Bitcoin carnage, Eth2 milestone, Libra launch, PayPal blunder: Hodler’s Digest, Nov. 21–27

Bitcoin carnage, Eth2 milestone, Libra launch, PayPal blunder: Hodler’s Digest, Nov. 21–27

The best (and worst) quotes, adoption and regulation highlights, leading coins, predictions and much more — one week on Cointelegraph in one link!

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Coming every Saturday, Hodler’s Digest will help you track every single important news story that happened this week. The best (and worst) quotes, adoption and regulation highlights, leading coins, predictions and much more — a week on Cointelegraph in one link.

Top Stories This Week

Buy the Dip

Bitcoin price tumbles, falling below $17,000 in biggest crash since March

At the start of the week, the crypto markets were brimming with optimism. Bitcoin was one resistance zone away from all-time highs, altcoins were rallying by triple digits, and the surge was making a splash on the homepage of The Wall Street Journal.

With Bitcoin’s market cap at all-time highs, it was time to celebrate with a nice turkey dinner and all the trimmings. Unfortunately, Thanksgiving left the crypto world with a rather bitter aftertaste. 

On Nov. 26, BTC’s price suffered one of its biggest dollar losses since March. All told, the world’s biggest cryptocurrency collapsed by more than 15%. Massive liquidations were blamed for the crash from $19,484 to $16,334 in the space of a day.

As Cointelegraph analyst Michaël van de Poppe noted, market corrections are rarely elegant things. “They are often vertical and painful. Staircase up, elevator down,” he wrote.

Three reasons traders now expect Bitcoin hitting $13,000 before a new rally

So… what happens next? Are hopes of hitting $20,000 dashed in the short term, or was this a mere blip in the road that should be shrugged off?

Well, it depends very much on who you ask. Some traders are anticipating another steep pullback in the not-too-distant future, pointing to historical patterns that suggest BTC could fall back down to the $13,800–$14,500 range.

A pseudonymous trader known as “Salsa Tekila” said BTC needed to break $17,500 to remain in bullish territory, adding that $18,700 is the only big resistance before all-time highs. However, the trader warned that things are looking bearish below $17,500… and this could prompt a drop to the $11,000–$13,000 range.

Others, such as the crypto index fund provider Stack Funds, have described the pullback as a “healthy correction” that was needed before Bitcoin continues its upward trajectory.

The firm said BTC has been at overbought levels since October, meaning some heat desperately needed to leave the market.

Meanwhile, Quantum Economics founder Mati Greenspan said the correction may have already bottomed out, adding: “A 17% pullback is rather tame for this stage of the cycle.”

Ethereum 2.0 confirmed for Dec. 1 launch, just hours before deadline

Eth2’s beacon chain has been confirmed for Dec. 1 after 16,834 validators transferred 524,288 ETH into a deposit contract.

There had been doubts over whether the deposit contract would hit the minimum threshold by Nov. 24, paving the way for Phase 0 to begin in earnest a week later.

But transfers rapidly increased as the deadline neared. There was a celebratory atmosphere in the ETH community, not least because it finally marks the beginning of an upgrade that has been plagued by delays and complications.

While genesis participants will not be able to withdraw their coins until Eth2 reaches Phase 1.5 — which will merge the Ethereum mainnet with Eth2’s beacon chain and sharded environment — many hodlers are waiting for third parties to launch withdrawal-enabled staking services, despite the potential risk of exit scams.

Yearn Finance is going on an acquisition spree

Away from the major cryptocurrencies, Yearn Finance has had a very busy week. In a sign that consolidation is coming to the DeFi markets, the protocol has performed three high-profile mergers in as many days.

On Nov. 25, Yearn Finance announced a partnership with Pickle Finance to boost yield farming incentives. It’s also hoped that the move will compensate those affected when $20 million was lost in a recent Pickle exploit.

A day later, YFI was yearning for more. The protocol’s founder, Andre Cronje, announced details of yet another integration. This time, Yearn planned to join forces with Cream, a lending protocol similar to Compound and Aave.

But the acquisition spree was far from over. On Saturday, a new collaboration was also unveiled with the market coverage provider Cover.

Observers say Yearn is “scooping up developers and monopolizing talent,” but critics have claimed that none of these acquisitions have actually been approved through a community vote.

Facebook’s Libra to reportedly launch in January 2021 as USD stablecoin

After months of uncertainty and regulatory drama, Facebook’s embattled Libra project might be nearing launch at last… kind of.

Reports suggest that Libra will initially take the form of a U.S.-dollar-backed digital currency — and it could see the light of day as soon as January 2021.

According to the Financial Times, the Libra Association will eventually add more fiat currencies to the basket of assets that back Libra’s value.

The exact launch date is still unknown and would depend on the Libra Association receiving approval from regulators in Switzerland to operate as a payments service.

Winners and Losers

Winners and losers

At the end of the week, Bitcoin is at $17,707.60, Ether at $541.01 and XRP at $0.62. The total market cap is at $530,787,776,807.

Among the biggest 100 cryptocurrencies, the top three altcoin gainers of the week are Stellar, Horizen and XRP. The top three altcoin losers of the week are Energy Web Token, NXM and Synthetix.

For more info on crypto prices, make sure to read Cointelegraph’s market analysis.

Most Memorable Quotations

“It’s quite common that market corrections don’t happen in a smooth manner. They are often vertical and painful. Staircase up, elevator down.”

Michaël van de Poppe, Cointelegraph analyst

“#Bitcoin has been compared negatively to a lot of things over the years, such as tulips, rat poison, Ponzi schemes, snake oil, etc., but the one that has hurt the most by far has been the comparison to the Segway.”

Tyler Winklevoss, Gemini co-founder and CEO

“The New York Times is planning to publish a negative story about Coinbase […] The story will likely imply that Black employees were discriminated against during this process; this is false.”

Coinbase

“Everyone should put 2% to 3% of their net worth in Bitcoin and look at it in five years, and it’s going to be a whole lot more.”

Mike Novogratz, Galaxy Digital founder and CEO

“WHAT CRAP — new to coinbase — and all my XRP trades went into limbo then finally showed up only AFTER the bottom fell out — causing me to lose a ton of money!!!”

Mike Palagi, Coinbase user

Prediction of the Week

Institutional money may propel Bitcoin to $250,000 in a year, says macro investor

Global Macro Investor CEO Raoul Pal has predicted that Bitcoin could hit $150,000 by November 2021 in the most conservative scenario — and could even surge to $250,000 owing to the large amount of institutional money currently flowing into the market.

According to Pal, most of Bitcoin’s additional supply is currently being absorbed by PayPal, Square and Grayscale. He believes that the resulting supply squeeze is the catalyst for Bitcoin’s latest surge.

“I’ve never seen a market with this supply and demand imbalance before,” Pal said, pointing out the macroeconomic factors that are playing in Bitcoin’s favor.

Pal went on to predict that additional monetary stimulus to sustain economies in the wake of COVID-19 will devalue fiat, and this, together with low interest rates, will propel Bitcoin’s price to new highs.

“It’s life-changing. No other asset has an upside of 5x, 10x, 20x in a short space of time,” he told Cointelegraph.

FUD of the Week 

XRP price spikes to $0.90, crashes in seconds as Coinbase goes down

Altcoins weren’t immune from the Bitcoin bloodbath, and it was red across the board in the immediate aftermath of the nightmare before Thanksgiving.

But just before this correction happened, something crazy was happening with XRP.

The No. 3 cryptocurrency, not known for being a digital asset that delivers big gains, has had a blockbuster November. At the time of writing, it’s risen 154% since the month began — rallying from $0.24 to $0.61. Most of these gains were concentrated over a few days.

At one point this week, XRP hit highs of $0.76, but over on Coinbase, it briefly spiked to $0.90 before crashing back down by 30% in a matter of seconds. This was the highest price level since May 2018.

The rally was apparently driven by Coinbase users as the price of XRP did not see the same heights on other exchanges.

Some disgruntled traders flocked to Downtector and claimed they had lost “a ton of money” after their trades failed to process.

PayPal suspends user for crypto trading using PayPal’s own service

Well this is awkward. A PayPal user has claimed their account was restricted… because they were performing too many trades on the platform’s new crypto service.

On Reddit, the user in question claimed that PayPal had sent them a message, informing them that their account was being permanently limited “due to potential risk.” But “TheCoolDoc” claimed they had only made 10 crypto transactions over a week — purchasing during dips and selling when prices were high.

Bizarrely, PayPal had asked for an explanation for each transaction. Hours later, the user was told they would not be able to conduct any further business using the platform — and the funds in their account were placed on a 180-day hold.

Other Reddit users pointed out that the service is supposed to be more of a Bitcoin bank account than a trading account. Nonetheless, TheCoolDoc has vowed that they will “never buy a Satoshi of crypto” from PayPal again.

Chinese police seized crypto assets worth $4.2 billion today from PlusToken Ponzi

The PlusToken scandal has reportedly resulted in a titanic seizure of crypto assets by Chinese authorities — worth $4.2 billion at today’s prices.

Court rulings posted by The Block show authorities have seized 194,775 BTC and 883,083 ETH — alongside millions of Litecoin, Dogecoin and XRP.

Gains from the seized crypto assets will be forfeited to the national treasury. The precise details of how the assets will be dealt with and processed in accordance with national laws have not been fully spelled out.

The PlusToken scheme had presented itself as a South Korean crypto platform that could generate 8%–16% returns per month, drawing in 2 million members. It later turned out to be one of the industry’s biggest-ever exit scams.

Best Cointelegraph Features

Hodl or spend? Retailers offer Black Friday deals for those paying with cryptocurrency

As crypto enters the mainstream, major retailers are offering discounts and promotions to get customers to pay using cryptocurrency.

Bitcoin and blockchain topics to discuss with the crypto curious this Thanksgiving

Experts explain how to address common questions newcomers may have regarding Bitcoin and the blockchain space over the holidays.

Ethereum 2.0 to boost DeFi but delayed launch may set the network back

The launch of Ethereum 2.0 is bound to support DeFi growth, but would it be capable of handling the pace at which DeFi is growing?


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The best (and worst) quotes, adoption and regulation highlights, leading coins, predictions and much more — one week on Cointelegraph in one link!

Libra picks former HSBC brass as CFO

Libra picks former HSBC brass as CFO

The G7’s recent rejection of Libra doesn’t seem to have slowed them down.

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The Libra Association, which oversees the as-yet unreleased Libra cryptocurrency, has chosen a chief financial officer and chief risk officer for the project. 

Ian Jenkins, who touts experience from HSBC, Santander, and Credit Suisse, will supervise the Libra Network’s finances and risk management, according to an Oct. 15 announcement.

The news comes only days after the multi governmental group G7 explained that the project needed proper regulatory measures in place prior to launch. 

“The G7 continues to maintain that no global stablecoin project should begin operation until it adequately addresses relevant legal, regulatory, and oversight requirements through appropriate design and by adhering to applicable standards,” said a draft of the G7’s concerns.

This story is developing and will be updated.


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The G7’s recent rejection of Libra doesn’t seem to have slowed them down.

Goldman Scandal, BTC Bull Trap Fears, How Libra Will Make Money: Hodler’s Digest, May 25–31

Goldman Scandal, BTC Bull Trap Fears, How Libra Will Make Money: Hodler’s Digest, May 25–31

Goldman Sachs attacks crypto, why Bitcoin may be wandering into a bull trap, and how Libra is going to make money.

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Coming every Sunday, Hodler’s Digest will help you track every single important news story that happened this week. The best (and worst) quotes, adoption and regulation highlights, leading coins, predictions and much more — a week on Cointelegraph in one link.

Top Stories This Week

Goldman Sachs butts heads with Bloomberg over Bitcoin

One of the world’s biggest investment banks caused a stink this week when it declared cryptocurrencies are not an asset class. In a leaked PowerPoint presentation, Goldman Sachs warned Bitcoin doesn’t provide diversification benefits, dampen volatility in a portfolio or show evidence of hedging inflation. One damning line read: “We believe that a security whose appreciation is primarily dependent on whether someone else is willing to pay a higher price for it is not a suitable investment for our clients.” Goldman’s view is directly at odds with Michael Bloomberg, whose financial reform plan unequivocally called BTC an asset class. As you’d expect, the crypto community reacted furiously. D-TAP Capital founder Dan Tapeiro argued Goldman Sachs was simply worried about protecting revenues, as it doesn’t make fees when a client buys BTC. Tyler Winklevoss also criticized the quality of Goldman’s research, writing: “Crypto used to be where you ended up when you couldn’t make it on Wall Street […] Today, Wall Street is where you end up when you can’t make it in crypto.”

$10,000 bull trap? Why Bitcoin price is now likely to pull back

Bitcoin grew in value by nearly 25% in the month of May — and now, it’s on track for a bullish monthly candle close. But wait! It might be a little too early for long-term hodlers to get excited. Cointelegraph’s Keith Wareing believes a pullback in BTC’s price is “somewhat inevitable” after such a big increase over the last eight weeks. A new downward channel has emerged on the charts that puts $9,700 as resistance, $8,700 as the midpoint level and $7,400 as support. However, he expects any dip would be short-lived “due to the increased momentum” across other indicators. According to Michaël van de Poppe, BTC needs to hold above $9,300 in a bullish scenario — and as long as that level remains support, further upward activity should be expected. There have been other interesting developments this week. Grayscale Investments is now buying 1.5 times the amount of Bitcoin being mined — adding 18,910 BTC to its crypto fund even though just 12,337 BTC has entered circulation. “There isn’t enough new supply to go around, even for just one guy,” commented Binance CEO Changpeng Zhao.

Libra will allow Facebook to spike ad prices, Zuckerberg says

We’re starting to get a few more juicy details about what Libra will look like — and how Facebook’s controversial stablecoin will make money. Mark Zuckerberg, the social network’s CEO, believes the digital currency will cause ad prices to soar. During an annual shareholder meeting, he said Libra means consumers will find it easier to make impulsive purchases — and as a result, companies will be prepared to pay more when they are bidding for advertising. Last year, Facebook earned about $69.6 billion from selling ads, representing a whopping 98% of its total income. In other news, the company is continuing to spruce up the project so it can appease regulators. Facebook’s accompanying digital wallet, Calibra, has now been rebranded as Novi. A representative told Cointelegraph that “people were getting confused” because Calibra and Libra sounded too similar — and it’s hoped that the new name will create a distinction between the two.

Tether unseats XRP as third-largest crypto, dwarfing its volume 25:1

Big news in the crypto rankings this week — Ripple’s XRP is no longer the world’s third-largest cryptocurrency by market capitalization. It has now been overtaken by Tether, the stablecoin that’s pegged to the U.S. dollar. XRP has failed to gain adoption among retail investors — and USDT’s average daily trading volume in May was 25 times higher. It’s the latest chapter in a very sad book for XRP, which has seen its market cap collapse from highs of $130 billion in January 2018 to just $9 billion today. Of course, the race is far from over. A decent bull run could help XRP regain third place and blow past its stablecoin rival, which cannot move up or down by more than a few percentage points.

Think there is only 21 million Bitcoin? Think again, says Weiss Ratings

Weiss is known for its controversial cryptocurrency posts — and now, the ratings agency has shared its latest unpopular opinion: The supply of Bitcoin is higher than 21 million. “Exchanges leverage the existing supply of any #crypto asset in much the same way banks leverage the supply of fiat money,” Weiss explained in a tweet. It recommended investors to hold their own crypto, thereby ensuring that they don’t have to put their trust in these trading platforms.

Winners and Losers

At the end of the week, Bitcoin is at $9,524.12, Ether at $235.44 and XRP at $0.20. The total market cap is at $269,068,116,779.

Among the biggest 100 cryptocurrencies, the top three altcoin gainers of the week are Celsius, Cardano and Quant. The top three altcoin losers of the week are Theta Fuel, Theta Token and BHPCoin.

For more info on crypto prices, make sure to read Cointelegraph’s market analysis

Most Memorable Quotations

“The last 896 days were simply one massive re-accumulation phase before the run to 100k+ #bitcoin, and the consolidation structure will soon be broken. Are you prepared?”

Positive Crypto, analyst

“When they run an ad, somebody clicks on that ad and is now going to be more likely to buy something because they actually have a form of payment that works that’s on file; then it basically becomes worth it more for the businesses to bid higher in the ads. And what we see are higher prices for the ads overall.”

Mark Zuckerberg, Facebook CEO

“Craig Steven Wright is a liar and a fraud. He doesn’t have the keys used to sign this message … We are all Satoshi”

Unknown actor

“In the specific case of issuer-backed stablecoins there’s lots of things that could be done but aren’t, eg. every stablecoin could be an instant cross-chain bridge!”

Vitalik Buterin, Ethereum co-founder

Prediction of the Week

Bitcoin 896-day “accumulation” will now spark $100,000 bull run — analyst

After spending almost 900 days correcting from its all-time high of $20,000, one trader believes Bitcoin is about to begin its trip to $100,000. Positive Crypto said a “massive accumulation phase” has taken place between December 2017 and now — with investors repositioning themselves and buying in. Despite wobbling around the halving and after, Bitcoin’s price has entirely erased losses from its March crash, which Positive Crypto notes formed a “higher low” compared with the peak of the bear market in December 2018. That cycle of “higher lows” itself positions the market for upside. As we’ve seen in past predictions over recent weeks, many analysts believe a bullish trend for Bitcoin will kick in over the next year or two.

FUD of the Week

Ethereum significantly less private than Bitcoin, new research shows

Transactions on the Ethereum blockchain are easier to track than those on Bitcoin’s network, according to new research. A unique feature of Ethereum is its name service, which ties addresses to human-readable “.eth” domains. The researchers were able to scrape 890 domains located on public Twitter profiles, and this was already enough to discover potentially compromising activity. About 10% of those wallets had interacted with gambling platforms, while 5% used adult services. Another problem lies in how those who use mixer services to “clean” their funds by sending them to a new address aren’t using the features properly, making identification easy.

Colombia is the ransomware capital of Latin America

A worrying new study has revealed that 30% of all ransomware attacks within Latin America have specifically targeted Colombia. The country had the same number of incidents as Peru and Mexico combined, with the report warning that the threat is “underestimated.” Small- and medium-sized businesses are the preferred targets of cybercriminals, but 83% of Colombian companies lack the response protocols necessary to handle the violation of information security policies. Phishing emails are the most common technique, and victims who click on suspect links normally end up being locked out of their devices. Up to $1.1 million in ransoms were collected over the course of 2019.

NYC hacker charged over $94 million Bitcoin-for-cards scheme

A man is facing up to 20 years in jail and $500,000 in fines for allegedly participating in a $94-million Bitcoin-for-cards scheme. Vitalii Antonenko was arrested at New York’s John F. Kennedy International Airport after arriving from Ukraine, and it is claimed he was carrying devices “that held hundreds of thousands of stolen payment card numbers.” Prosecutors say the suspect and his co-conspirators used SQL injection attacks to extract payment card data from vulnerable networks and then sold it on “online criminal marketplaces.”

Best Cointelegraph Features

The crypto enthusiast’s dream: top countries that tick all the boxes

Alongside the internet, cryptocurrencies have made the world a global village. Here’s Jinia Shawdagor’s list of countries that are ideal for crypto enthusiasts to live in.

Ethereum network use hits a new all-time high — will ETH price follow?

Interaction with the Ethereum network recently hit an all-time high, but as António Madeira explains, the increase in gas usage may pose problems for the cryptocurrency network.

Indian banks still cryptophobic despite no banking prohibition

Even though banks are not prohibited from providing accounts to crypto traders, financial institutions in India are still hostile toward crypto. Mohammed Danish looks at the legal resources available to Indian crypto users and businesses if they face cryptophobia.


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Goldman Sachs attacks crypto, why Bitcoin may be wandering into a bull trap, and how Libra is going to make money.

British Payment Firm Checkout.​com Joins the Libra Association

British Payment Firm Checkout.​com Joins the Libra Association

The Libra Association reinforces its efforts to launch the network in Q4 2020, adds British payment startup Checkout.​com as its 24th member

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In a fresh move to revive Facebook-backed digital currency project Libra, the Libra Association has onboarded another member.

British payment startup Checkout.com has joined the Libra Association, becoming the 24th member engaged with the mission of building a better global payment network, Libra tweeted on April 28.

Tech advancements would fail without necessary regulatory frameworks

Guillaume Pousaz, Checkout.com founder and CEO, officially announced the news in a company statement on Tuesday. The executive outlined that Checkout.com joins Libra’s efforts to not only promote technological advancement but contribute to the formation of necessary regulatory framework to drive mass adoption of better payment solutions.

Pousaz argued that without such regulation framework, the technological breakthrough is not possible:

“Regulation should form an integral part of any resulting framework, given its unique ability to protect the ecosystem from systemic abuses. Absent of such regulation, it is our fundamental belief that the technological advancements alone would fail to provide the secure and stable payments infrastructure required to drive mass adoption, impeding its progress.”

The Checkout.com CEO continued to say that the firm has joined the Libra Association because the digital currency project can open finance to billions of unbanked people. Pousaz added that Libra’s principles come in line with Checkout.com’s mission to change the way that businesses interact with financial services for the better.

Visa and Mastercard previously abandoned Libra amid regulatory hurdles

Checkout.com’s entrance to the Libra Association comes after a series of departures from the group by top payment firms including Visa and Mastercard. In October 2019, Visa, EBay, Stripe and Mastercard abandoned Facebook’s digital project Libra amid increased regulatory concerns.

Mastercard CEO Ajay Banga eventually argued that the firm decided to leave the Libra project because the firm’s key members refused to commit to “not do anything that is not fully compliant with local law.”

Coitnelegraph asked Checkout.com to comment on Libra’s late 2019 departures but did not receive an immediate response. This story will be updated should they respond.

Libra reinforces its efforts to launch the project in Q4 2020

Despite multiple departures, the Libra Association has been reinforcing its commitment to launch a global payment network so far. In mid-April 2020, Libra applied for a payment license from a major Swiss regulator, the Swiss Financial Market Supervisory Authority (FINMA). In conjunction with the application, the Libra Association has also made several major alterations to its white paper in an apparent effort to move forward with the project.

Since announcing the FINMA application news, Libra has been pushing the project even harder. On April 20, the Libra Association was joined by non-profit organization Heifer International. The Libra project is also apparently preparing to significantly expand its team in 2020 as Libra’s  digital wallet Calibra is also looking to create 50 new roles for its workforce in Ireland.

Earlier today, the Libra Association’s vice chair Dante Disparte said that the Libra project continues to rely on blockchain technology and is expected to launch in Q4 2020.


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The Libra Association reinforces its efforts to launch the network in Q4 2020, adds British payment startup Checkout.​com as its 24th member

Blockchain, Not Crypto, Is at Core of Facebook’s Libra, Vice Chair Says

Blockchain, Not Crypto, Is at Core of Facebook’s Libra, Vice Chair Says

Libra Association’s vice chair Dante Disparte expects Libra network to launch in Q4 2020

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Despite existing concerns that blockchain is not mature enough to bring the new era of payments, the technology is being increasingly explored by global central banks. Blockchain technology meanwhile remains at the core of Facebook’s digital currency Libra, according to a top project executive.

Since Libra’s white paper release in June 2019, the not-yet-launched stablecoin has continued to rely on blockchain architecture, Libra Association’s vice chair Dante Disparte explained.

Blockchain unlocks payment network interoperability

In an April 28 interview with financial publication Central Banking, Disparte outlined a number of structural benefits provided by blockchain implementation. As part of the blockchain-powered advantages, the exec outlined the technology’s potential to drive interoperability of payment technologies. He said:

“We remain very committed to blockchain architecture as a distributed ledger technology for this project. Without it, the project doesn’t achieve many of the efficiencies: the low-cost structure and interoperability that it’s being designed to achieve.”

According to Disparte, the interoperability problem is one of the biggest challenges faced by global payment networks. “Because the technologies don’t speak to each other, it is often years before the units can make payments to each other,” the executive noted.

Disparte continued:

“Without blockchain at the core of libra and that technology being shared among the members of the association, who would run validating nodes, it would be much harder to have a digital wallet environment that doesn’t have lock-in effects, where the user is locked into one provider or another.”

Cointelegraph reached out to the Libra Association to know more about how exactly Libra is planning to tackle the interoperability issues by means of blockchain. The Association had yet to respond as of publication.

“Cryptocurrency aspect is not the key dimension of innovation,” Disparte says

In the interview, Disparte also touched upon a common narrative stipulating that cryptocurrencies are not that crucial for innovation as blockchain technology is.

Disparte said:

“The cryptocurrency aspect is not the key dimension of innovation. The real breakthrough is to create the protocol level for the transfer of value. That’s Libra’s big contribution. Without blockchain at the core, it is very hard to achieve that openness that we’re trying to develop at the wallet level and at the user level.”

According to the executive, the Libra Association expects to launch Libra in Q4 2020. By that time, the project hopes to sort out major issues including regulation, organization and readiness to move from testnet to the main environment, Disparte noted.

Libra is putting more efforts to launch the project

Disparte’s interview comes after Libra put some new efforts to move forward with the project recently. On April 16, the Libra Association applied for a payment system license from the Swiss Financial Market Supervisory Authority, also making a bunch of changes to its white paper.

Alongside working on regulatory matters, Libra has continued to grow its members and team. On April 20, the Libra Association added non-profit organization Heifer International. Earlier today, the Association was joined by British payments start-up Checkout.com. Facebook’s digital wallet Calibra is also looking to create 50 new roles for its workforce in Ireland.


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Libra Association’s vice chair Dante Disparte expects Libra network to launch in Q4 2020

Bitcoin Correction Fears, Libra U-Turn, Maker Sued: Hodler’s Digest, April 13–19

Bitcoin Correction Fears, Libra U-Turn, Maker Sued: Hodler’s Digest, April 13–19

In this week’s Hodler’s Digest, Libra’s massive U-turn, Bitcoin in danger of a massive correction, and crypto-friendly Square gets green light from U.S. government

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Coming every Sunday, Hodler’s Digest will help you track every single important news story that happened this week. The best (and worst) quotes, adoption and regulation highlights, leading coins, predictions and much more — a week on Cointelegraph in one link.

Top Stories This Week

Weekend trap? Bitcoin hits $7,300 in attempt to finally break out

At the start of the week, we knew a big move for Bitcoin was brewing — but it was unclear whether or not the world’s biggest cryptocurrency was heading to $6,000 or $8,000. After a scary slip below $6,666, we got our answer on Thursday: BTC was heading upward. Bitcoin vaulted past $7,000 with ease and headed toward $7,300 as the weekend roared on. But wait a second. Cointelegraph analyst Michaël Van de Poppe has warned the gains may not be sustainable as volume starts to drop significantly in the markets. To make matters worse, three technical factors have emerged that show BTC is vulnerable to a severe correction: There’s a deviation from the descending trendline, the emergence of a fractal resembling the 2019 top and an increase of Tether supply. Search volumes for “Bitcoin halving” may have reached all-time highs this week, but it seems there’s a real risk it will be overshadowed by the coronavirus pandemic and the economic fallout.

Dorsey’s crypto-friendly firm Square joins Paycheck Protection Program

COVID-19 continues to dominate the headlines. On Monday, the crypto-friendly payment firm Square Capital — which was founded by Twitter CEO Jack Dorsey — announced it was among the first Bitcoin-related companies to become an authorized lender under the U.S. government’s Paycheck Protection Program. It means Square can now provide small businesses with low-interest loans that will be 100% forgiven if used to cover approved costs. This is a big deal considering that many fintech firms have been struggling to participate. In other news, data from Coinbase suggests that a small portion of Americans may be using their coronavirus stimulus checks to buy crypto. The number of new deposits worth $1,200 — identical in value to the funds being sent to eligible consumers — has spiked in recent days.

Libra just made a bunch of changes to play more nicely with regulators

Remember Libra, Facebook’s controversial stablecoin project that looked dead in the water after receiving a firm pushback from global regulators? It’s back. Sweeping changes have been made to Libra’s white paper with a view to making the product more palatable for governments and central banks. Now, single-currency stablecoins pegged to the U.S. dollar, pound and euro are going to be created alongside a Libra coin backed by a basket of assets. Plans for a permissionless network have now fallen by the wayside, limiting what people will be able to do on the network. We’re yet to see how lawmakers in Washington will respond to the watered-down measures. Although it may seem like this massive U-turn is great news for Bitcoin, economists such as John Vaz believe Libra could still be a threat to crypto. Whereas BTC continues to grapple with scalability concerns, Libra has been purpose-built as a payments network that can accommodate a surge in demand. Vaz warned that the project could quickly become a major competitor, not least because Facebook already has billions of users on its books.

Maker faces new lawsuit demanding $28 million for Black Thursday liquidations

A new class action lawsuit has been filed against the Maker Foundation, with the DeFi giant accused of misrepresenting the risks investors in the ecosystem faced. Maker allows crypto users to use ETH as collateral for loans paid using DAI stablecoins. But it is alleged that these “collateralized debt position holders” lost $8.325 million when Ether plummeted on March 12 because their ETH was auctioned off with $0 bids. The suit is demanding these funds are reimbursed and that $20 million in punitive damages is also paid as compensation. “The Maker Foundation neglected its responsibilities to its investors by either fostering or, at the very least, allowing the conditions that led to Black Thursday,” court documents filed in California add.

Andreessen Horowitz looks to double down on crypto with new $450 million fund

Venture capital firm Andreessen Horowitz may have plans for another crypto asset fund. A report in the Financial Times revealed it is looking to garner $450 million in crypto. It’s not clear at this stage how big the new crypto fund will be. Also going by the name a16z, Andreessen Horowitz has previously invested in Coinbase, and it’s also a financial backer of the Libra project. The company, which was established by Marc Andreessen and Ben Horowitz over 10 years ago, already has a $350-million crypto fund in operation.

Winners and Losers

At the end of the week, Bitcoin is at $7,212.70, Ether at $183.48 and XRP at $0.19. The total market cap is at $208,547,116,707.

Among the biggest 100 cryptocurrencies, the top three altcoin gainers of the week are Komodo, Hyperion and DigiByte. The top three altcoin losers of the week are Insolar, Swipe and Nervos Network.

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For more info on crypto prices, make sure to read Cointelegraph’s market analysis.

Most Memorable Quotations

“The claims of a ceasefire made by ransomware groups are irrelevant [and] should be completely disregarded. Would you leave your front door unlocked simply because the local burglars had pinky-promised not to rob you? Probably not.”

Brett Callow, Emsisoft threat analyst

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“Soon [it] will be difficult to value money. If so, all society’s values realign. Expect volatility.”

Dan Taperio, Gold Bullion International co-founder

“There’s been a gargantuan explosion of phishing emails related to COVID-19. People are getting so many legitimate emails from their employers and vendors about the virus that ransomware attackers have an opportunity to blend in.”

Bill Siegel, Coveware CEO

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“CORONA CRISIS great for GOLD SILVER BITCOIN. US gov printing $10 trillion in FAKE US $ to save U.S.”

Robert Kiyosaki, “Rich Dad Poor Dad” author

“The Maker Foundation neglected its responsibilities to its investors by either fostering or, at the very least, allowing the conditions that led to Black Thursday, all after actively soliciting millions of dollars of investment into its ecosystem.”

Court document

Prediction of the Week

“Mathematics works!” — CZ predicts QE will drive Bitcoin prices up

Speaking at the virtual BlockDown 2020 conference, Binance CEO Changpeng Zhao said he believes there are big things ahead for crypto. Although he admitted he was shocked by the impact that the aggressive pullback on global markets had on crypto, CZ insisted that trading activity has risen substantially and exchanges are “actually doing quite well.” He also believes that aggressive quantitative easing measures enforced in response to the coronavirus pandemic — where central banks effectively start printing new money — could spark a bull trend in the coming months. CZ added: “Mathematics works. If you increase supply of the fiat currency and Bitcoin is a limited asset, mathematics will eventually work.”

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FUD of the Week

Don’t trust ransomware groups amid pandemic, expert warns

Ransomware groups may have made promises to halt their activity against medical organizations during the coronavirus pandemic, but one cybersecurity expert says these assurances should be taken with a massive pinch of salt. Emsisoft threat analyst Brett Callow told Cointelegraph that these promises are irrelevant, adding: “They’ve put lives at risk by attacking hospitals in the past, and it would be a mistake to assume that they would hesitate in doing so now.” He also compared taking these assurances at face value to leaving a front door unlocked because burglars had “pinky-promised” not to rob you.

Hospitals still being attacked despite big fall in ransomware

Perfectly proving Brett Callow’s point, a new report from Chainalysis this week found that hospitals are still being attacked by ransomware gangs. (That said, the overall number of attacks has dropped significantly since the coronavirus pandemic intensified in March.) The company’s senior economist, Kim Grauer, told Cointelegraph: “This is probably because they [hospitals] can’t afford to lose access to vital, often sensitive, patient data and, therefore, are considered more likely to pay up, especially during a health crisis.” She also cautioned that it’s difficult to accurately assess the true scale of ransomware incidents because there is a “massive underreporting problem.”

Criminals are selling COVID-19 infected blood on the darknet

Chainalysis also revealed this week that criminals claim to be selling coronavirus-infected blood on the darknet. These illicit marketplaces have not been immune to the adverse effects of the pandemic, with a 33% decline in the volume of cryptocurrency sent to scam addresses. In a new low for the darknet, one vendor claimed to be offering COVID-19-infected blood that was extracted from his hospitalized father that had been injected into bats. It’s not clear whether this listing is real or an attempt to scam users. To be fair, there are some signs that darknet operators are trying to take a dignified approach. Several venues have banned the sale of so-called COVID-19 “cures” altogether.

Best Cointelegraph Features

Journeys in blockchain: Akon of Akoin and Akon City

Darren Kleine speaks to the Grammy-nominated singer-turned-crypto evangelist who is looking to create an entire city in Senegal that’s a model for African financial empowerment.

Crypto scams on the rise and can still affect Bitcoin’s price

Bolstered by the new coronavirus pandemic, scams continue to be rampant in the cryptocurrency world. As António Madeira explains, they still have the potential to hit the market where it hurts.

Wright v. Kleiman enters final act — document reveal may set precedent

Some attorneys say this long-running court case may set legal precedents that could impact the future of Bitcoin. Andrew Singer has been speaking to them.


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In this week’s Hodler’s Digest, Libra’s massive U-turn, Bitcoin in danger of a massive correction, and crypto-friendly Square gets green light from U.S. government

Libra Stablecoin is Still a Major Threat to Bitcoin: Economist

Libra Stablecoin is Still a Major Threat to Bitcoin: Economist

Will Facebook’s Libra stablecoin emerge as Bitcoin’s strongest competitor? Economist John Vaz believes so

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Economist and academic John Vaz believes Bitcoin (BTC) still faces stiff competition from Facebook’s troubled Libra project.

Vaz told Cointelegraph that Bitcoin has scaling challenges in terms of payments and was used disproportionately as a vehicle for speculation. By contrast he said Libra has been purpose-built to scale as a payments network and could quickly emerge as a major competitor despite its ongoing issues with regulators.

“Libra isn’t dead,” he said,“they’re just navigating the regulatory nightmare.”

However, Vaz dismissed central bank digital currencies (CBDCs), describing them as a weak “defensive posture” in response to the threat crypto assets posed to their control over money supply and credit.

Vaz said that “the biggest competition for Bitcoin comes from other cryptocurrencies”.

Facebook’s Libra is very interesting

While noting that Facebook suffers from issues of public mistrust, Vaz said that the proposed model for the Libra stablecoin was “very interesting” — emphasizing both the basket of assets underpinning the stability of the instrument, and the existing networks that large tech companies are able to tap into.

The economist argued that companies like Facebook could capitalize on their existing user base and said that financial transactions were already taking place.

“They are targeting a market which is ready-made for them in the sense that people are already making transactions on Facebook, and Messenger, and WhatsApp, and Instagram — they own the lot. So they’ve got the message traffic, and those people are doing economic transactions already using fiat.”

As such, Vaz said that Libra would launch with “a very large ‘domain possibility’ — perhaps more than any other cryptocurrency from day one.”

He predicted that Libra’s initial target will be developing countries rather than developed markets, and stated: “They will entrench themselves there – where people are already heavily using the apps and they have a need for payments.”

CBDCs comprise defensive reaction to crypto asset

Vaz doesn’t believe central bank digital currencies (CBDCs) will be much of a competitor to crypto assets and stablecoins and were “a defensive posture”:

“They will be a kind of rearguard action being fought by the central banks because they don’t like cryptocurrency.” 

Rather than central banks posing a threat to Bitcoin, John believes that Bitcoin and other cryptocurrencies threaten to undermine banks’ control over the money supply. He said: “It takes away their ability to pull a lever in the economy because under things like Bitcoin, you can’t create money by the way of credit.”

“Banks can lend that money up to maybe eight or nine times on a fractional reserve system. So a lot of banks create massive money supply on the fractional reserve system. Under Bitcoin, you can’t lend what you don’t have.”

Vaz asserts that CBDCs do not offer any benefits beyond peer-to-peer settlement — “which you get by default with cryptocurrency.” “Central bank digital currencies are probably more about tracking money than providing benefit,” he added.


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Will Facebook’s Libra stablecoin emerge as Bitcoin’s strongest competitor? Economist John Vaz believes so

Libra Rival Celo Announces $700,000 in Grant Funding for 13 Startups

Libra Rival Celo Announces $700,000 in Grant Funding for 13 Startups

Celo has awarded $700,000 in grants to 13 companies seeking to build on top of or develop the platform or foster the Celo community

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Open-source payments network Celo has announced its first round of development grant recipients.

A press release shared with Cointelegraph states that Celo has awarded $700,000 in grants to 13 different companies who are looking to build on top of the network, contribute to the development of the Celo platform, or foster the Celo community.

The project has already received more than 50 grants proposals from teams based in 16 different countries and will continue to accept proposals until May 19.

Celo Awards $700,000 to 13 developers in first round of grant funding

Celo states that the chosen grant recipients „provide building blocks to help strengthen the Celo protocol, provide more access to the financially underserved, and develop programs to help educate and nurture the Celo community.” 

The recipients building products and services on Celo include eSolidar — a charity marketplace platform, Philippine-based digital gift card platform Beam & Co, Brazilian crypto-powered platform for small paid tasks LoveCrypto, payments platform Pay with Mon, and bill remittance platform SaldoMX.

The Blockchain for Social Impact Coalition — a nonprofit for incubating Ethereum and blockchain-based solutions to address the United Nations’ Sustainable Development Goals — is also a recipient of funding from Celo.

The largest cohort of recipients are startups “building blocks to strengthen and scale the Celo platform” — which include Chorus One, Forbole, Gitcoin, Stake.fish, Figment, Gauntlet and Chainsafe.

Grants intended to foster Celo community and ecosystem

Celo announced its community grant program on Dec. 17, 2019, encouraging all “developers, designers, dreamers, and doers committed to building an open financial system” to apply.

The grants sought to foster development in governance and validator tools, on and off-ramps for payments and point-of-sale systems, smart contracts, and community education, in addition to innovative new use cases for the platform.

Libra members join Celo to hedge bets

On March 11, the Celo Foundation revealed the 50 founding members of its “Alliance for Prosperity,” including major tech, investment, payments, and cryptocurrency firms.

Among the alliance are several Libra Association members, including Andreessen Horowitz, Coinbase Ventures, Anchorage Mercy Corps, and Bison Trails.

During April 2019, Celo raised $30 million from noted blockchain investors Polychain Capital and Andreessen Horowitz.


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Celo has awarded $700,000 in grants to 13 companies seeking to build on top of or develop the platform or foster the Celo community

Libra Association Member Offers an Explanation for the Crypto Market Decline

Libra Association Member Offers an Explanation for the Crypto Market Decline

Marc Bhargava, co-founder of crypto prime broker Tagomi, isn’t surprised by the current market selloff — he blames margin calls

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A prime crypto broker blames margin calls on non-crypto assets for the current crypto market slide.

Marc Bhargava, co-founder of Tagomi (which has recently joined the Libra Association), shared his explanation of the current market downturn with Cointelegraph. Since Tagomi is connected with ten of the biggest exchanges and some of the biggest crypto traders, it enjoys a rooftop view of the market. Here’s how the co-founder contextualizes the recent market downturn

Bitcoin is a risk-on asset

Bhargava believes that crypto is not a safe haven asset, despite others saying the opposite:

“BTC and crypto is currently a risk-on asset, more similar to tech and VC than gold, so with oil prices and the general stock market tanking, the latter more due to coronavirus and the global slowdown associated with it, it’s not surprising that there are multiple sellers of crypto right now.”

Campbell Harvey, a professor of international business at Duke recently shared a similar opinion with Cointelegraph:

“Now, if these cryptos were safe havens, then you would expect maybe no change in their value or maybe even an increase in value. But that’s definitely not what we’ve seen. The cryptos got battered and dropped by more than 10%. So that suggests to me, in a particular situation of great stress where people are realizing that there’s systemic risk unfolding, the stock market drops as expected, people flee to safe assets, but they didn’t flee to cryptos, they fled to the U.S. 10-year bond.”

Margin calls on non-crypto assets to blame for the slump

Bhargava suggests that bitcoin has the potential to become a “counter-cyclical” asset, but “that’s just not where it is yet in terms of its evolution, primarily because larger asset managers and macro traders don’t trade/own BTC yet, and so you don’t see it independent from equity market movements like you do for gold.”

Another reason for this massive liquidation could be due to “folks getting margin called on other non-crypto assets.”

Some analysts believe that the current downturn is caused by something more trivial: PlusToken scammers liquidating their loot.

We have been reminded again that crypto markets don’t exist in isolation from the rest of the world.


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Marc Bhargava, co-founder of crypto prime broker Tagomi, isn’t surprised by the current market selloff — he blames margin calls

‘Cryptocurrency Will Not Die’: Mainstream Media on Bitcoin in 2019

‘Cryptocurrency Will Not Die’: Mainstream Media on Bitcoin in 2019

Donald Trump, Libra and “boring prices”: Here’s the roundup of mainstream media’s crypto coverage in 2019

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In late 2017, Bitcoin piqued the interest of millions of people hoping to capitalize on the ongoing frenzy and, as a result, drew the attention of various traditional media outlets. The press seemed largely skeptical about the concept of decentralization but proceeded to report on Bitcoin’s erratic price movement.

This year, as the space has become more regulated, cryptocurrencies saw a notably different kind of coverage. The industry’s Wild West days are over, and media outlets — most of whom were quick to bury Bitcoin at least once over that period — are now focusing on how cryptocurrencies are entering the agenda of Big Tech and, for instance, the People’s Bank of China.

Still, many spectators remain unconvinced — as illustrated by United States President Donald Trump’s tweet earlier this year that summarized the most popular concerns about cryptocurrencies in under 280 characters and was covered by most mainstream media outlets (with diametrically opposed views regarding the critique’s potential impact on Bitcoin’s value). The president’s tweet read:

“I am not a fan of Bitcoin and other Cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air. Unregulated Crypto Assets can facilitate unlawful behavior, including drug trade and other illegal activity….”

Here are the main highlights of 2019’s Bitcoin and blockchain coverage gathered from mainstream media.

Television reports

CNN

Title: Crypto Crazy

Airing date: Sept. 9–Sept. 13

Back in August, Julia Chatterley — the anchor for CNN’s daily global business program First Move — announced she would host a week-long series called “Crypto Crazy” the following month, signaling that her audience was interested in hearing more on digital money. The show’s main objective was to “debunk some of the most popular misconceptions” about cryptocurrencies. Notably, in the first episode, Chatterley asked the guest expert to explain some not-so-basic concepts, especially for a TV audience — such as fake volume reports, whales and cold wallets. In the following episodes, the anchor focused on this year’s most mainstream crypto events, including Libra and the Winklevoss twins’ attempts to take digital assets to Wall Street.

CBS

Title: Bitcoin’s Wild Ride

Airing date: May 19

Earlier this year, CBS devoted so much as “60 Minutes” to cover Bitcoin’s many swings that happened over 10 years. To get a first-person perspective, the channel’s correspondent, Anderson Cooper, interviewed a handful of industry participants — including, among others, the guy who infamously bought two pizzas for 10,000 Bitcoin, marking the first time the preeminent crypto was used as a currency. “Sorry, let me just get this straight,” Cooper asked, as would any person hearing this story for the first time. “You spent about $80 million on pizza?”

Newspaper reports

The New York Times

Title: Bitcoin Has Saved My Family

Date of publication: Feb. 23

In this op-ed, the Times’ audience was presented with a curious case of how Bitcoin — often depicted as a tax cheating tool for radical libertarians or even terrorists — can actually help those living in poverty-stricken countries. Penned by Carlos Hernández, a Venezuelan economist, the essay explains how keeping money in bolívars — the local soverign currency — is seen as “financial suicide” due to the overwhelmingly high inflation rates. The annual inflation rate in Venezuela was almost 1.7 million percent last year.

The author, who had gone grocery shopping after changing his Bitcoin into bolívars, could not find any milk in about 20 shops nearby due to extreme food shortages. Still, he had to buy something that day — otherwise, his bolívars would lose value — so he opted for cheese, the closest thing to milk he could find.

Hernández, who keeps all his money in Bitcoin, says that he is not the only Venezuelian relying on digital assets — in fact, as much as $1 million worth of bolívars was traded for Bitcoin in a single day in April via LocalBitcoins.com, a peer-to-peer exchange.

On page 9 of the Times, Hernández wrote:

“You could say that cryptocurrencies have saved our family. I now cover our household’s expenses on my own. My father is a government employee — in a printing department with no paper — and earns about $6 a month. My mother is a stay-at-home mom with no income. And cryptocurrencies helped my brother Juan, 28, escape Venezuela last summer.”

The Guardian

Title: A Chinese Digital Currency Is the Real Threat, Not Facebook’s Libra

Date of publication: Nov. 11

Earlier this year, the Guardian selected Kenneth Rogoff — a professor of economics and public policy at Harvard University, who worked as a chief economist at the International Monetary Fund in the early 2000s — to write a piece on cryptocurrencies.

Rogoff focused on an important trend: digital, state-run currencies that employ blockchain. China has advanced more than others in that regard, the economist argued, comparing the country’s efforts to Facebook’s Libra, which is by far a much more well-known project. Indeed, Zuckerberg himself made this analogy during a hearing before Congress. “China is moving quickly to launch a similar idea in the coming months,” the Facebook CEO said at the time. “We can’t sit here and assume that because America is today the leader that it will always get to be the leader if we don’t innovate.”

“A widely used, state-backed Chinese digital currency could certainly have an impact, especially in areas where China’s interests do not coincide with those of the west,” Rogoff wrote, stressing that China’s currency will most likely be “permissioned” and hence have strict control over all transactions that it entails. Ironically, that would entirely contradict the anonymous, pro-decentralization agenda that Bitcoin is famous for — and average readers are starting to realize that cryptocurrencies are not just some internet coins, but a global technology that can change financial systems forever.

Government reports

Department of Justice

Title: The Mueller Report

Date of publication: April 19

In April, the Department of Justice released special counsel Robert Mueller’s report detailing his investigation into Russian interference in the 2016 U.S. election. One of its major points was that Russian agents allegedly used cryptocurrency at numerous stages in their online efforts to disrupt the election, hoping to “capitalize on the perceived anonymity of cryptocurrencies.” Specifically, Mueller’s report revealed that the “systems used in the hacking of the Democratic Party” were paid for with Bitcoin, as were online hosting services used by websites that published the hacked materials and participated in “the targeting of disinformation at American voters.”

Indeed, while cryptocurrencies are known for the anonymity they provide, there is another side to the coin: All Bitcoin transactions are posted to the publicly accessible blockchain, therefore making it possible to identify the sender’s wallet address and track their entire transaction history.

Nevertheless, Bitcoin allowed Russians to “avoid direct relationships with traditional financial institutions, allowing them to evade greater scrutiny of their identities and sources of funds,” Mueller’s investigation concluded.

Business media reports

Bloomberg

Title: The World’s Most-Used Cryptocurrency Isn’t Bitcoin

Date of publication: Oct. 1

Bloomberg is by no means an apprentice in the crypto world, as the publication has been closely following digital assets for the past few years. Despite being regularly criticized by biased community members for spreading FUD, Bloomberg often offers quality insights into the space.

In October, the magazine moved focus from Bitcoin to Tether (USDT) — the popular but controversial stablecoin that is designed to maintain a one-to-one ratio with the U.S. dollar in terms of value. Tether’s trading volume surpassed that of Bitcoin’s for the first time in April and had been consistently exceeding it since early August at about $21 billion per day, Bloomberg noted.

But why Tether of all stablecoins? people familiar with the company’s scandalous lawsuit might ask. The answer is simple, yet not so obvious: According to Bloomberg’s source, some traders don’t even realize they are holding Tether.

“I don’t think people actually trust Tether — I think people use Tether without realizing that they are using it, and instead think they have actual dollars in a bank account somewhere,” Thaddeus Dryja, a research scientist at the Massachusetts Institute of Technology, told the magazine. Some exchanges even mislabel their pages to convey the impression that customers are holding actual dollars instead of Tethers, he argued.

CNBC

Title: There’s Another Reason Behind Bitcoin’s 200% Rise This Year — It’s Got Nothing to Do With Facebook

Date of publication: June 25

Back in June, when Bitcoin was in the midst of a long-awaited bull rally (which would soon end), CNBC tried to pinpoint the reason behind the positive price movement. The publication suggested that it wasn’t Facebook’s arrival into the space, as many believed, but something more niche — an event called the Bitcoin halving, when the rewards to miners are cut in half every four years. The next one is scheduled for May 2020, and the tightening of supply had forced the price upward, the article opined.

Perhaps CNBC was too early to take the Bitcoin halving into consideration, but the fact that a major news source is covering the technology’s complexities for a mainstream audience is a sign that Bitcoin is not as underground as we used to think.

The Wall Street Journal

Title: If Bitcoin Looks Like It Isn’t Trading, It’s Because It Isn’t

Date of publication: Dec. 6

The Wall Street Journal has kept its overall conversvative stance toward cryptocurrencies.

“The energy that drove bitcoin and the cryptocurrency industry through much of the early years has been replaced by the sobering reality that creating new global monetary standards requires more than computer code,” the publication wrote, citing data from research firm Flipside Crypto. Apparently, in the last week of November, only about 14% of the 18 million outstanding Bitcoin was actively traded.

Now, with the number of daily Bitcoin transactions falling, the journal continued, “hopes rest with institutional investors, and there have been signs of progress on this front,” citing Bakkt as an example.

Financial Times

Title: A US Recession Could Fuel a New Cryptocurrency Boom and Bust

Date of publication: Nov. 14

According to the Financial Times, if global economic decline and uncertainty about the future of U.S.–China trade lead the U.S. into recession, cryptocurrencies could serve as a financial safe haven and even experience another bull run. However, that would be followed by another price bust, the publication argued:

“The last bust made clear that gains not linked to adoption by ‘real world’ users do not last. While the underlying digital technology continues to hold promise, it has yet to find a significant user base beyond enthusiastic techies.”

Lifestyle media

The New Yorker

Title: Cryptocurrency 101 in the South Bronx

Date of publication: Dec. 2

The New Yorker published a story of Carlos Acevado — a public school teacher in Morrisania, the poorest congressional district in the U.S. — who shares his cryptocurrency knowledge as someone who got into Bitcoin back in 2014 with a group of his former students.

“When we first talked about Bitcoin in your class, I thought, Criminals,” one of Acevado’s students said. “I’m not talking about machine guns on the street,” the teacher replied. “It’s not ‘Mad Max’ out there.”

To Acevado, cryptocurrencies are more about helping “the unbanked” — which is why he created the Crypto Community Project, with the goal of building a cryptocurrency economy in the South Bronx.

“After these two days, you’re going to be the one per cent,” he told the 25 young people who had attended his class. “You’re going to know more about cryptocurrency and blockchain than ninety-nine per cent of people out there. You have the opportunity to get in on the industry right now.”

GQ

Title: Cryptocurrency Will Not Die

Date of publication: Nov. 26

GQ’s Rosecrans Baldwin interviews some of the people who were lucky enough to get in early (and some who, in their own words, “were late to the party of crypto” but still enjoyed nice gains during the crazy days of late 2017) — most of them got burned, but their morale remained unshaken. “You know, honestly, if I had a better car, I’d sell it and get back in,” said one of the interviewees. The other one admitted to selling his old car to pay some bills and get back in the game. Needless to say, that kind of devotion surprised Baldwin.

He too tried to get a hang of crypto trading, investing $100 that he borrowed from his magazine. “I spent about $10 worth of Bitcoin on 20 coins of IOTA — because I didn’t have one ‘iota’ of knowledge about trading crypto,” he writes, describing a shameless, unenlightened attempt at getting rich that might recall some early memories for most cryptocurrency holders out there.

“What is crypto?” the author ponders in his column. “A couple years ago, crypto was the future, according to your cousin at Thanksgiving.” Closer to the end of the article, he develops this idea further:

“Only crypto didn’t disappear, it just went quiet. And this Thanksgiving, the evangelists will tell you it’s bigger, more relevant than ever, only they’re not just your cousin anymore. They’re the People’s Bank of China. They’re Mark Zuckerberg. Talking about crypto today is more like talking about the climate crisis. Forget real or unreal. It’s ‘how soon,’ and ‘oh crap.’”


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Donald Trump, Libra and “boring prices”: Here’s the roundup of mainstream media’s crypto coverage in 2019

The Biggest Crypto Winners and Losers of 2019

The Biggest Crypto Winners and Losers of 2019

Will Facebook succeed in launching Libra in 2020? Will Craig Wright ever stop claiming to be Satoshi? Who will win among the bitcoin bulls and bears? Take a look at the biggest crypto winners and losers of 2019

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Even though the cryptocurrency industry is not new to ups and downs, 2019 has turned out to be the year with the most surprising reveals. The long-lasting bear market of 2018 moved market analysts to call it the year of regulatory reckoning, leaving many jurisdictions uncertain about how to treat cryptocurrencies.

However, 2019 also turned out to be the year of the comeback, as big tech giants like Facebook moved from banning crypto to embracing it. 

Escalating global events such as the trade war between the United States and China have shifted investors’ point of view on the utility of cryptocurrencies like Bitcoin, but there is still a lot to be done even as the U.S. Securities and Exchange Commission continues to turn down every other Bitcoin ETF proposal. 

As the year comes to a close, here is a look at the companies, individuals and various crypto projects that managed to come out on top in 2019, as well as those that failed to mark the year as a positive in their books.

The winners

Bitcoin’s double growth

This year, Bitcoin and the entire blockchain and cryptocurrency industry celebrated its tenth anniversary as proof of the resilience of Satoshi Nakamoto’s creation. However, at the beginning of 2019, the cryptocurrency industry was just recovering from the so-called crypto winter of 2018. 

Fortunately, Bitcoin kicked off the year with a bullish trend that resulted in an approximate price increase of 11% higher by the end of the first quarter. Anthony Pompliano, the co-founder of Morgan Creek Digital asset management firm, shared his view with Cointelegraph:

“Bitcoin’s price is up significantly in 2019 [as there are] more buyers than sellers on a net basis this year.”

As the trading volume and market capitalization increased throughout the second quarter of the year, Bitcoin led the market with a 165% gain as its price surged from $4,103 to $10,888. Furthermore, Bitcoin’s market dominance increased from 54.6% to 65%.

Among the reasons that have promoted Bitcoin’s continued growth despite a struggling market is the view that the digital currency can act as a hedge in the wake of increasing global uncertainty. This year, the U.S.–China trade war saw most investors look to Bitcoin and gold as hedges. Pompliano also told Cointelegraph that there were other contributing factors:

“The biggest moments probably revolve around the announcement of Libra and the subsequent reactions, both positive and negative, from various folks across the traditional and cryptocurrency markets.”

However, it was not all sunshine for Bitcoin in 2019. Over the third quarter of the year, a bearish outlook emerged as Bitcoin’s price decreased significantly as 100 billion in market capitalization was lost. Fortunately, even as the market struggled to gain ground against the bears, Bitcoin not only closed the quarter with the least amount of loss but also increased its market dominance by 5.4%. Ultimately, of all cryptocurrencies, Bitcoin’s performance has been the best so far.

Compared to assets from other markets, Bitcoin’s performance throughout the year is still far from tenuous. For instance, even though gold is regarded as a reliable store of value, its price has only increased by 17% since January. Even the S&P 500 Index, although with an excellent performance of +21%, is still dwarfed by Bitcoin’s growth throughout the year. Beyond price, Bobby Lee, CEO of the Ballet crypto wallet, told Cointelegraph that Bitcoin has benefited from several major technological developments:

“2019 was a great year for Bitcoin bulls because of the advances in the open-source ecosystem. Lightning Network is increasing Bitcoin’s transaction capacity, wallets with built-in, user-friendly features (Wasabi, Samourai) are improving privacy.”

Gods Unchained’s rise to popularity

According to reports, Gods Unchained, a blockchain-based virtual card game built on Ethereum, emerged as one of the highest-grossing and most popular blockchain games in 2019. This came about after the platform completely sold out its Genesis Card Pack to the tune of about $6.2 million. This came about after Blizzard, the creators of Hearthstone (a digital trading card game) banned Hearthstone player Chung Ng Wai (also known as Blitzchung) for expressing support for the Hong Kong protests. The Hearthstone game developer also stripped Blitzchung of his winnings. 

In addition to the backlash received from the gaming community, Blizzard’s actions were criticized in a tweet by Gods Unchained that claimed Blizzard “care[s] about money more than freedom.” Gods Unchained also promised to compensate Blitzchung for his lost winnings while offering him an invitation to their $500,000 tournament.

Related: Blizzard Bans Hearthstone Player, Blockchain Comes to Rescue

The tweet by Gods Unchained was retweeted over 10,000 times, and Google searches for the game have since surged. Unlike Hearthstone, Gods Unchained is decentralized and uses blockchain to ensure that players truly own in-game items and have the freedom to trade them at will.

In a move to give online game players long-term incentives, James Ferguson, CEO of Gods Unchained said that the game is “leveling up the outdated practices of the gaming industry.”

Coinbase’s continued expansion 

In the past, Coinbase maintained a reputation for employing a rather selective strategy for adding coins to its exchange. As one of the big league exchanges in the crypto space, Coinbase is also known for having significantly fewer large-scale hacks. In a year that saw other major exchanges like Binance fall victim to large scale security breaches, leading to the loss of thousands of Bitcoin, Coinbase stands out as a reliable and safe platform.

However, the company was heavily scrutinized by Twitter users this year over its acquisition of Neutrino, a startup that collects cryptocurrency transactional data using the blockchain. For most Twitter users, this move seems to facilitate the exchange’s spying on its customers. 

However, Coinbase’s move to acquire Neutrino is, according to a Coinbase blog post, part of its goal to support all assets while complying with applicable laws. In addition to acquiring Neutrino, Coinbase has doubled the number of listed cryptocurrencies on its exchange since 2018. Coinbase’s aggressive listing approach has seen the addition of coins such as Dash, Cosmos and Waves, to mention just a few.

The company has almost constantly been making news throughout the year, from making acquisitions to denying them, as well as securing multiple patents along the way. Meanwhile, Coinbases’s Visa debit card solution has also seen exponential growth this year, now available for use in even more countries. 

In May 2019, the company also expanded its reach to more than 100 countries while making its USDC stable coin — previously only available in the U.S. — available in 85 of those supported countries. In comparison, Coinbase was only available in about 32 countries last year. Its aggressive expansion appears to be in direct competition to other global players like Binance.

Binance ventures further

Ask any market analyst and they will admit that initial exchange offerings have grown into a big business in 2019. Reports have revealed a high demand for IEOs right from Q1 2019 to Q3, not to mention the fact that they collectively raised over $1.5 billion in the first half of 2019 alone. Unlike initial coin offerings, the biggest determining factor for a successful IEO is the availability of liquidity, and what better way to access liquidity than launching an IEO on a popular exchange. 

That is why Binance and its native cryptocurrency BNB have had one of the best years yet. As one of the biggest marketplaces for digital assets, Binance enjoys a significant share of the trading volume. The exchange’s performance has been so exceptional that the Binance Coin has gained value by 150% over the year. When taking everything into account and considering year-on-year growth, Binance Coin has even slightly outperformed Bitcoin.

Also, Binance expanded its reach with the launch of a fully independent U.S. arm of its trading platform. Despite heavy regulatory pressure that keeps the Binance exchange in the U.S. from operating in states such as New York, the company’s partnership with BAM, a registered money service in the U.S., has so far given the exchange some leeway.

The losers

Facebook’s uncertain Libra launch in 2020 

Facebook’s announcement of its Libra cryptocurrency has been one of the major events of 2019. However, on the unveiling of Libra as a stablecoin backed by a select number of national currencies, U.S. lawmakers reacted with skepticism, summoning Facebook CEO Mark Zuckerberg to multiple hearings.

Related: What Is Libra? Breaking Down Facebook’s New Digital Currency

At its core, Libra is a stablecoin backed by real money and lets users buy, sell and send money at nearly zero fees across borders. According to the project’s white paper, Libra’s overall mission is “to enable a simple global currency and financial infrastructure that empowers millions of people.”

Libra’s white paper further claims that it will use “a new decentralized blockchain, a low volatility cryptocurrency, and a smart contract platform” to empower about 1.7 billion unbanked people. This will be achieved through the use of Facebook’s WhatsApp, Messenger and Calibra, which is a digital wallet designed for Libra users.

Despite Libra’s ambitious plan to empower the unbanked, the Libra project has not only come under heavy scrutiny from lawmakers but also faced internal problems of its own. While sharing his thoughts with Cointelegraph, Ballet wallet’s Lee expressed optimism about Libra, saying that although “legislators and regulators in the United States and Europe understand that non-government currencies are a threat to their power, government opposition will diminish over time.” Lee further explained:

“Governments will change their stance because they will come to understand that they can’t control or stop Bitcoin, and they will prefer to have their citizens use centralized corporate coins that can easily be regulated, monitored, and pegged to fiat currency.”

Despite Libra’s ambitious plan to empower the unbaked, the Libra project has not only come under heavy scrutiny from lawmakers but also faced internal problems of its own. 

The U.S. Congress has asked Facebook to pause further development of the Libra projects, and cynics now believe that the project will not get out of the starting blocks without the government’s approval. Multiple European countries have also spoken out against the proposed cryptocurrency, while China announced that it will soon launch its own stablecoin, a national central bank digital currency, likely as a retaliatory measure. Furthermore, in the wake of increased scrutiny from government regulators, some of Libra’s high profile backers like Visa, eBay, MasterCard and PayPal have abandoned the project.

A rocky year for Circle

In October 2018, Circle, a cryptocurrency firm based in Boston and backed by Goldman Sachs teamed up with Coinbase to launch the Centre consortium. Counting on its reputation as one of the most well-funded crypto startups, the two companies aimed to help accelerate adoption of cryptocurrencies. Through the Centre consortium, Coinbase and Circle would increase liquidity to the crypto industry through the issue of a stable coin called the USD Coin. 

In July this year, Coinbase and Circle broadened participation into their consortium in a move that will allow other financial entities interested in the project to issue the USD Coin. In the announcement, the Centre network mentioned that “a natural next step is to imagine a new global digital currency” that would include a basket of tokens backed by a variety of stablecoins. Simply put, Centre’s plan is to go with a Facebook-like approach to create a global currency.

However, Circle has had a rocky experience throughout 2019. Even though the USD Coin has received a positive reception, with Centre claiming that the stablecoin has been used to clear on-chain transfers worth over $11 billion, Circle closed its mobile app, reduced its fundraising goal by 40%, and laid off 10% of its staff between May and June this year. Just recently, the company let go of 10 more of its employees, citing efforts to streamline its services. 

The latest news of layoffs from Circle comes after the recent transition of the company’s co-founder Sean Neville from his position as CEO to a seat at the company’s board of directors. However, a representative of Circle has denied any connections between the recent layoffs and Sean’s transition, telling Cointelegraph that: 

“None of this is related to Sean transitioning out of the co-CEO role. Sean will continue to serve on Circle’s board.”

Craig Wright’s court battles

When Australian-born technologist Craig Wright claimed to be Satoshi Nakamoto back in 2015, most people in the crypto community were skeptical and thought nothing of it. 

Most people expected that the Satoshi Nakamoto impersonator would have scurried back into obscurity by now. However, Wright and his claims have continued to headline the news throughout 2019. Wright claims that he invented Bitcoin a decade ago and mined over 1 million BTC along with his late business partner Dave Kleiman. After Kleiman’s death in 2013, Wright claims that he put the mined Bitcoin in the “Tulip Trust.”

However, the Australian entrepreneur and computer scientist was sued by Kleiman’s estate in 2018 for allegedly stealing up to 1 million Bitcoin. In the past, it is said that Wright and Kleiman worked together on mining and developing Bitcoin. According to Kleiman’s family, Wright stole between 550,000 to 1 million Bitcoin — worth about $10 billion. 

The ongoing case led to Magistrate Judge Bruce’s ruling that ordered Wright to turn over half of his Bitcoin holdings and intellectual property from before 2014 to Kleiman’s estate, presuming he is indeed Nakamoto. On Oct. 31, the trials re-emerged after Wright pulled out of the settlement agreement to forfeit half his Bitcoin and intellectual property.

In addition to his court battles, Wright was scrutinized by the crypto community after presenting what was considered forged documents as evidence of him being Nakamoto in another case of Wright against Peter McCormack. Wright’s case against McCormack is based on the fact that McCormack’s repeated statement that Wright is not Satoshi is harmful to Wright’s reputation. Most recently, Wright presented another document that allegedly proves how he came up with the Satoshi Nakamoto pseudonym.

Bitcoin ETF’s continual rejection by the SEC 

Even though U.S. regulators have always left a window for the possibility of approving Bitcoin exchange-traded funds in the future, up until now, every single attempt to license a Bitcoin ETF has been met with failure. In October this year, an ETF proposal filed by Bitwise Asset Management in conjunction with NYSE Arca was rejected by the Securities and Exchange Commission for failing to meet legal requirements that prevent illicit market manipulation. 

In fact, all Bitcoin ETF proposals presented to the SEC have been rejected on concerns about fraudulent activities and market manipulation. One of the main criteria for approving an ETF is establishing the underlying market of a new commodity-based ETF.

Related: The SEC Does Not Want Crypto ETFs — What Will It Take to Get Approval?

If the underlying market is resistant to manipulation, regulators can give the ETF the go-ahead. Given the complexities of the Bitcoin market, it seems approval from the SEC is unlikely. Despite the earlier rejection of Bitwise’s application, the SEC later announced that it would review Bitwise’s proposal once again.

While speaking to Cointelegraph on the realistic timeline of the first Bitcoin ETF approval, Charles Lu, the CEO of the Findora fintech toolkit provider said, “For a Bitcoin ETF proposal to gain SEC approval, the sponsor will need to prove that real price discovery is happening as opposed to market manipulations.” In Lu’s opinion, this will not happen anywhere soon, since the SEC would require “surveillance sharing agreements” with the big exchanges.

2019 and 2020

Overall, the crypto industry has shown some significant growth over the past year. Although volatile, Bitcoin is showing significant signs of growth. More institutional investors are looking into the industry to find more ways to invest as well. Even though there is a downtrend in market cap and trading volumes, prominent traders believe that a turn of fate might just be around the corner, especially for Bitcoin holders.

Out of all the winners and losers of 2019, perhaps Facebook Libra is one that stands to be most impactful in 2020. For most onlookers, it will be interesting to see whether Facebook’s Libra project will turn a new leaf and launch successfully in 2020. If it does, there is a high likelihood that big changes will take place throughout the entire industry.


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Will Facebook succeed in launching Libra in 2020? Will Craig Wright ever stop claiming to be Satoshi? Who will win among the bitcoin bulls and bears? Take a look at the biggest crypto winners and losers of 2019

The Modern Great Game — Facebook’s Libra Project

The Modern Great Game — Facebook’s Libra Project

What are the possible scenarios for governments after the launch of Facebook’s Libra, and should the U.S. be afraid of it?

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Since Facebook’s digital currency project, Libra, was announced in June, there has been a growing chorus of central bankers and policy makers pushing back against its ambitions. Germany’s Vice Chancellor Olaf Scholz and France’s Finance Minister Bruno Le Maire have both, separately, made it clear that they are not impressed with Libra and that the issuance of currency is the exclusive duty of the state and intrinsic to the sovereignty of a nation. The irony of this stance is apparently lost on both men, as neither France nor Germany have issued their own currency since 1999.

Although the Facebook subsidiary Calibra — which was setup to facilitate Libra — is based in Switzerland, Facebook may have been expecting a more favorable reception in the United States as a heavyweight of Silicon Valley. However, when Calibra CEO David Marcus was summoned to Washington D.C. on July 16 and followed by Facebook’s Mark Zuckerberg on Oct. 23, it became apparent that the social media behemoth had not done enough networking on Capitol Hill. 

Policy makers from across the aisle lined up to chastise both men for Facebook’s failings on issues such as data privacy and Russia’s meddling in the U.S. elections. Despite some indications of appreciation for Facebook’s innovation, many showed their disapproval for the Libra project. Zuckerberg was probably not expecting his testimony to be a pleasant experience, as members of the Senate Banking Committee earlier that month had caused Stripe, Visa and Mastercard to leave Libra’s governing body, the Libra Association, by threatening them with increased regulatory scrutiny should they move forward with the project. Despite these events, Marcus has remained upbeat about Libra’s launch going ahead in 2020, but many believe the project is mortally wounded.

The dominance of the U.S. dollar in international trade and America’s overarching control of the world’s payment rails serve as immense soft power tools for the U.S. and the West. So, it is not surprising that the meddling of a billion-dollar tech giant, whose internal motto up to 2014 was “move fast and break things,” has elicited such a backlash. Uncle Sam would likely be much happier for no one to move and for nothing to get broken.

Unfortunately, China didn’t get the memo, and its response to Libra can be characterized as “move faster and strike while the iron is hot.” Shortly after Libra was announced in July, China announced its own Digital Currency Electronic Payment system, or DCEP, that it had been researching for five years. 

Further updates on the project have made no attempt to hide the scale of China’s ambition. Speaking at the inaugural Bund Financial Summit in Shanghai in October, Huang Qifan, the vice chairman of the China Centre for International Economic Exchanges, indicated that one of the aims of the DCEP is to replace SWIFT and CHIPS — two networks that form a large part of the international payments system. Not only did he criticize the networks for being outdated, slow and expensive, he took direct aim at the ability of the U.S. to use them for waging financial wars against other countries.

“The lesson from the internet is anything that China bans — invest in,” was a statement made by Fred Wilson, the principal of Union Square Ventures, when he appeared before the New York Department of Financial Services to discuss digital currencies in 2014. Wilson was highlighting America’s history of allowing innovation compared to China’s more controlling regulations and policies. 

Perhaps China’s politburo, remembering this statement, was keen to turn it on its head by revealing the existence of its DCEP while watching U.S. regulators threaten to tie Libra up with red tape. In truth, this statement would never have been accurate in the context of payment processing, where China has continued to make great leaps forward ahead of the West for the past decade. 

Alipay is the largest payment processor in the world — the Chinese tech giant has been involved in payment processing in China for over a decade. Along with the WeChat messaging app, Alipay accounts for 92% of China’s mobile payments. According to a 2017 report by the Brookings Institute, this system has less friction than the “swipe card” system that dominates payments in the U.S. China’s rapid uptake of mobile payments means they likely see Europe and the U.S., where signing for credit card payments and writing checks are still commonplace, as being well behind the curve.

The ability of the Chinese state to influence Chinese companies, including the likes of Alipay and WeChat, and the mass adoption of mobile payments in the country means that a central bank digital currency would be adopted more rapidly there than anywhere else. Adoption in China does not mean that DCEP will become the dominant global payment rail overnight, but thanks to Alipay and WeChat, China has the world’s leading mobile payment firms by transaction volume, and this infrastructure already serves Chinese nationals when traveling abroad, allowing for digital yuan to be used in commerce across the globe. A customer visiting Harrods in London, for example, and asking to pay using WeChat will find employees more than willing to facilitate the transaction. 

There have been mixed messages from Beijing as to how DCEP will function, but in his talk at the Bund, Huang indicated it would be based on encryption and blockchain technology. If it is indeed blockchain-based, then it’s reasonable to assume someone using the system would not need access to a yuan-denominated bank account.

In theory, the payments system could be accessed by anyone who downloads a wallet, much in the same fashion as anyone who downloads a Bitcoin wallet can buy and hold Bitcoin.  Whether this is possible or not should become clear when China releases more details about the project. China will likely maintain exclusivity to edit and control access to the DCEP, which it could — using consistent language here — use to “wage financial war” by using it in the same way the U.S. has done with the existing payments systems.

In the third quarter of 2019, 2.8 billion people were using at least one of Facebook’s core products (Facebook, WhatsApp, Instagram or Messenger) each month — close to double the population of China. If Facebook were a religion, it would be one of the largest in the world.

While Zuckerberg is far from the second coming and the U.S. dollar is not in need of a miracle to save it just yet, the U.S. may want to reconsider its policy on Libra. The current international payment rails are likely to see disruption over the next decade whether the U.S. likes it or not. Perhaps it is better that the disruption comes from a U.S. tech giant than a foreign state.

The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Sean Kiernan is a founder and CEO of DAG Global which is working to obtain a full UK banking license in order to offer merchant banking services to corporates in the digital asset sector and broader UK SME space. Sean has extensive experience in financial services, having worked in various roles in executive management.


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What are the possible scenarios for governments after the launch of Facebook’s Libra, and should the U.S. be afraid of it?

US Lawmakers Want to Brand Libra a Security, Association Disagrees

US Lawmakers Want to Brand Libra a Security, Association Disagrees

Will Libra be able to operate in the U.S. if Congress classifies stablecoins as securities?

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A couple of United States lawmakers are looking to classify stablecoins as securities. With Libra considering adopting fiat-pegged stablecoins rather than a single token supported by a basket of national currencies, the proposed crypto project might be facing yet another regulatory hurdle.

Meanwhile, lawmakers sponsoring the bill say stablecoins should be classified as securities to protect U.S. consumers. If passed, stablecoin projects like Libra will potentially fall under the purview of stringent U.S. securities regulations.

Critics of the move remark that such measures only serve to further dampen the country’s position in the emerging digital landscape. Some commentators have long accused regulators of chilling innovation in the U.S. crypto and blockchain space.

Libra maintains that its proposed stablecoin project is a commodity. The association is also moving forward with developing the payment system, recently releasing updates on the state of its testnet and detailing the number of transactions carried out so far.

U.S. lawmakers want “managed stablecoins” classified as a security

As previously reported by Cointelegraph, two Texas representatives — Lance Gooden and Sylvia Garcia — have proposed a piece of legislation that will classify stablecoins as securities. Named as the “Managed Stablecoins are Securities Act of 2019,” the bill, which is sponsored by representatives from both sides of the aisle, could place an even greater regulatory burden on stablecoin projects like Libra. In a statement quoted by The Hill, Rep. Garcia remarked:

“Managed stablecoins, such as the proposed Libra, are clearly securities under existing law. This legislation simply clarifies the statute to remove any ambiguity.”

A co-sponsor of the bill, Rep. Gooden, also echoed the sentiment that Congress should take the lead in shaping the legal landscape for cryptos and the digital space at large. According to Gooden, “It’s the responsibility of Congress to clarify the regulatory framework that will apply to stablecoins, especially now that mainstream institutions are offering them to consumers.”

It appears that consumer protection concerns are at the heart of lawmaker endeavors to put stablecoins under the security token paradigm. However, such a move increases the regulatory burden on stablecoins, as U.S. securities laws contain a litany of reporting and compliance requirements.

Cointelegraph reached out to the Libra Association for comments about the proposed bill. In its email response, Dante Disparte, the association’s head of policy and communications, remarked:

“We maintain that responsible financial services innovation and regulatory oversight are not in contest. The Libra payment system is designed from the ground up to serve as a payment infrastructure that can empower billions of people left on the margins of today’s networks. The Libra Coin is simply a proxy for an instantaneous payment system that is low friction and high trust.”

With Libra yet to launch, it remains unclear exactly what type of token the project will utilize. In October 2019, the association hinted that it might abandon its original plan of creating a single token supported by a basket of national currencies in favor of a fiat-pegged stablecoin.

Related: Libra Might Become Unrecognizable by Navigating Regulatory Concerns

The bill before Congress represents another development in the emerging trend of government authorities in Western countries looking to place stringent regulatory hurdles along the path of stablecoin projects. Several regulatory agencies in the U.S. as well as international organizations like the G-20 have expressed concerns about stablecoins.

Another potential regulatory hurdle for Libra

If passed, the bill could potentially serve as another regulatory impediment on the path of the Libra project in the U.S. In an email to Cointelegraph, crypto and blockchain legal expert Max Ambrose highlighted how much of a burden the proposed bill could have on Libra:

“It will require Libra to follow substantial regulatory requirements imposed by the SEC that they are hoping to avoid altogether. These regulatory requirements increase legal costs and will tie Libra’s hands on numerous investment-related issues, requiring them to operate within specific bounds which the SEC and lawmakers can carve out.”

The added compliance burden for Libra would be to such an extent that, as Ambrose remarked, “The bill may entirely prevent Libra from operating in the US,” but the likelihood of such will depend on whether the association chooses to follow local regulations. He added:

“Libra’s argument that it is not a security is further evidence of the hardships they will face if they are subjected to US securities laws and regulations.”

Joe DiPasquale, CEO of BitBull Capital — a crypto and blockchain hedge fund firm, echoed similar sentiments declaring that stablecoins being classified as securities in the U.S. could hurt Libra’s operation in the country. Writing to Cointelegraph, DiPasquale declared that classifying Libra as a security would limit the flexibility of the project’s operation in the U.S.

A security token designation might not be the only worry for Libra in the U.S.: Earlier in November, Kenneth Blanco, director of the U.S. Financial Crimes Enforcement Network, declared that businesses that conduct stablecoin transactions must register as money services businesses.

Since the release of the project’s white paper, Libra has been facing criticism from several regulatory stakeholders both within and outside the U.S. While much of the initial objection to the project appeared to stem from Facebook’s involvement in the Libra Association, recent events seem to point toward governments wanting to stake a firm stance against the project as a whole.

Are stablecoins securities?

With the bill already before Congress, part of the developing conversation is circling around whether stablecoins are securities. In the U.S., the Howey Test is the standard for classifying investment instruments as securities.

So far, the U.S. Securities and Exchange Commission has elected to utilize the Howey Test rather than create another standard specifically for crypto. According to Ambrose, Congress reserves the right to create a legal framework for determining whether crypto tokens should be seen as securities. As part of his email to Cointelegraph, Ambrose said:

“The legal basis to classify a cryptocurrency as a security is up to lawmakers (e.g., Congress) and regulatory agencies (e.g., the Securities Exchange Commission, aka SEC), so if this bill passes, Congress is effectively creating the legal basis for the classification. It becomes irrelevant whether Libra is or is not a security under current law, because it would be classified as a security under the new law.”

In summary, the Howey Test classifies an investment instrument as a security if it:

  • Involves monetary investment
  • The investment is in a common enterprise
  • There is an expectation of profit from the investment
  • There is an expectation of profit due to the efforts of the promoter or third-party

Sponsors of the bill argue that managed stablecoins constitute investment contracts and are therefore securities under the paradigm of the Securities Act of 1933. Earlier in November 2019, the International Organization of Securities Commission declared that some stablecoins might be securities.

According to the IOSCO, some stablecoin implementations possess certain features typical of securities. Thus, the international securities regulator maintains that regulators would be correct in classifying some stablecoins as securities.

However, the Libra Association maintains that while regulators and lawmakers have to consider consumer protection laws, the steps they take should not inhibit the growth of the digital asset space. Disparte remarked to Cointelegraph:

“We recognize that stablecoins are an emerging technology, and that policymakers must carefully consider how this fits into their financial system policies. However, we believe that it is important to regulate activities and not technologies, allowing for responsible innovation to flourish.”

It could be better…

Some U.S. crypto and blockchain stakeholders have lamented the current state of regulations governing the country’s digital asset space. Earlier in 2019, Jeremy Allaire, the CEO of Goldman Sachs-backed Circle — a crypto payments firm — declared that unclear U.S. crypto regulations were forcing companies to move their projects to other countries.

Indeed, during his recent appearance before Congress, Facebook CEO Mark Zuckerberg sounded a note of caution against stringent digital regulations in the U.S. According to the Facebook chief, such measures are handing over control of the emerging digital economy to China.


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Will Libra be able to operate in the U.S. if Congress classifies stablecoins as securities?

EToro: Facebook Should Drop Libra and Support Third-Party Stablecoins

EToro: Facebook Should Drop Libra and Support Third-Party Stablecoins

Facebook needs to change strategy and focus on the Calibra wallet — not Libra — to assure success, say eToro’s blockchain researchers

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Blockchain researchers at online brokerage eToro have argued that Facebook should look to support third-party stablecoins, not Libra.

According to a Nov. 28 report from Finextra, eToro’s blockchain research unit eToroX Labs believes that while Facebook’s crypto project offers a “trailblazing opportunity” to disrupt financial services worldwide, the social media giant needs to change its strategy to assure success.

Facebook should focus on wallet infrastructure

Distrust and forceful opposition have plagued Facebook’s project since its inception — prompting American politicians to recast Libra derisively as “ZuckBucks.” 

Yet eToroX Labs’ researchers argue that there is still something to fight for in realizing the company’s ambitious aim of embedding a peer-to-peer payment network that could purportedly improve financial inclusion globally.

Facebook could solve its problems by delegating asset issuance to regulated third-party partners, they say. 

According to eToro, independent, multiple fiat-backed stablecoins would remove the task of currency control from Facebook, which could instead focus on building its Calibra wallet infrastructure and rolling it out for the estimated 2.7 billion users worldwide across its platforms.

EToro is itself notably an issuer of a range of stablecoins, backed by the U.S. dollar, pound sterling and euro.

The firm’s CEO and founder Yoni Assia said that the Libra Association should lobby lawmakers to provide harmonized and streamlined regulatory frameworks that would cover “the governance of the third parties using the Libra chain for executing payments,“ arguing that:

“The regulatory burden and associated compliance costs would befall those who use the ledger for their own gains, be it in the issuance of collateralized stablecoins, commodities or other financial instruments, effectively removing Libra from the money trail altogether.”

Proliferating options

Earlier this week, David Rutter, the CEO of enterprise software firm R3, ridiculed Facebook’s Libra announcement this summer as naive and “ridiculously stupid.”

As Libra continues to divide global opinion, the Libra Association is proceeding with development, reportedly logging over 30 projects and 51,000 transactions on the Libra network during the past two months of testing.

Facebook has meanwhile just announced the launch of a new fiat payment system, Facebook Pay, designed to facilitate payments across Facebook, Messenger, Instagram and WhatsApp.

In October, United States Representative Warren Davidson had argued that Facebook adding Bitcoin (BTC) to its Calibra wallet would be a “way better idea” than creating a new currency.


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Facebook needs to change strategy and focus on the Calibra wallet — not Libra — to assure success, say eToro’s blockchain researchers

Klaytn Blockchain Ahead of Facebook’s Libra Network, Says Kakao CEO

Klaytn Blockchain Ahead of Facebook’s Libra Network, Says Kakao CEO

The CEO of Kakao said that the Klaytn blockchain is similar to Facebook’s Libra network but more developed

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Yeo Min-soo, the CEO of South Korean internet giant Kakao, said that his firm’s Klaytn blockchain is similar to Facebook’s Libra except it is way ahead in its development.

According to the Korea Herald on Nov. 28, Min-soo lauded Klatyn’s development during the first Klaytn Governance Council Summit held in Seoul:

“Facebook’s Libra launched last month with aims to recruit 100 partners. Libra is taking a similar approach to ours, but it has yet to experience the milestones we have crossed. […] Next year, Klaytn will become Asia’s biggest blockchain consortium.”

The Klaytn platform, which is developed by Kakao’s blockchain subsidiary Ground X, currently has 27 firms in its Governance Council, of which the combined value is reportedly 70 trillion won (over $59.3 billion). 

During the event, Min-soo emphasized that the platform does not belong to Kakao, but to all the Klaytn council members. The council is the Klaytn ecosystem’s decision-making body and was joined by major crypto exchange Binance in October.

A fast-growing ecosystem

Min-soo said that since its launch in late June, Klaytn has been stable and operated without any errors halting its operation. He claimed that the platform is now processing a daily transaction volume of around 700,000, comparable to the Ethereum blockchain, which has been active since 2015. 

According to blockchain data website BitInfoCharts, Ethereum’s blockchain processed over 674,000 transactions on Nov. 27.

As Cointelegraph reported in March, Kakao plans to integrate a Klaytn wallet, dubbed Klip, in its Kakao Talk messenger. Min-soo touched on the subject during the event, saying, “Based on our 40 million user pool, we are putting our best efforts for a soft landing for the mass adoption of Klip.”

In September, Kakao launched a special edition of Samsung’s Galaxy S10 smartphone in partnership with the company. As previously rumored, the firm preloaded the devices with its Klay tokens.


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The CEO of Kakao said that the Klaytn blockchain is similar to Facebook’s Libra network but more developed

New Bill Would Put Facebook’s Libra Stablecoin Under US Securities Law

New Bill Would Put Facebook’s Libra Stablecoin Under US Securities Law

American lawmakers have introduced a bill to put Facebook’s Libra under the jurisdiction of the Securities and Exchange Commission

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American lawmakers have reportedly introduced a bill aiming to put Facebook’s Libra under the jurisdiction of the Securities and Exchange Commission (SEC). Two Texas representatives, Sylvia Garcia and Lance Gooden, have proposed legislation that would put even more regulatory scrutiny on Facebook’s not-yet-launched Libra stablecoin and related projects, CNBC reports Nov. 21.

The bipartisan team of the House Financial Services Committee introduced the bill today, speaking at a committee hearing on the role of big data in financial services.

Libra is “clearly” a security under existing law, lawmaker claims

In the new bill called the “Managed Stablecoins are Securities Act of 2019,” Garcia reportedly argued that Libra and other managed stablecoins “are clearly securities under existing law.” She stated:

“This legislation simply clarifies the statute to remove any ambiguity. Bringing clarity to the regulatory structure of these digital assets protects consumers and ensures proper government oversight going forward.“ 

The new bill is necessary to protect U.S. consumers, Gooden says

Rep. Gooden, the second sponsor of the bill, stressed that it is Congress’s responsibility to clarify the regulatory framework that will apply to stablecoins — digital currencies pegged to another asset such as the U.S. dollar. Gooden elaborated that the bill is necessary to help consumers understand the financial assets they are buying, stating:

“In what are called ‘managed stablecoins’, we have trusted brands marketing digital assets to consumers as secure and stable […] Everyday investors need to know they can trust the issuers behind their financial assets. This bill would bring them the security they deserve by applying the laws we use to regulate financial securities to this new breed of digital currencies.”

Facebook Calibra exec previously said that Libra is a commodity

Meanwhile, Libra backers deny that the stablecoin is a security. In a hearing with the House Financial Services Committee in July 2019, the head of Facebook’s native crypto wallet service Calibra stated that he does not consider Libra a security or exchange-traded fund, stating that it could be possibly treated as a commodity.

Facebook is not the only company that has been battling with regulators over the status of its digital currency initiative. The SEC recently declared that Telegram’s $1.7 billion Gram token sale in 2018 was illegal, arguing that those tokens are securities. Following the SEC’s action, Telegram responded, counterclaiming that Gram is not a security. The counterclaim was subsequently challenged by the regulator.


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American lawmakers have introduced a bill to put Facebook’s Libra under the jurisdiction of the Securities and Exchange Commission

As Regulators Stonewall Libra, Facebook Rolls Out New Payment System

As Regulators Stonewall Libra, Facebook Rolls Out New Payment System

Seemingly sidelining Libra for the time being, Facebook launches new fiat payment system

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As the Libra stablecoin project continues to face a hostile audience of regulators, Facebook launches a new fiat payment system called Facebook Pay.

Empower people everywhere to buy and sell things online

On Nov. 12, the social media giant announced that it is introducing Facebook Pay, a payment system that is designed to facilitate payments across Facebook, Messenger, Instagram, and WhatsApp. Deborah Liu, VP, marketplace & commerce at Facebook said:

“People already use payments across our apps to shop, donate to causes and send money to each other. Facebook Pay will make these transactions easier while continuing to ensure your payment information is secure and protected.”

In an apparent bid to avoid further regulatory scrutiny, the company clearly states that Facebook Pay is “built on existing financial infrastructure and partnerships.” The firm is similarly clear that the payment service will be kept separate from Facebook’s new Calibra wallet and the Libra network.

Facebook Pay will start rolling out this week on Messenger and Facebook in the United States for “fundraisers, in-game purchases, event tickets, person-to-person payments on Messenger and purchases from select Pages and businesses on Facebook Marketplace.”

Facebook concludes the announcement with the belief that the firm can “help businesses grow and empower people everywhere to buy and sell things online.”

Every major U.S. payment processor has left the Libra Association

At the beginning of October, the Libra Association lost seven partners out of the original 28. Namely PayPal, Visa, Mastercard, Stripe, eBay, Mercado Pago and Booking decided to leave the consortium.

However, not long after, Alfred F. Kelly, CEO of major payment processor Visa, said that the company is still in discussions with Facebook on the Libra project, adding that it believes that digital currencies provide safer payments to more people and places.


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Seemingly sidelining Libra for the time being, Facebook launches new fiat payment system

Former PBoC Governor: Libra Would Be Trusted If Run by IMF

Former PBoC Governor: Libra Would Be Trusted If Run by IMF

Zhou Xiaochuan — the People’s Bank of China’s longest-serving governor — has proposed Libra would be more easily trusted if it were in the hands of the IMF

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The former head of People’s Bank of China (PBoC), Zhou Xiaochuan has argued that the Libra stablecoin would be more readily trusted if it were in the hands of an organization like the International Monetary Fund (IMF).

Zhou is the longest-serving governor of China’s central bank to date, having held the role between 2002 and 2018. During his tenure, China soared to become one of the world’s leading economies.

Zhou made his comments during a speech delivered in Beijing as part of the 10th Caixin Summit on Nov. 8, according to a tweet from Dovey Wan, founding partner of blockchain investment firm Primitive Ventures.

Private-sector interests

A rough translation of Zhou Xiaochuan’s remarks reveals that his take on Libra is guided by concerns surrounding the implications of the asset being governed by a consortium of private-sector firms.

The former governor stressed that the general public will inevitably question the motivations of the Libra Association and argued that more trust would be afforded to the initiative if it was in the hands of an international organization such as the IMF. 

The Libra Association will undoubtedly make a profit from the project, he noted, and could then use the money for other things — such as potentially channeling it into the provision of other financial services.

Notwithstanding these arguments, he suggested that broadly speaking, an initiative such as Libra was a positive development.

China expected to be the first country to launch a CBDC

As reported, the People’s Bank of China — an institution is expected to become the first in the world to launch a central bank digital currency (CBDC). 

The project — which has been framed by some as having been accelerated by the direct competition posed by Libra — has generated considerable interest in the cryptocurrency industry. 

PBoC Deputy Director Mu Changchun revealed this August that the CBDC will be structured as a centralized, two-tier system, with the PBoC at the top tier and the second tier managed by domestic commercial banks.

Recently, Ethereum (ETH)’s co-founder and ConsenSys CEO Joe Lubin expressed his belief that the People’s Bank of China is unlikely to implement the decentralized design of blockchain for its forthcoming CBDC. 

Lubin argued that the asset is likely to be used to maintain Chinese authorities’ existing oversight of capital flows and that, if anything, the PBoC will make use of “some of the cryptographic primitives of blockchain.”


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Zhou Xiaochuan — the People’s Bank of China’s longest-serving governor — has proposed Libra would be more easily trusted if it were in the hands of the IMF

Facebook’s Calibra Exec: Libra Is More Like Email Than PayPal

Facebook’s Calibra Exec: Libra Is More Like Email Than PayPal

Libra is an interoperable protocol like email, not a payment service like PayPal, Calibra’s VP of product says

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Facebook’s crypto project Libra will be more similar to email tech than payment services such as PayPal, vice president of product at Calibra said.

Speaking at the Web Summit in Lisbon on Nov. 5, Kevin Weil, vice president of product at Facebook’s Calibra digital wallet unit, emphasized that interoperability — the basic principle of email — will the key concept of Libra.

“A journey of years and decades”

Noting that any global developer or entrepreneur can build wallets for Libra, Weil encouraged the global community to collaborate on the interoperable protocols. He said:

“You and me don’t have to collaborate on which email provider we are going to use before we send each other an email. We don’t have to choose which browser we are going to use tailored to which individual website you’re going to go to. These things are protocols, and as long as you build to the protocol everything’s interoperable. Libra is the same way.”

Considering the approximate timing for the Libra’s launch, Weil said that “this will be a journey of years and decades.” As reported by CNBC, Weil expressed confidence that the social media giant’s cryptocurrency will not go viral like a social network. Weil also stressed that users’ financial data on Calibra will stay separate from their social data on Facebook.

Non-members could still use Libra platform

Weil’s statement follows a recent claim of Calibra CEO David Marcus that companies outside the formal Libra Association are able to offer services on the platform. 

In an interview in mid-October, Marcus said that former association members such as Visa and Mastercard will still be able to issue cards for Libra.

Best Time to Launch Libra Was Three Years Ago

At the same event, Weil also suggested that the best time to launch Libra was three years ago, before the major crypto bull run of 2017. The Calibra exec reportedly added that now is the second-best time to do so. Weil also reportedly revealed that he was not an early believer of the major cryptocurrency Bitcoin (BTC) but became a fan in 2015 and 2016.


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Libra is an interoperable protocol like email, not a payment service like PayPal, Calibra’s VP of product says

Five European Union Countries Team Up to Block Libra: Report

Five European Union Countries Team Up to Block Libra: Report

France, Germany, Italy, Spain and the Netherlands have teamed up to encourage the European Union to ban Libra altogether, a new report says

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Five European Union member countries have reportedly teamed up to prevent the issuance of Facebook’s stablecoin Libra.

Private meetings to turn EU against Libra

Following a series of private meetings in October, France is reportedly leading the anti-Libra effort with Germany, Italy, Spain and the Netherlands, political news publication Politico Europe reports on Oct. 30.

Citing sources familiar with the matter, Politico states that the countries’ deputy finance ministers have presented their unified position against Libra to other EU ministers at a private meeting on Oct. 28 in Brussels.

According to the report, the group intends to prevent Libra from launching in Europe as well as increase pressure on Facebook and other members of the Libra Foundation to give up on the project. Eurozone diplomats and European Commission (EC) officials reportedly confirmed to Politico that the coalition is encouraging EU governments to consider banning Libra altogether.

The European Commission cannot ban Libra without a legal reason

However, a complete ban of Libra could be problematic for the Commission, the officials reportedly said. According to Politico, such an action would require Brussels to provide a legal reason to ban the initiative as well as more details on what rules should be applied. 

Moreover, EC officials have also called for more caution against rigorous measures in relation to Libra, raising concerns about its negative impact on the development of new technology-driven products and services in the European Union.

Per Politico, the officials are working on a statement that will come out in December, in which they claim that Libra should not be allowed to launch unless the EU can regulate it. France, Germany and Italy had already suggested the idea of banning Libra back at the G7 meeting in mid-October after finance ministers discussed the risks associated with stablecoins, the report notes.

On Oct. 22, ING CEO Ralph Hamers argued that banks could stop providing services to Facebook if the firm launches Libra. Previously, the United Kingdom’s central bank revealed a set of rules that Libra must comply with in order to be issued in the country.


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France, Germany, Italy, Spain and the Netherlands have teamed up to encourage the European Union to ban Libra altogether, a new report says