Bitfarms Ltd. has adopted a shareholder rights plan to protect the integrity of its ongoing Strategic Alternatives Review Process. This plan was unanimously approved by the Board and involves issuing rights to shareholders to prevent unwanted takeovers. Riot Platforms Inc., which owns 11.62% of Bitfarms, made an unsolicited bid to acquire all shares and plans […]
Bitcoin News
Ethena Labs Adopts Bitcoin to Back USDE Stablecoin; Supply Surpasses 2 Billion
On Thursday, Ethena Labs unveiled its new strategy to back USDE with bitcoin, enhancing the stablecoin’s foundation. The stablecoin, known for delivering yields in the double digits, has rapidly ascended to become the fifth-largest stablecoin by market capitalization, now valued at over billion. USDE to Utilize Bitcoin as Collateral An update shared by Ethena […]
Bitcoin News
Honduran City of Prospera Adopts Bitcoin as Unit of Account
The city of Prospera in Honduras has recently adopted bitcoin as a unit of account, allowing companies to pay taxes and determine obligations in bitcoin. The measure could incentivize the development of a circular economy, given that bitcoin has been legal tender in the city since 2022.
Prospera Adopts Bitcoin as Unit of Account
The city of Propera has taken the first steps for the development of a pure bitcoin-based economy. The zone announced it approved using bitcoin as a unit of account on January 5, allowing for prices and taxes to be denominated and paid using bitcoin.
Jorge Colindres, General Secretary of Prospera, supported this decision. He stated:
At Prospera, we believe in the right to financial freedom and monetary freedom. People should be free to carry out transactions, do their accounting, and report taxes in the currency of their free choice.
Adopting BTC as a unit of account brings possibilities for establishing a bitcoin circular economy in the city, given that BTC has been approved as a legal tender since 2022. In this sense, the city declared that this move “presents an exciting opportunity for residents and businesses at Prospera, paving the way for a modern, efficient economic ecosystem in this pioneering city.”
However, the payment of taxes with BTC is still on hold due to external regulatory issues and technical limitations involving the adopted electronic tax payment system. This means that tax duties will be declared in BTC but will be reported to authorities in U.S. dollars or Honduran lempiras.
While at one time there were rumors about Honduras adopting bitcoin as legal tender in 2022, the central bank of the country quickly put the rumors to rest, stating that it was not a regulated currency and had no status of legal tender, later warning on the dangers of cryptocurrencies due to the rising popularity of these assets.
Nonetheless, Prospera has self-regulation faculties under the Development and Employment Zone (ZEDE) designation, allowing it to make independent decisions. This, however, has spurred criticism from part of the Honduran society that considers the existence of these zones a violation of its constitution and sovereignty over the territories they occupy.
To follow all the latest developments in crypto and the economy in Latin America, sign up for our Latam newsletter below.
What do you think about adopting bitcoin as a unit of account in Prospera? Tell us in the comments section below.
Visa Adopts Web3 Tech for Its New Loyalty Engagement Solution
Visa, a worldwide leader in credit payment technology, has announced that it will include Web3 elements in its customized loyalty program solution. The company partnered with Smartmedia Technologies, a Web3 loyalty rewards startup, to add innovative features to these programs that include virtual worlds, digital wallets, and gamified rewards.
Visa Turns to Web3 to Revitalize the World of Loyalty Rewards Programs
Visa, one of the largest payments companies in the world, is adding Web3 elements to its loyalty program solution. The company announced that it was revitalizing its traditional engagement solution with Web3 elements to catch the attention of a new kind of customer with more expectations about rewards than just receiving points.
For this, Visa partnered with Smartmedia Technologies, a startup that allows adding virtual and digital experiences to rewards programs. Smartmedia has worked with American Express, Accenture, Axe, and Vodafone.
Kathleen Pierce-Gilmore, SVP and Global Head of Issuing Solutions at Visa, acknowledged that traditional points programs have failed to address the new needs of consumers in this field, which includes digital collectibles and augmented reality elements. She stated:
Our new innovative digital loyalty solution empowers brands to reward customers not only for their transactions but for their active engagement, paving the way for secure, seamless and immersive digital and real-world experiences at their fingertips.
In practice, this means that brands will be able to reward customers with tokens and digital collectibles for purchases, social media interactions, augmented reality treasure hunts, and informative polls. These tokens will allow users to unlock rewards at some destinations or enrich their experience in digital worlds.
Visa has been very active in the cryptocurrency and blockchain, having partnered with Valr, an African exchange, in October. In the same way, Visa also expanded its stablecoin settlements capabilities to the Solana blockchain in September.
What do you think about including Web3 elements in Visa’s loyalty engagement solution? Tell us in the comments section below.
Grayscale Adopts Cash Model for Spot Bitcoin ETF but Warns of ‘Adverse Consequences’
Grayscale Investments has adopted the cash creation model, instead of the in-kind model, for its proposed spot bitcoin exchange-traded fund (ETF). However, the crypto asset manager warned of adverse consequences. “A spot commodity exchange-traded product that only employs cash creations and redemptions and does not permit in-kind creations and redemptions is a novel product that has not been tested, and could be impacted by any resulting operational inefficiencies,” the firm’s filing with the U.S. Securities and Exchange Commission (SEC) details.
Grayscale’s Spot Bitcoin ETF Filing Amendment
Grayscale Investments filed the second amendment to its registration statement (Form S-3) for Grayscale Bitcoin Trust with the U.S. Securities and Exchange Commission (SEC) on Dec. 26. The crypto asset manager outlined how its proposed spot bitcoin exchange-traded fund (ETF) will use the cash creation method, instead of the in-kind method.
“The trust is currently able to accept cash orders,” the filing states, adding:
The trust is not at this time able to create and redeem shares via in-kind transactions with authorized participants.
The filing further notes that “there has yet to be definitive regulatory guidance on whether and how registered broker-dealers can hold and deal in bitcoin in compliance with the federal securities laws.”
Grayscale is seeking to convert its bitcoin trust (GBTC) into a spot bitcoin ETF. Although the SEC initially rejected the firm’s filing, a court instructed the securities regulator to reassess its decision following the asset manager’s challenge. Many spot bitcoin ETF applicants, including Grayscale and Blackrock, the world’s largest asset manager, had pushed to use the in-kind model. However, the SEC reportedly insisted on the use of the cash creation model for spot bitcoin ETFs.
“The lack of ability to facilitate in-kind creations and redemptions of shares could have adverse consequences for the trust,” Grayscale described in its filing. “To the knowledge of the sponsor [Grayscale Investments], exchange-traded products for all spot-market commodities other than bitcoin, such as gold and silver, employ in-kind creations and redemptions with the underlying asset,” the filing explains, adding:
The sponsor believes that it is generally more efficient, and therefore less costly, for spot commodity exchange-traded products to utilize in-kind orders rather than cash orders.
Grayscale clarified that this is “because there are fewer steps in the process and therefore there is less operational risk involved when an authorized participant can manage the buying and selling of the underlying asset itself, rather than depend on an unaffiliated party such as the issuer or sponsor of the exchange-traded product.”
The filing additionally notes:
A spot commodity exchange-traded product that only employs cash creations and redemptions and does not permit in-kind creations and redemptions is a novel product that has not been tested, and could be impacted by any resulting operational inefficiencies.
“In particular, the trust’s inability to facilitate in-kind creations and redemptions could result in the exchange-traded product arbitrage mechanism failing to function as efficiently as it otherwise would, leading to the potential for the Shares to trade at premiums or discounts to the NAV per Share, and such premiums or discounts could be substantial,” Grayscale detailed.
On Monday, Grayscale announced the resignation of Barry Silbert from its board of directors. Last week, the SEC held meetings with several spot bitcoin ETF filers and reportedly set a deadline of Dec. 29 for amended filings for applicants who want to be included in the initial round of spot bitcoin ETF decisions.
What do you think about Grayscale adopting the cash creation model? Let us know in the comments section below.
SEC’s Preference Prevails: Blackrock Adopts Cash Model for Spot Bitcoin ETF
Blackrock, the world’s largest asset manager, has acquiesced to the U.S. Securities and Exchange Commission (SEC)’s preference for the cash creation model rather than the in-kind model for its spot bitcoin exchange-traded fund (ETF). “Blackrock has gone cash only. That’s basically a wrap. Debate over. In-kind will have to wait,” said an ETF analyst. “Good sign,” he added, noting that the SEC is “getting ducks in row” before the holidays.
Blackrock Adopts Cash Creation Model
Blackrock, the world’s largest asset manager, has yielded to the U.S. Securities and Exchange Commission (SEC)’s preference for the cash creation model, instead of the in-kind model, for its spot bitcoin exchange-traded fund (ETF).
The asset manager filed an amendment to its spot bitcoin ETF filing on Monday. The amendment details that Blackrock’s Ishares Bitcoin Trust issues shares in baskets of 40,000 or integral multiples thereof, noting that “Baskets may be redeemed by the Trust in exchange for the cash proceeds from selling the amount of bitcoin corresponding to their redemption value.” The amendment continues:
These transactions will take place in exchange for cash. Subject to the in-kind regulatory approval, these transactions may also take place in exchange for bitcoin.
In its latest amendment, Blackrock also switched the ticker for its spot bitcoin ETF from IBTC to IBIT. Bloomberg ETF analyst Eric Balchunas commented: “I’m not totally surprised Blackrock switched its ticker last minute. IBTC was already a ticker they used in Europe for a treasury ETF so confusing internally. IBIT was available for recycle via liquidated Defiance ETF. And it’s just as sober and Boomer-friendly as IBTC.”
Blackrock and several other spot bitcoin ETF issuers recently met with the SEC several times to discuss their applications, including the use of the cash creation model versus the in-kind model. Blackrock prefers to use the in-kind model and even proposed a revised in-kind model which it thought would resolve the SEC’s concerns.
Balchunas shared on social media platform X on Monday:
Blackrock has gone cash only. That’s basically a wrap. Debate over. In-kind will have to wait. It’s all about getting ducks in row bf holidays. Good sign.
What do you think about Blackrock adopting the cash creation model for its spot bitcoin ETF? Let us know in the comments section below.
Bullish Sentiment Surrounds AVAX Price As Republic Adopts Avalanche Blockchain
Tech firm Republic has recently announced its mission to democratize private market investing, with the selection of Avalanche as the platform for launching its profit-sharing digital asset, the Republic Note (R/Note).
The R/Note is a revenue-sharing digital security that is backed by Republic’s private equity portfolio, which includes over 750 assets.
Republic And Avalanche Forge Partnership
According to Republic’s announcement, Avalanche was chosen for several key reasons. Firstly, its scalability and speed ensure that Republic Note holders can enjoy seamless and cost-effective transactions.
Notably, Avalanche has established partnerships with renowned brands like Amazon Web Services and Mastercard, highlighting its technical capabilities.
Additionally, Republic plans to launch a dedicated Subnet on Avalanche next year, offering a purpose-built network specifically designed for the Republic Note.
This will provide enhanced security, privacy, and regulatory compliance, creating a robust digital security environment.
Mission alignment between Republic and Ava Labs, the team behind Avalanche, is another crucial factor. Per the announcement, both entities share a commitment to fostering a more inclusive future for financial markets through tokenization.
Furthermore, Avalanche’s “eco-friendliness” sets it apart from other blockchains, consuming significantly less energy, per the announcement.
The pre-sale of Republic Notes has already attracted participation from thousands of individual retail investors, resulting in pre-sales exceeding million. The public listing of the Republic Note is scheduled for December.
Optimism For AVAX Price
The partnership between Republic and Ava Labs is anticipated to have a positive impact on the AVAX price. The launch of the Republic Note on Avalanche’s platform establishes a strong foundation for expanding its reach to a global audience of investors.
Despite a 5% decline in the past 24 hours, AVAX has outperformed major cryptocurrencies such as Bitcoin (BTC) and Ethereum (ETH), with a 130% rally over the past 30 days, positioning itself as one of the industry’s top performers.
However, it is important to note that AVAX has recently undergone a correction, and its ability to surpass the .64 level will be crucial in determining its prospects amidst the ongoing bullish momentum.
Resistance levels at .59 and .74 have proven challenging for AVAX to breach and consolidate since February 2023.
Overall, the forthcoming launch of the Republic Note on Avalanche’s mainnet is a significant milestone in making the asset accessible to pre-sale participants who have contributed over million.
It remains to be seen whether this partnership can further bolster AVAX’s price and reinforce the positive trend observed over the past 30 days, potentially driving AVAX to new yearly highs in 2023.
The collaboration between Republic and Ava Labs underscores their shared vision of democratizing access to private markets through tokenization.
Featured image from Shutterstock, chart from TradingView.com
Study: Africa Likely to Leapfrog Leading Fintech Regions if It Adopts New Technologies
Africa will likely leapfrog the top fintech regions if startups on the continent adopt new technologies, the Global Fintech 2023 report by the Boston Consulting Group and QED Investors has said. The report points to the African continent’s young population as well as the projected population growth of 1.2 billion more inhabitants by 2050.
Overcoming Africa’s Financial Exclusion Woes
According to the Global Fintech 2023 report by the Boston Consulting Group and QED Investors, Africa and the Middle East are likely to leapfrog established fintech centers if they adopt new technologies. The report also noted that while cash is “still king” in Africa, fintech startups are ideally positioned to solve the continent’s financial exclusion woes. By overcoming this, the fintechs will help make Africa one of the fastest-growing regions globally.
On how Africa is likely to achieve this feat, the report pointed to the continent’s projected population growth of 1.2 billion more inhabitants by 2050. The report also cited Africa’s position as the continent with the youngest population globally. Nigeria, Africa’s most populous nation, is identified in the report as one example of the countries on the continent whose demographic profile makes it an ideal candidate to propel the fintech market in Africa.
Smartphones Present Major Fintech Opportunities in Lending and Payments
In terms of the technology that is likely to anchor the continent’s expected growth, the report said smartphones — which are already the primary way African residents access financial services — bring significant fintech opportunities.
“Accordingly, most Africans’ first interaction with the financial services sector may be through their smartphones—presenting major fintech opportunities in payments and lending for regional champions with full-stack attacker models,” the report explained.
The report, however, acknowledged that telco fintech players have dominated the African fintech market. It added that these will likely retain their dominance even as more fintech startups switch to new technologies.
As shown by the report’s data, revenue earned by African fintech startups is expected to grow 13 times and top billion by 2030, the fastest rate by any region. Latin America has the second-highest projected growth with 12.5x, while Asia-Pacific is projected to become the largest fintech market by 2030.
Register your email here to get a weekly update on African news sent to your inbox:
What are your thoughts on this story? Let us know what you think in the comments section below.
EU Council Adopts New Rules for Europe’s Crypto Markets
The Council of the European Union has given its final approval to new regulations for crypto assets and markets in the EU. The decision completes a lengthy and complex legislative process for what’s considered to be the world’s first comprehensive legal framework for digital assets like bitcoin.
EU Finance Ministers Give Final Nod to Markets in Crypto Assets Law
At a meeting on Tuesday, the EU Council, composed of the finance ministers of the member states, adopted the Markets in Crypto Assets (MiCA) legislation. The set of rules brings crypto assets, their issuers and crypto service providers under a Union-wide regulatory framework.
The formal adoption is the final step in the legislative process, the Council noted. It comes after a provisional agreement was reached in June 2022, following trilogue negotiations with the European Parliament and the Commission, and the EU lawmakers’ vote in April of this year.
“I am very pleased that today we are delivering on our promise to start regulating the crypto-assets sector,” stated Elisabeth Svantesson, the finance minister of Sweden. Quoted in a press release, she also emphasized:
Recent events have confirmed the urgent need for imposing rules which will better protect Europeans who have invested in these assets, and prevent the misuse of crypto industry for the purposes of money laundering and financing of terrorism.
The legislation is designed to regulate the supervision, consumer protection and environmental safeguards of digital assets, including cryptocurrencies like bitcoin. The new rules also cover utility tokens, asset referenced tokens and stablecoins.
The law regulates trading platforms as well as digital wallets used to hold crypto assets. “This regulatory framework aims to protect investors, preserve financial stability, while allowing innovation and fostering the attractiveness of the crypto-asset sector,” the EU Council insisted, adding:
It also introduces a harmonized regulatory framework in the European Union which, given the global nature of crypto markets, is an improvement compared to the current situation with national legislation in some member states only.
MiCA is part of a larger digital finance package, meant to develop a common European approach, which also contains a digital finance strategy, a Digital Operational Resilience Act, concerning crypto service providers, too, and a proposal on a distributed ledger technology pilot regime for wholesale uses.
How will MiCA change the regulatory climate for the crypto industry and users on the Old Continent? Share your thoughts on the regulation in the comments section below.
Litecoin Network Adopts Ordinal Inscriptions, Following Bitcoin’s Lead
Following a growing trend of Ordinal inscriptions on the Bitcoin blockchain, the technology has been ported to the Litecoin network, and the number of onchain Litecoin inscriptions has surpassed 13,000. Software developer Anthony Guerrera made Ordinal inscriptions on the Litecoin network possible by receiving 22 Litecoin to port the technology to the proof-of-work (PoW) blockchain.
Digital Collectibles Are Now Possible on Litecoin
Proponents of the cryptocurrency network Litecoin (LTC) were pleased to hear that Ordinal inscriptions are now possible on the network. Software developer Anthony Guerrera accepted a challenge to port the technology to Litecoin after the offer grew from five LTC to 22 tokens.
While Litecoin’s network has a number of differences, its codebase shares similarities with Bitcoin, including additions like Segregated Witness (Segwit) and Taproot, which make Ordinal inscriptions possible on the Litecoin network.
“JUST IN: BTC Ordinals are now on Litecoin,” Guerrera tweeted on Feb. 18. The coder also shared the open-source codebase hosted on Github and further explained that he inscribed the first Ordinal onchain. The developer said:
The first Litecoin Ordinal has been inscribed on the Litecoin blockchain. The mimblewimble whitepaper will live within Litecoin forever.
Since the codebase was released and the first Litecoin-based Ordinal inscription was shared on Twitter by Guerrera, the number of LTC-based Ordinals has grown significantly. At the time of writing, there are approximately 13,211 Ordinals on the Litecoin blockchain. Many people are sharing their Litecoin Ordinal inscriptions on social media and promoting their newly launched LTC-based collections.
Meanwhile, the number of Ordinal inscriptions on the Bitcoin blockchain has surpassed 160,000, and the growing trend shows no sign of slowing down. Furthermore, people are building infrastructure around Bitcoin-based Ordinals, such as minting tools that can issue an Ordinal inscription without a full node for a base fee, wallets, and marketplaces.
There are also numerous collections competing to be the ‘blue-chip’ non-fungible tokens (NFTs) on the Bitcoin blockchain. It’s hard to say whether the trend will grow on Litecoin as it did on the Bitcoin network, but after Guerrera minted the first one, thousands have followed. It will be interesting to see if digital collectibles minted on either Bitcoin or Litecoin will enter the established NFT market economy dominated by chains such as Ethereum.
What do you think about Litecoin-based Ordinal inscriptions? Share your thoughts in the comments section below.