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| Hey Insider! Welcome to the week's first Inside Cryptocurrency newsletter! Today's issue covers some of the most prominent stories hitting the headlines during the weekend and within the day, including Australia's new crypto regulation proposal, Ferrari's decision to start accepting crypto payments, BlockFi CEO's testimony in the ongoing trial against the bankrupt crypto exchange FTX's former CEO, and more. Enjoy your reading, and if you find this newsletter useful, please do not forget to share it with your friends and colleagues! Doğa
p/dogayurduneri | |
| 1 | | Italian luxury car manufacturer Ferrari has started accepting payments in cryptocurrencies for car purchases in the U.S. The company plans to expand the new payment option to Europe by Q1 2024 and then to other regions where crypto is legally accepted. More: - The carmaker has partnered with the crypto payment processor BitPay to enable the new payment option.
- The accepted cryptocurrencies will include Bitcoin (BTC), Ether (ETH), Ripple (XRP), Shiba Inu (SHIB), Tether (USDT), and USD Coin (USDC).
- Customers using the crypto payment option in the U.S. will pay no additional fees or surcharges, and there will be no changes in car prices.
- When customers pay in crypto, BitPay will immediately convert this payment into a traditional currency on behalf of Ferrari's dealers to protect them from volatility.
- The payment processor will also ensure the cryptocurrencies paid for car purchases come from legitimate sources.
- Ferrari's Chief Marketing and Commercial Officer Enrico Galliera said the decision came in response to the requests from young and traditional investors and its dealers.
- Galliera added that most cryptocurrencies reduced their carbon footprint through the introduction of new software and a broader use of renewable sources, and this aligns with the brand's target to reach carbon neutrality by 2030.
Zoom Out: - Ferrari sold 13,200 cars in 2022, with prices ranging from $211,000 to $2.1M.
- Elon Musk-led electric vehicle (EV) giant Tesla became one of the first carmakers to accept cryptocurrencies as a payment method in 2021 before suspending the payment option due to Bitcoin's adverse environmental impacts amid the concerns around the use of fossil fuels for Bitcoin mining and transactions.
- Japanese car manufacturing giant Honda also recently started accepting payments with cryptocurrencies for its products through a third-party blockchain-based payments processor, FCF Pay.
Q: Would you prefer to buy a luxury car with crypto? Join the conversation here. |     | |
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What the numbers say: The data from Google Trends has shown that the search volume for the term "Bitcoin" retreated to the lowest level since 2020, marking a three-year low. The relative interest score of the searches for Bitcoin fell to 15, down from an all-time high of 100 in May 2021. Such a low volume was last seen in September 2020. The decline in volume represents a drop in user interest in the leading cryptocurrency. The analysts have also pointed out that the search interest conventionally shows parallelism with the increase in Bitcoin's price. Relevance: Google Trends data revealed a similar downward trend for the term "crypto" in June, too. The statistics showed that online search volume for crypto retreated to the levels at the end of 2020 and fell to 17, marking a 29-month low. At the time, the decline in the interest on Google was attributed to the lower trading volumes in the spot crypto exchanges in May. Brands that should care: The latest downturn trend in user interest in the term "Bitcoin" on Google coincided with a decline in the spot trading volume of major crypto exchanges, including Binance and Coinbase. Most recently, the digital asset data provider CCData reported that Coinbase, the largest U.S. crypto exchange, saw a 52% drop in spot trading volumes during Q3 compared to the same period last year. | | | |
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| 3 | | Bankrupt crypto lender BlockFi's CEO, Zac Prince, has recently testified in court as part of the ongoing trial against the bankrupt crypto exchange FTX's former CEO, Sam Bankman-Fried (SBF). In his testimony, Prince blamed FTX and its sister company, Alameda Research, for BlockFi's collapse. More: - Prince said he would have never lent funds if he had known that FTX and Alameda Research used false balance sheets.
- BlockFi CEO also added that lending funds to Alameda Research would not have been appropriate if he had known that the company was using FTX customers' funds.
- Prince's testimony pointed out that BlockFi had a total of $1.1B on FTX.
- Prince stated that his company called some of the loans back, though there had been $650M still outstanding.
- BlockFi filed for Chapter 11 bankruptcy protection in November 2022, shortly after FTX, due to the volatility in the crypto market and its exposure to the exchange.
- The firm is currently going through its bankruptcy process.
- Adam Yedidia, a former FTX software developer, also recently testified that FTX customer deposits went to an account controlled by Alameda Research since the exchange was having trouble with opening a bank account.
Zoom Out: - FTX, previously the third-largest crypto exchange, filed for Chapter 11 bankruptcy in November 2022, with all the 130 entities under the roof of FTX Group.
- The downfall followed the claims that SBF used customer funds in FTX to compensate for losses at Alameda Research.
- The 31-year-old former CEO is currently being tried on seven charges, including money laundering and misappropriation of customer funds, to which he pleaded not guilty, facing a statutory maximum of 110 years in prison.
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| 4 | | The U.S. state of California's governor, Gavin Newsom, has recently approved a new crypto bill dubbed the Digital Financial Assets Law that would enforce stricter regulations on crypto-related companies. The law will take effect in July 2025. More: - The bill will make it mandatory for both individuals and firms seeking to engage in digital asset operations in the state to obtain a license from the Department of Financial Protection and Innovation (DFPI).
- The new regulation was built on California's existing money transmission laws, which prohibit banking and transfer services from operating without a license from the DFPI.
- The bill will also allow the DFPI to implement strict audit requirements on crypto companies and force them to maintain comprehensive financial records.
- The firms not complying with the new regulations will face enforcement actions.
- Newsom's approval came around a year after he declined to sign a similar bill aimed at establishing a licensing regime and regulatory framework for digital assets in California due to a lack of flexibility necessary to keep up with fast-changing trends in the crypto market.
Zoom Out: - In the U.S., New York has also been implementing a similar licensing regime through the issuance of BitLicense to allow a company to run crypto activities under regulations in the state.
- The license, issued by the New York State Department of Financial Services (NYDFS), has been criticized many times over the last few years for restrictive measures, long wait times, and high compliance costs.
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| 5 | | The Australian government's Department of the Treasury has proposed new rules that would require crypto exchanges to obtain a license from the local market regulators to operate in the country. If the proposal built on existing laws comes into effect, the crypto trading platforms with more than $3.2M of holdings or ~$950 of holdings for an individual will have to get a permit from the Australian Securities and Investments Commission (ASIC). More: - The government will consult on the new rules until Dec. 1, and the draft legislation will come in 2024.
- Following the debut of draft legislation, the country's market regulator will ensure the crypto exchanges are compliant with the new regulations for a period of 12 months.
- The rules will also include new standards for custody, transactions, staking, and token issuance inspired by the regulatory frameworks in the U.K., Canada, and Singapore.
- The government pointed out that the new obligations, including submitting financial records, monitoring market misconduct, and meeting solvency and cash reserve requirements, are established based on the country's existing law for financial services.
- The framework will mainly aim to support the growth of digital assets in the country while protecting consumers.
Zoom Out: - The new rules were proposed shortly after several other jurisdictions, such as the U.K., the European Union (EU), Canada, and Singapore, established rules to regulate the crypto industry.
- On the other hand, over the last several months, many banking institutions in Australia have restricted their customers from making payments to crypto exchanges, citing potential risks from scams in an unregulated market.
- The Australian lenders limiting payments to crypto trading platforms include the Australia and New Zealand Banking Group (ANZ), National Australia Bank (NAB), Westpac, Bendigo Bank, and Commonwealth Bank of Australia (CBA).
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| 6 | | South Korean crypto exchange Upbit has obtained in-principle approval in Singapore to offer digital payment token services in the region in compliance with local regulations. The preliminary license was granted to the company by the Monetary Authority of Singapore (MAS), the city-state's financial market regulator. More: - The firm must demonstrate its commitment to featuring strong anti-money laundering measures to obtain a full license from the MAS, which could not be achieved by most applicants.
- Through the preliminary license, the company will be able to offer its crypto services to retail customers, institutional investors, and infrastructure-focused businesses.
- The in-principle approval was mainly given to a subsidiary of Upbit APAC, Upbit Singapore.
- Upbit APAC also operates regulated crypto exchanges in Thailand and Indonesia.
Zoom Out: - Several crypto-related firms have already managed to obtain full approval in the city-state, including Coinbase, Crypto.com, Blockchain.com, and Circle.
- However, some other crypto companies, like Ripple, are still in the preliminary stage with their in-principle approvals from the MAS.
- The MAS is most famous for its strict stance on the crypto market and stingy attitude toward approving a license.
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- Madeira, an autonomous region of Portugal, has announced its plans to establish a Bitcoin business hub to boost regional innovation.
- Hong Kong-based BC Technology Group Ltd. has started weighing the sale of its crypto trading platform OSL, one of the only two licensed exchanges in the region, at a valuation of $128M.
- Lawyers for the bankrupt crypto exchange FTX's former CEO, Sam Bankman-Fried (SBF), have asked Judge Lewis A. Kaplan to allow the defendant to access his prescribed medication during his ongoing trial, stating that he cannot focus without it.
- Popular crypto wallet MetaMask has returned to Apple's App Store after being removed from the platform without specifying any reason.
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INSIDE CRYPTOCURRENCY LEADERBOARD (30 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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