A proposal that would have effectively banned the mining and transactions of energy-intensive cryptocurrencies such as Bitcoin in the European Union failed to win approval by a parliamentary committee, as the bloc pushes ahead with regulation of the fast-growing sector. The EU’s Economic and Monetary Affairs Committee voted on a final draft of the Markets in Crypto-assets (MiCA) legislation on Monday, which included a clause pledging to make cryptoassets traded or issued within the bloc “subject to minimum environmental sustainability standards.” A final tally of the committee’s voting showed the proposed clause was defeated with 23 votes in favor, 30 against and six abstentions. Crypto industry pundits said the proposal would have acted as a de-facto ban on cryptocurrencies such as Bitcoin and Ether, which operate using a “proof-of-work” consensus mechanism and require large amounts of energy to mint tokens and record transactions. The proposal had promised to allow time for such tokens to improve their carbon footprint in order to comply with the new rules, though. A previous version of MiCA had suggested banning proof-of-work tokens outright. Ernest Urtasun, shadow rapporteur on the MiCA legislation and a member of the European Parliament within the Greens/EFA political group, said the proposal wasn’t intended to force a ban on “proof of work” tokens like Bitcoin. “It was not as simple as this. Our proposal was more complex and more taking into account the need of the industry to adapt,” he said. The committee passed a separate proposal to add cryptocurrency mining to the EU’s taxonomy […]

Crypto firms in the United Arab Emirates (UAE) are being deluged with requests to liquidate billions of dollars of virtual currency as Russians seek a safe haven for their fortunes, according to company executives and financial sources. Some clients are using cryptocurrency to invest in real estate in the UAE, while others want to use firms there to turn their virtual money into hard currency and stash it elsewhere, the sources said One crypto firm has received lots of queries in the past 10 days from Swiss brokers asking to liquidate billions of dollars of Bitcoin because their clients are afraid Switzerland will freeze their assets, one executive said, adding none of the requests had been for less than $2bn. “We’ve had like five or six in the past two weeks. None of them has come off yet – they’ve sort of fallen over at the last minute, which is not rare – but we’ve never had this much interest,” the executive said, adding his firm normally receives an inquiry for a large transaction once a month. “We have one guy – I don’t know who he is, but he came through a broker – and they’re like, ‘we want to sell 125,000 Bitcoin’. And I’m like, ‘what? That’s $6bn guys’. And they’re like, ‘yeah, we’re going to send it to a company in Australia’,” the executive said. Switzerland’s financial market supervisor declined to comment on cryptocurrency transaction volumes. The country’s economic affairs secretariat (SECO) said in an emailed statement […]

For investors, these are unprecedented times. The world has been rocked by a deadly pandemic. Europe is at war; Russia in an economic chokehold. The United States is experiencing its highest inflation in 40 years and it’s likely to get worse. Currency and equity markets are gripped by a scale of volatility unseen in years. The status quo of the traditional geopolitical order faces a crisis. And commodities are trading like meme stocks. Enter cryptocurrency – a $3 trillion market that promises to liberate people from the grip of the global financial system. Cryptocurrencies have become increasingly mainstream. Five years ago, the market was valued at just $14bn – a fraction of what it is today. The US government, among others, is trying to get in on the digital asset boom, seeking to regulate and reinvent a sector operating largely out of its reach. US President Joe Biden on Wednesday signed an executive order requiring the government to assess the risks and benefits of creating its own central bank digital currency (CBDC). While taking inspiration from cryptocurrencies and following some of the same principles, CBDCs are not regarded as crypto as they are regulated by a central authority. The White House will also look into mitigating crypto risks for consumers and leading economic and technological competitiveness and innovation in the sector. China debuted its version of a CBDC, the digital yuan, during the Beijing Winter Olympic Games last month. According to the Pew Research Center, 16 percent of Americans have […]

The Biden administration’s long-awaited executive order for government agencies to take a closer look at issues surrounding the crypto market is being celebrated by industry participants despite it lacking a clear path on possible regulation. “The executive order is quite vague. They still talk a lot about the need to keep restrictions on this asset class,” said Matt Maley, chief market strategist at Miller Tabak + Co., said. “However, it is still the kind of signal that the Washington, D.C., establishment is becoming more comfortable with cryptos and that is bullish.” Bitcoin rallied as much as 11% on Wednesday. Ether, the second-largest token, gained more than 8%, while so-called altcoins also rallied. The advance is in line with other risk assets, like stocks, which have been under pressure amid the fallout from Russia’s invasion of Ukraine. Antoni Trenchev, co-founder of crypto platform Nexo, cautioned investors to “expect further volatility as we seek clarity from the regulatory haze and the ripple effects from Ukraine continue to felt across the world.” Nonetheless, others are claiming the executive order as a victory for the sector. Grayscale Chief Legal Officer Craig Salm, called the directive “incredibly positive” during an interview. Here’s what else market participants are saying: Like many of you, I thought the Biden Admin’s EO would acknowledge crypto, but not detail specifics on next steps for regulation. However, I was pleasantly surprised & inspired by the EO acknowledging the *need* for evolution and alignment of the govt’s approach to crypto. — Brad Garlinghouse (@bgarlinghouse) […]

President Joe Biden is set to sign an executive order this week that will outline the U.S. government’s strategy for cryptocurrencies, according to several people familiar with the administration’s plans. The order will direct federal agencies to examine potential regulatory changes, as well as the national security and economic impact of digital assets, said the people, who asked not to be named discussing the deliberations. The White House’s approach to crypto has attracted fresh attention in recent weeks as Washington and its allies have levied sanctions on Russia, prompting concerns that firms and individuals there could use crypto to evade the restrictions. The White House declined to comment. The order, which has been in the works since last year, will require federal agencies across the government to report later this year what they’re doing regarding digital assets, Bloomberg News has reported. Biden’s team is under pressure to play more of a coordinating role as industry executives bemoan what they say is a lack of clarity on U.S. rules. Meanwhile, the crypto industry is facing intense scrutiny from lawmakers, including Senator Elizabeth Warren and Senate Banking Committee Chairman Sherrod Brown, over concerns that sanctioned individuals and firms in Russia may be using digital assets to bypass the sanctions. Still, some analysts and officials have questioned how effective a workaround crypto could be, given the limited size of the market.

Cryptocurrency alone will not allow Russia to skirt a barrage of sanctions aimed at punishing Moscow for invading Ukraine, cryptocurrency analysts told Al Jazeera. The United States, United Kingdom, European Union and Canada announced new sanctions on Monday, this time targeting Russia’s central bank and national wealth fund. The US Treasury Department said that it was limiting Russian President Vladimir Putin’s ability to use the country’s $630bn in foreign reserves. The move came just a day after the US and its allies cut off some Russian banks from SWIFT (the Society for Worldwide Interbank Financial Telecommunication), a secure messaging network used for trillions of dollars worth of transactions. Russia’s economy was already reeling on Monday. The ruble plunged to an all-time low, the central bank raised its key interest rate to 20 percent, and the stock exchange stayed closed. Enforcing sanctions requires the ability to track transactions – typically through the banking system. Iran and North Korea have both used cryptocurrencies, which operate outside the confines of the financial system, to get around sanctions. “Crypto can be used to evade sanctions and hide wealth,” Roman Bieda, the head of fraud investigations at Coinfirm, a blockchain risk management platform, told Al Jazeera. But crypto experts told Al Jazeera Russia’s case is different, with the country having less wiggle room due to the scale of the economic blow and its limited adoption of digital currencies. Replacing hundreds of billions of dollars Unlike North Korea, Venezuela and Iran, Russia has been deeply ingrained in the […]