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Fluffypony, the Master behind Monero Steps Down after 5 Years of Leadership

Riccardo Spagni, the lead maintainer of cryptocurrency Monero (XMR), has stepped down from his current position. Spagni, also known as Fluffypony, was the lead maintainer of the Monero project since 2014 when it first launched. According to an announcement, he will continue to be a part of the project but as a backup maintainer. ‘Snipa’, a steady contributor to Monero, will be the new leader of Monero. At present, it is unclear as to the reason for which Fluffypony has resigned though in the past he had expressed his thoughts on quitting the project, to quote, “I was the lead maintainer across all the projects, and at some point last year I was like: I can’t do this,’.

During an interview with Coindesk in May 2018, Spagni stated “I will always be an advocate for privacy, and Monero, a part of the Monero community, but my actual responsibilities by definition need to be reduced.” More specifically, Fluffypony’s other duties have also been delegated to other contributors, for example, approving announcement emails sent to members of the Monero community. Instead, he will be focusing on tasks such as engineering, administration, and server access.

Currently, Monero prices have dropped from $51 to $44 in these two days.

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First in the World? Lithuania Central Bank Approved Blockchain-based Digital Collectible

As revealed in a recent press release, the Bank of Lithuania has approved a sample size of the physical version of LBCOIN, a silver digital collector coin equivalent in value to €19.18. The coins were produced to commemorate the year of the Act of Independence of Lithuania and its 20 signatories.The sizing and form of this coin will be like that of a credit card, equally, it will depict the Act of 16 February 1918. The coin features a digitized picture of the Council of Lithuania as well as a Lithuanian Flag on one side coin. To add to its value, the national anthem has been inscribed in binary code. The other side of the coin showcases the Vytis – the coat of arms which represents the Republic of Lithuania.

The digital token was designed by Giedrius Paulaskis, and the Bank of Lituania is preparing to release 24,000 blockchain-based digital collector tokens. Every one of these tokens will feature one of the 20 signatories of the Act of Independence.Upon purchasing the digital coin, the collector will get one of the six randomly selected digital tokens. Once they have a collected token from each of the six available categories, they will be eligible to exchange the set for a physical silver coin.

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Impending Central Bank Digital Currency: Data Shows Not All Central Banks Support the Move

Reports of a unified digital currency to be issued by central banks of countries have been ongoing for some time, but a new surveyshows that not all central banks are open to the idea. The outcome of the survey was published by the Bank of International Settlements (BIS) which produced logistics and market sentiments in line with the Central Bank Digital Currency (CBDC) adoption.

Although banks in emerging market economies (EMEs) are switching direction towards the issuance of government-backedCBDCs, while those in developed countries seem to be employing a more logical approach on the move from fiat to digital currencies.

The paradox of the situation is that banks with the capacity to push the world into the digital currency era are actually not showing much interest towards adoption; with the reason for their reluctance remaining a question with no answer.

Figures from the survey show that 1.6 billion people could have access to CBDCs in less than three years which is the most baffling data from the survey titled “Impending Arrival—a sequel to the survey on central bank digital currency.” Participants of the survey included 66 banks representing 75% of the world’s population and 90% of its economic output. 10% of the banks stated they would launch the first general-purpose CBDCs in the space of three years, which represents 20% of the world population.

While reviewing the outcome of the survey with Cointelegraph, Himanshu Yadav, co-founder and managing partner of Woodstock Fund said, “As CBDCs are rolled out, some will ignore them, and some will explore them further, leading to a huge positive gain in the cryptocurrency ecosystem. Developers will build tools that will allow for seamless exchange between CBDCs and cryptocurrencies, and the race for digital currency supremacy will take center stage in this decade.”

This shows that central bank digital currencies despite being centralized in nature have the requirements to attain immediate mass adoption that has been taking the creators of cryptocurrencies which includes stablecoin more than a decade to achieve with the result still being in the mixed zone.

This is possibly due to the fact that central backs occupy a major position in the global economy and any adventure into the implementation of blockchain is a plus to the ecosystem.

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Brazilian Banking Federation President Claims Crypto Cannot Replace Fiat Money

Murilo Portugal, the President of the Brazilian Banking Federation, has argued that cryptocurrencies like Bitcoin and Ethereum are not real currencies. Portugal was speaking at a debate associated with the impact of the digital revolution redefining financial sector. The debate focused on disruptive technologies, how their deployment and use is affecting the traditional financial ecosystem.

Crypto World Under Pressure

While speaking at the debate, Portugal claimed that cryptocurrency does not fulfil any of the three fundamental functions of traditional money. He stated that cryptocurrencies are not valid as a means of exchange, a reserve of value, or a unit of account. He commented, “They are actually called coins but they are not coins, why it is cryptocurrency. They do not fulfil any of the classic functions of the money, which is to serve an account unit, where people can express prices. They do not serve as a mean of payment or as a store of value because the volatility is very high.”

The financial leader explained that the digital revolution is in a wholde different dimension in terms of the world of finance and therefore regulators must dive deeper into studying it. He acknowledged how cryptocurrencies are transforming the insurance, payments, and credit space. He further stated that information (data) and money are becoming equivalent, thus predicting that data would end up being regulated in a similar way as fiat in the future.

The Febraban president revealed that the young generation of Brazil are all jumping on the digital bandwagon. Only 56% of the population has access to the internet while 75% of the economically active population have a mobile phone. Latin American nations hold the largest number of crypto users in the globe. Brazil, Mexico, Argentina, Chile, and Colombia all fall within the top 10 cryptocurrency nations.

Venezuela, Brazil’s neighbor, is increasingly using cryptocurrencies, particularly Bitcoin as a mean of getting money out of the nation. Although Venezuela has been adversely affected by hyperinflation, Bitcoin is not being used as a traditional store of value. Bitcoin is being used as “vehicle currency” to transfer value out of the country. Informal money transmitters are increasingly using Bitcoin to transmit money outside the country. They hold onto Bitcoin, let it increase in value and when a client comes in to send money, they immediately cash it in and convert it as soon as possible to stable coins like the US dollars. The nation’s attempt at a petroleum backed cryptocurrency has failed.

When it comes to financial matters, Portugal is well respected and his words are taken seriously. Besides holding an economic development degree from the university of Cambridge, Portugal served as an executive director of the International Monetary Fund and World Bank.

The Brazilian president is not the only person who thinks cryptos do not have real use and cannot be regarded as real currencies. Aurel Schubert, the former director-general of the European Central Bank, stated that Bitcoin has not future and later or sooner, it will be on display in the Museum of Illusions. Andrew Bailey, the current governor of Bank of England, also mentioned that Bitcoin has not caught on as much as people had expected it to be.

Bitcoin as Virtual Property with Monetary Value

Cryptocurrency like Bitcoin is deemed legal by most jurisdictions across the world. It is regarded as a property with monetary value. Bitcoin serves the needs of users by being a better approach to transmit value from one individual to another. It is revolutionary because it could transmit any amount of value across any border or any distance without the involvement of regulators and intermediaries. It has become reputable by its popularity among people across the world. Although Bitcoin has not successfully evolved into medium of exchange, used in day-to-day life for selling and buying goods, it is frequently considered as a digital gold because of its ability to act as a store of value.

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US Regulators Overreach to Protect US Dollar Supremacy with TON Decision, Will Bitcoin be next?

If the last two years have revealed anything about our global monetary system, it is that the US Federal Reserve and President Donald Trump really do not want a competitor to the US Dollar.

The value of Bitcoin, the pioneer cryptocurrency born of the 2008/2009 global financial crisis, has risen dramatically since its inception and it even appears to be maturing into a form of digital gold. In addition, market sentiment towards investment in the coin has now evolved from fringe technology users to mainstream enterprises and everyday investors.

While the general consumer public has been getting comfortable with cryptocurrency, there has always appeared to be a very deliberate effort by the US authorities to stifle any maturation that Bitcoin hopes to see. And it’s not just Bitcoin, other digital assets and projects that have even begun posturing to utilize some of their own agency have all been thrown in front of the US Securities and Exchange Commission, and the outcomes seem all but predetermined.

SEC Commissioner Dissents on Bitcoin Double-Standard

In February this year, US Securities and Exchange Commission (SEC) Commissioner Hester Peirce wrote, that “the Commission applies a unique, heightened standard under Exchange Act Section 6(b) to rule filings related to digital assets” which had never been applied to traditional market offerings.

The SEC Commissioner’s dissenting statement came in response to the rejection of Bitwise’s Bitcoin ETF application.

Peirce wrote, “This line of disapprovals leads me to conclude that this Commission is unwilling to approve the listing of any product that would provide access to the market for bitcoin and that no filing will meet the ever-shifting standards that this Commission insists on applying to bitcoin-related products—and only to bitcoin-related products.”

The SEC has rejected all previous bitcoin ETF proposals filed to date.

There Can Be Only One…Telegram Gets the Message

While it tries to keep Bitcoin under wraps, the US Government along with its European Regulator allies has also forced the much-publicized Facebook Libra project to move away from its original plan of a permissionless digital currency towards a coin that would be subject to foreign exchange controls and regulations.

But perhaps the most excessive abuse of power by the US SEC has been the manner in which it recently shot down the Telegram Open Network (TON). It is difficult to see how the US regulators have not over-reached on their ruling and what’s more alarming is the lack of backlash towards the regulators by other sovereign nations who have had their own rights encroached.

Following Telegram abandoning the TON project, the companies CEO Pavel Durov published a long explanation entitled, “What was TON and Why is it Over?” But in summary, Durov explained that the primary reason to abandon the project ultimately came down to the US regulators somehow being able to encroach on the sovereign rights of other nations and dictate where Grams could be distributed for the entire world.

Durov wrote, “Perhaps even more paradoxically, the US court declared that Grams couldn’t be distributed not only in the United States, but globally. Why? Because, it said, a US citizen might find some way of accessing the TON platform after it launched. So, to prevent this, Grams shouldn’t be allowed to be distributed anywhere in the world – even if every other country on the planet seemed to be perfectly fine with TON.”

The Telegram CEO further reiterated that the US courts are exceeding its own jurisdiction and deciding what is best for the rest of the world and believes that they are exploiting their control over the dollar.

Durov stated, “Sadly, the US judge is right about one thing: we, the people outside the US, can vote for our presidents and elect our parliaments, but we are still dependent on the United States when it comes to finance and technology (luckily not coffee). The US can use its control over the dollar and the global financial system to shut down any bank or bank account in the world.”

Trump Plays the Same, but the Game has Changed

With TON basically put down and Libra tamed, it seems only a matter of time before the decision is made to once again re-focus on Bitcoin. Especially, given that the decision will ultimately fall into the hands of US President Donald Trump.

Last year Trump was quoted in an outburst against cryptocurrencies, “We have only one real currency in the USA, and it is stronger than ever, both dependable and reliable. It is by far the most dominant currency anywhere in the world, and it will always stay that way. It is called the United States dollar!”

While Trump’s state-of-play towards digital assets may be the same, perhaps the game has changed.

Following his comments last year, Trump now finds himself having to contend with the COVID market downturn as well as China’s unswerving mission to achieve the world’s first central bank digital currency (CBDC), or DCEP in their case.

Should China be able to achieve a central bank currency first, it could spell the end of US dollar dominance, particularly within those countries involved in the Belt and Road Initiative, a project spearheaded by China to digitalize the old silk road connecting Europe, Asia, and Africa.

And finally, given Trump’s push for negative interest rates, the excessive amounts of money printing stimulus, and a world shifting away from Oil consumerism and consequently the petro-dollar: how strong and stable can the US dollar even remain?

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Billionaire Investor Ray Dalio Bearish on Cash Says Central Banks Drive Economy

Billionaire investor Ray Dalio, the Founder and CIO of Bridgewater Associates, asserted that since the 2008 Financial Crisis, the behavior of central banks like the Federal Reserve demonstrates that capital markets are no longer free.

Ray Dalio believes that the Federal Reserve no longer operates within the traditional economic system and is now the market maker. He also expressed that the traditional valuation of cash has been thrown out the window and will make the US dollar less attractive as a reserve currency.

Central Banks Drive Capital Markets

In an interview with Bloomberg, Dalio argued that capital markets are no longer free as they are now driven by the shifting priorities of central banks to own assets they buy and sell.

Dalio told Bloomberg that capital markets, “Are driven by central banks not only their actions but their desire to be an owner of those assets. Their priorities about that ownership when they buy and when they sell are not the same as the classic free-market allocations,” leading the billionaire to conclude that, “The capital markets are not free.

The billionaire highlighted that the Fed’s behavior has changed from putting money on deposit for banks to borrow and lend out—which fuels the traditional credit system and creates fair competition for financial assets—to asset ownership. Consequently, Dalio asserts that the economy and markets are primarily driven by the ownership of assets by central banks.

US Dollar as a Reserve Currency?

Dalio explained that the Feds transition to market maker and the current capital market environment was a consequence of the 2008 Global Financial Crisis. He did concede that without the Fed taking on this role large parts of the US economy would have failed.

In the interview, Dalio also highlighted his concerns for the US dollar as a reserve currency as the flood of cash clearly indicates that the traditional method of valuation no longer applies to cash.

Dalio has been known to be bearish on cash as a reserve currency but still believes cryptocurrencies like Bitcoin are too volatile to be considered as an alternative. He also previously noted that reserve currencies go through cycles and that, just as the British pound was the world’s reserve currency before the US dollar, so too the dollar is now facing reserve status challenges by China.

CFTC Committee to Hold Virtual Meeting on Digital Currencies and Blockchain

The Commodity Futures Trading Commission (CFTC) is set to hold a virtual meeting centered around digital currencies. The meeting scheduled by the Technological Advisory Committee (TAC) of the CFTC has drafted discussions centered around decentralized ledger technology (DLT) and digital currencies per its agenda. The CFTC has been showing a positive attitude towards digital currencies as detailed in its earlier released regulatory framework. The TAC meeting is scheduled for the 16th of July and will feature public hearings from TAC sub-committees.

The CFTC is Bullish on Digital Currencies

As a regulatory body, the CFTC has adequately recognized the role of digital currencies and decentralized ledger technologies in today’s changing digital economy. In its framework, the commission acknowledged cryptocurrencies as commodities that can be traded. The CFTC has affirmed that it will utilize a “principle-based” system in driving innovations in the blockchain advancements as well as other tradable markets under its purview.

As part of the arranged virtual meeting, the TAC will have hearings based on the scalability and resiliency of decentralized ledger technology systems with Shaunna Hoffman, a Global Cognitive Legal Leader with IBM, an organization renowned for advancing blockchain development. The meeting will also feature CentralBank Digital Currency design, the volatility of Bitcoin (BTC) against other assets as well as the impact of Covid-19 on asset price correlation.

Scheduling this meeting following its released framework gives an inclination that the CFTC is keen on consolidating its bullish approach towards digital currencies.

Expectations of Massive Crypto Boom

The CFTC role in the blockchain space has been conspicuous in recent times. In November 2019, the United States CFTC commissioner Brian Quintenz acknowledged that crypto powered derivative contracts have had an enormous impact on the U.S economy. The relevance of blockchain technology during the COVID-19 induced pandemic has also shown how invaluable decentralized ledger technology and cryptocurrencies can be. The CFTC is thus set to assert a positive oversight role in order to “stay ahead of the curve” as CFTC Chairman Heath Tarbert asserted.

Bank of Japan Sets Up New Research Team For Digital Yen CBDC Development

Japan’s central bank announced that it has set up a new research team to dive deeper into Central Bank Digital Currency (CBDC) experimentation and development. The Bank of Japan (BOJ) is possibly preparing for a CBDC, given the recent rising demand for classless payments and growing interest among other central banks.

The New Team to Explore the Use of CBDCs

The new team would follow up on the Bank of Japan’s efforts on CBDCs, as well as on joint research that the central bank has been carrying out with other major central banks since January. In other words, the new team is set to take over from a previous working (research) group, which was created in January this year to look into the feasibility of a national CBDC. Furthermore, the team would continue doing research work undertaken with other leading central banks.

The team would belong to the central bank’s payment and settlement systems department.

Since the beginning of this year, Japan’s central bank has been formally researching CBDCs when it partnered with five major central banks, including the Swiss National Bank, the European Central Bank, the Bank of England, the Sveriges Riksbank (Sweden), and the Bank of Canada. The formation of the new team indicates that the Bank of Japan is determined towards CBDCs.

A New Deal for Japan

The news comes just a few days when Japan’s government said it is contemplating issuing a national digital currency by including the plan in its policy framework. The move to include such a plan in the country’s policy framework would make the issuance of a CBDC as part of this year’s government policy.

Although the Bank of Japan has previously stated it has no immediate plans to issue a digital yen, the recent breaking news indicates urgency. Japan’s central bank is shifting towards embracing technology as China appears to be moving quickly to launch its own CBDC. Japan’s lawmaker, Norihiro Nakayama, once stated that Japan would require support from the US to curb the influence of China’s digital currency.

Senate Hearing Views Digital Dollar CBDC as Critical to Maintaining Global Reserve Currency Status

The United States government’s plan for its digital dollar or central bank digital currency (CBDC) may have just reached a new level of urgency, as the US hopes to maintain its most effective tool of power—global dependence on the Federal Reserve and the US dollar.

The US Senate Banking, Housing, and Urban Affairs Subcommittee on Economic Policy conducted a hearing on July 22, entitled—Winning the Economic Competition—which mainly focused on the rising economic power struggle between China and the United States.

The subjects being strategically discussed by the Senate focused on maintaining the US dollar’s dominance as the global reserve currency for the global economy as China’s influence continues to rise. The hearing featured five speakers who covered topic such as supply chain dependence and emerging technologies like 5G—with one speaker bringing the topic back to digital dollars.

While the previous hearings have had a major focus on what role digital asset could play in maintaining the economic status quo, cryptocurrency was referenced in this Senate hearing as one of the many tools that could maintain US economic supremacy.

Christopher Giancarlo, Former Commodity Futures Trading Commission (CFTC) Chairman was in attendance in Wednesday’s Senate hearing and he turned the subject to digital dollar experimentation and the necessity to begin pilot programs to to test the uses of a Federal Reserve issued tokenized dollar.

Subcommittee Chair, Senator Tom Cotton (R-Ark) believes the idea of a digital dollar has moved beyond just academic discussion and asserted that CBDC development should be escalated—adding that is needs to be “better than Bitcoin.”

Senator Cotton said:

“Maintaining the dollar’s supremacy is not only an economic matter, it is a critical strategic matter as well. Is what allows us to have such effective sanction regimes around the world as well as other benefits.”

Cotton then invited Giancarlo to discuss the next steps required before a digital dollar could be launched. Crypto Dad, as Giancarlo is sometimes referred to due to his openness to innovation, went on to emphasize the issue of which nation’s values will define the global reserve currency. The United States dollar has enjoyed this status for the better part of a century. Giancarlo warned that China may gain the edge in the near future as it is in the process of rolling out its digital Yuan while the US is far behind in development.

Witness to the hearing, Walter Russell Mead, the James Clarke Chace Professor of Foreign Affairs and Humanities at Bard College and a member of the Hudson Institute, lent his support to the Senator Cotton’s argument. He asserted that the US Federal Reserve System is one of the nation’s “most effective tools of power.”

On the evolution of the dollar to meet the digital landscape, Mead said:

“We have to assume that as the nature of finance changes, the nature of currencies change, we have to stay at the leading edge…we need to be thinking actively about how the dollar can be a fundamental building block for economic activity in this time of the information revolution.”

US Federal Regulator Says Banks Can Offer Cryptocurrency Custody Services to Customers

The United States Office of the Comptroller of the Currency (OCC) issued a public letter on July 22, clarifying that federal savings associations and national banks have the legal right to take custody of crypto-assets. The OCC is an independent bureau within the US Department of The Treasury and was established to supervise, regulate, and charter all federal saving associations and national banks in the US.

Cryptocurrency Meets Institutional Banking

The OCC has issued a landmark announcement for the cryptocurrency industry by confirming that all federal saving associations and national banks are allowed to offer cryptocurrency custody services for customers.

With the letter, federal savings associations and national banks have been made aware that they can freely hold cryptocurrency assets for customers, whether it is holding keys or offering other custody or protective services. The letter clarifies the stance by the OCC that bank custody services, which have been known to include holding digital assets, can extend to cryptographic keys and other cryptocurrency-related assets.

Chief Counsel and Senior Deputy Comptroller at the Office of The Comptroller of The Currency (OCC) wrote the letter as a response to an unnamed bank, which had sought the opinion.

The letter reaffirms the position of the OCC that national banks can offer permissible banking services to any lawful business they choose, including cryptocurrency businesses, provided that they comply with applicable law and effectively manage the risks.

In the letter, the regulator explained the rationale for its decision, saying that cryptocurrency users desire safe custody for their crypto assets from recognized institutions such as banks. The OCC also justified that banks providing custody storage could be a significant benefit for market participants such as investment advisers and fund managers who need third-party asset custodianship.

As part of the letter, the OCC said that state and national banks and federal savings associations have long provided custody and safekeeping services, including both electronic assets and physical objects. The regulator stated that the OCC has especially recognized the significance of digital assets and the role that banks play in providing safekeeping for such assets since 1998.

The Acting Comptroller of The Currency at the OCC, Brian Brooks, also stated that regulators strive to ensure that banks offer financial services that meet the current needs of their customers. He said that banks could continue providing cutting-edge custody services like safe deposit boxes and vault storage to safeguard customers’ valuable assets, including cryptocurrencies. Brooks is the former chief legal officer of Coinbase cryptocurrency exchange, who took office at the OCC less than two months ago.

The OCC said that its approval does not limit banks to a specific type of cryptocurrency custody. Financial institutions can, therefore, hold digital assets and store copies of their customers’ private keys in secure cold storage facilities.

Expanding Cryptocurrency Custody Matters

The latest announcement is seen as a significant boon for cryptocurrency in the US. The move has allowed federal savings associations and national banks to further embrace cryptocurrency and develop related services without previously-vague guidance. The announcement would thus enable an increasing number of banks and financial institutions to launch crypto custodial services. These solutions give institutional and retail investors peace of mind that their digital assets are insured, secure, and under the care of a trusted third-party, thus freeing them from responsibility for safeguarding their crypto assets.