Crypto News Headlines (14-Sep-2022)

PARIS – Changpeng “CZ” Zhao, founder and CEO of crypto exchange Binance, says the European Union’s landmark Market in Crypto Assets (MiCA) regulation is “a little bit strict” on stablecoins, which are cryptocurrencies pegged to the value of other assets like gold or the U.S. dollar.

“The drafts are not adopting USD-based stablecoins, which have 75% of the liquidity in the market,” Zhao said at Binance Blockchain Week in Paris on Wednesday.

In June, EU lawmakers agreed to the main political points of MiCA, which will allow crypto companies to operate across the bloc’s 27 member nations with a single license. Some in the industry are concerned that a legislative cap on stablecoins becoming widely used as a means of payment could constrain the market, particularly for assets not priced in euros.

Still, Zhao described MiCA as “fantastic” and said he expects it to be viewed as “the global standard” in crypto regulation for other jurisdictions to copy.

Canadian Prime Minister Justin Trudeau talked about cryptocurrency in a speech Monday before the first full caucus meeting of the three-day Cabinet retreat in Vancouver for Liberal parliament members.

After congratulating Conservative member of parliament Pierre Poilievre for winning his party’s leadership on Saturday, Trudeau criticized his new rival’s politics, calling it irresponsible. The Canadian prime minister also attacked Poilievre’s advice about cryptocurrency.

Referring to Poilievre’s suggestion to Canadians that investing in bitcoin could allow them to “opt out” of inflation, Trudeau stressed:

Telling people they can opt out of inflation by investing their savings in volatile cryptocurrencies is not responsible leadership.

“By the way, anyone who followed that advice would have seen their life savings destroyed,” the Canadian prime minister claimed.

Trudeau also criticized politicians for using “buzzwords, dog whistles, and careless attacks,” stating that they “don’t add up to a plan for Canadians.” He continued: “Attacking the institutions that make our society fair, safe, and free is not responsible leadership.”

Bitcoin (BTC), the industry’s largest cryptocurrency by market capitalization, is down by 9% on Wednesday, wiping out most of its recent gains.

Following the official announcement of the U.S. Consumer Price Index (CPI) on Tuesday, the price of Bitcoin fell to a six-day low of $20,062, before climbing to around $20,380 at time of writing, according to data from CoinMarketCap.

While analysts considered that the CPI could be 8.1% compared to August 2021, the CPI was 8.3%, 0.2% higher than expected.

Some industry leaders were hopeful the slide would be short-lived, but not all forecasts came to pass.

“Bitcoin is down on the news that inflation for August came in higher than expected (8.3% instead of 8.1%). Bitcoin should be up today. Its properties dictate that it should be inversely correlated to inflation. The fact that it is down shows just how early it is,” Tyler Winklevoss, the co-founder of crypto exchange Gemini, wrote on Tuesday.

Mikhail Mishustin, the Russian Prime Minister, has ordered the government to establish rules regarding crypto regulation by the end of this year.

The date by which the Russian government is supposed to arrive at a consensus has been set as December 19, 2022.

The Prime Minister has explicitly instructed the Duma, as well as other state authorities, that there must be coordinated policies in place regarding the issuance and circulation of cryptocurrencies or digital currencies in Russia.

Not just issuance and circulation, Mishustin has also mentioned the requirement for the regulations pertaining to crypto mining and cross-border transactions.

The draft crypto regulations have to be in sync with the Russian Finance Ministry, the central bank, anti-money laundering authority Rosfinmonitoring, the Federal Tax Service, and also the Federal Security Service.

Just a week ago, Deputy Finance Minister Alexei Moiseev stated that the Bank of Russia was on board with the ministry to allow crypto for cross-border payments.

The long-awaited Ethereum Merge is just around the corner, but not everyone is excited about the major upgrade. A group calling themselves ETHW Core has voiced its opposition to the change and is set to conduct a hard fork within 24 hours after the Merge.

Under the project name, ETHPoW and with the token ETHW, ETHW Core plans to split off from the main ETH blockchain and maintain a PoW version to keep ETH mining alive beyond the Merge.

“ETHW mainnet will happen within 24 hours after the Merge. The exact time will be announced 1 hour before launch with a countdown timer and everything including final code, binaries, config files, nodes info, RPC, explorer, etc. will be made public when the time’s up,” the group wrote in a Tuesday tweet.

The Merge will shift the Ethereum network away from its current proof-of-work (PoW) mining model to a proof-of-stake (PoS) consensus mechanism, phasing out miners and replacing them with validators.

A 39-year-old man was arrested last week in the Netherlands on suspicion of laundering funds stolen using malicious software that purported to be linked to crypto wallet service Electrum.

The unidentified man was held in Veenendaal, about 35 miles southeast of Amsterdam, and was released on Sept. 8. He remains a suspect and his crypto has been seized, Dutch cyber police said in a Tuesday statement.

“Cryptocurrency, like ordinary money, is vulnerable to all kinds of crime,” the police said. “The anonymous and cross-border nature of cryptocurrency affords opportunities for criminals.”

According to the police, the suspect had laundered tens of millions of euros (tens of millions of U.S. dollars) and had sought to cover his tracks using privacy coin monero (XMR) and decentralized exchange Bisq. He was identified through bitcoin (BTC) transactions.

The U.S. Department of Justice (DOJ) announced Monday that Nikhil Wahi, the brother of a former product manager at Coinbase Global Inc. (Nasdaq: COIN), “pled guilty to one count of conspiracy to commit wire fraud in connection with a scheme to commit insider trading in cryptocurrency assets.” The DOJ calls it the “first-ever cryptocurrency insider trading case.” Nikhil Wahi was arrested in July.

His brother, Ishan Wahi, worked at Coinbase as a product manager assigned to the cryptocurrency trading platform’s asset listing team beginning in October 2020.

The Justice Department explained that on multiple occasions between July 2021 and May 2022, Nikhil Wahi profited from using “confidential Coinbase information about which crypto assets were scheduled to be listed on Coinbase.”

Just a day after reports emerged that the South Korean authorities had started yet another investigation against Terraform Labs, Bloomberg said a local court had issued an arrest warrant against Do Kwon and five others.

The price of the two current native assets – LUNA and LUNC – dumped hard, as the former is down by over 20% on a daily scale.

Citing a note from a Seoul court, Bloomberg outlined the arrest warrant issued against Do Kwon and five other individuals due to a violation of capital market rules.

Another local report claimed that Interpol will have to intervene since Kwon is currently residing in Singapore.

It also named two of the other five Terra-related individuals – Nicholas Platias (founding member of TFL) and Han Mo – an employee.

This latest development comes just a day after South Korean prosecutors launched another investigation against Terraform Labs to determine whether its native tokens were securities.

As reported before, LUNA and UST were once among the ten largest cryptocurrencies in terms of market cap.

South Korea’s “blockchain” city of Busan continues to establish agreements with cryptocurrency industry heavyweights as Huobi Global enters the development ecosystem.

Huobi Global and its Korean branch became the latest exchange to sign a memorandum of understanding with the Busan Metropolitan City government to participate in the growth of its blockchain industry.

According to an official announcement from Huobi, the partnership will see the company provide research and development, technology and financial support for the Busan Digital Currency Exchange. Huobi is also set to assist in identifying and hiring blockchain talent for Busan’s local exchange.

Huobi has been operating a local office since 2019 and received a mandatory regulatory license from the South Korean Financial Services Commission in 2021. The company cites its operational experience within the country as an important factor in assisting Busan’s goal of becoming a global cryptocurrency and blockchain hub.

Maker, the DeFi protocol behind the DAI stablecoin, announced that it has doubled its debt ceiling on its staked Ethereum (stETH) vault.

The world’s largest decentralized-finance app, Maker is working to reduce its reliance on centralized stablecoins such as Centre’s USD Coin (USDC)—especially after the mid-August Tornado Cash scandal.

Staked Ethereum is a crypto token representing one unit of Ethereum that has been deposited or locked up in anticipation of the merge, the network’s upcoming upgrade.

Decentralized lending platforms provide direct loans to businesses and individuals without intermediaries, while also providing interest to other parties who supply capital. Staked Ethereum is a staking token issued as reward to lenders of Ethereum on staking services such as Lido Finance, Coinbase, Kraken, and Binance, among others.