Crypto Digest on 5.06.23

Overview of current news in the crypto space

In our digest, we reviewed some important news from the crypto-industry over the last week. 

• U.S. law recognizing cryptocurrencies as commodities received support

Representatives of the U.S. Republican Party have drafted a bill that delineates different types of cryptocurrencies and clearly defines which agencies should regulate different types of assets. The bill gives regulatory authority to the Securities and Exchange Commission, which will register bitcoin exchanges and will be able to classify digital currencies, as well as monitor the circulation of stabelcoins in the U.S. market. The SEC and CFTC would divide digital assets into securities and commodities and regulate them according to their authority. However, this did not please the crypto business and the expert community, who often criticize Congress for its slowness in legalizing the blockchain industry. In addition, Circle CEO Jeremy Alleir said that if U.S. authorities delay or choose to implement repressive mechanisms against market participants, companies will leave for other countries. Therefore, the new bill raises doubts about how it will be implemented in reality and what will be its consequences for the cryptocurrency market in the U.S.

1. Rosbank introduced cryptocurrency payments in cross-border transactions

Rosbank has made it possible for its customers to make cross-border cryptocurrency payments through its B-crypto fintech service. The bank claims that cryptocurrency transactions are safe thanks to an effective risk management strategy. This news was the first of major Russian banks to provide such a service. Although Russia has not yet adopted legislation on the use of cryptocurrencies in cross-border payments, many experts are positive about such activities. Companies that work with foreign partners under sanctions or high fiat volatility may benefit from the use of cryptocurrencies in transactions. However, experts also warn that such transactions may carry risks of legal consequences in unfriendly countries that may recognize them for circumventing sanctions.

• Russian authorities abandoned the idea of creating a national crypto-exchange

The Russian authorities abandoned the idea of creating a national crypto-exchange and plan to establish rules for existing financial structures related to cryptocurrency. Crypto-exchanges will help businesses to make cross-border settlements, their work may be perceived in the context of possible circumvention of Western sanctions, so restrictions may be imposed against them. Market participants believe that the new mechanism will help reduce sanctions risks and the likelihood of cyberattacks, as well as support competition. Probably, the Central Bank will act as the regulator of crypto-exchanges, and the corresponding rules will be spelled out in the bill on experimental-legal regimes in relation to it. The Ministry of Finance also did not support the concept of establishing a national crypto exchange and considered the idea of legislative regulation of the possibility of creating independent similar platforms by businesses. Earlier, the Central Bank also advocated a comprehensive regulation of digital currencies and international settlements and exchange transactions with cryptocurrency in the experimental-legal regime, and bring mining into the legal field.

• Tether’s capitalization set an all-time record at $83.2 billion

The capitalization of Tether, an issuer of stabelcoin USDT, reached an all-time high of $83.2 billion, according to the company’s report dated June 1. The company believes that the success is due to the fact that people want access to financial freedom. Stablecoin USDT is backed by real assets, such as fiat currency and bonds, and is always held at a stable 1:1 level against the U.S. dollar. In addition, Tether’s (USDT) leading stabelcoin has recovered its capitalization to the highs it reached at the beginning of last May at $83.2 billion. USDT’s capitalization recovery is evidence of the token’s dominant role in the cryptocurrency market as a means of transaction and storage. Since the beginning of 2023, Tether has issued $15 billion worth of USDT, which coincided with a 15% increase in the asset’s market share. According to Blockworks Research, USDT’s share of the staplecoin market is 63%, the highest in two years.

• Bali authorities will fight the use of cryptocurrency by tourists

Authorities in Bali (Indonesia) have decided to combat the use of cryptocurrencies in the tourism sector. According to Antara portal, the government will crack down on payments with digital assets in hotels, restaurants, shopping malls and other places. The use of cryptocurrencies for payments has been banned in Indonesia since 2021.

Violators can be subject to various sanctions, including deportation, administrative penalties, criminal prosecution and business closure. Bali authorities reminded that the use of currencies other than the rupiah as a means of payment is regulated by a law from 2011. People who carry out foreign currency transactions without the permission of the Bank of Indonesia can be punished with one to five years in prison, as well as fines ranging from 50 million rupiah ($3300) to 22 billion rupiah ($1.4 million).

According to Bali Governor Wayan Koster, foreign tourists who use cryptocurrency as a means of payment will be severely punished. He also noted that tourists who violate visa restrictions and other provisions will also be punished.

Recall that cryptocurrency trading is allowed in Indonesia, but its use as a means of payment has been banned since 2021. In January, the country’s government announced plans to launch a national cryptocurrency exchange by the end of 2023.

• Bitcoin ATM installation rate resumes growth

The number of bitcoin ATMs around the world continues to increase, reaching 35,065 units, a 5% increase from the beginning of April. The U.S. remains in the lead, with 30,014 bitcoin-ATMs installed (84.7%). Canada is in second place with 2,740 units or 7.6% of the total. In third place is Australia – 463 (1.3%).

According to Coin ATM Radar service, in terms of manufacturers, General Bytes is leading with 10,109 cryptocurrencies (28.8%). Next comes BitAccess (6,913, 19.7%) and Genesis Coin (6,596, 18.8%).

Also worth noting are the leading bitcoin-ATM operators. Bitcoin Depot operates 6,362 devices or 18.2% market share. In second place is Coin Cloud (4,265, 12.2%), and in third place is CoinFlip (4,043, 11.5%).

Recall that in January 2022 the pace of device installation began to slow, and in February 2023 bitcoin-ATM operator Coin Cloud filed for bankruptcy.

Crypto-industry news on Bit.team – always up to date.