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| 1 | | At a recent panel, U.K. lawmakers have argued that retail investing in unbacked cryptocurrencies, including Bitcoin (BTC) and Ether (ETH), should be legally regulated like gambling. The proposal was brought up by the Treasury Select Committee, which consists of a cross-party group of members of Parliament. More: - The committee cited the highly volatile nature of unbacked cryptocurrencies, their lack of intrinsic value, and their failure to show a noticeable social good while explaining the argument.
- The committee chair, Harriett Baldwin, said these aspects make unbacked crypto assets fundamentally different from conventional financial assets.
- The panel report also cited testimonies from crypto firms like Binance and Galaxy Digital, current and former senior officials at the U.K.'s financial regulator, academics, economists, and industry experts.
- The lawmakers said they strongly recommend such treatment in regulating the trade of digital tokens, though the government does not have to follow the committee's recommendations.
- The proposal came after a months-long inquiry into the potential ways of supervising digital assets.
- The report also pointed out that regulating crypto asset trading as traditional financial services would cause consumers to believe that this activity is safer than it is and protected by the regulators while it is not.
- The government is expected to respond to the report within two months.
Zoom Out: - In February, the U.K. government proposed that crypto services are regulated like traditional financial services.
- The U.K. Prime Minister Rishi Sunak has repeatedly shown efforts to make the country a global crypto hub since his duty of finance ministry, which aligns with the government's latest suggestion.
- The country imposes high taxes on gambling, requires gambling businesses to verify customers' identities, which conflicts with the crypto industry's characteristics related to anonymity, and expects these companies to take measures to prevent money laundering.
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What the numbers say: NFT-based online video game Axie Infinity's token, AXS, briefly jumped over 16% within the day. The token peaked at $8, up from $6.96 half an hour before. Then, the price retreated to the same $7 level as at the beginning of the day. The token's market cap also simultaneously saw a massive increase within the same hours, rising from $799.06M to the day's peak of $937.92M. Relevance: The increase in the price and the market cap came right after the Axie Infinity creator Sky Mavis launched the popular Web3-based game on Apple's App Store, allowing iOS users in key markets to access the game. The game was first made available to users across Latin America and Asia in countries including Argentina, Colombia, Peru, Mexico, Venezuela, Indonesia, Malaysia, and Vietnam. The firm also previously rolled out Axie Infinity on Google Play Store in select countries. Brands that should care: Earlier in May, the crypto data website CoinGecko's research revealed the 10 most popular Web3 games in 2023 based on their daily average unique active wallet numbers. On the ranking, Axie Infinity sat in last place, following its rivals like space exploration game Alien Worlds, fantasy-themed Splinterlands, farming game Farmers World, post-apocalyptic Earth restoration game Planet IX, and casual mini game Iskra. | | | |
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| 3 | | Ripple, a payment protocol most famous for its native token XRP, has acquired Swiss-based crypto custody firm Metaco for $250M as part of its strategy to expand its business beyond the U.S. and the country's uncertain regulatory environment. The acquisition was funded using a combination of cash and Ripple equity. More: - As part of the deal, Ripple will become the only shareholder of Metaco.
- However, the Swiss-based firm will continue to operate as an independent unit led by its founder and CEO, Adrien Treccani.
- The acquisition will see Ripple diversifying its offerings by integrating the technology into the custody, issuance, and settlement of tokenized assets.
- Ripple said diversification of the custody solutions would bring new revenue opportunities to the firm.
- Metaco provides customers with a secure infrastructure for custody services.
Zoom Out: - The acquisition announcement came right after Ripple won a court victory in its legal battle with the U.S. Securities and Exchange Commission (SEC).
- In 2020, the SEC filed a lawsuit against Ripple and some of its executives over the unregistered sale of nearly $1.3B of XRP tokens.
- Judge Analisa Torres has recently denied the SEC's request to seal documents involving the agency's former executive Bill Hinman's 2018 speech on crypto and securities, which was believed to strengthen Ripple's legal arguments.
- In the speech, Hinman stated that Ether (ETH) is not a security, contradicting current SEC chair Gary Gensler's argument that all crypto assets other than Bitcoin (BTC) are securities.
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| 4 | | The largest stablecoin issuer, Tether (USDT), has announced that it will start investing 15% of its monthly net profit in Bitcoin (BTC) on a regular basis as of this month. The move aims to diversify the firm's reserves that back its token, USDT, whose value is pegged to the U.S. dollar (USD). More: - The issuer will not use a third-party custodian and will keep all its BTC holdings under self-custody.
- In its latest earnings statement, Tether reported $1.48B of net profit for March and over $2.44B of USDT reserves.
- Assuming the net profit remains the same, the monthly amount to be invested in BTC equals $222M.
- Tether's chief technology officer (CTO), Paolo Ardoino, said the decision to invest in Bitcoin was made due to the first and largest cryptocurrency's strong position as an investment asset.
- Ardoino also added that Bitcoin has repeatedly proven its resilience, significant growth potential, and long-term value with its limited supply, decentralized nature, and widespread adoption.
- The move is expected to make Tether one of the major Bitcoin holders, along with the firms such as business intelligence firm MicroStrategy, electric vehicle (EV) giant Tesla, and crypto mining company Marathon Digital.
Zoom Out: - A stablecoin is a type of cryptocurrency whose value is pegged to another reference asset, mostly a fiat currency.
- These assets are generally used by customers to trade with different cryptocurrencies without converting their funds back into fiat currencies.
- USDT is currently the largest stablecoin by market cap and competes with USD Coin (USDC), Binance USD (BUSD), Dai (DAI), and TrueUSD (TUSD) in the top five of the ranking.
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| 5 | | The U.S.-based crypto exchange Coinbase has announced that it is diversifying its crypto offerings in Singapore as part of its global expansion plans. The firm's country director for Singapore, Hassan Ahmed, said the move would prove that the world is keeping on with or without the U.S., and they are quite committed to becoming a global company. More: - As part of its expansion in Singapore, Coinbase lifted transaction fees for customers who purchase USD Coin (USDC) using Singapore dollars (SGD).
- The platform's Singaporean unit also started allowing users holding USDC to earn rewards.
- In addition, the firm launched USDC order books for more experienced traders, enabling more than 200 trading pairs for the popular stablecoin.
- Singaporean users can also now stake Ether (ETH), Solana (SOL), Cardano (ADA), Cosmos (ATOM), and Tezos (XTZ) through the platform.
Zoom Out: - Coinbase received in-principle approval from the Monetary Authority of Singapore (MAS), the region's financial regulator, to operate as a payments institution in the country in October 2022.
- The move has become Coinbase's latest effort to accelerate its global expansion plans, mainly due to its legal conflict with the Securities and Exchange Commission (SEC) in its native U.S.
- The company also recently launched a new Bermuda-based international derivatives exchange for institutional crypto traders outside the U.S., and its executive team, including the CEO Brian Armstrong, visited the United Arab Emirates (UAE) for strategic development in the region.
- The firm is currently in a legal battle with the SEC in which the regulator claims that the platform could violate securities laws through its exchange and staking services, while the popular crypto exchange requests the agency to create a clear framework for digital assets.
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| 6 | | A Twitter user named Rev.Hodl has recently shared a new post showcasing the different use cases of his Bitcoin (BTC) miner. The tweet pointed out that the tech enthusiast installed Bitcoin mining equipment in his garden to help the vegetable and cannabis seedlings grow by heating them during cold months. More: - In the post, Rev.Hodl said he was very happy with the results, adding that the things a small Bitcoin mining equipment can do are amazing.
- The Twitter user also counted other purposes for which he uses the Bitcoin miner, including making a dehydrator and heating his house.
- Furthermore, the post advised other users to set the miner between 500 and 700 watts to keep the temperature in the 70s Fahrenheit indoors when it's in the 20s outdoors.
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Term of the Day Venture debt: Venture debt is a form of non-dilutive debt financing used by startups, especially early-stage, to supplement their equity fundraising. Question of the Week How do you approach networking, and what advice can you give others looking to build their professional connections? Join the conversation |
INSIDE CRYPTOCURRENCY LEADERBOARD (7 DAYS) |
 | Staff Writer | | Doga is a tech and science editor who has been writing news for nearly 10 years. She worked for leading tech platforms and mainstrem media channels as an editor and presenter throughout his career. Then, she carried her know-how to more than one platform. She is a part-time cat lover and binge-watcher, and also fond of science, space, and emerging tech. She always has a story to tell. She is a bit addict to the laughter and -unfortunately- the '90s culture. | | This newsletter was edited by Aaron Crutchfield | |
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