exports and other natural resources, such as Bitriver, that operate in the virtual currency mining sector.

US sanctions the first Russian Bitcoin mining company

Since the war on February 24, the United States has implemented multiple rounds of sanctions. Sanctions have been imposed on the country’s top banks and lenders, as well as cryptocurrency exchanges. “Having operated in the Russian Federation economy’s technology sector,” Bitriver was labeled.

Bitriver claims to be the world’s largest provider of environmentally-friendly cryptocurrency mining, having been created in 2017. It boasts a 100-megawatt renewable energy data center in Bratsk, Siberia, with 75,000 miners.

According to the Treasury Department, the company sold mining capacity to overseas clients, allowing Russia to “monetize its natural resources.” It went on to say:

“Russia has a comparative advantage in crypto mining due to energy resources and a cold climate. However, mining companies rely on imported computer equipment and fiat payments, which makes them vulnerable to sanctions.”

Anti-industry lawmakers in the United States have been increasing their rhetoric, believing that the country exploits crypto assets to dodge sanctions.

The Treasury Department defined crypto transactions to be “deceptive or organized transactions or deals” that might be exploited in sanctions evasion just days after the invasion in February.

The International Monetary Fund (IMF) echoed this opinion this week, warning that nations such as Russia and Iran may utilize cryptocurrencies to circumvent sanctions.

However, economists and industry experts have slammed the idea that the country will turn to crypto to dodge sanctions.

Crypto Is Now Accepted at a Singapore Luxury Car Company

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EuroSports Global, a Singaporean luxury automobile dealer, has begun taking crypto payments for Lamborghini and Alfa Romeo vehicles.

EuroSports has collaborated with Fomo Pay, a digital payments startup, to take payments in BTC, ETH, USDT, and USDC for its cars. The startup sees a need to meet “the rising need for flexible and easy-to-use crypto payments” while also lowering transaction fees and simplifying international transactions utilizing crypto.

According to Fomo Pay CEO Louis Liu, the MAS granted the company a digital token payment license in September 2021. 2Tone Antique, a merchant, specializing in vintage high-end timepieces, and Luxehouze, a renowned marketplace for luxury commodities in Asia, use the firm’s intermediary services.

2Tone Vintage intends to attract new customers using Fomo Pay, while Luxehouze wants to prevent currency swings.

Despite the Monetary Authority of Singapore’s warnings that bitcoin trading is dangerous, several establishments in the region are already taking cryptocurrencies as payment.

“Singapore is one of Luno’s main markets, given its position as a worldwide financial center with a progressive business climate,” Sherry Goh, country manager for Singapore at London-based crypto exchange Luno, said.

“Between March 2021 and February 2022, our client base increased by more than 40% year over year,” he added.

Porsche Towson now accepts crypto

Porsche now accepts digital assets payments in the form of Bitcoin, Ethereum, Shiba Inu, and other cryptocurrencies.

On Twitter, Bitpay announced cooperation with Porsche Towson. Users may pay for a Porsche automobile using digital assets, thanks to Bitpay’s integration.

Porsche Towson is a Porsche dealership located in Twoson, Maryland. The store sells both new and used Porsche vehicles. BitPay was founded in 2011 with the goal of making bitcoin payments easier for companies. BitPay now has over 10,000 businesses that utilize it to make bitcoin transactions easier.

Companies like BitPay, which allow retailers and even real estate brokers to accept payments in numerous digital assets, are poised to pull business away from traditional banks.

According to Deloitte, firms may handle crypto payments without keeping bitcoin on their balance sheet by using an intermediary that converts back and forth between cryptocurrencies and fiat.

This helps to attract new clients in the near term, with the third party considering most of the risk and regulatory requirements.

Russia’s biggest darknet and crypto exchange suffers a major blow

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Russia’s most feared darknet market- Hydra and a cryptocurrency exchange Garantex are soon to be sanctioned by the United States Department of the Treasury’s Office of Foreign Assets Control for their alleged association with ransomware activities, as per an announcement.

In a press release published on the Treasury Department’s website, Secretary Janet Yellen said, the move against Hydra and Garantex would serve as a reminder to criminals that they can no longer hide on the darknet or their forums.

The U.S. government agency alleged Garantex in particular, saying that it had “willfully disregarded” Anti-Money Laundering and Combating the Financing of Terrorism requirements imposed by many regulators on digital currency exchanges. It further accused that the firm was run by individuals who showed “wanton disregard for regulations and compliance.”

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It is to be noted that cybercriminals allegedly linked to Russia are notoriously reputed for their several high-profile attacks around the world. Data from blockchain researchers confirmed that roughly 86% of illicit bitcoin received directly by Russian crypto exchanges in 2019 were traced back to Hydra, which the Treasury Department described as the world’s “largest and most prominent darknet market.”

Additionally, the new sanctions would prevent U.S. citizens from making or receiving “any contribution or provision of funds, goods, or services” to Hydra or Garantex, the Treasury said.

The US dismantle Russia’s largest darknet

The department said the sanctions, which prohibit U.S. transactions with Hydra and Garantex and seek to freeze any assets they may have under U.S. jurisdiction, are part of a global effort to disrupt the overall structure of malicious cybercrime services, drugs, and other illegal offerings, including ransomware activity, that arise out of Russia.

The Treasury worked in tandem with the U.S. Department of Justice, the FBI, and the German Federal Criminal Police, in shutting down several Hydra servers in Germany and seizing $25 million worth of bitcoin.

In September 2021, The U.S Treasury Department had imposed sanctions on Russia-based business Suex OTC for its alleged role in facilitating transactions for ransomware attacks. Since then agencies from the FBI to the Justice Department have been extra vigilant and set up task forces to enforce and investigate malicious actors using cryptocurrencies for illegal activities.

Oklahoma Marches Ahead In Providing Tax Incentives For Bitcoin Miners

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The state of Oklahoma is leading the way among its peers as lawmakers have recently introduced legislation that aimed to provide tax incentives to bitcoin and cryptocurrency miners who establish their businesses in the region.

Just a few weeks back Oklahoma’s governor Kevin Stitt announced a new crypto mining headquarters in Pryor. Later Sen. John Montgomery along with state representative Ryan Martinez presented their “Commercial Digital Asset Mining Act of 2022” on the Senate floor.

The draft focused on reducing the expenditures related to hardware and electricity used by commercial mining operations. The bill states,

“The original intent of the Legislature that the Oklahoma Tax Code recognize[s] the continuing development of new and advanced manufacturing and industrial processing technologies has led to new industrial processes.”

To summarize, Montgomery’s bill would establish a framework of incentives meant to draw crypto mining businesses to Oklahoma. He also spoke on the cap on tax credits, and how much the businesses can receive in incentives, which is yet to be determined, but the senator is targeting incentives worth no more than $5 million.

The latest Public records revealed that the legislation was cleared by the Oklahoma Senate on March 22 in a 29-16 vote. The bill moved to the legislature’s lower chamber on March 23 and was referred to its technology committee on March 30.

Oklahoma Is One Of The Best States For Crypto Mining- Survey

In a recent survey by commodity.com, researchers have analyzed data from several sources and created a composite score based on factors like State income tax burden, Electricity rates, Average internet speed, cost of living, etc. Taking these factors into account, Oklahoma emerged as one of the best states for cryptocurrency mining besides North Dakota, and Tennessee.

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PayPal Enables Crypto Transfer For US Customers 5

However, states like Illinois and Georgia are also eyeing similar measures. In fact, Kentucky’s government approved tax incentives last year, but New York, on the other hand, is going in the opposite direction.

The “mining” process requires sophisticated hardware which is usually tedious and costly and has come under heavy criticism. For this reason, New York lawmakers are pushing for restrictions on the state’s mining sector, citing environmental concerns. 

Previously TronWeekly had reported on the Bitcoin supply reaching 19 million BTC out of a total of 21 million, leaving only 2 million units to be minted.

Elizabeth Warren advocates US to establish a CBDC

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Senator Elizabeth Warren (D-Massachusetts) believes it is past time for the United States to develop its own digital currency (CBDC). In an episode of NBC’s “Meet the Press Reports” with Chuck Todd, set to air on Thursday at 10:30 p.m. ET, Warren made this urge to the US government.

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Senator Elizabeth Warren

A brief transcript of the conversation was provided by NBCUniversal. She said,

“So a lot that banks do wrong, if you think, ‘We could improve that in a digital world,’ the answer is, ‘Sure you could.’ But in that case, let’s do a central bank digital currency,” Warren told Todd. “Yes, I think it’s time for us to move in that direction.” 

In response to Todd’s question regarding whether Bitcoin will be regulated as a commodity, Warren responded that she believes it will, noting the subprime mortgage financial crisis that started in 2007. She made no reference to the regulations’ possible format.

Elizabeth Warren’s sanctions compliance bill for crypto companies

In March, Elizabeth Warren announced a new bill that would prevent bitcoin companies from trading with sanctioned entities. Sens. John McCain and Tim Kaine introduced the Digital Assets Sanctions Compliance Enhancement Act, which would make it easier to comply with sanctions on digital assets.

Senators Jack Reed (D-R.I.), Mark Warner (D-Va.), Jon Tester (D-Mont.) and others sponsored the Digital Assets Sanctions Compliance Enhancement Act, which would allow the US president to add non-US-based crypto firms to the sanctions list if they encourage sanctions evasion.

According to a draft of the bill, the president’s administration would be entrusted with identifying “any foreign person” who runs a crypto exchange or otherwise enables digital asset transactions and has also helped Russians on the Office of Foreign Asset Control’s sanctions list evade sanctions.

The bill appears to cover more than just Russian sanctions. Another provision would allow the Financial Crimes Enforcement Network (FinCEN) to track people who transact with cryptocurrency worth more than $10,000.

Furthermore, with respect to the CBDC, when Elizabeth Warren was asked if the senator viewed cryptocurrency as this decade’s real estate bubble, she stated that the entire digital world has operated in a bubble-like fashion. She supported her statement by further adding that it has risen due to the fact that everyone is saying how amazing it is going to be, just as it was in the real estate market.

Non-crypto ‘e-cash’ in the making; More details

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A bill directing the US Secretary of the Treasury to develop and test an electronic version of the US dollar that is not a cryptocurrency and yet is simple to use for those who are economically disadvantaged or technologically handicapped has been introduced. This bill was introduced on Monday when the United States House of Representatives presented the Electronic Currency and Secure Hardware Act (ECASH Act).

Congressman Stephen Lynch

According to Representative Stephen Lynch, chair of the House Financial Services Committee’s Fintech Task Force, the bill will also “maximize” consumer protection and data privacy.

The effort isn’t intended to prevent a Central Bank Digital Currency (CBDC) from being issued by the federal government. According to Lynch, the ECASH Act’s pilot program will,

“complement, and advance ongoing efforts undertaken by the Federal Reserve and President Biden to examine the potential design and deployment options for a digital dollar.”

The CBDC project, on the other hand, has made substantial progress. The digital dollar set a record speed of 1.7 million transactions per second (TPS) in one of two recent pilot tests, far quicker than most crypto networks.

The CBDC initiative is still in its early phases, according to CNBC, and is nicknamed ‘Project Hamilton.’ It’s being built in such a way that it’ll be able to resist transaction outages caused by server outages and other problems. As a result, the major purpose of ‘Project Hamilton’ is to address the worldwide CBDC sector’s technological and regulatory issues.

The conceit of cryptocurrency a downer

The United States Treasury Department, not the Federal Reserve Boar As a result, it is intended to “replicate the privacy-respecting aspects of actual cash,” such as coins and notes, as closely as feasible.d, would issue e-cash, as previously stated. As a result, it would not be a CBDC or cryptocurrency.

The electronic dollar would be a digital token—a bearer instrument similar to paper currency—rather than a cryptocurrency or CBDC based on blockchain. This means that if it’s misplaced, it’s lost forever.

The e-cash would be legal tender, and transactions would not require internet access. This type of e-cash, on the other hand, would allow for peer-to-peer transactions.

Users would not be subject to the same strict know-your-customer [KYC] procedures as anyone trying to use cash, according to Lynch’s plan. They can obtain e-cash dollars through a bank account, a peer-to-peer transaction, or a retailer, and then use them for anything.

This has the potential to benefit people who are unable to open bank accounts due to minimum balance limitations. The adoption of e-cash would be aided in the same way.

Within 90 days of enactment, the measure calls for the implementation of a two-phase e-cash pilot program. In reality, no later than 48 months following enactment, e-cash will be available to the general population in the United States.

White House Examines Crypto’s Impact On Climate

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The White House is currently seeking public opinion on crypto’s impact on the climate. Following Joe Biden’s executive order last month, the president entrusted the Office of Science and Technology Policy [OSTP] with drafting a report that examines whether digital assets “impede or advance efforts to tackle climate change” and makes moves toward a “clean and reliable electricity grid.”

While releasing the report recently, the team explored the climatic concerns, calling for the public to weigh in on the same. The report will also analyze any potential benefits of crypto and blockchain technology. According to a document published in the Federal Register, the office noted,

“It also seeks comment on implications that digital assets have for U.S. policy including as it relates to electricity grid reliability and greenhouse gas intensity. The office will also explore if digital assets could improve the reliability of verifying carbon offsets and accounting for greenhouse gas emissions.”

At the beginning of the year, a House committee held a discussion on crypto’s carbon footprint. Experts unanimously agreed that solutions that ensure crypto doesn’t fry the planet should be top of regulators’ minds as digital assets become more widely used.

President Joe Biden speaking at a podium, flanked by U.S. flags.

In an executive order signed earlier this month, President Joe Biden had directed the government to study how to reduce crypto’s negative impacts on the climate. This came after several environmental groups put pressure on the government’s perceived inaction.

Revising crypto tax rules will generate $11B in revenue in 10 years

In the latest development, the US government’s budget for the 2023 fiscal year said that modernizing tax rules around digital assets will yield roughly $11 billion in revenue over the next decade.

The budget from the Biden administration which was released by the White House on 28 March noted that modifying the tax rules on digital assets will reduce the deficit by $10.9 billion from 2023 to 2032. 

It is also estimated that revising tax rules to include digital assets will bring the government $4.9 billion in revenue in 2023. Apart from that, the budget sanctioned $52 million to combat “the misuse of cryptocurrency” by expanding the Department of Justice’s ability to address cyber threats to the United States.