Crypto News Headlines (20-Oct-2022)

Electric car maker Tesla (TSLA) did not sell any of its bitcoin holdings nor purchase any additional bitcoin in the third quarter, the company reported Wednesday in its latest earnings report.

The value of its digital assets remained at $218 million, the same as they were at the end of the second quarter, when Tesla surprised some investors by selling $936 million worth of bitcoin, or approximately 75% of its total holdings, in order to raise cash.

Tesla reported no impairment charges to the value of its bitcoin holdings, as the price of the cryptocurrency remained almost the same at the end of both the second and third quarters at slightly under $20,000.

According to a recently published South African government gazette, crypto assets have been declared as financial products under the country’s Financial Advisory and Intermediary Services (FAIS) Act. Signed by the Financial Sector Conduct Authority (FSCA) commissioner, Unathi Kamlana, the declaration became effective on October 19.

The designation, which has been welcomed by some players in South Africa’s crypto industry, applies to any “digital representation of value which is not issued by a central bank but is capable of being traded, transferred or stored electronically by natural and legal persons for the purpose of payment, investment or other forms of utility.”

The United States today announced the takedown of a Russian-Venezuelan network that used Tether (USDT) to trade outside the traditional banking structure, thus evading international sanctions.

One of the most discussed geopolitical scenarios for cryptocurrencies is their ability to evade conventional financial restrictions imposed by world powers against their adversaries—but this workaround is becoming increasingly difficult to execute.

A few hours ago, the U.S. Department of Justice announced that it was pressing charges against five Russian and two Venezuelan nationals accused of maintaining a global network of money laundering, smuggling, and trading with sanctioned companies, particularly the Venezuelan state-owned Petróleos de Venezuela, S.A. (PDVSA).

Months after announcing it had raised $11.15 million, crypto asset manager Valkyrie Investments earlier this month revealed – quietly – that the biggest participant in the funding round reneged, leaving Valkyrie scrambling to find others to fill the gap.

In a letter that went largely unnoticed until now, Valkyrie CEO Leah Wald wrote that an entity she called CSA Evolution VC Fund was no longer able to contribute $5 million toward the transaction.

“We had a signed subscription doc in-hand, and their [limited partners] were blue chip firms that have impeccable reputations in the business,” she wrote in the letter dated Oct. 7. “In the months that have since passed, though, those LPs backed out and the investor was unable to meet its obligation.” She went on to say that Valkyrie was looking for other investors to step in.

The $9 billion-valuated German fintech N26 launched crypto trading on its mobile app. Starting from Austria and rolling out to other countries in the upcoming months, N26 Crypto will let its customers buy and sell 200 cryptocurrencies, including Bitcoin (BTC tickers down $19,216) and Ether (ETH tickers down $1,301).

The Berlin-based fintech announced on Oct. 20 that the launch in Austria addresses “strong local demand,” with 40% of N26 users either actively trading or have expressed interest in investing in cryptocurrencies. N26 plans to roll out its crypto trading service to other key markets in the next 6 months.

N26 customers with a verified identity can access N26 Crypto from the “Trading” section within their N26 app’s new “Finances” tab. Thus they can buy crypto from their fiat bank account. The transaction fee is set at 1.5% for BTC and 2.5% for other currencies for the usual accounts with some extra discounts for N26 metallic card holders.

Two men from Massachusetts, have been sentenced to serve time in prison for an “extensive scheme to take over victims’ social media accounts and steal their cryptocurrency using techniques such as SIM swapping,” according to a press release by the Justice Department.

Eric Meiggs, 24, has been sentenced to two years and one day in prison and Declan Harrington, 22, has been sentenced to two years and seven days in prison.

The FBI had arrested Meiggs and Harrington in 2019. Meiggs plead guilty to each of the seven counts charging him with conspiracy, wire fraud, computer fraud and abuse as well as aggravated identity theft in 2021.

The initial allegation was that the duo tried to steal more than $550,000 in cryptocurrency. The latest announcement says the duo targeted “at least 10 identified victims” stealing “approximately $330,000 in cryptocurrency.”

Walmart Global Chief Technology Officer and Chief Development Officer Suresh Kumar discussed cryptocurrency at Yahoo Finance’s All Markets Summit Tuesday.

Replying to a question about the role of crypto in Walmart’s future, Kumar said: “I think that there are three major areas of disruption. Crypto falls in sort of the middle of it. I have talked before about the way in which customers are getting inspired and discovering products. That is changing.”

He continued: “Part of that is going to happen in the metaverse. Part of that is going to happen on live streams, inside your social media app. So whether it is physical goods or virtual goods, they [crypto] play a part in terms of what the customer wants.

FTX boss Sam-Bankman Fried thoroughly broke down his ideal regulatory framework for the crypto industry on Wednesday.

The billionaire said he is a proponent of regulation using blacklists or blocklists, a model where individuals may freely trade unless explicitly sanctioned. This is in contrast with whitelists or allowlists where individuals are banned from trade by default unless explicitly granted permission.

“We need fast, reliable lists of addresses associated with illicit finance,” said the CEO. “But peer-to-peer transfers should generally be free as long as they’re not going to sanctioned actors.”

Contributors reduced the tax rate from 1.2% to 0.2% since the earlier rate was thought to cause a decline in network activity.

The new rates went into effect today at 12:50 p.m. UTC after the community’s approval of governance Proposal 5234, which reduced the number of tokens burnt with each transaction.

Last month, the Terra Classic governance council voted to levy a 1.2% tax on each LUNC transaction and trash the proceeds in a bid to reduce LUNC supply, believing that fewer tokens in circulation would enhance value.

While the 1.2% burn fee was intended to strengthen LUNC’s tokenomics, it actually discouraged usage and reduced on-chain activity. According to estimations from key contributors, the tax reduced LUNC’s on-chain transaction volume by 91.67%.

At the time of writing, LUNC is trading at $0.00025.

Bloomberg Intelligence senior commodity strategist Mike McGlone says Bitcoin’s (BTC tickers down $19,201) relative discount to its high hash rate in October — the largest since the first quarter of 2020 — could soon see Bitcoin return to “its propensity to outperform most assets.”

In an Oct. 19 Twitter post, the Bloomberg analyst suggested that Bitcoin’s ever-increasing hash rate — a measure of the processing power and security of a blockchain — relative to its price points “to risk/reward leaning favorably.”

Many believe that in theory, Bitcoin’s hash rate should go up relative to its price.

McGlone pointed to a graph noting that the 10-day average of Bitcoin’s hash rate in October is “roughly equivalent” to the level it should be at around $70,000. However, the price is instead currently at $19,500 as of Oct. 18.