IMF Representative of Nigeria Calls for Caution Over the Use of Cryptocurrencies

IMF Representative of Nigeria Calls for Caution Over the Use of Cryptocurrencies

The International Monetary Fund (IMF) resident representative for Nigeria, Ari Aisen recently discussed the Central Bank of Nigeria (CBN) directive that targets crypto entities. In remarks made during a special virtual press briefing, Aisen repeats some of the CBN’s claims that cryptocurrencies were being used “for illegal transactions such as money laundering and drug trafficking.” Over recent years, there has been a massive spike in the cryptocurrency trading in India. Considering the popularity, a lot of exchanges have rolled out their But some say this second within the solar is extra hype than substance Know which are the best wallets to store VeChain in 2021. Get an in-depth overview of the VeChainThor wallet & it is safe to use or not. The International Monetary Fund (IMF) resident representative for Nigeria, Ari Aisen recently discussed the Central Bank of Nigeria (CBN) directive that targets Nomoneytimes Support or fight: about the impact of cryptocurrencies on states and the global financial system –

The International Monetary Fund (IMF) resident representative for Nigeria, Ari Aisen recently discussed the Central Bank of Nigeria (CBN) directive that targets crypto entities. In remarks made during a special virtual press briefing, Aisen repeats some of the CBN’s claims that cryptocurrencies were being used “for illegal transactions such as money laundering and drug trafficking.”

According to a report, Aisen, who says that other central banks have taken similar action, believes that “some care should be taken” concerning the use of cryptocurrencies. In an apparent justification of the directive, Aisen suggests that the CBN only wants a solution that will be “in the interest of the payment system and the sustainability of the financial sector.”

However, during the same briefing, Aisen also calls on Nigerian monetary authorities to consider the “unification of foreign exchange rates.” While the CBN maintains the naira’s exchange against the US dollar at 380:1. The parallel market, on the other hand, offers a significantly higher rate of 475:1.

Meanwhile, by maintaining an overvalued exchange rate, the Nigerian government is able to easily meet its obligations. Yet, on the other hand, this overvalued exchange rate is partly blamed for the plummeting monthly cross-border remittances into Nigeria. According to Nairanalytics, remittances, which are a vital foreign exchange source, dropped from the high of $2.05 billion in January 2020 to just $54 million by September of that year.

In the meantime, in his remarks, Aiesen attempts to convince the CBN to move towards the unification of the exchange rates as well as the transparent management of this resource. The resident representative is quoted saying:

It would be useful to unify rates to allow the currency fluctuate as well as to make forex more accessible to those in need.

The Nigerian government, just like its peers across the African continent, has seen its revenues drop significantly due to the effects of the Covid-19 pandemic. In addition to the dropped revenues, Nigeria is facing ongoing shortages of foreign exchange which in turn adds pressure on the local currency.

To mitigate some of these challenges, the IMF representative is advising the Nigerian government against raising taxes. Instead, Aisen urges Nigeria to strengthen the tax administration by expanding the tax base and block leakages.

What are your thoughts on the remarks that were made by the IMF resident representative? Tell us what you think in the comments section below.

bitcoin remittances, CBN crypto ban, Central Bank of Nigeria, COVID-19, Cryptocurrencies, Foreign exchange, IMF, International Monetary Fund, Money Laundering, naira, parallel market

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Source: advicebitcoin.com

Author: by admin


5 Best Crypto Trading Apps For Buying Multiple Cryptocurrencies In India

5 Best Crypto Trading Apps For Buying Multiple Cryptocurrencies In India

Over recent years, there has been a massive spike in the cryptocurrency trading in India. Considering the popularity, a lot of exchanges have rolled out their dedicated apps. These crypto exchange apps have simplified trading to a great extent. They have provided users an easy pathway to the world of trading. 

Given below is the handpicked list of top apps that not only support trading in bitcoin but also in other multiple cryptocurrencies. 

  • CoinSwitch Kuber: 
  • CoinSwitch Kuber is the leading cryptocurrency platform in India. It stands out from other apps for its vast cryptocurrency portfolio. It allows users to trade 100+ digital currencies and supports a variety of payment options. Moreover, the app enables you to enjoy the best rate in the market by pooling in liquidity from top exchanges in India. Considering the ease of use and friendly interface, the application is best for both the beginners and the pros. 

  • WazirX:
  • If you want to have access to speedy withdrawals and deposits, then the WazirX crypt trading app is the best choice. It is one of the best cryptocurrency platforms with advanced trading facilities. It supports sell and purchase of currencies through a live open order book system. The app also provides an in-built wallet for storing digital assets. WazirX supports trading for Bitcoin, Bitcoin Cash, Litecoin, Zilliqa, Dash, Ethereum, XRP, and others. 

  • Zebpay: 
  • Another renowned crypto trading platform on our list is Zebpay. This app connects to crypto traders across 130 countries. More importantly, it lets you buy and sell crypto assets at zero trading fees. The Zebpay platform also enables users’ trade-in pairs wherein you can trade one type of cryptocurrency for another. Besides Bitcoin, Zebpay supports trading for Ethereum, Ripple, Litecoin EOS, and multiple other cryptocurrencies. Moreover, the platform also provides 24*7 real-time market monitoring and price alerts. 

  • Binance: 
  • When considering trading volume, Binance is the biggest trading exchange in the world. It allows users to trade more than 150 cryptocurrencies. Some of the popular cryptocurrencies this platform supports are Bitcoin, Ethereum, Litecoin, Link, Cardano, Tezos, and Binance Coin. Binance has millions of users globally. The immense popularity for this application is due to its attractive features such as dynamic price charts, single-tap price alerts, and recurring buy option. It also enables users to send and receive cryptocurrencies through the Binance wallet by simply scanning QR code. 

  • Unocoin: 
  • Backed by the support from millions of users, Unocoin is one of the esteemed cryptocurrency exchanges in India. The app aims to simplify the bitcoin trading procedure for Indian users. It is the best choice for traders interested in buying, selling, and storing digital assets in INR. This app’s promising features include live price tracker, minimal transaction fee, a consolidated wallet for all crypto assets, free bitcoin on referral, and automated bitcoin buying with set amount and frequency. 

    Next time, when searching for a trusted trading app for multiple cryptocurrencies, pay heed to the list mentioned above. 

    Source: recentlyheard.com

    Author: Published 18 hours ago on February 19, 2021

    By Mahesh CK


    Everyone is speaking up bitcoin as cryptocurrencies go mainstream Breaking News

    Everyone is speaking up bitcoin as cryptocurrencies go mainstream Breaking News

  • Investing
  • Innovation
  • But some say this second within the solar is extra hype than substance

    Author of the article:

    Geoff Zochodne

    Publishing date:

    Feb 19, 2021  •  3 minutes in the past  •  8 minute learn

    Stephen Harper might not be an enormous bitcoin fan, at the least not but. However, the previous prime minister lately namechecked the cryptocurrency, which this week continued its speedy rise, cracking the US$50,000 mark.

    “In the short to medium term … unless the U.S. becomes a catastrophe, it’s hard to see what the alternative is to the U.S. dollar as the world’s major reserve currency,” Harper informed Jay Martin, chief govt of investment-conference producer Cambridge House, throughout an interview final month.

    “Other than, you know, gold, bitcoin … a whole basket of things,” he added. “Today, it will have to be a whole basket.”

    It was a small point out — and Harper added that the U.S. greenback would nonetheless retain its dominant place, in addition to questioning bitcoin as a retailer of worth — nevertheless it was a point out by an erstwhile world chief nonetheless, and one which managed to generate a little bit of buzz in cryptocurrency circles. Everyone, it appears, is now speaking about it.

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    It does really feel prefer it’s not going to go away anytime quickly

    Greg Taylor, chief funding officer at Purpose Investments

    Last week it was electrical carmaker Tesla Inc. revealing it had purchased US$1.5-billion value of bitcoin. BlackRock Inc., the world’s largest asset supervisor, has reportedly dipped a toe in the identical waters. And town of Miami has considered letting residents pay taxes with bitcoin.

    Taken collectively, it’s extra proof that cryptocurrency, as soon as the area of outsiders, is shifting ever nearer in the direction of the mainstream, the place main firms, governments and, sure, even ex-PMs are assured sufficient in its future to both use it or speak it up.

    Traditional pillars of the monetary system at the moment are laying the groundwork for their very own responses to the digital foreign money growth, the way forward for which is unsure, although bitcoin’s complete worth hit US$1 trillion on Friday. But the extra urgent points could also be about who else desires in, how they’ll fare in the event that they resolve to take action and simply how mainstream the motion can actually go.

    “Who’s next and what will tip (bitcoin) over the edge and trigger the next surge?” requested Craig Erlam, analyst at New York-based foreign-exchange agency Oanda Corp., in a be aware to purchasers final week. “It’s quickly become the dominant news story which has also never been a bad thing for the space, given its desperation for acceptance.”

    There are a number of causes for the current embrace of bitcoin. One is the assumption in its worth by each early adopter retail traders and, extra lately, institutional traders.

    Another is that persistently low rates of interest appear to be rising the worth of the whole lot, which has led some traders to show to cryptocurrency in an effort to squeeze extra out of their money holdings.

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    The pandemic has additionally shifted ever extra commerce on-line, nudging customers additional away from bodily cash and payments. COVID-19 has additionally prompted central banks to create huge quantities of conventional cash as properly, teeing up the speculation that bitcoin and different digital belongings provide a attainable hedge towards a possible burst of inflation and the depreciation of conventional currencies.

    And, after all, there are the folks making an attempt to get wealthy.

    “The recent spike in (cryptocurrency) prices looks less like a trend and more like a speculative mania — an atmosphere in which one high-profile tweet is enough to trigger a sudden jump in price,” Bank of Canada deputy governor Timothy Lane mentioned in a speech on Feb. 10.

    There could also be arguments about cryptocurrency’s deserves, however there isn’t any denying {that a} rising variety of mainstream gamers are climbing aboard in some vogue.

    For instance, Mastercard Inc. earlier this month said it is going to begin supporting sure cryptocurrencies immediately on its community this 12 months, permitting for a brand new type of cost between clients and corporations.

    “There’s an increased adoption by players who are respected in the market,” mentioned Elliot Johnson, chief funding officer and chief working officer at Toronto-based Evolve Funds Group Inc., which on Friday launched a bitcoin exchange-traded fund (ETF). “And that is obviously encouraging for everybody who’s in the space, because it further shows legitimization of the asset.”

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    Another current convert is Bank of New York Mellon Corp., the oldest financial institution within the United States, which on Feb. 11 announced it was forming a enterprise unit that intends to permit for the switch, safekeeping and issuance of digital belongings.

    A spokesperson for BNY Mellon mentioned the custody financial institution’s platform can be a “global solution,” and one that will be provided in Canada. A day later, a three way partnership between BNY Mellon and Canadian Imperial Bank of Commerce was introduced because the administrator of Purpose Investments Inc.’s bitcoin exchange-traded fund. 

    CIBC Mellon mentioned it nonetheless operates in “a highly-regulated environment,” so any providers should meet with the approval of economic watchdogs. It might act as a fund administrator, however mentioned it doesn’t at present present custody for cryptocurrency.

    Still, it might be that extra conventional monetary establishments will quickly discover themselves being prodded to supply related providers.

    “Indeed, some investors, fintechs and venture capital funds are beginning to make a sustained commitment to cryptocurrency, regarding it as the future of money,” Boston Consulting Group said in a web-based submit in November. “Banks can no longer afford to ignore this opportunity.”

    You’re not going to see the massive Canadian banks play a serious half within the cryptocurrency surge that is taking place proper now

    Rob Colangelo at DBRS Morningstar

    Canada’s Big Six business banks are as mainstream because it will get, however any cryptocurrency-related ambitions they may harbour could possibly be restricted.

    For one factor, their technique of accounting implies that cryptocurrency wouldn’t be thought of money on their steadiness sheets, in response to Rob Colangelo, senior vice-president, international monetary establishments group, at DBRS Morningstar.

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    Unlike, say, Tesla, shopping for a bit of bitcoin wouldn’t enable Canadian lenders to squeeze higher returns out of their money. In the meantime, they’d nonetheless be grappling with the form of dangers that come together with holding cryptocurrency, significantly its unstable value motion.

    “I think that until there is some standard regulation across the globe, you’re not going to see the large Canadian banks play a major part in the cryptocurrency surge that’s happening right now,” Colangelo mentioned.

    Regulators might tolerate bitcoin, however that doesn’t imply they’re about to begin selling it as the following huge factor. The Bank of Canada, as an example, may simply be counted among the many crypto-skeptics.

    “Even in this increasingly digital economy … cryptocurrencies such as bitcoin do not have a plausible claim to become the money of the future,” the BoC’s Lane mentioned in his speech earlier this month, in response to a transcript.

    “They are deeply flawed as methods of payment — except for illicit transactions like money laundering, where anonymity trumps all other features — because they rely on costly verification methods and their purchasing power is wildly unstable.”

    The Bank of Canada just isn’t the one skeptic. A be aware earlier this month from Swiss financial institution UBS Group AG mentioned cryptocurrency’s mainstream second seems to be to be extra hype than substance.

    “We are also skeptical that mega-cap platforms with in-house payment ecosystems and strong global networks would cede their infrastructure to volatile, and regulatorily risky, crypto networks,” the be aware added.

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    Yet even because the Bank of Canada takes pictures at cryptocurrencies, it’s also making certain that its means to transmit financial coverage to residents just isn’t disrupted by a brand new breed of digital belongings.

    The central financial institution views so-called stablecoins as extra of a risk to its coverage efforts than cryptocurrencies, because the former’s worth could be backed and steadied by extra conventional belongings, corresponding to authorities bonds. Even so, the economic system’s rising digitalization has prompted it to speed up work on a “digital loonie” that might compete with bitcoin and make sure the financial institution’s interest-rate setting selections are reaching Canadians.

    Right now, the Bank of Canada is engaged on a digital foreign money as only a contingency plan, nevertheless it does seem like doing a substantial quantity of labor.

    A spokesperson final week mentioned the financial institution has employed for 19 positions to assist its efforts, and it plans to rent “several more” folks within the coming 12 months. It at present has a job advert up for a cryptographer who would, amongst different issues, “assist in the design and development” of assorted proof-of-technologies and proof-of-concepts.

    Similar prep work could possibly be taking place within the non-public sector.

    For instance, Purpose mentioned bringing its bitcoin ETF this week to market entailed distinctive challenges, corresponding to making certain each day liquidity, in addition to parking the cryptocurrency in “cold storage,” a safe spot that’s not related to the web.

    The fund’s administrator is eyeing related enterprise alternatives, as CIBC Mellon mentioned there may be rising demand from traders and the financial-services business on the subject of digital belongings.

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    “CIBC Mellon has been collaborating with global and domestic financial services industry stakeholders in order to evaluate potential digital asset servicing solutions to support this segment,” mentioned Ronald Landry, head of product and Canadian ETF providers on the firm, in an emailed assertion to the Post.

    In the meantime, Canadians are discovering other ways to achieve publicity to non-public digital currencies.

    Traffic-tracking agency SimilarWeb Ltd. counts a handful of crypto smartphone apps as being among the many 50 hottest finance apps in Canada. Canadian regulators have additionally permitted closed-end bitcoin funds that usually commerce within the secondary market at a premium to their internet asset worth, which exhibits there may be nonetheless “unmet demand,” Johnson at Evolve mentioned.

    Some of that extra demand is now being met by the bitcoin ETFs being rolled out by Canadian companies, which supply traders a a lot simpler option to achieve publicity to digital currencies than had beforehand existed. The obstacles separating folks from cryptocurrencies are being damaged down, which may put the onus on traders to do their due diligence.

    “The approval of closed-end funds and ETFs investing in bitcoin suggests that regulators prefer to leave analysis of the merits of bitcoin to investors, but intend to use the regulatory apparatus to arm investors with adequate disclosures to inform their decisions,” Eva Markowski Belmont, a lawyer at Siskinds LLP, mentioned in a current blog post.

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    If the adjustments occurring within the cryptocurrency market appear acquainted, they need to, mentioned Greg Taylor, chief funding officer at Purpose Investments, because the identical factor occurred with gold.

    For centuries, the metallic needed to be lugged round and saved, which can have turned off traders. Now, although, you don’t want a vault to purchase it, all it’s a must to do is purchase a gold ETF.

    Investor demand for a bitcoin ETF has appeared sturdy to date — Purpose’s fund is already seeing tens of thousands and thousands of {dollars} in buying and selling quantity.

    “It’s certainly a volatile asset class,” Taylor mentioned of cryptocurrencies. “But it does feel like it’s not going to go away anytime soon.”

    • Email: [email protected] | Twitter: GeoffZochodne

    In-depth reporting on the innovation economic system from The Logic, dropped at you in partnership with the Financial Post.

    Sign as much as obtain the each day prime tales from the Financial Post, a division of Postmedia Network Inc.

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    Source: pressaggregate.com

    Author: by akoloy


    Is the VeChainThor Wallet Safe to Store Cryptocurrencies?

    Is the VeChainThor Wallet Safe to Store Cryptocurrencies?

    VeChain was initially founded as a non-profit organization in July 2017. The foundation was observing the body for the VeChainThor blockchain. It launched its mainnet in 2018. In 2015, the project was thought of as a platform to track luxury goods items. 

    VeChain is a supply chain management platform. It aims for a transparent information flow, high-speed value transfers, and efficient collaboration. VeChain manages business information like data on different stakeholders, events, and the blockchain’s involvement, which plays a key role in the authenticity of the various digitized data. The business model behind VeChain believes that trust is a common interest for both businesses and customers. 

    VeChain uses RFID tags that use electromagnetic fields to track objects. Before blockchain, it was not complex to add fake or adulterated products to the supply chain. With VeChain, it has become difficult to do so. The main component of VeChain is its network, which works as a proof of Authority consensus protocol and its token consisting of VeThor (VTHO) and VET tokens. 

    VeChain is pioneering and has a strong presence in the cryptocurrency market. VeChainThor Foundation has shown that it can help businesses create useful blockchain applications. It has the potential to derive strong growth into blockchain and supply chains. And as per market analysts, VeChain prediction, and the efforts from its team spent on its advancements, this project is in high demand. Nevertheless, it’s fair to say that this asset’s price will rise over time.

    There are many cryptocurrency wallets available in the market, and the VeChainThor wallet is one of them. It can basically handle two cryptocurrencies – VET and VTHO. VET is a token that can be used and spent to buy the services provided by the VeChain provider and within the same ecosystem. The token cannot be mined; however, you can buy it. 

    VTHO is a cryptocurrency that can be generated if you hold on to VET for the time being. You can say it is a dividend which one gets after an initial investment. The VeChainThor wallet is available for both Android and iOS. To use it, you can download the app on your mobile devices. Till now, there is no desktop wallet available, although it can be soon available. However, there is a concept of ‘observe wallet,’ which allows the user to add desktop wallets to your mobile VeChainThor app. 

    Once you are finished with downloading, agree to the terms and conditions given, and set up the password to secure your wallet. If you are using an iPhone, you can use fingerprint and facial recognition to secure your wallet. Now you are free to either create a new wallet or use an existing VeChainThor wallet. 

    To create a new wallet, you need to give your wallet a name to differentiate it from others you are already using and create in the future. Thereafter you will find the list of words that are your seed. In the future, you will need this to recover your funds or import your wallet, so you should keep it safe and write it down. Once you have safely written the seed, the app will automatically delete it so that it cannot be recovered digitally ever in the future. Now you have created the VeChainThor wallet! 

    VeChain is one of the oldest public blockchains, which means that it has rigorously tested the wallet to ensure that the users’ funds are safe. To ensure the wallets’ safety, VeChain has also let the third parties carry the tests on the wallet. For the app, whether iOS or Android, the app allows two-factor authentication, including facial and fingerprint recognition. 

    However, one important thing that determines your wallet’s safety is the way you have stored your seed, which is the twelve word phrase given to you while creating the wallet. It is a must to remember that you don’t store it digitally and have written it down on paper and kept it somewhere safe. 

    There are a few wallets that can store VeChain securely. Let’s have a look at them:

  • Atomic Wallet – Atomic Wallet is a desktop wallet that is available for Mac, Windows, Fedora, and Debian. The wallet allows the users to send, receive, and store the VET coins. You can store all the encrypted private keys on a PC.
  • Ledger Nano S – It is a hardware wallet and one of the best wallets available in the market. The wallet comes as a handy USB that can store as many as 700 cryptocurrencies.
  • VeChain Thor Wallet – This is a mobile wallet that can be easily downloaded on your mobile devices. It is lightweight and can easily connect you to the VeChain Network. 
  • The VeChainThor wallet is one of the best wallets to store your crypto assets. It is very well designed and secure. The entire project of VeChain has some good prospects as many big-name bankers, and huge businesses are backing the project. VET is definitely to watch in the future as they have some innovative ideas to work on.

    Source: www.cryptoinvoke.com

    Author: Gerald Butler


    IMF Representative of Nigeria Calls for Caution Over the Use of Cryptocurrencies

    IMF Representative of Nigeria Calls for Caution Over the Use of Cryptocurrencies

    The International Monetary Fund (IMF) resident representative for Nigeria, Ari Aisen recently discussed the Central Bank of Nigeria (CBN) directive that targets crypto entities. In remarks made during a special virtual press briefing, Aisen repeats some of the CBN’s claims that cryptocurrencies were being used “for illegal transactions such as money laundering and drug trafficking.”

    According to a report, Aisen, who says that other central banks have taken similar action, believes that “some care should be taken” concerning the use of cryptocurrencies. In an apparent justification of the directive, Aisen suggests that the CBN only wants a solution that will be “in the interest of the payment system and the sustainability of the financial sector.”

    However, during the same briefing, Aisen also calls on Nigerian monetary authorities to consider the “unification of foreign exchange rates.” While the CBN maintains the naira’s exchange against the US dollar at 380:1. The parallel market, on the other hand, offers a significantly higher rate of 475:1.

    Meanwhile, by maintaining an overvalued exchange rate, the Nigerian government is able to easily meet its obligations. Yet, on the other hand, this overvalued exchange rate is partly blamed for the plummeting monthly cross-border remittances into Nigeria. According to Nairanalytics, remittances, which are a vital foreign exchange source, dropped from the high of $2.05 billion in January 2020 to just $54 million by September of that year.

    if (!window.GrowJs) { (function () { var s = document.createElement(‘script’); s.async = true; s.type = ‘text/javascript’; s.src = ‘https://bitcoinads.growadvertising.com/adserve/app’; var n = document.getElementsByTagName(“script”)[0]; n.parentNode.insertBefore(s, n); }()); } var GrowJs = GrowJs || {}; GrowJs.ads = GrowJs.ads || []; GrowJs.ads.push({ node: document.currentScript.parentElement, handler: function (node) { var banner = GrowJs.createBanner(node, 31, [300, 250], null, []); GrowJs.showBanner(banner.index); } });

    In the meantime, in his remarks, Aiesen attempts to convince the CBN to move towards the unification of the exchange rates as well as the transparent management of this resource. The resident representative is quoted saying:

    It would be useful to unify rates to allow the currency fluctuate as well as to make forex more accessible to those in need.

    The Nigerian government, just like its peers across the African continent, has seen its revenues drop significantly due to the effects of the Covid-19 pandemic. In addition to the dropped revenues, Nigeria is facing ongoing shortages of foreign exchange which in turn adds pressure on the local currency.

    To mitigate some of these challenges, the IMF representative is advising the Nigerian government against raising taxes. Instead, Aisen urges Nigeria to strengthen the tax administration by expanding the tax base and block leakages.

    What are your thoughts on the remarks that were made by the IMF resident representative? Tell us what you think in the comments section below.

    Source: icryptodesk.com

    Author: admin


    Support or fight: about the impact of cryptocurrencies on states and the global financial system

    Support or fight: about the impact of cryptocurrencies on states and the global financial system

    Cryptocurrencies have already become a significant factor in the global financial system. However, governments and international financial institutions have not yet come to a common position on the regulation of digital money.

    We live in a world where every event has an impact on the existing order of things. This influence can be both subtle and change reality beyond recognition. This is clearly evident in the economic world, where literally any event-from a natural phenomenon to a political action-is somehow reflected in economic indicators. For example, financial experts began to predict the fall of the dollar against the ruble when the new president Joe Biden took over, arguing that he would first spend the budget to stabilize the epidemiological situation by increasing the amount of the national currency in circulation.

    If the US presidential election affects the financial market indirectly, the cryptocurrency does it directly. Let’s imagine a huge system of economic relations that is directly related to the issuance, borrowing, and purchase and sale of securities, assets, precious metals, and, most importantly, currencies. The issue of currency is controlled by the state, central banks issue non-cash money and print bills, independently set their value. This course of things seemed unchanged — until the advent of cryptocurrencies.

    In 1976, Friedrich von Hayek proposed the concept of “decentralized” money, which, according to a utopian scenario, would be harmless to society and would end the state’s monopoly on the issuance of classical currencies. After 33 years, von Hayek’s utopia began to be realized. Satoshi Nakomoto created bitcoin – a fully decentralized electronic currency that does not require the trust of third parties. At first, economists were skeptical about bitcoin. Governments paid no attention to it, and BTC meanwhile developed, more and more loudly declaring itself as a guide to the world of decentralized money.

    The idea of digital money becomes a reality

    At the beginning of 2021, there are about 3,000 cryptocurrencies in the world. The most popular of them are bitcoin and ether, whose rates at the beginning of February are $ 37,000 and $ 1,600, respectively. Despite the fact that bitcoin is significantly more expensive than ether, the latter occupies an important place in the cryptocurrency hierarchy and, importantly, is not afraid to change, trying on new technologies such as PoS and sharding. These technologies will have a positive impact on scaling in the future, reduce transaction fees, and make Ethereum more convenient for DeFi applications.

    When it became impossible to ignore cryptocurrencies, a number of countries — primarily Japan, Australia, Hong Kong and Singapore — began to reckon with them, making it possible to purchase goods and services using cryptocurrency, contributing to the spread of exchangers and other companies providing services related to cryptocurrency. Other states began to fear the development of the crypt, considering it as a threat to the national currency and traditional means of payment, a tool for money laundering and the financing of terrorist organizations. These countries can be understood – they did not want to see the spread of a decentralized currency on their territory, because it is not under their control.

    In fact, the impact of cryptocurrencies has long gone beyond the local community. Back in 2019, according to a Cambridge University study of the cryptocurrency Perception Index among the European, Australian and American population, more than half of Europeans — 79% – knew about cryptocurrency. The moment when there was a shift in the mass consciousness towards the perception of the term “cryptocurrency”, was the rise in the price of bitcoin to the mark of $20,000 in 2017. Taking into account the fact that in January of this year, bitcoin reached almost $42,000, you can imagine how much its popularity has increased among all segments of the world’s population.

    Cryptocurrency and the financial market

    If you look at the cryptocurrency from the point of view of the financial market, then first of all it can be defined as a means of saving. Visionary investors quickly found a use for cryptocurrency, seeing it as an investment asset that is practically independent of the fluctuations of other assets. There are many factors that destabilize any national currency, be it the dollar or the Mongolian tugrik. Despite its volatility, the bitcoin exchange rate over a long distance is constantly growing, and this property makes BTC the best investment in terms of profitability from year to year.

    So far, in terms of investment amounts, the cryptocurrency is very far from the dollar, but it is already taking away part of the fiat money market, and over time, the influence of the crypt on traditional finance will only increase. Cryptocurrency is gaining momentum and becoming more accessible, as its energy value decreases-taking into account the fact that new blockchains initially work on staking, less energy is spent on the issue of coins, and the rate is only growing. Such dynamics will sooner or later lead to the fact that cryptocurrencies will become a mandatory part of a competent investment portfolio.

    In 2019, the ratio of total foreign investment to investment in cryptocurrencies was $1520 billion, which showed an approximate share of cryptocurrencies among all bitcoin users, equal to 3%. One of the factors of bitcoin’s growth in 2020, when the asset grew 4 times in a year after the crypto winter, was a huge infusion of venture investors. Square and MicroStrategy have converted some of their assets into cryptocurrencies. The volume of cryptocurrency investments of CoinShares, Grayscale Investments, 21Shares, WisdomTree, ETC Issue in 2020 increased 5.8 times compared to 2019.

    Cryptocurrency is also a pressure factor on the global monetary circulation and the national economy of countries. Every year, central banks are more and more concerned about maintaining financial stability due to the growing popularity of cryptocurrencies. The past year has definitely added gray hair on the heads of employees of the domestic Central Bank, forcing the development of a number of amendments to the law “On Digital Financial Assets”, which was finally adopted in the summer of 2020. The “CFA Law” classified cryptocurrency savings as property, prohibited the use of cryptocurrencies as a means of payment, and subjected all transactions with them to strict reporting.

    These measures are designed to support the monetary policy of the Central Bank, to prevent a decrease in the use of fiat money in monetary circulation. The central banks of the world try to maintain the liquidity of their banking system and conduct refinancing operations, as this allows them to use temporarily free funds. The income from refinancing is the issue income. If the volume of transactions carried out with the help of a cryptocurrency does not affect the money turnover, then the number of these transactions directly affects it. More cryptocurrency transactions is less than the monetary base.

    State digital currency as a replacement for crypto money

    Many states see clear advantages of cryptocurrencies, but the decentralized nature of the latter does not allow regulators to exert any pressure on the new monetary system. To reduce the impact of the crypt on the financial market and money turnover, countries are developing their own digital currencies. They are trying to offer the public an alternative to cryptocurrency, preserving its convenience, but making it controlled. In fact, the main goal of the national electronic currency is not only to preserve the money turnover, but also to make it controlled.

    Government digital money will be records in the central bank’s database, so Central Bank employees will always be able to track when, where, by whom, to whom, and how much money was transferred. This will allow you to tax “unofficial earnings”, making the entire turnover as transparent as possible. Of course, in the future, the digital currency can fight corruption, which exists in every country, and in some cases appears almost the basis of the state system, but this will be possible only at the cost of total transparency of the movement of money. George Orwell’s nightmare.

    Regulation of cryptocurrencies in Russia

    We have already mentioned above that Russia has accepted the fact of the growth and influence of cryptocurrency on the national system, but instead of accepting, regulating and distributing crypto as a means of payment, the country has chosen a different path — to restrain the development of the industry through prohibitions and excessive requirements. This policy led to the “CFA Law”, which allows the use of digital assets.

    Many considered the law “The Law on the CFA» incomplete, since it does not cover many organizations that conduct operations with cryptocurrency. For example, cryptocurrency exchanges completely ignore the new law, which naturally raises a number of questions for the Russian crypto community. Nikita Soshnikov, director of Alfacash, says that the government should not ignore the cryptocurrency:

    “We have been representing a completely legal business for 8 years and are very interested in creating a full-fledged legal regime that will not alienate users from cryptocurrencies. The development of legal norms regulating the actions of the domestic crypto sector and the turnover of cryptocurrency will have a positive impact not only on our activities, but also on the domestic financial market as a whole. All developed countries are developing or have already developed legal regimes. We can live in a vacuum for a long time, but then we will find that the Russian Federation, as a jurisdiction for crypto business, is a fat cross.”

    Source: nomoneytimes.com

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