Crypto News Headlines (16-Sep-2022)

Guidance issued by the U.S. Securities and Exchange Commission (SEC) on how lenders should treat customers’ digital assets is disrupting the banks’ crypto projects, Reuters reported citing people familiar with the matter.

In March, the SEC said all U.S.-listed public companies that function as crypto custodians should account for their crypto exposure as liabilities instead of assets on their balance sheets, and disclose risks associated with those assets to investors. The custody of crypto assets by lenders present unique technological, legal and regulatory risks when compared to other assets, the SEC guidance said.

The Basel Committee on Banking Supervision, the global standard-setter for banking regulation, is planning to issue international rules for banks exposed to crypto, including strict capital requirements and exposure caps. The Basel committee’s upcoming standards combined with the SEC guidance could drive U.S. banks further away from participating in digital asset markets.

Binance, the largest cryptocurrency exchange by daily trading volume, and Ukraine’s supermarket chain Varus have announced a partnership that will allow Ukrainian shoppers to purchase food and other goods online with digital coins.

Using the Binance and Varus apps, customers will be able to enjoy instant crypto payments and fast delivery in nine Ukrainian cities: the capital Kyiv, Dnipro, Kamianske, Kryvyi Rih, Zaporizhzhia, Brovary, Nikopol, Vyshhorod, and Pavlograd.

To take advantage of the payment option, crypto owners will have to download and install the Binance app on their Android or iOS devices. Then, they can go to the Varus website, select the products they want to buy and send the digital money from the Binance Pay wallet.

In a report on the announcement of the new payment method, the crypto news outlet Forklog noted that earlier this year the Binance Pay service was integrated by the Ukrainian chain of stores for home appliances and electronics, Foxtrot.

In response to the ongoing Russian invasion of Ukraine, the U.S. Treasury Department today announced the addition of 22 individuals and two entities tied to the Russian government to the Office of Foreign Assets Control (OFAC) sanctions list.

The list includes entities that OFAC says supported Russia’s invasion, including Task Force Rusich, an alleged neo-Nazi paramilitary group that the agency says participated in combat alongside Russia’s military in Ukraine.

“Today’s action is being taken in coordination with those taken by the U.S. Department of Commerce, which is imposing additional export control measures to further align with partners and allies, as well as by the U.S. Department of State, which is targeting Russia’s defense and high-technology industries,” the Treasury Department said in a press release.

Solana-based NFT marketplace Magic Eden’s proposal “AIP 93: A Marketplace for Apes, by Apes, built by Magic Eden – Brand Decision” is now open for voting from September 16-22.

The proposal aims to build the ApeCoinDAO marketplace for ApeCoin (APE) holders to buy and sell ApeCoinDAO NFTs including BAYC, MAYC, BAKC, and Otherside Otherdeeds. It will have discounted 0.75% transaction fee, with no cost to the DAO.

The community has voted “against” the proposal of Magic Eden to build an NFT marketplace for the ApeCoin community. In fact, 85% of users have voted against the proposal, receiving 99K APE. Whereas, nearly 15% have voted in favor of the proposal, receiving 17K APE. Therefore, it indicates the community is against the proposal.

Meanwhile, Snag Solutions’ “AIP-98: A Community-First ApeCoin DAO Marketplace Proposal – Brand Decision” has received major attention from the community. Also, the proposal has received 99.73% votes in favor and 0.27% votes against the proposal. The proposal is 50% less expensive than Magic Eden’s proposal.

The United States Department of the Treasury added five cryptocurrency addresses tied to a neo-Nazi group involved in Russia’s war on Ukraine to list of entities sanctioned by the Office of Foreign Asset Control.

In a Thursday notice, the U.S. Treasury designated 22 individuals and two entities, including many the government department claimed had furthered the Russian government’s objectives in Ukraine, to its list of Specially Designated Nationals, effectively barring U.S. persons and companies from dealing with them. Included in the sanctions of one of the entities — a neo-Nazi paramilitary group called Task Force Rusich — were two cryptocurrency addresses for Bitcoin (BTC), two for Ether (ETH) and one for Tether (USDT).

Treasury Secretary Janet Yellen said the sanctions were imposed as part of the government’s efforts “to hold Russia accountable for its war crimes, atrocities and aggression,” financially isolate Russian President Vladimir Putin, and prevent the country from financing its military. On Monday, Ukraine’s military took back a section of the territory east of the city of Kharkiv that had been occupied by Russian forces for months.

The Ethereum Merge, which happened on Thursday, has introduced several structural changes to the blockchain, promising to make it more environment-friendly and reduce the supply of its native token ether (ETH).

According to traders, one consequence of the upgrade is that the activity in the futures market will now be closely tied to staking yields – rewards earned by locking ETH in the network in return for a chance to verify transactions under the proof-of-stake (PoS) consensus mechanism.

The bigger the reward for staking, the greater the number of stakers and the stronger the demand for shorting or selling futures. That’s because staked ether cannot be withdrawn before the next upgrade called Shanghai fork, due in mid-2023, and will earn rewards in ETH, which makes stakers vulnerable to potential ether price slides. Therefore, they will likely hedge their ETH exposure by selling futures contracts tied to ether.

“Stakers have been and will be natural sellers in futures and perpetual futures. That’s why open interest [number of open positions] is so high and it will only grow if staking yields go higher,” Zaheer Ebtikar, portfolio manager at crypto hedge fund LedgerPrime, told CoinDesk.

Retailers selling hardware cryptocurrency wallets in Russia are now overstocked, market participants have told the leading Russian business daily Kommersant. That’s after earlier this year these products saw an explosive demand after Moscow’s decision to militarily intervene in neighboring Ukraine.

In the spring months, many Russians sought to acquire a cold storage device for their crypto assets, amid expanding sanctions over the Ukraine conflict and currency restrictions imposed by the Bank of Russia. Some Russian citizens relocating to other countries also took their savings with them in crypto.

According to stats compiled by the Moneyplace analytics service, hardware wallet sales on the Ozon and Wildberries marketplaces reached a record high of 16.5 million rubles in May (over $275,000). In August, the figure fell by half, dropping below 8 million rubles (less than $135,000).

President of El Salvador Nayib Bukele announced that he will seek re-election after his term ends in 2024, according to Reuters.

El Salvador is among the countries that prohibited presidents from serving consecutive terms, a ban that was overruled by the country’s supreme court in September 2021. “Developed countries have re-election, and thanks to the new configuration of the democratic institution of our country, now El Salvador will too,” President Bukele said in a speech on Thursday.

A keen advocate of Bitcoin, Bukele led El Salvador’s drive to accept the cryptocurrency as legal tender last year. The move sparked criticism from the likes of the International Monetary Fund, prompting El Salvador’s finance minister to declare that, “No international organization is going to make us do anything, anything at all.”

Crypto lending firm Celsius Network, which is currently in Chapter 11 bankruptcy proceedings, has asked the court for authorization to sell its stablecoin holdings in order to generate liquidity to help fund its operations, according to new court filings.

Celsius filed for bankruptcy in July, and is currently before the U.S. Bankruptcy Court for the Southern District of New York, which is also hearing Three Arrows Capital’s bankruptcy case.

If this motion is approved by presiding Judge Martin Glenn, the Chief U.S. bankruptcy judge, the proceedings of the sale would go to primarily pay for the operations of Celsius Network. While the proceeds generated by the sale of the stablecoins constitute property of the Debtors’ estate, paying them back is part of a separate and ongoing process.

“The Debtors, however, continue to own stablecoins that should be monetized to fund their operations in these Chapter 11 cases given their market stability compared to other types of cryptocurrencies,” the filing reads.

Celsius’ official committee of unsecured creditors made a deal with the U.S. Trustee’s office earlier in September to appoint an independent examiner, provided they took certain steps to limit the amount of time and funding the examiner would take. Celsius agreed to join the examiner, and the judge signed off on the deal on Wednesday.

A hearing is scheduled for Oct. 6 in New York to discuss the proposed stablecoin sale.

Meme-inspired cryptocurrency Dogecoin (DOGE) is now officially the second largest proof-of-work (PoW) crypto in terms of market cap, following the Ethereum network’s proof-of-stake (PoS) upgrade on Thursday. 

Bitcoin (BTC), of course, remains miles ahead of Dogecoin’s market cap of $7.83 billion, though the well-followed memecoin is still comfortably ahead of the third place PoW cryptocurrency Ethereum Classic (ETC) with a market cap of $4.69 billion, Litecoin (LTC) at $4.01 billion and Monero (XMR) at $2.65 billion.

One Dogecoin fan appeared to be in disbelief of Dogecoin’s rise to become the second largest PoW cryptocurrency, stating, “who would have thought that this would happen. Congrats #Dogefam.”

But, it wasn’t taken well by everyone. One Twitter user responding to a tweet about the news asked how people could take the crypto industry seriously with a memecoin so close to the top spot, emphasizing the need to remove “useless coins” from public view.