The Central Bank of Nigeria (CBN) has disavowed a letter that allegedly instructed financial institutions to sever ties with four global cryptocurrency exchanges. The central bank stated that the letter did not originate from its office and recommended that individuals interested in “authentic updates” refer to its official website. Fake Content The Central Bank of […]
Bitcoin News
Central Banks Kept Purchasing Gold in February; China Continues Gold Run
Central banks kept up demand for gold in February, registering net purchases of 19 tonnes. Albeit the purchasing trend continued, purchases fell 58% compared to January’s demand, according to IMF and World Gold Council numbers. China reported the largest gold accumulation, acquiring 12 tonnes to maintain a 16-month gold purchasing streak. Gold Demand Still High […]
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BIS Announces Project Agorá: Central Banks Bet on Tokenization for Cross Border Settlements
The Bank for International Settlements, the central banks’ bank, announced the launch of Project Agorá, a joint private-public initiative seeking to examine the potential benefits of tokenization for improving cross-border settlements. Agorá includes the participation of seven central banks and private institutions to be convened by the Institute of International Finance (IIF). BIS to Explore […]
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Banks Seek to Purchase Bitcoin Directly From BTC Mining Firm Hut 8, Says CEO
Per the CEO of Hut 8, a bitcoin mining company listed on the Toronto stock exchange, major financial institutions have made inquiries to purchase bitcoin directly from the firm. Additionally, the Hut 8 executive emphasized the forthcoming halving event’s “big impact,” noting a surge in demand juxtaposed with a reduction in available bitcoins. Financial Giants […]
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Riding The Ripple: XRP Stellar 1-Year Performance Leaves Banks In The Dust
XRP holders are facing mixed signals. While the digital asset boasts nearly 20% in gains over the past year, significantly outperforming traditional savings accounts, its recent performance pales in comparison to other cryptocurrencies.
After a substantial decline, the altcoin’s price has now entered a phase of sideways consolidation, making market players unsure of its future course. It appears like the cryptocurrency will likely stay stuck in a narrow range until there is a breakout in either way.
XRP: Beating Savings Accounts
Despite the seemingly negative vibe, a recent report highlighted the coin’s resilience. Specifically, it underscored its advantage over stagnant savings accounts.
XRP hit a low of .42 in March 2023 and surged to .93 in July, fueled by optimism surrounding the Ripple vs. SEC lawsuit. The coin then saw a rise of 1.30% on Sunday. After losing 1.35% on Saturday, the altcoin gained 0.41% at the end of the week to close at .6299. Today, it sits at .61, reflecting a 20% year-over-year increase.
This dwarfs the returns offered by most savings accounts. A Business Insider report pegs the average Annual Percentage Yield (APY) for US savings accounts between 0.01% and 0.25%. Even high-yield online banks rarely surpass 5.30% APY.
XRP is up over 6% within a single year, it has outperformed every savings account of every bank in the world and yet you people are still crying about it. pic.twitter.com/GGxVPJfudU
— Mr. Huber (@Leerzeit) March 29, 2024
“Mr. Huber,” a prominent crypto community investigator, emphasizes this point. To paraphrase his views, he said while XRP might not be setting the crypto world on fire right now, it’s definitely a better option than letting your money languish in a savings account.
However, discontent simmers within the community. Over the past three months, XRP has seen a meager 1% growth, while rivals like Bitcoin and Ethereum have skyrocketed by over 50%. This lackluster performance compared to its peers is causing frustration among holders.
The future trajectory of XRP hinges on multiple factors. The ongoing Ripple vs. SEC lawsuit, which centers around whether XRP is a security, is a significant cloud hanging over the coin’s price. A favorable outcome could reignite investor confidence and propel XRP upwards.
Diverse Perspectives And Pressure In The Crypto Market
Another factor is the broader cryptocurrency market. If the current bull run continues and other top coins maintain their momentum, XRP might face additional pressure to catch up.
Analysts remain divided on XRP’s short-term prospects. Some believe the current stagnation is a buying opportunity before a potential price surge. Others urge caution, citing the ongoing lawsuit and the unpredictable nature of the cryptocurrency market.
The diverse perspectives surrounding XRP showcase the exciting array of options available to investors. With XRP presenting a compelling alternative to conventional savings methods, its unique features shine through.
Despite recent fluctuations in its performance compared to other digital assets, this opens up opportunities for thoughtful consideration and strategic investment. Ultimately, the choice to embrace XRP hinges on aligning with one’s personal risk appetite and long-term investment objectives, empowering individuals to make informed decisions tailored to their financial aspirations.
Featured image from Karolina Grabowska/Pexels, chart from TradingView
Court Dismisses Custodia Bank’s Challenge Against Federal Reserve
In a significant ruling, a federal judge has dismissed Custodia Bank Inc.’s claim for entitlement to a Federal Reserve master account, marking a setback for the Wyoming-based depository institution. Custodia Bank argued that the Federal Reserve Bank of Kansas City (FRBKC) was legally obliged to grant its application for a master account, a critical financial […]
Bitcoin News
House Financial Services Committee Advances Bill to Repeal SEC Bulletin Preventing Banks From Offering Crypto Custody Services
The House Financial Services Committee of the U.S. Congress has advanced a resolution that seeks to disavow SEC SAB 121, a bulletin that leaves banks and financial institutions out of the cryptocurrency custody provider market. However, the resolution, advanced with bipartisan support, is unlikely to be passed at a vote on the House floor, according […]
Bitcoin News
Fed Governor Discusses Crypto’s Impact on US Dollar Dominance — Says Banks Should Avoid Bitcoin ETFs as Primary Asset
A Federal Reserve governor has addressed crypto’s impact on the U.S. dollar’s dominance. Additionally, he expressed reservations about the need for a U.S. central bank digital currency (CBDC) and stated his opposition to banks holding bitcoin exchange-traded funds (ETFs) as their primary asset. Fed Governor on Crypto, CBDC, and the U.S. Dollar Federal Reserve Governor […]
Bitcoin News
US Banks Rally For Updated Crypto Guidelines As Digital Asset Prices Surge
Amidst a significant surge in cryptocurrency prices, which propelled the total crypto market capitalization to a high of .93 trillion on Thursday, influential interest groups are urging the US Securities and Exchange Commission (SEC) to revise accounting guidance that imposes higher costs on US banks for holding digital assets on behalf of their customers.
Banking Trade Groups Urge SEC To Revise Crypto Accounting Rules
According to a Bloomberg report, a coalition of trade groups, including the Bank Policy Institute, the American Bankers Association, the Securities Industry and Financial Markets Association, and the Financial Services Forum, sent a letter to the SEC on Wednesday outlining their desired changes.
The existing guidance requires public companies, including banks, to treat cryptocurrencies they hold in custody as liabilities on their corporate balance sheets. Consequently, banks must allocate assets of a similar value to comply with capital requirements and protect against potential losses.
According to Bloomberg, the trade groups have requested the SEC to consider the following key changes:
- Exclude certain assets from being classified under the broad crypto umbrella. This includes traditional assets recorded or transferred using blockchain networks, such as tokenized deposits, as well as tokens underlying SEC-approved products like spot Bitcoin exchange-traded funds (ETFs).
- Grant regulated lenders an exemption from the current balance sheet requirement while maintaining the disclosure of crypto activities in financial statements.
The trade groups argued that if regulated banking organizations are unable to provide digital asset-safeguarding services at scale, it would negatively impact investors, customers, and the broader financial system.
However, the SEC has defended its accounting guidance, citing the “unique risks” and uncertainties posed by cryptocurrencies compared to other assets held by banks.
Limiting Custody Expansion?
The specific guidance in question, known as Staff Accounting Bulletin No. 121, has faced criticism from banks since its publication in 2022.
Lenders argue that the bulletin limits their ability to expand digital asset services for customers due to the associated high costs. Consequently, banks missed out on providing custody services for recently approved Bitcoin exchange-traded funds, with Coinbase emerging as the preferred custodian for the majority of ETF issuers.
The trade groups also highlighted additional challenges resulting from the guidance, including a “chilling effect” on plans to utilize blockchain technology for traditional assets. While the SEC described SAB 121 as non-binding staff guidance, it acknowledged that following it enhances disclosure to investors regarding firms safeguarding crypto assets for others.
As the SEC faces mounting pressure, there have been efforts by lawmakers to repeal the guidance. A resolution was introduced in the House Financial Services Committee, spearheaded by Representatives Mike Flood and Wiley Nickel, while Senator Cynthia Lummis sponsored identical legislation in the Senate. These measures aim to remove the SEC’s authority in making rules that impact bank custody.
The outcome remains uncertain, as the legislation’s success depends on garnering sufficient support, particularly among Democrats and within the White House.
However, the collective efforts of trade groups, lawmakers, and industry stakeholders could potentially lead to regulatory changes that alleviate the burden on banks holding digital assets, facilitating their participation in the evolving cryptocurrency landscape.
Furthermore, the recent endeavors undertaken by US institutions exemplify a growing interest and eagerness to adopt and invest in cryptocurrencies, particularly Bitcoin.
This heightened institutional involvement has significantly contributed to the swift success of Bitcoin spot ETFs, which gained regulatory approval merely a month ago.
Featured image from Shutterstock, chart from TradingView.com
30 Banks Participating in Russia’s Central Bank Digital Currency Pilot
The number of banks participating in Russia’s central bank digital currency pilot has increased to 30. Seventeen banks have signed an agreement with the Bank of Russia to participate in the digital ruble program. They will join 13 other banks, about 600 citizens, and 30 trading and service companies that are already testing Russia’s central bank digital currency.
17 Banks to Join 13 Other Banks in Digital Ruble Pilot
Russia’s central bank, the Bank of Russia, announced on Wednesday that 17 additional banks are gearing up to join its digital ruble pilot program. These financial institutions have already signed an agreement with the Russian central bank and are now implementing the necessary systems to participate in the upcoming expanded pilot.
Currently, 13 banks are already participating in the digital ruble pilot, along with around 600 citizens and 30 trading and service companies. These participants are already actively involved in testing operations with real digital rubles. The 13 existing participating banks are Alfa Bank, Dom.Rf Bank, Ingosstrakh Bank, VTB Bank, GPB Bank, Qiwi Bank, Ak Bars Bank, MTS Bank, Promsvyazbank, Sovcombank, Sinara Bank, Rosbank, and TKB Bank.
The 17 banks that will join them in the extended digital ruble pilot are AB Bank Russia, Bank Orenburg, Russian Standard Bank, SME Bank, Rosselkhozbank (Russian Agricultural Bank), Tinkoff Bank, Expobank, Novikombank, Bank RRB, Kuban Credit Bank, Tochka Bank, Primtercombank, Rosdorbank, Sberbank, CB Center-Invest, RNKB Bank, and Dengi.Mail.Ru.
The Bank of Russia website details various stages of the digital ruble project. Starting with the creation of a prototype platform in December 2021, the central bank tested and refined the digital ruble prototype throughout 2022. Based on these test results, a roadmap for implementation was developed. August 2023 was the start of piloting operations “with real digital rubles involving a narrow circle of clients of 13 banks,” Bank of Russia described.
“The digital ruble is a digital form of the Russian national currency that the Bank of Russia plans to issue in addition to existing forms of money,” Russia’s central bank explained, elaborating:
The ruble will have three forms: cash, non-cash and digital. They are equivalent: one cash ruble is equal to one non-cash ruble, as well as one digital ruble.
What do you think about the number of banks participating in Russia’s central bank digital currency pilot? Let us know in the comments section below.