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New York regulator hunts crypto and AI specialist for policy unit

(Coin Telegraph)-14/08/2024

The New York State Department of Financial Services (NYSDFS) is seeking a specialist to help develop policies on cryptocurrencies, decentralized finance (DeFi) and artificial intelligence, among other related fields.

The New York financial regulator is seeking candidates for a position within its Innovation Policy Unit, who will be specially tasked with tackling “cutting-edge policy issues” in the broader financial services landscape.

According to the job posting, the policy specialist is expected to help resolve policy issues in traditional markets, crypto and DeFi, as well as the use of AI and machine learning in financial markets.

NYSDFS continues to fine-tune BitLicense requirement

The NYSDFS introduced the BitLicense, New York’s business license for cryptocurrency use, in August 2015.

Since then, it has actively updated it to ensure ongoing oversight of crypto exchanges and service providers. At the time, major crypto firms, including Bitfinex, Kraken and Paxful, departed the state due to noncompliance.

Furthermore, the NYSDFS unveiled new restrictions on Nov. 15, which mandate crypto companies to submit their coin listing and delisting policies for NYSDFS approval. Technological, operational, cybersecurity, market, liquidity and illicit activity risks of the tokens are among the factors to be considered by the NYSDFS.

In January, the New York State Comptroller Thomas DiNapoli raised concerns about NYSDFS’ management of BitLicense.

DiNapoli pointed out a lack of thoroughness regarding a range of security checks of the potential licensees, which included several incomplete fingerprinting processes before application approval.

Holes in New York’s crypto licensing requirements

The NYSDFS has also failed to provide proof of verifying applicants’ tax obligations or minimum net worth documentation.

Members of the Innovation Policy Unit are required to perform qualitative and quantitative research to inform the NYSDFS decision-making around policy reviews.

On May 30, the NYSDFS established customer service standards for regulated virtual currency entities (VCEs) or crypto exchanges. At the time, Supervisor Adrienne Harris explained that recordkeeping in the form of tabulation and customer feedback must begin in the third quarter of 2024 and be accessible to the NYSDFS by Nov. 1. She added:

“This guidance outlines clear expectations for a positive customer experience, which benefits both consumers and business.”

There are currently 32 crypto exchanges registered under BitLicenses or trust charters.

Over $1B wiped out in crypto liquidations as global markets suffer

(Crypto News)-07/08/2024

Crypto investors and traders lost approximately $1.08 billion in total liquidations amid uncontrolled falling prices of prominent cryptocurrencies, including Bitcoin, Ether and Solana.

On Aug. 5, crypto market prices saw a significant decline owing to the weakening global economy, which was catalyzed further by the sudden crash of Japan’s stock market. In the process, nearly 300,000 crypto traders were liquidated from their leveraged positions or collateral trades, according to data from Coinglass.

Amid the ongoing bear market, the prices of the most popular cryptocurrencies depreciated, with Bitcoin falling by over 10% and 20%, respectively. As a result, crypto traders anticipating a prolonged bull run lost their positions in the bloodbath.

As Bitcoin prices crashed from around $65,000 to the $50,000 mark, traders holding long positions on crypto exchanges lost over $315 million in under 24 hours. On the other hand, shorters lost $62.23 million in the process.

During the same timeline, traders with Ethereum long positions lost a total of $305 million, while traders holding short positions lost more than $50 million.

Long positions across all crypto assets lost over $930 million in 24 hours, while shorters lost $163.45 million. All told, nearly 80% of all traders got rekt in less than 12 hours.

According to Coinglass data, the largest single liquidation order happened on the crypto exchange Huobi, where a trader lost $27 million in the BTC/USD trading pair.

As shown above, most liquidations took place on Binance, the largest crypto exchange by trading volume. Other prominent crypto liquidations were recorded on OKX, Huobi, Bybit and BitMEX, among other exchanges.

While traders patiently await a comeback of the bull run, hackers found an opportunity for profits amid the bear market.

As Ether lost over 20% of its value — from approximately $2,760 to $2,172 — funds linked to a hack on crypto bridge Nomad in August 2022 were used to buy 16,892 Ether.

Onchain activity showed that hackers bought ETH at low prices and siphoned it through the crypto mixer Tornado Cash to prevent traceability.

Bitcoin on edge as economy falters: 10x Research report

(Crypto News)-07/08/2024

Recent findings from a 10x Research report reveal growing concerns about the United States’ economic strength, which could have significant repercussions for the crypto market.

The report shared with Cointelegraph reveals that the Bitcoin price could fall (and stay) below the psychological mark of $50,000, signaling red flags for other cryptocurrencies.

The ISM Manufacturing Index, a traditional economic health barometer at the core of these concerns, has recently witnessed a substantial downturn.

Speaking with Cointelegraph, Markus Thielen, founder of 10x Research, explained that it “may be premature” for crypto traders to open further leveraged long positions.

“The market structure, including fiat-to-crypto on-ramps, has been weak for months […] it’s unlikely that significant players will invest amid high volatility and unpredictable prices. Many still need to exit positions and deleverage their portfolios.”

Bitcoin and stock market implications

The disconnect revealed in the 10x Research report speculates that the historical correlation between the ISM Index and BTC indicates a bleak forecast for the crypto market.

“Historically, Bitcoin has experienced sharp corrections when the ISM peaked.”

While the ISM Index now indicates economic weakness and the stock market is potentially inflated, the report reveals that adjustments are expected imminently.

“The S&P 500 might need to align with the ‘real’ economy, potentially leading to a 20% stock decline.”

The US economy shows signs of weakness

The report’s insights highlight that the US economy’s status is unsteady due to the shifting position of the US Federal Reserve:

“In the past 48 hours, it has become apparent that the US economy is weaker than the Federal Reserve initially believed.”

The report further highlights that Fed Chair Jerome Powell reinforced this point, indicating a potential dovish shift in policy if inflation decreases as anticipated, aiming to cushion further economic downturns.

BTC dominance shift

On Aug. 5, BTC dominance, a ratio of the asset’s market capitalization to the rest of the crypto market, hit a new yearly high of 58% as crypto and stock markets crashed.

The shift in dominance percentage co-aligned with the sudden sell-off of Ether, which fell by as much as 18% in two hours.

IG Markets analyst Tony Sycamore informed Cointelegraph that this collapse in market price amid a rise in BTC dominance reminds the market that crypto sits at the “pointy end” of the risk asset spectrum.

Bitcoin Spot ETFs Post $168M in Outflows While Ethereum ETFs See Meager Inflows

(Crypto News)-07/08/2024

Over the past 24 hours, investors have withdrawn approximately $168 million from nine U.S. spot Bitcoin exchange-traded funds (ETFs).

Over the last two days, net outflows from these ETFs have reached a staggering $405 million, according to data from Farside Investors.

In contrast, spot Ethereum ETFs experienced net inflows totaling nearly $49 million during the same period.

Grayscale’s GBTC and Fidelity’s FBTC Lead Withdrawals

The most notable outflows were from Grayscale’s Bitcoin ETF (GBTC) and Fidelity’s Bitcoin fund (FBTC), with each fund witnessing withdrawals of about $69 million.

Interestingly, Grayscale’s Bitcoin Mini Trust (BTC), a low-cost alternative to GBTC, saw the highest daily inflows, attracting almost $29 million.

Bitwise’s Bitcoin ETF (BITB) and Valkyrie’s Bitcoin fund (BRRR) also recorded gains, each pulling in approximately $6 million.

Other Bitcoin ETFs, such as BlackRock’s iShares Bitcoin Trust (IBIT), reported no flows.

On the trading front, U.S. Bitcoin and Ethereum ETFs saw a combined trading volume of nearly $6 billion on Monday, with spot Bitcoin ETFs alone accounting for over $5 billion.

IBIT and FBTC led this trading activity.

Spot Ethereum ETFs, led by Grayscale’s Ethereum ETF and BlackRock’s iShares Ethereum Trust (ETHA), contributed around $715 million to the total volume.

Eric Balchunas, an ETF analyst at Bloomberg, described the high trading volume during a market downturn as a reliable indicator of market fear.

He emphasized that deep liquidity during such times is valuable to traders and institutions, suggesting long-term benefits for ETFs.

BlackRock’s ETH ETF Sees Inflows

Meanwhile, BlackRock’s ETHA recorded $47 million in net inflows on August 5, followed by VanEck’s and Fidelity’s Ethereum ETFs, which collectively attracted nearly $33 million.

Bitwise’s Ethereum fund and Grayscale’s Ethereum Mini Trust also reported gains on the same day.

However, the Grayscale Ethereum Trust (ETHE) faced significant outflows, with nearly $47 million withdrawn, marking the lowest outflow since its conversion to an ETF.

Over ten trading days, the fund saw outflows exceeding $2.1 billion.

Despite this, investors still hold approximately 234 million ETHE shares, now valued at around $4.7 billion, according to Grayscale’s latest updates.

The recent crypto market crash, which began on August 4, was triggered by Jump Trading’s substantial transfer of Ether to exchanges, leading to a sharp correction across the crypto markets.

Bitcoin briefly dipped below $50,000 at the start of U.S. trading hours on August 5, while Ethereum saw a more than 20% drop in its value within a day.

As of the latest updates, Bitcoin has partially recovered to around $54,000, and Ethereum has rebounded by 6%, trading at over $2,400, as per CoinGecko’s data.

As reported, digital asset investment products saw outflows amounting to $528 million last week, marking the first downturn in four weeks.

The exodus is believed to be a response to mounting concerns over a potential recession in the United States, compounded by geopolitical uncertainties and consequent widespread liquidations across various asset classes.

For one, the Bank of Japan’s (BOJ) decision to raise interest rates for the first time in 17 years due to concerns over the Yen’s purchasing power decline against the US Dollar has triggered apprehension within risk-on asset markets, prompting widespread sell-offs.

US government transfers 300 ETH — Arkham Intelligence

(Coin Telegraph)-07/08/2024

According to Arkham Intelligence, a wallet believed to be controlled by the United States government transferred 300 Ether, valued at approximately $699,000, to a wallet address ending in “d46” on Aug. 5.

The onchain analytics firm also claimed that the funds within the wallet, which now shows a balance of $0, resulted from a US government seizure.

Ethereum’s price action

This reported transfer of ETH by the United States government follows days of disappointing price action following the highly anticipated launch of Ethereum exchange-traded funds (ETFs) in the United States.

Independent analyst Crypto Lion said that ETH’s struggling price action following the ETF launch was mainly attributable to a lack of demand for the smart contract asset on exchanges.

The lack of demand coincides with a significant downturn across financial markets due to an interest rate increase by the Bank of Japan that sent the price of Ethereum tumbling further.

Ether encountered significant selling pressure largely attributable to a handful of market makers, who unloaded approximately 130,000 ETH, valued at $290 million at the time of writing, onto the market. This caused Ether to sink to lows of around $2,100 on Aug. 5, and the digital asset continues to trade well below its 200-day exponential moving average.

Ethereum ETF outflows

According to the CoinShares weekly inflows report dated Aug. 5, digital asset investment vehicles recorded their first capital outflow in four weeks.

Outflows for Ethereum investment funds and products totaled $146 million for the week, bringing the total outflow figure since the launch of the Ethereum ETF in the United States to $430 million.

CoinShares noted that the data was impacted by $603 million in outflows from Grayscale’s Ethereum Trust, which was introduced in 2017 and has seen significant outflows since the introduction of Ethereum ETFs in late July.

CoinShares analyst James Butterfill reinforced the theory that the current market downturn is primarily driven by macroeconomic factors and geopolitical tensions. This negative sentiment among investors may potentially signal a longer recovery period for ETH than was initially expected.

Crypto market crash triggered by ‘aggressive’ selling by Jump Trading: Report

(Coin Telegraph)-07/08/2024

The current crypto market crash is being directly linked to selling by Jump Trading, according to QCP Group, one of Singapore’s first digital asset trading groups.

The price of Ether fell over 21% in the 24 hours leading up to 11:20 am UTC to trade at $2,252, according to Cointelegraph data.

The crash to an over five-month low was mainly caused by Ether selling from Jump Trading and Paradigm VC, according to an Aug. 5 report by QCP Group, which wrote:

“The immediate trigger in crypto seems to have been aggressive ETH selling from Jump Trading and Paradigm VC. The move was probably exacerbated by market makers scrambling to cut short gamma as front-end ETH volumes spiked more than 30% to 120%!”

Ether’s price is struggling to remain above the $2,200 psychological mark, and a potential move below it could trigger more panic selling among crypto investors, leading to lower lows.

The sharp decline comes despite the launch of the first spot Ether exchange-traded funds (ETFs) in the United States, which debuted for trading on July 23.

Jump Trading continues selling Ether

During the past week, Jump Crypto, the crypto division of Jump Trading, has shifted hundreds of millions of dollars worth of digital assets to crypto exchanges in preparation for a sizable sale, as reported by Cointelegraph.

Jump Trading has sold over $377 million worth of Wrapped Lido Staked ETH (wstETH) since July 24, when Ether’s price started to decline.

The firm is looking to sell a total of $481 million worth wstETH, according to an Aug. 5 X post by Lookonchain, which wrote:

“Jump Trading is selling 120,695 wstETH ($481M) and has sold 83K $wstETH ($377M) since July 24, leaving 37,604 $wstETH($104M). The market also began to fall after July 24, falling by more than 33%!”

Jump Trading is reportedly being investigated by the US Commodities and Futures Trading Commission (CFTC). The firm’s president, Kanav Kariya, stepped down from his role on June 24.

Macroeconomics played a significant part in the crypto market crash

Macroeconomic factors have also played a crucial role in the crypto market downturn.

Friday’s poor US unemployment data was a significant negative catalyst, according to QCP’s report:

“In addition to that, huge unwinds across all assets have caused volatility to spike sharply. The VIX touched 50 (it was only higher during the Covid panic and the 2008 financial crisis), and USDJPY 1M at-the-money Vols spiked to 16%! This is likely to cause further unwinds.”

Moreover, the current military tensions between Israel and Iran could also add further downward pressure on global markets, according to QCP:

“A global risk-off mood has also set in with Israel killing the Hamas leader over the weekend. Iran has vowed to take action, and the US has actually started to deploy troops into the Middle East.”

Swiss central bank posts loss of $2.27 bln as franc weighs

(Reuters)-31/07/2024

The Swiss National Bank (SNBN.S), opens new tab swung to a loss of 2 billion Swiss francs ($2.27 billion) in the second quarter, the central bank said on Wednesday, as the rising value of the Swiss franc reduced gains from foreign currency investments.

The result compared with a first-quarter profit of 58.8 billion francs, and came despite valuation gains in the SNB’s gold and equity portfolios.

During the quarter, the SNB made a 3.26-billion-franc gain from the increased value of the 1,040 tonnes of gold it holds, as global political tension boosted the price of the precious metal.

Foreign currency positions – the 740 billion francs of stocks and bonds the SNB has bought – reported a loss of 3.10 billion, however, as the franc’s higher value and lower bond prices wiped out gains from increases in global equity markets.

The SNB also lost 2.06 billion francs on its Swiss franc positions, mainly from paying interest on sight deposits to commercial banks.

The second quarter loss is unlikely to be a major concern for the SNB, as making a profit is not part of the central bank’s mandate, which instead focuses on price stability.

“The SNB’s financial result depends largely on developments in the gold, foreign exchange and capital markets,” it said.

“Strong fluctuations are therefore to be expected.”

UBS economist Florian Germanier said the rising value of the franc could be a factor in the SNB’s result in coming months.

“We expect the franc to strengthen as other central banks cut rates and because of geopolitical tensions adding to the safe haven flows into the currency, which is a significant risk for the SNB’s results for the rest of the year,” he said.

US bank regulator looks to tighten control of asset managers’ bank stakes

(Reuters)-31/07/2024

A U.S. bank regulator is considering a stricter framework for how large asset managers like Blackrock (BLK.N), opens new tab and Vanguard can prove they are not influencing banks where they hold large stakes.

The Federal Deposit Insurance Corporation voted on Tuesday to advance a proposal for the agency to exert more influence over whether asset managers or other firms building large stakes in banks should receive stricter regulation and oversight.

Agency officials also indicated they may launch a review of existing so-called “passivity agreements” with large asset managers, with a focus on boosting FDIC oversight of their commitments to not play an active role in bank management.

Under law, third parties that obtain a greater than 10% stake in a bank can be considered a controlling interest in the bank and subjected to stricter regulation and oversight. But firms can avoid those restrictions under “passivity agreements,” in which the investor commits to regulators they will not exert influence on the bank.

Specifically, the FDIC under the proposal would remove an existing exemption in which it does not review new large investments in banks as long as the Federal Reserve signed off on that approach.

“It is highly inappropriate for the FDIC to abdicate the responsibility Congress entrusted to us to safeguard the ownership and control of the banks we supervise,” said Rohit Chopra, director of the Consumer Financial Protection Bureau and an FDIC board member.

FDIC Chairman Martin Gruenberg also backed the proposal, which would also seek broader feedback about the role of asset managers obtaining large stakes in banks.

Separately, FDIC Commissioner Jonathan McKernan offered a proposal that would have directed FDIC staff to order a review of existing passivity agreements for some large asset managers, and ensure the FDIC has the capacity for monitoring the commitments those firms make. Under his plan, the FDIC would look to strike new agreements with those firms that would do away with the current practice of self-certification by the firms and require FDIC monitoring.

However, McKernan did not bring that proposal up for a vote after Gruenberg indicated such action would not require formal board action. Gruenberg added that he is open to reviewing existing agreements, with a focus on ending the practice of self-certification.

When asked, Gruenberg said he expected notifications to begin review existing agreements could happen soon.

The FDIC action comes amid growing concern among some policymakers over large asset managers’ expanding footprint in the banking sector, driven by the growth of index investing, and what it could mean for bank management. In his remarks, Chopra noted that BlackRock (BLK.N), opens new tab and Vanguard collectively control more than $17 trillion in assets, with stakes large enough to trigger stricter oversight.

Some FDIC officials expressed concern. FDIC Vice Chairman Travis Hill noted that such a push could reduce investments in banks to the detriment of those firms.

A spokesperson for Blackrock declined to comment. Vanguard said in a statement it wants to continue a “constructive dialogue” with regulators over passive investments.

Spokespeople for those firms did not immediately provide comment on the FDIC’s actions.

The industry has been quick to critique this scrutiny, calling it unjustified and burdensome.

“It is alarming to see that the FDIC is proposing to revise the current framework in the absence of a clearly identified problem,” said Eric Pan, CEO of the Investment Company Institute, which represents asset managers. “We fear that the FDIC is asking the investment funds industry to prove a negative, setting up a flawed foundation on which to impose harmful limits and red tape on investment funds and increase costs on American investors.”

Donald Trump’s potential SEC chairman should tackle 5 issues

(Crypto News)-31/07/2024

It’s time for Securities and Exchange Commission (SEC) Chair Gary Gensler to polish his resume. At a Bitcoin conference in Nashville on July 27, Republican presidential nominee Donald Trump vowed to oust crypto’s favorite supervillain in favor of a pro-industry replacement.

That’s good news for Web3, but turning America into the crypto capital of the world isn’t as simple as saying, “You’re fired.” Insatiable demand for tokenized dollars has given the US an invaluable head start, but Web3 still desperately needs investor protection and oversight. That’s exactly what the SEC exists to provide.

Trump should pick an SEC chair who understands this — and commits to five goals from the start.

Let Ether funds start staking

Spot Ethereum exchange-traded funds (ETFs) finally hit the market on July 23, but staking — or locking ETH as collateral in exchange for rewards — is conspicuously absent.

Fixing this is easier said than done. The Investment Company Act of 1940 requires ETFs and mutual funds to promptly redeem shares for underlying fund assets on demand — usually within the day. Staking makes that virtually impossible for spot Ether funds. Timelines for staked ETH withdrawals are unpredictable, often taking days to complete.

The SEC has exempted funds from this rule in the past. It needs to do the same for spot Ether. Crafting a thoughtful carveout will take time. Trump’s nominee should get started on day one.

Embrace on-chain compliance solutions

The SEC should take a similarly flexible approach elsewhere. Core functions of securities markets — such as reporting, clearing, and settlement — are subject to intense regulatory scrutiny, and rightfully so. They are also areas where blockchain excels.

Distributed ledgers automatically record and settle every onchain transaction and are highly resistant to manipulation or fraud. The SEC knows this and — in at least one instance — already recognized onchain ledgers as valid financial reports. Now, regulators should replicate this at scale, issuing comprehensive guidance so others can follow the same path.

Upgrade KYC and custody rules for Web3

The same goes for other compliance mandates, such as Know Your Customer (KYC) and custody. Today, self-custody wallets — such as Ledger and MetaMask — are regulatory black holes, off limits to most security tokens.

It doesn’t have to be that way. In the US, qualified crypto custodians (QCs) — which hold crypto for users in insured, segregated accounts — are already proliferating. They include Anchorage Digital, BitGo, Coinbase Custody, and Paxos, among others.

Adding elements of self-custody — such as non-upgradable smart contracts and private keys — to existing rules for crypto QCs would only strengthen protections for investors.

Congressional gridlock is no excuse. These changes are largely achievable within existing laws. The core goals of SEC oversight are as relevant as ever. Blockchain technology simply achieves them in new ways. Mapping these new solutions onto the SEC’s existing frameworks will open up a world of possibilities for Web3.

Bring DEXs out of the shadows

Decentralized exchanges (DEXs) such as Uniswap and Balancer are the future of trading. They replace a costly chain of intermediaries — including custodians, brokers, clearinghouses, and transfer agents — with transparent, non-custodial smart contracts. Implemented properly, DEXs can cut costs, mitigate counterparty risk, and facilitate real-time, 24/7 trading.

There’s one problem. Despite being in use for nearly a decade, DEXs are still almost completely unregulated. This is largely thanks to an ongoing tug-of-war between the SEC and the Commodity Futures Trading Commission (CFTC), which oversees commodity derivatives markets.

Fixing this is straightforward. The SEC should clarify what tokens, if any, are securities, set a clear registration path for the DEXs that trade them, and hand off the rest of the spot crypto market to the CFTC.

Crucially, DEXs should meet comparable standards to traditional exchanges for risk management, KYC and disclosures. But, as with other compliance rules, the SEC should fully embrace on-chain solutions wherever possible.

Dollarize the digital economy with RWAs

Onchain dollarization is the holy grail of US crypto policy, and the opportunity is wide open. Global demand for tokenized dollars clocks triple-digit growth rates year after year. Dollar-backed stablecoins — such as USD Coin — have already bought upward of $100 billion of US government debt.

That’s only scratching the surface. Tokenized money market funds and other yield-bearing real-world assets (RWAs) are only beginning to gain a foothold in Web3. The handful of early entrants — such as BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL) and Franklin OnChain US Government Money Fund (FOBXX) — are stymied by severe restrictions.

It’s time to reverse course. The SEC should actively foster a robust onchain market for USD-backed RWAs. These tokenized securities must fully leverage blockchain’s capabilities. They must be tradable on DEXs, accessible to user-managed wallets, and open to Web3 developers.

A truly America-first crypto policy should prioritize dominating the digital economy for decades to come. In that, America’s robust financial regulatory framework is an invaluable asset. Trump should pick an SEC chair who understands this — and is ready to act.

Russian Parliament to Review Crypto Bills and Mining Legislation to Legalize Crypto: Bloomberg

(Crypto News)-31/07/2024

The lower house of the Russian parliament, the State Duma, is set to review a cryptocurrency bill along with separate legislation on crypto mining in its second and third readings on Tuesday.

Anatoly Aksakov, head of the Duma’s financial market committee, told Bloomberg that the draft laws are expected to swiftly gain approval from senators in the Federation Council and be signed into law by President Vladimir Putin, with an effective date of September 1.

“Previously, there were fears that the legalization of cryptocurrency could create problems for the development of the domestic market,” Aksakov said.

Russia to Regulate Crypto Amid US Sanctions

Russia’s move to regulate cryptocurrencies comes as the nation faces increasing pressure from US threats of secondary sanctions on foreign banks.

While the use of digital currency for payments is currently banned in Russia, President Putin recently urged the government to seize the opportunity to regulate this method domestically and for international transactions.

“Cryptocurrencies are increasingly used in the world as a means of payment in international settlements,” he said.

The change in policy comes despite the central bank’s proposal for a blanket ban on cryptocurrencies in January 2022, citing risks to financial stability and economic security.

However, by the end of last year, the Bank of Russia softened its stance, supporting the experimental use of cryptocurrency and mining in cross-border settlements, although it advised financial organizations not to promote digital currency services publicly.

The Bank of Russia did not respond to requests for comments on this policy shift.

First Deputy Governor Vladimir Chistyukhin recently acknowledged the need to explore all options for overcoming challenges in international payments, including those previously considered unpopular.

According to Aksakov, the new legislation will regulate cryptocurrencies similarly to foreign currency in Russia.

Businesses involved in crypto and mining have lobbied for these laws to ensure they can operate within a legal framework without fear of official scrutiny.

More recently, it was revealed that the Russian government is reportedly set to make a crypto exchange ban u-turn, and will no longer try to stop the “circulation” of crypto in the country.

Russian Commodities Firms Turn to Stablecoins for Transactions

As reported, Russian commodities firms facing challenges in executing financial transactions with Chinese counterparts have turned to stablecoins.

In response to international restrictions and tightening compliance measures, these firms have turned to cryptocurrencies, including Tether’s stablecoin, to facilitate cross-border transactions with their Chinese clients and suppliers.

Furthermore, Russia has also been pushing forward with CBDC plans.
In July last year, Russian President Vladimir Putin officially signed a bill that would introduce a digital version of the country’s national currency.

The move gave legal authority to the Bank of Russia, the country’s central bank, to act as the platform operator for the digital ruble.

The digital ruble will act as a new form of payment, alongside cash and non-cash rubles.

More recently, it was revealed that Iran and Russia are working on CBDC and “digital financial asset” (DFA)-powered trade solutions.