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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Ledger Users Can Now Buy Crypto Directly Using PayPal
PayPal has taken another step in its crypto mission following a team-up with hardware wallet provider Ledger. This time around, the payments giant is making it possible for users to purchase crypto directly without the need for extra verifications.
Ledger Live Integration With Paypal
On August 16, Ledger and PaPal announced an integration to make buying cryptocurrencies easier. This feature will allow users to purchase crypto using PayPal directly from the Ledger Live app.
Chairman and CEO Pascal Gauthier of Ledger made a statement about integrating Ledger Live with Paypal to make crypto transactions easier.
“Both PayPal and Ledger are focused on creating secure, seamless, and fast transactions no matter where you are in the world. PayPal,” Gauthier said. “We’re combining the uncompromising security of Ledger with PayPal’s leadership in protected payments technology to help facilitate a seamless platform for user crypto transactions.”
Ledger Live’s integration with Paypal currently offers four cryptocurrencies in the US, such as Bitcoin (BTC), Ether (ETH), Bitcoin Cash (BCH), and Litecoin (LTC), and this will allow US residents to be able to purchase these cryptocurrencies with their verified Paypal accounts with no extra verification required.
What makes this integration so interesting is that no “withdrawal” process needs to be initiated by a user. All the crypto purchases made through Paypal via Ledger Live are immediately sent to the user’s wallet, according to the announcement.
Ledger Live’s integration with Paypal is indeed a significant step in the financial tech world, as the two giants share a similar vision of creating fast and seamless transactions on a universal scale.
Ledger is one of the most notable hardware wallet manufacturers, recording over 6 million Ledger Nano hardware wallet sales all around the world since 2016. Also, Ledger launched its Tradelink service in 2023 that will enable “off-exchange trading, enhanced security, distribution of risk, zero transaction fees, and a more efficient and faster trading” for institutional investors.
Paypal’s interest in the crypto world is by no means new. On August 7, Paypal made an announcement to launch its own Ethereum-based stablecoin called PYUSD.
However, nothing was said about PYUSD being listed as one of the coins that will be available on the Ledger Live just yet.
PYUSD’s launch has not been smooth either with regulators calling for more oversight following the launch. Last week, US congresswoman Maxine Waters called for federal oversight and enforcement of PayPal after launching the stablecoin.
PayPal also revealed plans to allow select customers to purchase cryptocurrencies such as Bitcoin and Ethereum using PYUSD. However, amid the new UK regulatory system that will come into play on October 8, Paypal plans to temporarily pause the buying of cryptocurrencies in the country from October 1 to resume crypto services in the Q1 of 2024.
US Banking Crisis: Nigerian Banks Not Directly Exposed to SVB Says Central Bank Governor
A recent review of Nigerian banks’ bond portfolios showed that the institutions were not directly exposed to Silicon Valley Bank, the governor of the country’s central bank has said. In addition, the governor said the Central Bank of Nigeria’s stringent guidelines help to create a “very safe” banking system.
Priority Given to Depositors
According to the governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, a recent review of Nigerian banks’ bond portfolios showed that the country’s financial institutions had no direct exposure to Silicon Valley Bank (SVB). Emefiele, who made the remarks during a meeting of the bank’s monetary policy committee, added that the central bank’s so-called prudential guidelines help to ensure that only healthy banks are allowed to operate.
Some of the guidelines and considerations used by the CBN include banks’ non-performing loans (NPL), which averaged 4.2%, and the capital adequacy ratio of 13.7%. According to Emefiele, these ratios, as well as the banks’ average liquidity and loan-to-deposit ratios of 43% and 52% respectively, indicate that Nigerian banks are “very safe.”
Also, in his remarks published by Nairametrics, Emefiele implied that the central bank has and will always prioritize bank customers.
“We will rather dispose of shareholders than make depositors lose money,” Emefiele said.
To support this claim, Emefiele is quoted in the report stating no Nigerian depositor has lost money to a failed bank since 2003.
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Bitcoin Is Now Directly Correlated With The US Dollar
In the ongoing banking crisis in the United States, the US Dollar (USD) appears to correlate directly with Bitcoin.
Bitcoin Positively Correlates With USD
According to Kaiko, a digital assets market provider, Bitcoin, the most valuable cryptocurrency, appears to be moving synchronously with the USD as the market adopts a wait-and-see approach amid fear of further turbulence in the United States financial markets.
Historically, #Bitcoin has had an inverse correlation with the U.S. Dollar.
Over the past month, this negative correlation has mostly disappeared amid a wider market rally. pic.twitter.com/Q9H0T4k51M
— Kaiko (@KaikoData) March 17, 2023
Historically, Kaiko notes, Bitcoin moves inversely with USD. That means whenever the USD rallies, Bitcoin tends to crumble. This has been observed in the last few months, especially throughout 2022, resulting in what was known as the crypto winter.
As USD strengthened across the board in 2022, crypto prices, including BTC, weren’t spared. To illustrate, Bitcoin crashed from as high as ,000 registered in November 2021, dropping below ,000 in November 2022.
The crypto meltdown was made worse by the collapse of UST, an algorithmic stablecoin by Terra, the crash of several centralized finance projects like Voyager Digital and BlockFi, and the spectacular fall of FTX, the Sam Bankman-Fried exchange in November.
The bankruptcy and failure of some of these platforms dented user confidence, forcing a capital flight to safe havens beyond the crypto markets to gold and the USD.
At some point in 2022, for example, DXY data, an index that tracks the USD, showed that the greenback strengthened by over 20%.
During that time, BTC more than halved, demonstrating the relationship between the USD and Bitcoin.
The DXY measures the strength of the USD against a basket of other currencies, including the Japanese Yen, Euro, Chinese Yuan, and others. The index will rise if the USD is strong and dip if it falls relative to these currencies.
The Tide Is Changing
As of mid-March 2023, Kaiko observes that rallying Bitcoin and crypto prices seems to coincide with the relative strengthening of the USD; and is shifting. When BTC prices rose from ,700 last week to ,300, the USD added 3% from late February 2023. The USD holds firm despite questions being raised concerning the monetary policy approach adopted by the Federal Reserve.
There have been more questions about the effectiveness and the speed of rate hikes in the past few months. Although inflation is lower, it is not at ideal levels.
The Fed aims to eventually reduce inflation to around the 2% benchmark level. While critics descend on the Fed, the USD is steady, syncing with Bitcoin, that’s relatively higher.
Central Bank of Bolivia Selling Dollars Directly to Citizens as Devaluation Fears Rise
The Central Bank of Bolivia is now selling dollars directly to citizens in order to curb what it is calling a speculative attack that has increased the demand of the population for foreign currency. This rise in demand has been caused by several factors which led the population to believe there might be a devaluation move coming.
Central Bank of Bolivia Sells Dollars to Appease Local Market
The Central Bank of Bolivia is executing extraordinary measures to supply its internal market with foreign currency. On March 6, the monetary institution announced that it would start selling dollars to the citizens directly, adding its action to the established traditional currency exchange market.
The measure would counter what the central bank is calling a “speculative attack” on the national monetary system, prompting Bolivians to purchase more dollars in order to protect from a rumored increase in the exchange rate. Edwin Rojas, president of the Central Bank of Bolivia, stated:
The Central Bank of Bolivia opens its doors, we reiterate, through Banco Unión, since it is the body that is going to collaborate with us in this process so that the population that demands dollars and cannot get them (outside) can come to us to satisfy their demand.
Fears of Devaluation
The increased demand for dollars that the central bank is facing has to do with fears about the current state of the national reserves, and how this can trigger a change in the exchange rate of the U.S. dollar.
In Bolivia, there is a fixed exchange rate, set back in 2011, that establishes each dollar is valued at 6.86 bolivians, the fiat currency of the country. Countries like Venezuela and Argentina, which had established exchange controls on foreign currency, have experienced elevated levels of devaluation and inflation due to these restrictions.
On March 9, Rojas gave a summary of how the market was reacting to this measure, noting that more than million was allocated during the last two weeks to satisfy the unprecedented demand. He explained that the country had no plans for changing its monetary policy.
However, analysts are uncertain about the sustainability of these movements. The last report on the status of the foreign currency reserves dates from February 8, when the central bank reported having 2 million. This is less than the 0 million that Antonio Saravia, a local economist, estimates that the national market needs monthly. He doubts the government can sustain this level of intervention for too long.
What do you think about the Situation that the Central Bank of Bolivia is facing with unprecedented demand for U.S. dollars? Tell us in the comments section below
New U.S Regulatory Agency Possibly In The Works To Oversee Crypto Exchanges Directly
The U.S. Securities and Exchange Commission (SEC) Chair, Gary Gensler, said Congress needs new regulatory frameworks for crypto exchanges. At present, no single agency is directly responsible for them, leading to an incoherent regulatory approach.
A possible solution lies in the formation of a new agency to oversee crypto exchanges directly. Alternatively, an existing agency would see an expanded role. Either way, regulatory clarity remains a central sticking point for the cryptocurrency industry. Can we now expect to move forward on the issue?
The U.S. Crypto Industry May Finally Get Regulatory Clarity
Newly appointed Gensler addressed the House Financial Services Committee yesterday. Among the many topics discussed was the fact that no single agency is in charge of crypto exchanges in the U.S.
The statement was Gensler’s first regarding his approach to cryptocurrency regulation. He pointed out that crypto businesses must deal with multiple regulators. The issue is compounded by a mishmash of rules at both the state and federal levels.
By putting in place a regulatory framework for exchanges, Gensler hopes more direct oversight will lead to a vibrant crypto marketplace that’s safer for investors.
“That could instill greater confidence. Right now there’s not a market regulator around these crypto exchanges. And thus there’s really not protection against fraud or manipulation.”
Chief Legal Officer at Coinbase, Paul Grewal, said he welcomes the opportunity to discuss how to get crypto regulation right. Adding, his firm is willing to share its knowledge on what works and what doesn’t.
Earlier this year, in responding to SEC allegations of selling unregistered securities, Ripple CEO Brad Garlinghouse said the regulatory landscape is a mess. Going further, he explained that Ripple deals with eight different agencies, and each has its own take on cryptocurrency.
“With 8 different govt agencies, each with their own (and sometimes opposing) views of crypto, U.S. market participants are facing conflicting policies and no surprise, some act conservatively.“
Robinhood Under Fire
Also on the agenda with the House Financial Services Committee was Robinhood. Lawmakers raised concerns over the possible conflict of interest that comes with zero commission trading apps.
Under its “payments for order flow” business model, the firm receives compensation and other benefits for directing orders to different parties for trade execution, with Citadel Securities executing near half of Robinhood trades.
Julian Emanuel, the Chief Equity and Derivatives Strategist at BTIG, said zero commission at the front end increases the likelihood of users trading.
“When you can engage in an activity that used to cost you something and no longer seemingly costs you anything, the inclination is particularly if you’re making money doing it, you’re likely to do it more often. It’s a perfect example of the law of unintended consequences.”
Similarly, accusations of “gameifying” trading have the same effect. Regulators widely criticized the use of confetti and other techniques to entice customers into trading.
In December last year, Robinhood agreed to settle with the SEC for million over charges it failed to disclose its “payments for order flow” model adequately.
“We Participate Directly in the Rising Bitcoin Price“ — Aroosh Thillainathan, Founder and CEO of Northern Data
Northern Data, the specialist in high-performance computing, is one of the world’s leading providers of infrastructure for Bitcoin mining and listed on the Frankfurt Stock Exchange (XETRA: NB2, ISIN: DE000A0SMU87). We spoke with founder and CEO Aroosh Thillainathan about the prospects for Bitcoin and the growth expectations for Northern Data.
Q: Mr. Thillainathan, Bitcoin is gaining more and more attention, not the least because of the enormous rise it is currently experiencing. The Bitcoin price has more than doubled within the last few weeks. Where is this momentum suddenly coming from?
A: There are many reasons: Payment companies such as Paypal and Square have recently announced that they will enable their customers to pay with Bitcoins in the future, thus opening up a mass market for the digital currency. In addition, the first US companies are currently starting to shift their currency reserves into Bitcoin – first and foremost the US software company Microstrategy. The US capital markets players are also beginning to discover Bitcoin. Just recently, JP Morgan published that their strategists believe Bitcoin can reach 6,000 and higher in the long term as it begins to compete with gold as an asset class. And there are rumors that various central banks are buying Bitcoins on a massive scale right now. The very fact that there is no one reason is why, for me, the current rally in the Bitcoin price is on very solid footing.
Q: In your view, does Bitcoin have the potential to become an asset class like gold, stocks or bonds?
A: It already is! While the utility of Bitcoin as a payment instrument is still in its infancy, Bitcoin is already the “better gold” for the new generation of investors. It is a safe way to store value, especially in these current times with more and more governments expanding their money-printing activities.
Q: But gold has been accepted as a so-called “store of value” for thousands of years, while Bitcoin is only a little older than 10 years.
A: Bitcoin, however, has a number of advantages over gold: It is free and easier to store, and it allows its owner to access, share, or transfer assets from anywhere in the world at any time. Imagine, for example, on a Sunday afternoon you want to transfer gold for the equivalent of 5,000 euros from Frankfurt to Hong Kong within minutes. What is completely impossible with gold is no problem with Bitcoin. And in terms of effort, it is also completely irrelevant whether you transfer Bitcoins for five thousand or five million euros, which of course makes Bitcoin particularly attractive for professional investors. And finally: It is a question of the collective acceptance of Bitcoin as a “store of value”, and in my opinion that is now a widely accepted fact.
Q: So, you see Bitcoin as a new asset class. Doesn’t the Bitcoin price fluctuate too much for that?
A: Let’s remember spring of last year, when many stocks plummeted by more than 50% within a few days. Bitcoin does not fluctuate any more than other volatile asset classes. Due to the money-printing orgy we are currently seeing, any and all asset classes promising returns will remain volatile in the future. And, by the way, fiat money – which is the euro, dollar and so on – is also very volatile. In fact, the USD probably lost about 20% of its value in the last 12 months. At least. Most investors just don’t see it yet, because they take exactly this fiat money as a reference value, which creates the illusion that fiat money is stable.
Q: Do you see further upside potential in Bitcoin?
A: Bitcoin offers investors the opportunity to escape the devaluation of their fiat currencies through the massive injection of money by almost all central banks. It is estimated that in the year just ended, more than 22 percent of the US dollar in circulation was printed by the Federal Reserve. So, when you realize that almost a quarter of all existing US dollars were created in the past year, you realize the immense potential of Bitcoin as a store of value. We are only at the very beginning.
Q: Doesn’t mining threaten Bitcoin with a fate similar to that of the US dollar?
A: Not at all. Since the final Bitcoin quantity is limited to 21 million pieces, it stands in sharp contrast to conventional currencies, which suffer from unlimited money creation by central banks. Currently, 18.81 million Bitcoins exist, with 900 new Bitcoins added each day through mining. In 2140, the last few Bitcoins will be mined, and from then on there will be no more new Bitcoins. The scarcity of Bitcoin is its ultimate value proposition.
Q: If Bitcoin establishes itself permanently as a new asset class, will we all invest some of our wealth in Bitcoin at some point?
A: Absolutely. And as Gorbachev so beautifully said, “Those who are late will be punished by life itself”! A striking example: Last year, more than 24 million people had assets of more than one million dollars. Thus, absurdly, it will never be possible for every millionaire to own one single Bitcoin, because there are simply not enough Bitcoins.
Q: With all these positive prospects for the future, isn’t there the potential for setbacks? Bitcoin is still not regulated everywhere, and couldn’t negative assessments by the SEC, for example, put an abrupt end to the price upswing after all?
A: The further regulation of Bitcoin is, of course, an issue that could once again threaten setbacks. And as I said, investors need to be prepared for volatility, not just in Bitcoin, but in all asset classes. The financial world has changed dramatically in recent years. On the subject of regulation, Bitcoin has already reached a scale where it can no longer simply be “banned.” Large publicly traded companies in the US are currently already starting to invest significant portions of their cash reserves in Bitcoin, and large investment companies such as Fidelity and the first insurance companies such as MassMutual have also discovered the cryptocurrency. That Bitcoin will be further regulated globally is evident, and when this process is completed in the coming years, Bitcoin will have fully arrived at the mainstream. It is also interesting to look at markets where Bitcoin is already regulated. For example, Bitcoin has been officially recognized as legal tender in Japan since 2017. The experience with it has been extremely positive and gives a good indication of what we can expect in other markets. I would sum it up like this: More regulation will make Bitcoin stronger in the long run, not weaker.
Q: Your company Northern Data itself is one of the largest providers of Bitcoin mining infrastructure. How long have you been active in this area?
A: We turned to Bitcoin mining with our team at a very early stage, almost eight years ago at this point. Bitcoin mining is highly competitive. Only those with the most efficient infrastructure can survive the fierce competition. Due to our very early entry into this market we were forced to develop our own proprietary solutions to the challenges that come with it. Bitcoin mining is one of the first and largest applications of high-performance computing (HPC), in which hundreds of thousands of highly specialized computers solve complex computational tasks in parallel. This presents extreme challenges, in part because the chips used have special requirements in terms of their power consumption and cooling needs. We therefore had to develop our own proprietary innovations in the area of cooling and needed a special AI to control thousands of computers in parallel. But this pressure to develop our own innovations at an early stage is the basis of our success today. Today, we serve multibillion-dollar corporations and offer full-scale Bitcoin mining services: from purchasing the hardware, to setting it up, to running it successfully in our data centers.
Q: How does your company benefit from the positive development of Bitcoin?
A: On one hand, we are experiencing massive demand for our infrastructure, such that we are currently opening a new data center site every few weeks. The demand is simply overwhelming, and we have long waiting lists. As we enter into long-term contracts with our customers and they pay us upfront to build the infrastructure, this creates a massive global infrastructure for HPC in a comparatively short period of time. This infrastructure is owned by us and will enable us to achieve great growth for many years to come. With individual customers, we have also agreed on variable remuneration components in addition to the basic remuneration, with which Northern Data itself participates directly in the rising Bitcoin price. Due to the current development, we are talking about a very significant additional upside here, which we have not yet taken into account in our public forecasts.
Q: Nevertheless, your public forecast already shows an almost unbelievable growth…
A: That is correct. In the current year, we expect to generate revenues of between EUR 350 million and EUR 400 million with EBITDA of between EUR 100 million and EUR 125 million, based purely on the contracts that are already concluded and excluding the aforementioned performance-related compensation.
Q: And what does it look like for 2022 and beyond?
A: Since we are currently in a high-growth period as mentioned above, the 2021 figures are only the basis for continued high growth in the coming years. In the future, in addition to the establishment of Bitcoin as a new asset class, we will benefit very strongly from the other applications in the area of HPC, which are just now starting to become relevant. While currently, the majority of our customers are still Bitcoin miners, our customer base should be much more diversified by the end of this year, for example with customers in AI, deep learning, research, or rendering.
As I said earlier regarding the Bitcoin price, we are just at the beginning. This is also true for Northern Data, both in terms of our operational numbers and our company valuation.
Apple Co-Founder Claims Google is “Directly Profiting” from Crypto Scams in Lawsuit
Apple co-founder Steve Wozniak is suing YouTube’s parent company Google, claiming that the video content platform is directly profiting from crypto scams that hurt users
These claims have come about as the result of a new lawsuit filed by the revered electronic engineer who co-founded Apple alongside Steve Jobs.
Within the lawsuit, he references the fake crypto giveaway videos that have become commonplace on YouTube, comparing them to the ones seen recently on Twitter.
Specifically, many of these fake giveaway videos use Wozniak’s name and likelihood – as well as his deep ties to the crypto industry – to prey on unsuspecting victims who send Bitcoin with hopes of receiving more back.
Crypto Scams Proliferate on YouTube, Twitter
The digital and anonymous nature of Bitcoin and other crypto-assets make them the preferred currency of scammers looking to exploit naïve and unsuspecting users.
We saw a prime example of this last week when hackers gained control of large accounts on Twitter and used them to shill a classic crypto giveaway scam.
This has been a problem for years, and despite efforts to crack down on these types of schemes, they still run rampant on social media platforms.
On YouTube, for instance, users have reported seeing recommended videos and live streams that are posted by channels appropriating the names of prominent individuals and companies.
The scammers then run a video of someone associated with the company giving a speech at a past event, while overlaying instructions for how users can double their crypto by sending Bitcoin to a specific wallet address.
To viewers not familiar with this type of scheme, these ploys can be convincing.
Wozniak and 17 alleged victims are now filing a lawsuit in hopes of having a court force these types of videos to be strictly policed by the platform.
Wozniak Sues Google: Claims YouTube Directly Profits from Scams
Per a recent comment to Engadget before the lawsuit was filed, Wozniak explained that many of the scam’s victims have been reaching out to him upset that they haven’t received their promised crypto.
“The reputation problem lies in the fact that after a while, many email us looking for their cryptocurrency and [are] mad at us.”
In the lawsuit, he claims that Google has been “unapologetically hosting and directly profiting from similar scams” – now requesting that the platform puts in place better safeguards to stop these crypto scams from happening in the future.
Featured image from Unplash.
Mystery Man Gets Berlin Shop to Drop BitPay, Accept Bitcoin Directly
n An unknown super nice guy none other than A. Antonopolous spurred a small-time Gelato place in Berlins hip Friedrichshain district to start accepting Bitcoinn
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