A week of review | Libra received 5 "good guys card", and Telegram wants to receive a certificate

In the past week, Bitwise's Bitcoin Exchange Traded Fund (ETF) application was rejected. The Libra Association has five other founding members after PayPal, and Telegram received a ban from the US Securities and Exchange Commission (SEC) at the last minute.

Libra

The social media giant Facebook's encryption project this week can be described as full-line emergency, regulators overweight, allies launched, infringement lawsuits, so that CEO Zuckerberg had to participate in the hearing to be held later this month, and the encryption exchange CoinFLEX The probability that Libra will launch normally next year is only 30% .

The CoinFLEX exchange this week announced that it will launch a physical settlement futures contract for Libra. The futures will allow traders to bet on whether Libra will take effect before December 30, 2020. CoinFLEX CEO Mark Lamb said Libra Futures' initial price will be set at 30 cents, which is equivalent to about 30% of Libra's possible launch before that date. He explained, " The strong political opposition is cruel ."

German Finance Minister Olaf Scholz said this week to support the digitization of the euro, but against Facebook's Libra and other private currency projects. He believes that the power of currency issuance should be in the hands of the state.

The core element of national sovereignty is the issuance of currency, and we will not leave it to private companies .”

In the UK, the Bank of England has developed an intervention rule for Facebook's Libra cryptocurrency and other new digital payment service providers, which must be met before the launch of the UK. These rules include requiring the entire payment chain to demonstrate its operational and financial resiliency and providing sufficient information for regulators to monitor payments.

The Irish Data Protection Council (DPC) said this week that it has investigated Facebook's WhatsApp and Twitter for possible violations of EU data privacy rules, and that the survey is now in the decision-making stage. Facebook is likely to be fined by billions of dollars .

Valdis Dombrovskis, EU's vice president for euros and financial services, said the EU is studying the regulatory framework for cryptographic assets. He said Libra may have a systemic impact on financial stability and should be included in the EU's regulatory framework. Dombrovskis also said that

We need to regulate Libra within the EU, not only for financial stability, but also to protect investors .”

In the face of regulatory concerns, Facebook CEO Mark Zuckerberg will testify on its cryptocurrency project Libra on the House Financial Services Committee on October 23 . Zuckerberg will be the only attendee to attend. The chairman of the committee, Maxine Waters, drafted the draft "Technology giants away from the financial bill," the committee said.

“The draft legislation prohibits large public platforms like Facebook from being authorized, licensed or registered as financial institutions in the United States.”

This week, Finco Services sued Facebook in federal court in New York, accusing it of alleged trademark infringement. The lawsuit alleged that the same design company that Facebook used for Facebook designed the Facebook-like encryption project Libra and the encryption wallet company Calibra to design a wave logo that closely resembles it.

In addition, 30 different blockchain companies and non-profit organizations plan to fork the Libra encryption project led by social media giant Facebook to build the Libra version of OpenLibra without licensing.

This week, US Senators Sherrod Brown and Brian Schatz have sent letters to the three major payment giants Visa, Mastercard and Stripe, asking them to reconsider their partnership with Facebook-based stable currency project Libra. As a result, on Friday, Visa, Mastercard and Stripe announced their withdrawal from the Libra project, along with eBay and Mercado Pago , as well as PayPal, which announced its withdrawal last week. The first 28 founding members of the Libra Association are already close. One quarter announced the withdrawal.

Supervision

This week, the application of Telegram's Gram token and TON network became a hotspot for the encryption community.

On Tuesday, Telegram announced the Gram Wallet Terms of Service (ToS), which revealed that Telegram will integrate the wallet into the company's messaging application and provide it as a standalone product. Coinbase, the main cryptocurrency exchange, also said that its Coinbase Custody, which provides digital asset custody solutions for institutional investors, will support Telegram's upcoming Gram tokens. Coinbase Custody will provide offline storage and insurance services for token holders.

But just as people lamented that Telegram's Gram tokens and Facebook's Libra cryptocurrencies were treated differently, the SEC took an emergency this Friday against two entities behind the first currency issue (ICO) of Telegram's TON network. Act and obtain a temporary restraining order." The SEC determined that Gram is an unregistered security and cannot be sold to US investors . The SEC said it did so to prevent Telegram from flooding the US market with illegally sold digital tokens.

SEC executive director Stephanie Avakian said that in the SEC's view, these companies "have failed to provide investors with information on the business operations, financial conditions, risk factors and management of the Gram tokens and Telegram companies required by the securities laws."

If it weren't for Libra and Telegram, this week's headline should have been the SEC's ruling on Bitwise's ETF application, whether it was refusal or approval, which meant that the regulator released a strong signal to the market.

Before the SEC's ruling, Bitwise executives expressed optimism about the results. Matt Hougan, managing director and global research director of the company, said, "We need more approval from the Bitcoin ETF than ever before." But the SEC week explicitly rejected Bitwise's Bitcoin ETF application .

For the final result, Bitwise said,

“We are very grateful to the SEC for their careful review. The detailed feedback provided by them provides key background and clear methods for ETF applicants, which allows them to continue their efforts to launch the Bitcoin ETF. We look forward to continuing our fruitful cooperation with the SEC. To address their remaining concerns and intend to resubmit the application as soon as practicable."

The US Internal Revenue Service (IRS) has never given up efforts to incorporate cryptocurrencies into the tax system. This week, the IRS released a new guideline for calculating the tax payable on cryptocurrencies, the first update in five years . The guides released on Wednesday include: taxation when creating cryptocurrency forks; methods for assessing cryptocurrency as revenue; and how to calculate taxable income when selling cryptocurrencies. In addition, IRS added the issue of cryptocurrency ownership in the 1040 income tax table for the new tax season. It adjusts to the “Other income and income adjustments” section. Additional questions include “Do you receive, sell, send, trade or otherwise obtain the financial benefits of any virtual currency at any time in 2019?”

This week, the three major US financial regulators, CTFC, SEC and FinCEN, issued a joint statement warning the cryptocurrency users of their obligations in anti-money laundering (AML) and anti-terrorist financing (CFT). It is very rare for the three major regulators to issue statements simultaneously in a particular area. In addition, CFTC Chairman Heath Tarbert said this week that Ethereum is a commodity and therefore falls within the jurisdiction of the CFTC. In addition, he also expects CFTC to allow Ethereum futures to trade on the US market.

In terms of the central bank's digital currency, the Swiss National Bank (SNB) and the Bank for International Settlements (BIS) signed an agreement this week to cooperate at the BIS Innovation Center in Switzerland. The Swiss Center will initially focus on two research projects, integrating Central Bank Digital Currency (CBDC) into a distributed ledger technology infrastructure and analyzing how central banks are responding to the growing demand in the digital market.

Cryptographic currency

This week's international political economy and encryption industry have had major events, but the cryptocurrency market has maintained a steady and rising trend, and has not shown much price volatility.

The price of the largest cryptocurrency bitcoin in the market value rose to $8,600 in the middle of the week, but then began to slowly fall back. On Friday, China and the United States reached a "first phase" trade agreement , and the United States said that tariff measures will not take effect, which is pushing The stock market has risen while accelerating the fall of Bitcoin. The rejection of the bitcoin ETF that the industry expects this week has not caused much impact on the encryption market. Some analysts said that this is because the market has not had much hope for the approval of the Bitcoin ETF.

Bitcoin hosting provider Casa announced this week the launch of Casa Node 2, an upgraded version of its flagship plug-and-play Bitcoin node. According to the company, Casa Node 2 is equipped with a faster processor on the new Raspberry Pi 4 motherboard and will support 4GB of RAM, while the previous Casa Node only supported 1GB of RAM. In addition to launching a new version of the node, Casa also announced a new version of its native node software NodeOS.

Block Es, the developer of the EOS network, announced this week that it will release version 2.0 of the EOSIO open source protocol. The core content of EOSIO 2.0 includes related improvements to the EOS VM. The EOS VM is a high-performance WebAssembly engine dedicated to blockchain applications that makes more efficient use of system resources when dealing with smart contracts. According to Block.one, the updated EOS VM provides 16 times the performance of EOSIO 1.0, which greatly increases the efficiency of smart contracts.

Pablo Yabo, chief technology officer of Algo Capital, the hacker's blockchain company Algorand, said in a statement that he was "full responsibility" for the theft of the Algo hot wallet. Last week, Yabo's phone was attacked by hackers, which caused Algo's hot wallet to be attacked, losing about $12 million in Tether (USDT) and Algorand (ALGO) tokens.

Exchange

On the exchange side, Bitfinex is still at the center of the lawsuit. A law firm based in New York this week launched a class action lawsuit alleging that it manipulated the cryptocurrency market. The lawsuit was initiated by Roche Freedman, the founder of the company, Kyle Roche, who said on Twitter that Tether and Bitfinex are involved in fraudulent investors, manipulation of the market and concealing illegal gains.

In another lawsuit, Bitfinex obtained a favorable decision. New York Supreme Court Justice Joel Cohen dismissed a request from the New York State Attorney General's Office (NYAG) to request Bitfinex to collect and collate relevant documents . Earlier, NYAG asked Bitfinex and Tether to collect all the documents related to $850 million in internal transactions and $900 million in credit lines. However, another request from NYAG was approved and the judge ruled to extend the ban on the prohibition of Tether lending money to Bitfinex.

The main cryptocurrency exchange currency is confirmed after the launch of the P2P trading function. The currency security will support WeChat and Alipay as channels for French currency recharge. This means that users from China can purchase Bitcoin through these two payment methods. However, just one day later, WeChat and Alipay issued a statement stating that users are prohibited from using their payment platform for cryptocurrency transactions.

In addition, the World Federation of Exchanges (WFE), which includes more than 70 exchanges including CME, Nasdaq and ICE, urged UK financial regulators this week not to ban individual investors from using cryptocurrency derivatives. Coinbase, the leading cryptocurrency exchange, has launched a mobile app for its professional trading platform, Coinbase Pro. After ICE's Bakkt exchange experienced a downturn in the previous two weeks, Bitcoin futures are gradually entering the state, and its bitcoin futures trading volume soared to 224 contracts on October 9, an increase of 796 over the previous trading day. %.

By Liang CHE

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Disclaimer: It is only the author's point of view and does not constitute investment advice. Investment is risky and at your own risk.