The push by Binance, the world’s largest exchange by trading volume, to expand its influence has continued to gain increased momentum in Turkey.
The exchange’s Chief Executive Officer, Changpeng Zhao, known on Twitter as ‘CZ’, met with Turkish officials where he discussed issues bothering the crypto ecosystem.
“We had a virtual meeting with Mr. Changpeng Zhao, the founder of Binance. Mr. @cz_binance and I had discussions on the blockchain ecosystem and crypto assets,” said Dr.Nureddin NEBATİ, Turkey’s Minister of Treasury and Finance, one of the key officials that were a part of the meeting.
While the exact details of the conversation were not revealed, crypto Twitter has been speculating that something big might be underway between the trading platform and the Turkish government.
Over a year ago, Binance came under fire for operating illegally in quite a number of jurisdictions. With its license revoked, it made up its mind to pursue a more wholesome relationship with regulators across the board. With its commitment to tightening the loopholes in its engagement with regulators, it has earned one of the most impressive backing from regulators over the past year.
In his global campaign to get regulators’ nod, CZ has visited a number of government officials in France, Dubai, and even Kazakhstan. CZ’s meeting with Kazakhstan’s officials also involved signing a Memorandum of Understanding (MoU) with the country’s President, Kassym-Jomart Tokayev, as the parties looked to foster digital education and transformation in the country.
Binance’s efforts have produced operational licenses in key regions, including Spain, Bahrain, the United Arab Emirates (UAE), and Italy amongst others. The trading platform has reiterated how it is committed to ensuring governments around the world introduce functional regulators that can help foster the industry’s growth as a whole.
The meeting with the Turkish Minister is yet another way in which the trading platform is taking the lead in the industry.
Portuguese cybersecurity protocol Naoris announced on Wednesday that it has raised $11.5 million in a funding round led by Tim Draper’s Draper Associates.
Other high-profile investors, like Holt Xchange, Holdun Family Officer, SDC Management, Expert Dojo, Uniera, Level One Robotics, and multiple angel investors, including some “well-known” NBA stars and tennis players participated in the funding round.
David Carvalho, the founder and CEO of Naoris Protocol, said that the cybersecurity company plans to use the fresh funding to create a decentralised proof-of-security consensus mechanism by the end of 2022 as well as expand and scale its operations.
The executive elaborated that Naoris Protocol will use the capital to develop an AI-based “cybersecurity mesh” that it promises will protect web3 networks better as they grow.
With its blockchain-based cybersecurity mesh, Naoris aims to transform existing web2 networks that are highly centralised into decentralised networks made up of “trusted machines” that can help to validate one another.
Naoris Protocol is trying to solve the current problem whereby today’s computer networks can never be completely secured. That is because an attacker only needs to compromise a single device within any network to gain access to a business’s system. This means that the more a network grows, the more entry points emerge that attackers can easily use to gain access to a network and monitor or steal sensitive information.
Naoris protocol relies on blockchain and its decentralised proof of security consensus mechanism to transform each device into a trusted validator node, which is then tasked with validating all the other devices within the network.
This decentralised technique works because the more the network grows, the more validators there, thus increasing its security. It is a distributed security environment where every device continuously validates every other device in the network. This brings trust across all devices, thus securing a baseline layer and enabling trust and risk mitigation to be enabled in every element of the network. Since each device is basically a security watchdog for every other, they can act in synchronous harmony while enforcing and securely adhering to security policies.
The company says it is chasing to tap a $10 trillion global opportunity — it is estimated that cybercrime will cost businesses worldwide $10.5 trillion annually by 2025.
Carvalho commented: “Our vision is to leverage the cryptographic power of the many through blockchain to fundamentally change how trust happens between devices and applications on the internet.”
Naoris Protocol plans to create and run the decentralised system by the end of this year before rolling out its full product to clients across the Web3, critical infrastructure, banking, healthcare, government sectors, and other industries by mid-2023.
Tether Holdings Ltd, the blockchain startup that is in charge of the USDT stablecoin issuance and operations, has come out yet again to address the growing rumours about the composition of its reserve base.
Per the update on Wednesday, the stablecoin issuer said it is unlike what is currently in circulation. It holds no Chinese Commercial Paper as a part of the security to protect the integrity of the USDT. The firm warned against the impacts of false news, which can literally do more damage to the ecosystem than even cyber threats.
“The spreading of false information is the biggest threat to the cryptocurrency industry that currently exists. It is a threat of the same concern as scams, hacks, or cyberattacks because the spreading of false information risks not only the reputation of the industry but also each and every member of the community,” the company wrote in the update.
It clearly outlined that its total Commercial Paper exposure has been slashed from 30 billion as of July 2021 to approximately 3.7 billion nowadays. The firm said it plans to reduce the commercial papers to about 200 million by the end of August this year and its ultimate goal is to take the number to 0 latest by the end of November this year.
Maintaining a robust reserve has always been a major requirement for running a stablecoin like the USDT. While it has been bedevilled by a number of controversies with regulators in the past, Tether is now committed to publishing a regularly updated report about its stablecoin reserve portfolio.
Circle, the issuer of the second largest stablecoin, USDC, has also joined this trend as both stablecoin companies have continued to face scrutiny following the collapse of TerraUSD (UST) algorithmic stablecoin. Regulators are determined to prevent any other such mishap, and the oversight on these platforms has grown over the past couple of weeks.
The US Federal Reserve on Wednesday announced a 0.75 percentage point interest rate increase as part of efforts to clamp down rising inflation without creating a recession.
The latest interest rate rise by the Fed follows a similar hike in June – aggressive hikes that have so far put pressure on markets, including cryptocurrencies like Bitcoin (BTC). This is the fourth time the central bank has increased interest rates this year.
The price of Bitcoin increased 3.6% in the hour after Fed Chair Powell announced another big interest-rate raise.
Although crypto prices rose slightly following the Fed’s announcement, the markets are expected to remain volatile and bearish in the next few weeks.
Bitcoin was trading around $22,784.10 as of Thursday morning, 01:24 am EAT (East Africa Time), up 8.04% in the last 24 hours.
Aggressive rate hikes normally have negative impacts on crypto prices, and the markets are likely to continue to be bearish in the short term.
Industry leaders shared similar opinions regarding crypto market outlook, Chris Terry, BPSAA Board Member and VP of Enterprise Solutions at SmartFi, commented:
“We anticipate that Bitcoin will continue to trade in this tight range of $20,000 plus or minus 10-15%. None of this should be a surprise. We could be in this stalled market for weeks and weeks. Boring.”
“The crypto economy also moves up, overperforming the stocks, thanks to the higher volatility. It’s very interesting also to see how crypto is starting to correlate with the stock market and in general, with the planetary economy. It means that the crypto market is reaching a certain level of maturity.”
Risky assets like cryptocurrency and stock have been heavily correlated since the beginning of this year. Both have been moving in similar patterns and have struggled to gain momentum this year as investors are pulling away in response to soaring inflation, rising interest rates, and a potential recession.
Does the interest rate hike continue?
The Fed raised its benchmark interest rate by 0.75% (75 basis points), thus repeating the same hike it created the previous month.
The hike comes after data released earlier this month showed that prices of goods jumped a staggering 9.1% in June. That inflation rate, as witnessed more than 40 years ago, has put additional pressure on the Federal Reserve to increase interest rates.
Federal Reserve Chairman Jerome Powell stated on Wednesday that the central bank remains committed to bringing inflation down to a target rate of 2% and further said the Fed is well-equipped to accomplish that goal.
Powell mentioned at a press conference: “My colleagues and I are strongly committed to bringing inflation back down, and we’re moving expeditiously to do so. We have both the tools we need and the resolve it will take to restore price stability on behalf of American families and businesses.”
The Fed stated that additional rate hikes will be expected as “appropriate” to fight runaway inflation. In a statement on Wednesday, the Fed said: “Inflation remains elevated, reflecting supply and demand imbalances related to the pandemic, higher food and energy prices, and broader price pressures.”
The central bank added, “Russia’s war against Ukraine is causing tremendous human and economic hardship. The war and related events are creating additional upward pressure on inflation and are weighing on global economic activity.”
An increase in the benchmark interest rate normally raises borrowing costs for consumers and businesses, which in theory, is meant to reduce inflation by slowing the economy and reducing demand. This means borrowers will face higher costs, from credit card debt and car loans to mortgages. But that approach risks pushing the economy into a recession.
Mixed economic data indicates a country bolstered by robust hiring and an uptick in retail sales despite several rate hikes this year designed to slow economic activity. Last month, the U.S. witnessed stronger than expected job growth, as the economy added 372,000 jobs while the unemployment rate remained at 3.6%.
However, other indicators (like slowing home sales and a drop in consumer confidence) suggest the economy has started to weaken.
According to Andrew Levin, a former Fed economist and a professor at Dartmouth College, if the central bank hikes interest rates too quickly, an abrupt economic slowdown could send the economy into a recession.
