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China’s Anhui Province to Shut Down Crypto Farms as Grid Operator Issues Closure Notice, Reports

14/07/2021 by Idelto Editor

Anhui has reportedly become China’s latest region planning to end cryptocurrency mining. The province is going to shut down all mining facilities due to power supply shortages, according to local media. Another source revealed that the state-run network operator has issued a closure notice for bitcoin farms across the country.

Anhui to Halt Bitcoin Mining Amid Electricity Shortage

The Eastern province of Anhui has joined what’s become a long list of Chinese regions where cryptocurrency miners are no longer welcome. According to media reports, provincial authorities want to shut down mining facilities and also prevent new energy intensive projects in order to address the power deficit in the province.

According to a local news portal owned by the government-affiliated Hefei Media Group, which was quoted by Reuters and Bloomberg, the plan is to close down all crypto mining farms to deal with a serious supply shortage of electricity over the next three years. The report says data centers will be built in the future but in an orderly manner.

Officials expect electricity demand in Anhui to reach 73.14 million kilowatts in 2024. That compares to the current supply of 48.4 million kilowatts, highlighting a growing gap which the local government intends to mitigate. Besides banning crypto mining, the province is also preparing to adjust electricity pricing with the aim of stimulating more economic power consumption.

State Grid Corporation of China Issues Closure Notice for Crypto Mining

Global Times, an English-language newspaper under the People’s Daily, also shared the news on Twitter. The state-run publication added that “By now, nearly 90% of #China’s #Bitcoin mining capacity has been shut down.” Although Anhui is not a coin minting hotspot, its move underscores the ongoing crackdown in the country which has already affected mining hubs such as Sichuan, Xinjiang, Qinghai, Yunnan, and Inner Mongolia.

Meanwhile, Chinese crypto journalist Colin Wu, also known as ‘Wu Blockchain,’ tweeted on Wednesday that the State Grid Corporation of China (SGCC) has issued a closure notice for cryptocurrency mining operations across the People’s Republic. The measure concerns “all parts of the country” and the post detailed:

At present, some provinces with insufficient power in China, such as Henan and Anhui, have also begun to implement it.

Wu Blockchain later revealed that Gansu, a province in Northwestern China, has received the notification from the SGCC as well. The network operator “manages the vast majority of China’s electricity, but this notification appears to be formal,” the journalist explained in a comment on the latest developments in the battered crypto mining industry of China.

What do you think of this latest episode in China’s crackdown on cryptocurrency mining? Share your thoughts on the subject in the comments section below.

China Has Dispersed Over $40 Million of Digital Yuan in Red Envelopes, Report Reveals

11/07/2021 by Idelto Editor

China, which has arguably the most advanced digital currency project among leading nations, has so far handed out more than $40 million in red envelopes with digital yuan. The promotional campaign for the CBDC is currently focused on five major cities, taking into account their regional development priorities.

Beijing Gives Away 269 Million Yuan in Digital Currency

Chinese Authorities are rapidly moving forward with the pilot implementation of the digital yuan, the central bank digital currency (CBDC) issued by the People’s Bank of China. Since the announcement of the concept in 2014, the project has entered its seventh year of development, with large-scale trials across the mainland and cross-border tests with Hong Kong.

The ‘red envelope’ campaign, which was launched to put the digital yuan into the hands of Chinese consumers, has been expanding. The amount of funds distributed to Chinese citizens in digital RMB red envelopes has exceeded 269 million yuan, or around $41.5 million, according to a report by the Tuoluo Research Institute.

In Chinese tradition, the red envelopes are small packets with money usually given to children, family members, friends, or employees, and intended as a good luck wish. The red color in China is perceived as a symbol of energy and happiness.

Published by the Chinese crypto news outlet 8btc, the article reveals that the government efforts are currently focused on five major cities – Shenzhen, Suzhou, Beijing, Chengdu, and Shanghai. Authorities there have issued red envelopes with digital RMB for a total of 230 million Chinese yuan, approximately $35 million.

China Accelerates and Expands Digital Yuan Promotion

The report notes that the central government is “taking into account regional development strategies, and the frequency and scope of the promotion are accelerating outward.” For example, in Beijing, where local financial authorities recently announced a lottery to disperse 40 million worth of digital yuan ($6.3 million), the digital RMB program is mainly focused on the upcoming Winter Olympic Games.

Two pilots have progressed significantly in the Chinese capital. As part of the first one, selected merchants in the Wangfujing business district and the online marketplace JD.com started accepting digital yuan payments. Then, the second pilot project will focus more on the food, housing, transportation, travel, shopping, entertainment, and information scenes of the 2022 Beijing Winter Olympics.

Meanwhile, the economic and financial hub Shenzhen has already distributed 60 million yuan in digital RMB red envelopes (over $9 million). Application scenarios for the CBDC have gradually covered government affairs such as medical care, education, and transportation as well as consumption. More than 30,000 merchants in the city are now working to introduce support for digital yuan payments.

Chengdu has until now handed out 40 million of digital yuan (over $6 million). At least 11,000 merchants are participating in the pilot. They come from various sectors including catering, retail, and entertainment. Chengdu also launched a digital yuan trial in the public transportation system in the city’s administrative area. Tuoluo remarks that Chengdu’s red envelope program “highlights the characteristics of digital currency – small-value, high-frequency trading and inclusive finance.”

What do you think about China’s red envelope campaign to promote the adoption of the digital yuan? Let us know in the comments section below.

EU Mulls AML Authority and New Rules for Crypto Transfers, Documents Suggest

08/07/2021 by Idelto Editor

The European Union is preparing to set up an anti-money laundering agency to coordinate national supervisory authorities. According to a media report based on EU documents, the bloc also plans to impose new rules to increase transparency for cryptocurrency transfers.

Europe Steps Up Anti-Money Laundering Efforts on Union Level

In response to calls for enforcement of anti-money laundering (AML) rules throughout Europe, the European Commission is likely to propose the establishment of a new Anti-Money Laundering Authority (AMLA). According to documents seen by Reuters, the agency should become the “centrepiece” of an integrated supervisory system consisting also of national authorities.

In the absence of a pan-European anti-money laundering body, the executive power in Brussels has so far relied mainly on national regulatory agencies to enforce its AML rules. Cooperation hasn’t always been satisfactory when it comes to stopping dirty money, the report notes. That’s why the authors of the documents insist:

Money laundering, terrorist financing and organised crime remain significant problems which should be addressed at Union level.

The new authority will be expected to help prevent money laundering and terrorist financing cases in the European Union “by directly supervising and taking decisions towards some of the riskiest cross-border financial sector obliged entities.”

The agency will coordinate national supervisory authorities to more effectively enforce common European regulations. Brussels also wants to make EU’s AML rules directly binding on member states to stop criminals from exploiting differences between national regulatory regimes.

EU to Adopt Stricter Reporting Requirements for Crypto Service Providers

Another proposal from the quoted documents is to adopt new European requirements for service providers working with crypto assets. These platforms will be obliged to collect and make accessible data concerning the originators and beneficiaries of cryptocurrency transfers. The scope of EU rules for financial services does not currently cover such transactions and EU officials warn:

The lack of such rules leaves holders of crypto-assets exposed to money laundering and financing of terrorism risks, as flows of illicit money can be done through transfers of crypto-assets.

According to Sven Giegold, member of the European Parliament from the German Green Party, the European Commission has prepared a strong package against money laundering. “With uniform standards and more centralised supervision, the EU Commission is introducing important improvements to enable consistent action against financial crime,” Giegold emphasized.

The MEP added that the EU should in the meantime pursue legal action against those EU members that are not enforcing its AML rules properly. A final approval from the EP and the EU states will be needed for the new regulations to come into force.

What’s your opinion about the proposals in the EU documents quoted in the report? Let us know in the comments section below.

Indians Hold $40 Billion in Cryptocurrency, Report Suggests

29/06/2021 by Idelto Editor

Crypto investments in India have been gaining significant traction over the past year, blockchain data indicates. Despite the ambiguous regulatory situation in the country, more than 15 million Indians have bought or sold digital currencies.

Indian Crypto Investments Increase Amid Regulatory Uncertainty

A growing number of Indians have put money into cryptocurrencies in the past year, which saw major coins hitting all-time market highs. Investments in crypto assets have increased from around $200 million to almost $40 billion, Bloomberg reported, quoting blockchain forensics firm Chainalysis.

The massive growth has been registered despite an unclear future for decentralized digital money in the world’s second-most populous country. The spike in investment interest happens against the backdrop of a generally hostile, but also ambiguous, attitude of the Indian central bank towards crypto.

Over 15 million Indians have been buying and selling cryptos, the publication added, in disregard of a proposed ban on coin trading. Their number is approaching the 23 million crypto traders in the U.S. and far exceeds the U.K.’s 2.3 million active traders.

The remarkable increase in crypto investors is largely associated with Indians between 18 and 35-years-old, according to Sandeep Goenka, co-founder of crypto exchange Zebpay. Goenka, who has been representing the industry in regulation talks with the government, explained that young people find it far easier to invest in cryptocurrency than gold:

You go online, you can buy crypto, you don’t have to verify it, unlike gold.

Indians Find New Gold in Bitcoin

Historically, gold has been a very popular investment in India, where households own an estimated 25,000 tons of the precious metal. However, the latest data from the World Gold Council has indicated that adults under the age of 34 are less attracted to gold than older Indians.

A young entrepreneur who abandoned gold and turned to crypto has invested over 1 million Indian rupees (around $13,400) into bitcoin (BTC), ethereum (ETH), and dogecoin (DOGE) since December. To acquire the coins, 32-year-old Richi Sood borrowed some of the money from her father.

Sood, who sold a portion of her cryptocurrency when BTC passed the $50,000 mark in February and then bought again when prices dropped, used the profits to fund the overseas expansion of her education startup, Study Mate India. She says crypto has higher short-term returns than gold, elaborating:

I’d rather put my money in crypto than gold. Crypto is more transparent than gold or property.

In the last 12 months alone, daily crypto trading values have shot up almost 900%, the report reveals. At the same time, India is yet to adopt comprehensive regulations for the expanding crypto space, and the lack of clarity has likely put off many potential investors and traders.

In 2018, the Reserve Bank of India issued a circular which banned financial institutions from providing services to crypto businesses. However, in May this year, the RBI advised banks that the instruction was no longer valid, citing a year-old ruling from the Supreme Court. Nevertheless, several commercial banks have recently halted services to customers dealing in cryptocurrencies.

What do you think the future holds for cryptocurrencies in India? Share your thoughts on the subject in the comments section below.

SEC Delays Robinhood IPO Over Questions Concerning the Company’s Crypto Business: Report

26/06/2021 by Idelto Editor

Robinhood Markets Inc., the American financial services company headquartered in Menlo Park, California, has seen its initial public offering (IPO) delayed by the U.S. Securities and Exchange Commission (SEC). According to a report citing “people familiar with the matter” the SEC is questioning Robinhood’s cryptocurrency business.

SEC Questions Robinhood’s Crypto Dealings, IPO Delayed

Robinhood was supposed to be having an initial public offering this month but according to a report from Bloomberg, the listing has been slowed by the SEC. The report cites a few people familiar with the matter and they asked: “not to be identified because the matter is private.”

However, they say that the U.S. regulator has questions concerning the cryptocurrency side of the business, as Robinhood also allows customers to purchase popular stocks. Since 2018, Robinhood has allowed customers to purchase and trade crypto assets like bitcoin (BTC), dogecoin (DOGE), and ethereum (ETH).

The company came under fire at the end of January during the Wallstreetbets fiasco that saw the climactic rise and fall of Gamestop (GME) shares. Reports at the time from customers noted that Robinhood ceased offering GME, and other stocks like AMC as well. The move was so controversial, Tesla’s Elon Musk tried to get answers in an interview on The Good Time Show via the Clubhouse app.

Nevertheless, the SEC’s current concerns involve the cryptocurrency business that lets users purchase ETH, DOGE, and ETH rather than scrutinize the stock fiasco. Renowned investor Warren Buffet talked about Robinhood and told CNBC that investing in crypto assets and stocks on Robinhood is akin to casino gambling.

Billionaire investor and Shark Tank star Mark Cuban criticized Robinhood at the end of April and said: “The greatest inhibitor to its growth is that you can’t spend the Doge you buy on Robinhood.” The report authored by Bloomberg’s financial columnist Katie Roof on Friday concerning the SEC and Robinhood noted that the U.S. regulator is very busy dealing with IPOs.

The SEC is also dealing with crypto-based special purpose acquisition companies (SPACs) and bitcoin exchange-traded fund (ETF) filings. Roof highlights that Robinhood’s delay is similar to when Coinbase Global Inc., bumped its IPO.

Prior to the Coinbase listing, the exchange had to pay the Commodity Futures Trading Commission (CFTC) $6.5 million for “inaccurate reporting as well as wash trading.” The SEC further announced this week that it has delayed the bitcoin ETF decision for Valkyrie Digital Assets’ listing proposal.

What do you think about the Robinhood IPO delay? Let us know what you think about this subject in the comments section below.