Tag: Crypto Ban

Argentina Halts Crypto Operations Undertaken by Financial Institutions

by Blockchain News

Days after Argentina’s largest private bank Banco Galicia opened crypto trading services, the nation’s central bank cracked the whip by banning financial institutions from carrying out crypto transactions.  

The central bank noted that its decision to stop crypto transactions in the entire financial sector was reached to “mitigate the risks” involved when using digital assets, such as money laundering, cyberattacks, and high volatility. 

Financial institutions will only be allowed to finance investment, consumption of goods and services, and production. Argentinians, therefore, will lose opportunities to undertake crypto operations through banks as the blanket ban on unregulated digital assets takes effect. 

Recently, Banco Galicia rolled out the new service based on growing demand. It was to enable users to buy, send, and receive Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), and USD Coin (USDC). 

To tame runaway inflation, Argentinians have been seeking shelter in crypto. 

This can be illustrated by the fact that Argentina is among the world’s top 10 nations with the highest crypto adoption rates. Therefore, the latest development is a big blow.

With annual inflation rates surging by more than 50%, crypto exchange Lemon Cash had stipulated that it would roll out three million Visa crypto cards earlier this year. 

Franco Bianchi, the chief marketing officer at Lemon Cash, said:

“Latin America is a good place for these services. Several of the countries have unstable economies and devalued currencies, and the people seek access to cryptocurrencies as a refuge.”

Economists speculate that the inflation rate on Argentinian soil will hit 55% this year from the current 50.7%. 

Therefore, the crypto ban will undermine Argentinians because they were using cryptocurrencies as hedges against a cyclical economic crisis that includes a recession, hyperinflation, and repeated currency devaluations. 

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Russian Finance Ministry Believes Crypto Should be Regulated not Banned

by Blockchain News

The Ministry of Finance in Russia demonstrates its latest stance about the hot issue of the intended blanket ban on crypto-related activities by the nation’s apex bank. 

The ministry believes that these plans should be shelved because crypto regulation will fill the void by providing both transparency and protection to citizens. 

Ivan Chebeskov, the department director of the Russian Finance Ministry, stated:

“The first thing that should be done is to protect the interests of citizens, consumers of such services, those buying these assets or using the cryptocurrency in certain other process solutions. In this connection, regulation is needed, rather than prohibition.”

The ministry is awaiting the official position of the Russian government after sending a concept for regulation about the crypto market for review.

Chebeskov added:

“The Ministry of Finance is proactively participating in the elaboration of legislative initiatives …we have the prepared regulation concept that we are discussing inside the Finance Ministry, and we have recently sent it to the government office.”

On January 21, the Central Bank of Russia (CBR) went on the offensive through a newly published report entitled “Cryptocurrencies: Trends, Risks, Measures,” and linked cryptocurrencies to Ponzi schemes, thus necessitating their prohibition. Part of the proposal entails cracking the whip on offenders participating in the crypto market.

Nevertheless, Russian tech and political oligarchs are up in arms about these plans. For instance, Telegram founder and CEO Pavel Durov opined that a crypto ban would hinder growth in the emerging world of blockchain technology.

Furthermore, Leonid Volkov, the Chief of Staff to the Russian opposition leader, Alexei Navalny, stated that this was an effort in futility because the blanket ban on crypto assets was like prohibiting person-to-person transfers, which he noted was “Impossible.”

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Russian tech and political executives denounce crypto ban proposal

by Cointelegraph

Russia’s recent ban on crypto has drawn criticism from a number of big names, including Alexei Navalny’s chief of staff Leonid Volkov, and Telegram founder Pavel Durov.

On Jan. 20, Russia’s Central Bank published a report proposing a blanket ban on domestic crypto trading and mining. The report stated that the risks of crypto are “much higher for emerging markets, including Russia.”

However, it appears that this proposed ban isn’t universally accepted in the former Soviet Union. A Jan. 22 post by the Telegram founder, Pavel Durov stated that the proposed ban on crypto would “destroy a number of sectors of the high-tech economy.” He added:

“Such a ban will inevitably slow down the development of blockchain technologies in general. These technologies improve the efficiency and safety of many human activities, from finance to the arts.”

While Durov conceded that the “desire to regulate the circulation of cryptocurrencies is natural on the part of any financial authority,” he concluded that “such a ban is unlikely to stop unscrupulous players, but it will put an end to legal Russian projects in this area.”

Leonid Volkov: banning crypto is “impossible”

Meanwhile, in a Telegram post on Jan 20. Volkov, who is the chief of staff for Alexei Navalny, wrote that the ban would be like “calling a spade a spade.”

Navalny is an opposition leader in Russia and founder of The Anti-Corruption Foundation (FBK). In August 2020, he was poisoned with the nerve agent Novichok. After recovering in Germany, he returned to Russia in January 2021 where he was arrested and has remained imprisoned since.

In his announcement, Volkov referenced a Jan. 20 report by Bloomberg. It claimed that Russia’s Federal Security Service (FSB) was instrumental in advancing the ban because crypto can be used to finance “non-systemic opposition and extremist organizations.”

He went on to add that he was “sure that the Bloomberg version, in this case, is 100% close to reality, but nothing will happen” because Russians are more likely to use crypto to buy drugs rather than donate it to the Moscow-based non-profit FBK.

“Technically, banning cryptocurrency is the same as banning person-to-person transfers (i.e. it’s impossible)… Yes, they can make it very difficult to deposit funds on crypto exchanges, which means that intermediary services will simply appear that will do this through foreign jurisdictions. Yes, transaction costs will rise. Well, that’s all, I guess.”

Related: Bank of Russia governor: Banning crypto in Russia is ‘quite doable’

Many of Russia’s neighbors have also taken a hard-line stance on crypto. On Jan. 19, citizens in neighboring country Georgia were made to swear an oath to cease mining crypto. The governments of Kosovo and Kazakhstan, have also recently been added to the list of countries that have banned crypto mining.

Perhaps one exception is Russia’s neighbor Ukraine, which passed a number of laws to facilitate the country’s adoption of cryptocurrencies in September 2021.

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Another Islamic Organization Issues Fatwa Against Cryptocurrencies in Indonesia

by CryptoPotato

Tarjih Muhammadiyah is the third Islamic organization to issue a fatwa against the use of cryptocurrencies in Indonesia.

Cryptocurrencies аnd Fatwas

According to a report by CNBC Indonesia, the Tarjih Council and the Central Executive Tajdid of Muhammadiyah issued a new fatwa against cryptocurrency use, deeming it haram, or unlawful, for Muslims. The organization detailed two reasons behind the move.

Firstly, it observed that digital assets such as Bitcoin are speculative and highly volatile in nature. Additionally, cryptocurrencies are not backed by any other assets such as gold and are believed to be “obscure,” thereby making them unlawful under Islamic laws.

Secondly, the fatwa also stated that digital currencies do not follow Sharia tenets for barter system or medium of exchange laws which need them to be legal tender and approved by the state, or in this case – the central bank.

Will Fatwa Impede Crypto Adoption In Indonesia

Even though Tarjih Muhammadiyah happens to be one of the largest non-government Islamic organizations in the country, fatwas are typically not treated as binding judgments. But this isn’t the first time that an Islamic organization deemed cryptocurrencies “haram,” which means forbidden, in Indonesia.

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In November, the Islamic scholars declared that all digital asset trading is forbidden for Muslims. The National Ulema Council (MUI) cited aspects such as uncertainty, wagering, and harm in cryptocurrency assets.

It is important to understand that the decisions made by the Islamic authorities are not an official decree, nor do they imply an outright prohibition on cryptocurrency trading. But its far-reaching consequences, in a country that houses the largest Muslim population, cannot be ignored entirely.

Having said that, the barriers of trading have never been lower in Indonesia. It recorded almost $10 billion in crypto transactions in 2021. Moreover, the crypto giant Binance was in talks with some of Indonesia’s biggest companies to launch a crypto venture in the country.

The CZ-led exchange also teamed up with a consortium led by telecom Indonesia-backed MDI Ventures to expand the blockchain ecosystem in the country by setting up a new digital asset trading platform.

Despite the initial reluctance, cryptocurrencies were legalized in September 2018. Indonesia’s Ministry of Trade approved the trading of crypto assets as commodities.

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Russia Just Suggested A Blanket Ban On Bitcoin And Cryptocurrency

by NEWSBTC

Russia has proposed a full ban on crypto, this includes both mining and use of cryptocurrencies. The country’s Central Bank suggested that the trading of cryptocurrencies must come to a stop immediately. In the report put forth in an online press conference, the Russian government along with the Bank of Russia suggested this regulatory measure. This blanket ban on cryptocurrency was tied to risks of financial instability and rising illegal activities. The digital asset apparently posed a serious threat to the sovereignty of Russia’s monetary policy. Russia holds the third rank in bitcoin mining after US and Kazakhstan.

This recent ban on cryptocurrency comes right after the Central Bank of Russia displayed interest in securing information from commercial banks in respect to private money transfers. It also specified that the information collected will comprise of details of individuals who have previously traded in cryptocurrency, not only within the country but also outside of it. Despite Russia legalising cryptocurrencies in the year 2020, it always remained sceptical in regards to accepting the same as a medium of exchange. The report stated that this measure of banning crypto might after all be in favour of Russial as this decision happens to be the “best” and “optimal” one that safeguards Russia.

“Cryptocurrencies: Trends, Risks, Measures”

In the report, “Cryptocurrencies: trends, risks, measures” an excerpt read that cryptocurrenices “offer an outlet for people to take their money out of the national economy, thereby undermining it and making the regulators job of maintaining optimal monetary policies harder.” The other major concern that led to this ban was the ever increasing dynamic and volatile nature of cryptocurrency along with illegal activities being funded by the digital asset. The culmination of which has urged the Central Bank to form new laws and regulation which could help ban the digital asset in Russia.

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Related Reading | NGOs Use Crypto To Aid Afghans Facing Taliban Takeover

Russia previously also expressed its concerns around cryptocurrency as they believed that the asset could be used for money laundering and even financing terrorism. Reportedly, Russia has showed interest in creating thier own digital currency (CBDC) which is believed to enable, equip and finally empower the functioning of future banking in the country.

This could help people of Russia to opt for a quicker, easier and more seamless payment option. The report also stated that there will be a prohibition of mutual funds investments in cryptocurrency. Besides that, institutional investors have also been discouraged from investing in crypto. This move might be quite a blow to the country’s financial organisations as any cryptocurrency in the form of a financial asset will not be accounted for. Failing to abide by the above mandated resolution will result in firm punishment as mentioned in report.

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The crypto industry's growth has attracted a lot of negative attention | Source: TOTAL-CRYPTOCAP on TradingView.com

Russia Crypto Ban Extends To Mining Also

Cryptocurrency mining in Russia has a major footing as the country is the third largest when it comes to mining of cryptocurrencies. Volume of cryptocurrency mining still remains the highest in the US, followed by Kazakhstan, however, the latter has been in talks about cutting off electricity provisions. This news about Russia’s ban might potentially drive crypto enthusiasts across the globe up the wall. Minimising of crypto issuance along with over-the-counter trading desks, crypto exchanges and peer-to-peer exchanges could send a ripple across the whole crypto space.

Related Reading | Digging Into The Data Of Bitcoin Mining Decentralization

The aforementioned report also added that this prohibition was also because of environmental factors as it creates “”creates a non-productive electricity expenditure, which undermines the energy supply of residential buildings, social infrastructure and industrial objects, as well as the environmental agenda of the Russian Federation.

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Russia’s Central Bank Reportedly Proposes a Total Crypto Ban

by CryptoPotato

The central banking institution of the largest country by landmass – the Bank of Russia – urged the local government to impose a blanket ban on all cryptocurrency endeavors on Russian territory. It argued that digital assets remind of a pyramid scheme, undermine the sovereignty of monetary policy, and threaten the local financial network.

Russia Calls for a Crypto Ban

Many Russian authorities do not classify as the most crypto-friendly politicians since they have repeatedly opined against the asset class.

Some notable examples include Elvira Nabiullina – the Chief of Bank of Russia – who stated last year that investing in digital assets is more dangerous than any other strategy. Deputy Governor Sergey Shvetsov went even further, saying dealing with bitcoin is so risky that it can be compared to entering a minefield.

Keeping these adverse viewpoints in mind, it is no wonder that today (January 20), Russia’s central bank proposed a China-style ban on everything crypto.

According to the financial institution, bitcoin and the alternative coins could shake the monetary stability of emerging markets as the world’s largest nation by landmass is among them. Also, most residents of such countries lack sufficient financial literacy, the bank added.

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Furthermore, the organization claimed that cryptocurrency mining opposes Russia’s green agenda and jeopardizes the state’s energy supplies. It is worth noting, though, that digital asset mining thrives in the country, and it is the third-largest miner globally, falling behind the USA and Kazakhstan.

At the end of last year, Russia’s central bank came up with another anti-crypto proposal. Back then, the organization wanted to prohibit digital asset investments on Russian soil, citing similar potential risks.

Prior to that, Alexey Moiseev – Russia’s Deputy Finance Minister – informed that the Russian Federation has no plans to impose a complete crackdown on trading with cryptocurrencies. Contrary to many of his colleagues, he even expects blockchain technology to become a part of the future monetary system.

Pakistan Has the Same Intentions

Another central banking institution that proposed a total crypto ban is the State Bank of Pakistan. Last week, it argued that bitcoin and the altcoins have illegal status, are not able to facilitate trade activities, and could be used to finance acts of terrorism and launder money.

The organization added that many exchanges, such as Binance, pose a risk to investors. As such, the State Bank of Pakistan is willing to halt the “unauthorized operations” of digital asset trading venues by imposing penalties against them.

The possible legislation faced some backlash from locals as a considerable chunk have already entered the crypto market. Waqar Daka – a popular Pakistani TV host – was one of them.

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Pakistan’s Central Bank Recommends a Total Crypto Ban (Report)

by CryptoPotato

The State Bank of Pakistan (the nation’s central banking institution) and the Federal government are reportedly contemplating imposing a complete ban on all cryptocurrency endeavors. The authorities claimed that digital assets are illegal, are not able to facilitate trade activities, and could be used to finance acts of terrorism and launder money.

Pakistan to Ban Crypto?

Last October, the Sindh High Court urged the Pakistani government to regulate the cryptocurrency space within three months. The court also directed the lawmakers to form a committee and determine the legal status of digital assets.

90 days later, the central bank of Pakistan is ready with its decision proposing a complete ban on everything crypto, a local coverage informed.

There are several reasons why the State Bank of Pakistan demands such severe rules. First, it pointed out that cryptocurrencies are illegal and could not be employed in trading operations. The institution named several countries where digital assets are prohibited, including China.

Second, trading venues such as Binance and OctaFX pose risks for investors. The former has faced regulatory backlash from many watchdogs in recent months. However, Binance’s CEO – Changpeng Zhao – recently vowed to change the structure of his firm by turning it into a licensed monetary institution with centralized headquarters.

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Lastly, Pakistan’s central bank claimed that bitcoin and the alternative coins facilitate illegal operations like acts of terrorism and money laundering.

However, it is worth mentioning that BTC’s underlying blockchain technology is entirely transparent. All transactions are recorded on the digital ledger and can be seen by anyone with access to the Internet. On the other hand, cash remains the most preferred type of payment in illicit operations such as drug trafficking, terrorist funding, and prostitution.

The banking institution is also willing to halt the “unauthorized operations” of digital asset exchanges by imposing penalties against them “as some other countries have done.”

Waqar Zaka – one of the most well-known Pakistani TV hosts and a crypto entrepreneur – opposed such legislation. In his view, a considerable chunk of locals trade with bitcoin and alternative coins, and the rules should stay the way they are.

The Sindh High Court will next hear the case on April 12.

What Happened During The Previous Restrictions?

In April 2018, the State Bank of Pakistan advised all banks, financial institutions, and payment processors to refrain from employing cryptocurrencies and halt their services involving digital assets.

While the ban made things hard for locals, it did not completely stop them from trading or using the asset class.

In 2020, Justice Muhammad Iqbal Kalhoro questioned the move asserting that Pakistan risks falling behind in modern technology if it does not join the world of crypto.

According to recent estimations, digital assets are highly popular among the local population. Pakistanis increased their interest by more than 711% in 2021, while they collectively own nearly $20 billion worth of crypto.

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Kosovo Police Confiscates Hundreds of Cryptocurrency Mining Machines

by CryptoPotato

As a result of several police actions, the Kosovo authorities seized more than 300 cryptocurrency mining devices. According to the nation’s Minister of Energy and Economy, the seizure will save “tens of thousands of Euros per month.”

Kosovo’s Ban Intensifies

Similar to many other countries in Europe, Kosovo currently struggles with an energy crisis prompted by the sharp price increase of electricity. Attempting to curb consummation during the winter and eliminate power shortages, the government recently introduced a blanket ban on cryptocurrency mining.

Just a few days after the rule became live, local law enforcement agencies executed the first seizure. According to a recent announcement, Kosovo Police and Kosovo Customs conducted a joint operation, after which they confiscated 272 “Antminer” Bitcoin mining machines in the municipality of Leposavic.

During a separate action near the capital Prishtina, the authorities seized further 39 cryptocurrency mining devices, 35 of which were functioning at the time.

Meanwhile, the police also stopped a vehicle carrying banned equipment near the village of Druar. The driver allegedly hid six crypto mining machines and 42 graphics cards (GPUs) in the back of his car.

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Artane Rizvanolli – Kosovo’s Economy and Energy Minister – highlighted the police actions. Per her calculations, the confiscations will save “tens of thousands of Euros per month of taxpayers’ money,” which equals energy intended for hundreds of Kosovar families during the crisis.

Iran Enforced The Same Rules

Another country that introduced a temporary ban on cryptocurrency mining is Iran. Similar to Kosovo, the officials explained their decision with the rising electricity consumption during the coldest months of the year.

Interestingly, the Iranian government enforced the same legislation during the summer, too. Between June and September last year, when temperatures usually hover around 30-35°C (95°F), crypto mining was forbidden as the officials were strictly monitoring whether miners abide by the rules.

During an operation at the beginning of the summer, the police confiscated 7,000 bitcoin mining rigs hidden in an abandoned factory in the capital Tehran. The seizure was the largest ever carried out by the local authorities. Prior to that, back in January 2021, the government seized nearly 1,500 cryptocurrency mining devices.

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Alibaba Vice-Chairman and Billionaire Joe Tsai Likes Crypto

by CryptoPotato

The Chinese government has gone out of its way on the crypto crackdown. Despite this, the industry has evolved tremendously and continues to capture the imagination of many. Joe Tsai, who happens to be the executive vice-chairman of the Chinese e-commerce behemoth, Alibaba Group, is the latest to share his feelings on Twitter in three simple words, saying – “I like crypto.”

Tsai is Bullish on Crypto

Joe Tsai’s latest comment on crypto has created a frenzy in the micro-blogging space. For the uninitiated, Tsai is a Taiwanese billionaire who also owns the Brooklyn Nets of the National Basketball Association (NBA).

Interestingly, Brooklyn Nets’ sharpshooter Kevin Durant happens to be a Coinbase investor. The NBA star and his company Thirty-Five Ventures recently entered into a strategic partnership with the cryptocurrency exchange.

Besides, this isn’t the first time Tsai had spoken in favor of crypto. In an interview with Sportico’s Brendan Coffey back in August, the exec talked about media convergence, sports betting, and crypto. His words were,

“Media, sports betting, crypto-we see all those things converging a little bit,” Tsai explained. “You can’t talk about sports betting these days without thinking how that affects your media rights. And maybe, for the betting fan base, injecting a little bit of crypto will be interesting.”

Alibaba’s Tryst With Crypto

Despite Tsai’s latest comments on crypto, Alibaba has stayed away from the industry. In September this year, the e-commerce giant announced that it will stop selling specialized mining equipment in response to the People’s Bank of China’s stringent policy.

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The company revealed that it will halt the operations of two categories – Blockchain Miner Accessories and Blockchain Miners. It also went on to ban all cryptocurrencies such as Bitcoin, Ether, Quarkcoin, and Litecoin across all of its platforms.

2021 can be marked as a year when the Chinese war on Bitcoin (BTC) and the wider cryptocurrency got severe. The crackdown on crypto mining and trading started in May and soon intensified. This was a debilitating blow to the ecosystem in the country. Once a thriving mining scene, the new tightened policy almost eradicated institutional mining of cryptocurrencies.

Hence, it isn’t surprising that Alibaba’s tryst with crypto may have ended, for now at least. But, the metaverse is a whole different dimension, and the tech giants of the country, including Alibaba, are keen on exploring the opportunities. In fact, several companies have rushed for trademark applications related to the metaverse.

Featured Image Courtesy of BusinessInsider

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Bank of Russia governor: Banning crypto in Russia is ‘quite doable’

by Cointelegraph

In a Friday press conference, Central Bank of Russia governor Elvira Nabiullina further escalated the fear, uncertainty, and doubt (FUD) surrounding the state of crypto regulation in the country. When asked about the rise of digital assets, Nabiullina gave the following remarks, as reported by local news outlet finmarket.ru and translated by Cointelegraph:

You know that our attitude towards cryptocurrencies is of, to put it mildly, skepticism. Related to this are the significant risks for retail investors and the substantial volatility for this type of asset. In addition, cryptocurrencies are opaque in that they are frequently used for illegal operations or criminal nature. Therefore, we cannot welcome investments in them. We seek to prevent the Russian financial infrastructure from using crypto transactions. This is quite doable.

Nabiullina’s remarks came one day after conflicting reports pointed to the possibility of a blanket ban on cryptocurrency exchanges in Russia. As Cointelegraph recently reported, concerns about crypto have even made their way to the presidential office, with Vladimir Putin issuing a warning about digital assets. 

Related: Bank of Russia to ban mutual funds from investing in Bitcoin

In context, countries of the former Soviet Union remain far more susceptible to financial crimes such as money laundering or tax evasion than their Western counterparts. This is because privatization of state enterprises from the breakup of the USSR concentrated power in the hands of individuals who possessed enough “capital” to purchase shares at that time — mafias, gangs, and black-market participants. 

Relatively speaking, the anonymous, borderless, instantaneous, and regulatory-lacking nature of crypto would therefore be a greater enabler of criminal activities in the region. Partly to combat the problem, Russia is prioritizing the development of a regulatory-compliant digital Ruble as a sizable competitor to cryptos developed in the private sector.