Mining

Iran to Pilot ‘National Cryptocurrency,’ Amend Central Bank Law

19/10/2021 by Idelto Editor

The central bank of Iran is gearing up to begin the pilot phase of its digital currency project in the near future, its new head announced to representatives of local media. The monetary authority is also preparing to move forward with a plan to reform the legislation that governs its own activities.

Iran Preps Pilot for Sovereign Digital Currency

The “national cryptocurrency” of Iran will enter its pilot stage soon, the recently appointed Governor of the Central Bank of Iran (CBI) Ali Salehabadi has unveiled. Speaking to reporters after his first meeting with lawmakers, the high-ranking official said the regulator is now studying potential risks and benefits associated with the initiative. Quoted by IRIB News and the Financial Tribune, he explained:

The pilot trial will start, once the Money and Credit Council approves it.

Salehabadi, who has been heading the CBI since Oct. 6, did not provide any further details regarding the Iranian central bank digital currency (CBDC). According to the English-language business daily, the new phase of the project is likely to be in line with earlier plans for the development of a national crypto.

The report notes that three years ago the Informatics Services Corporation, CBI’s subsidiary operating the country’s banking automation and payment services network, was tasked to develop a sovereign digital currency. A CBDC prototype was designed using the Hyperledger Fabric platform, later statements by its representatives revealed.

It became clear that the digital version of the Islamic Republic’s national fiat, the rial, was being developed on a private blockchain. Unlike cryptocurrencies based on public blockchains such as Bitcoin, the Iranian state-issued coin is not going to be mined.

The public was never updated on the progress of this initial project until more recent announcements came out that a “crypto rial” plan is underway. Officials have emphasized that the Iranian crypto is going to be a digital currency circulated by the CBI and not a decentralized cryptocurrency that could be used for small, cashless transactions, the publication details.

New Commission to Prepare Amendments to Iran’s Central Bank Law

Besides the digital currency announcement, Iranian media has also learned that the central bank’s new management and members of the Majlis agreed to establish a joint commission tasked to reform the legislation concerning the CBI. Its members will be expected to quickly finalize a long-awaited plan to update the law that governs the central bank’s activities.

Governor Salehabadi also said that a special working group will be formed to clarify the positions of the bank and the government regarding cryptocurrencies. While, executive authorities in Tehran have been going after crypto investing and trading, only allowing banks and licensed moneychangers to use coins minted in Iran to pay for imports, lawmakers have opposed the restrictive policies. They believe that friendlier regulations would help Iran to circumvent U.S.-led sanctions and boost its economy.

Mining has been the one crypto-related sector that has received more clarity in terms of regulation. Iran recognized the extraction of digital currencies as a legal industrial activity in 2019 and introduced a licensing regime for entities involved in the business. And although mining farms have been blamed for electricity shortages during the extremely hot summer this year, restrictions have since been lifted for authorized crypto miners which number over 50, according to the state-run power utility Tavanir.

Do you think Iran will eventually issue its own digital currency? Share your expectations in the comments section below.

Local Businesses in New York Urge Governor to Impose Statewide Bitcoin Mining Moratorium

18/10/2021 by Idelto Editor

The governor of New York state, Kathy Hochul, has been urged by a group of local companies to deny business permits to bitcoin miners. The letter specifically asks for the “denial of permits for the Greenidge Generating Station and the Fortistar North Tonawanda Facility.” The letter also calls for the New York government to assess “proof-of-work” (PoW) digital currency mining in the state as the local businesses believe PoW mining “drastically undermines New York’s climate goals.”

Local Businesses From New York Urge Governor Kathy Hochul to Impose a Statewide Bitcoin Mining Moratorium

Climate change is a big deal to a number of local businesses in the state of New York as a large coalition of companies has urged governor Kathy Hochul to deny bitcoin mining permits. The coalition’s letter is backed by businesses and organizations such as Seatuck Environmental Association, Ravines Wine Cellars, Peconic Baykeeper, Nassau Hiking & Outdoor Club, NYPAN Environmental Committee, Mothers Out Front New York, and New Yorkers for Clean Power.

“We, the undersigned organizations, businesses, and labor groups, write today to urge your administration to issue a statewide moratorium on proof-of-work (PoW) cryptocurrency mining until a thorough statewide Generic Environmental Impact Statement (GEIS) is conducted, and to deny the permits for the Greenidge Generating Station and the Fortistar North Tonawanda Facility,” the letter states. The letter, published to earthjustice.org on October 13, adds:

“These ‘mining’ activities, particularly proof-of-work cryptocurrency mining use enormous amounts of energy to power the computers needed to conduct business – should this activity expand in New York, it could drastically undermine New York’s climate goals established under the Climate Leadership and Community Protection Act.”

New York’s Bumpy Relationship With Bitcoin Mining

The state of New York (NY) is no stranger to such controversies over bitcoin mining as debate over the subject has raged on for a few years now. In 2018, a number of counties in NY, like the Plattsburgh Common Council, passed new guidelines for miners that aimed to control noise and fire safety regulations. Despite the stricter rules in specific areas, bitcoin miners have been flocking to NY over the last two years. Meanwhile, as miners entered the New York market, operations started getting complaints from local neighbors and NY politicians.

In December 2020, an environmental organization called Sierra Club, a committee aimed at preserving the Finger Lakes region, filed a lawsuit against the NY town of Torrey for allowing the Greenidge Generation power plant to expand its mining operations. Sierra Club asked the town of Torrey and the Torrey Planning Board to block the construction with an injunction. Senator Kevin Parker (D) believes bitcoin miners should halt operations over climate change concerns as well.

In May 2021, senator Parker introduced legislation to address these concerns as he explained that bitcoin mining “threatens not only New York’s climate goals, under the CLCPA, but also global energy policy, such as the Paris Agreement.”

Parker’s bill aimed to impose a moratorium on the operation of cryptocurrency mining centers until the NY government could complete an assessment of the environmental impact. If the moratorium was imposed, bitcoin mining operations that could prove the business does not “adversely affect the state greenhouse gas emission targets in the climate leadership and community protection act of 2019,” could operate legally under NY law.

Letter Stresses ‘Climate Crisis in New York Is Here Now’

The recent letter to NY governor Kathy Hochul says that bitcoin mining facilities are threatening the state’s advances toward addressing climate change.

“In New York, data mining operations using warehouses full of computers have set up shop in upstate areas siphoning electricity from New York’s grid, ‘re-powering’ defunct fossil-fueled power plants, thus seriously jeopardizing the state’s progress on and meeting mandates for reducing greenhouse gas (GHG) emissions,” the letter emphasizes.

The letter stresses that the group of local businesses want governor Hochul to act now. The letter concludes:

“As you have witnessed in your early weeks on the job, the climate crisis in New York is here now. New York City recently saw unprecedented flooding that led to the loss of lives – strong climate action is needed now more than ever. We urge you to lead the way and set a national precedent on the issue of proof-of-work cryptocurrency by issuing a statewide moratorium and denying the permits for Greenidge and Fortistar. Thank you for your time and consideration of our comments.”

What do you think about the letter to NY governor Kathy Hochul that wants a statewide moratorium placed on bitcoin mining operations in New York? Let us know what you think about this subject in the comments section below.

Jack Dorsey Says Square Is Considering Building a ‘Bitcoin Mining System Based on Custom Silicon’

16/10/2021 by Idelto Editor

Following the latest report from Cambridge University that shows a large percentage of the Bitcoin network’s hashrate resides in the United States, the CEO of Twitter and Square, Jack Dorsey, has announced that Square is considering building a “bitcoin mining system based on custom silicon.”

Square Considers Building a Mining System

On the same day the CFTC fined Tether Limited and Bitfinex, and the filings that give the impression that the U.S. Securities and Exchange Commission (SEC) approved the Proshares Trust bitcoin futures ETF, Twitter CEO Jack Dorsey said Square is possibly jumping into the bitcoin mining industry. Dorsey has been a bitcoin proponent for years and he recently explained that Square is in the midst of building a bitcoin hardware wallet in order to “make bitcoin custody more mainstream.”

In recent times Dorsey has also said that bitcoin will be a big part of Twitter’s future. He shared a URL link to a book called “Anatomy of the State” by the economist Murray Rothbard, and Twitter just recently launched a bitcoin tipping feature. Now Dorsey and Square are considering joining the bitcoin mining industry and aim to approach the ecosystem in a different fashion.

“Square is considering building a bitcoin mining system based on custom silicon and open source for individuals and businesses worldwide,” Dorsey said on Friday. “If we do this, we’d follow our hardware wallet model: build in the open in collaboration with the community.”

Dorsey believes mining needs to be “more distributed” and the “more decentralized this is, the more resilient the Bitcoin network becomes.” At the same time, the Square founder said the mining industry needs to progress toward “clean and efficient energy use” and to Dorsey, this requires “innovation in silicon, software, and integration.”

Dorsey Discusses Silicon Design and Says Jesse Dorogusker Plans to Research What’s ‘Required to Take on This Project’

“Silicon design is too concentrated into a few companies,” Dorsey further remarked. “This means supply is likely overly constrained. Silicon development is very expensive, requires long-term investment, and is best coupled tightly with software and system design,” he added. Dorsey also said:

There isn’t enough focus on vertical integration. Considering hardware, software, productization, and distribution requires accountability for delivering to an end customer vs improving a single technology in the chain.

He added that he believes mining is not accessible to everyone, and everyone should be able to plug in a rig and mine. But there’s a lot of complexity and barriers to entry, Dorsey highlighted, and he asked his Twitter followers: “What are the biggest barriers for people running miners?” Toward the end of his thread, he said that Jesse Dorogusker “will start the deep technical investigation required to take on this project.”

What do you think about Twitter CEO Jack Dorsey saying Square is considering joining the bitcoin mining industry? Let us know what you think about this subject in the comments section below.

Bitcoin Mining Operation Being Sued for Producing High Noise Levels in Tennessee

16/10/2021 by Idelto Editor

A bitcoin mining operation in Tennessee is being sued by neighbors due to the high level of noise the facility produces. The lawsuit, which was filed in August, asks mining operator Red Dog to shut down operations and pay personal damages fees, as well as compensate owners for decreased property values. The lawsuit could set a precedent for other cases now that Bitcoin mining companies are seeking to migrate to new zones previously ignored.

Bitcoin Mining Operation Faces Noise Complaint

Red Dog Technologies, the owner of a Bitcoin mining operation located in the U.S. state of Tennessee, is being sued by a member of a neighboring community due to the amount of noise the operation produces. According to reports from local media, the complaint states that the noise coming from the mine creates a situation that “unreasonably interferes” with the “use and enjoyment” of the plaintiff’s property.

Worries about the mine disturbing citizens and the legality of the operation have already been raised to Washington County Mayor Joe Grandy, who was informed about the issue in June. Apparently, the mine didn’t comply with the zoning requirements to perform cryptocurrency mining operations in the area. Red Dog reportedly tried to dampen the noise last summer, but commissioners weren’t satisfied.

An Important Lawsuit

While some might see this lawsuit as just another common complaint, it has special importance that could set a precedent for similar cases now that mining companies are setting up in regions that were ignored previously. At the core of the complaint is a rezoning proposal that Brightridge, the power company that leases the property to Red Dog, the mine operator, requested from the county to be able to operate the facility (that is described as a blockchain data center) in the zone.

The complaint states that the rezoning request, proposing to change the zone type from General Agriculture to Agriculture Business, is not accurate enough to be considered valid. The request states that “while there are small fans on the data centers that generate noise, the petitioner has advised that the noise is considered small and will not impact or be heard from adjoining properties.”

The current case could result in the closure of the bitcoin mining facility, now that the planning commission of the county has voted unanimously to shut down the mine and pursue legal action against the operator if the company fails to comply.

What do you think about this lawsuit? Let us know in the comments section below.

Putin: Still Early but Crypto Can Be Used for Oil Trade Settlements, Store of Value

15/10/2021 by Idelto Editor

Accusing the U.S. of undermining the dollar through money printing and sanctions policy, President Vladimir Putin has admitted that cryptocurrency can be utilized for settlements in the future, although it’s too early to do that in oil trade. While noting that it lacks backing, the Russian leader assumed crypto could be used to store value one day, too.

U.S. Cutting the Branch It’s Sitting on, Putin Says

U.S. dollar-denominated settlements are declining and countries are scaling down their dollar reserves, Russian President Vladimir Putin said in an interview with CNBC this week. Speaking after his participation in the 20th annual Russian Energy Forum in Moscow on Wednesday, Putin criticized Washington’s monetary and international policies stating that “the United States is cutting the branch it is sitting on.”

The dollar’s status as an international reserve currency is a major competitive advantage, the Russian head of state noted but warned that U.S. authorities are undermining it through increasing sovereign debt and boosting inflation at home, while “making a big mistake” by using the dollar as a sanctions tool abroad. All this is leading to Russia and other countries moving away from the U.S. currency. Putin explained:

Our clients simply cannot pay us in dollars for the products we deliver to them. What happens next? We have no choice other than to switch to other currencies in our settlements.

Cryptocurrency Is Legitimate, Has Right to Exist

Asked by CNBC’s Hadley Gamble whether oil contracts can be denominated in a currency other than the U.S. dollar, including crypto, Vladimir Putin commented that “this seems premature.” At the same time, the president of the Russian Federation acknowledged that despite currently being unstable, cryptocurrency can be used in oil trade settlements at some point in the future.

“It is fine for transferring funds from one place to another, but I think it would be premature to use it in trading, especially when dealing with energy resources,” the Russian strongman said, remarking that cryptocurrency has lacked any backing. Nevertheless, he also stressed:

It is legitimate and can be used in settlements, no doubt about that, but it is too early to use it for trading in oil or other raw materials and energy sources.

Things can change, however, and Putin is convinced that “everything has the right to exist. We will see how this will go from here. Maybe crypto will one day be used to store value. But we see how the market fluctuates, so it seems too early for that now… Of course, there is value there,” the president pondered.

Vladimir Putin also mentioned the energy-intensive process of cryptocurrency extraction. “In order to mine crypto, you need a lot of energy, and for that people have to use traditional sources of energy, primarily hydrocarbons,” the Russian president pointed out in the interview, which was published by the Kremlin.

Putin’s latest comments come after a statement by his press secretary Dmitry Peskov in early September that Russia is still not ready to recognize bitcoin. He expressed the current position of the executive power in Moscow following El Salvador’s move to adopt the leading coin by market cap, BTC, as legal tender alongside the U.S. dollar.

Although Russian officials have stated on many occasions that cryptocurrency will not be accepted as a means of payment — as it is viewed as a prohibited money surrogate — the country has been advancing towards regulating its crypto space. This includes the adoption of relevant legislation such as the law “On Digital Financial Assets.” Deputy Minister of Finance Alexey Moiseev recently said that Russia is not planning to follow in the footsteps of China and ban its citizens from buying cryptocurrency.

Do you think Russia will start using cryptocurrency in the future to settle payments in oil trade? Let us know in the comments section below.