In what is being hailed as a major victory for the cryptocurrency industry, a key United States House panel has passed two bills that could bring regulatory clarity to crypto firms in the country. The Financial Innovation and Technology for the 21st Century Act establishes rules for crypto firms to register with either the Commodity Futures Trading Commission or the Securities and Exchange Commission. The Blockchain Regulatory Certainty Act removes hurdles and requirements for blockchain developers and service providers. However, another proposed piece of legislation, the Digital Assets Market Structure bill, failed to garner support from both Republicans and Democrats.
The launch of the Worldcoin human identity verification system has drawn criticism from key figures in the crypto community, including Ethereum co-founder Vitalik Buterin. Buterin published a long-form essay expressing his concerns about the project and its Worldcoin token, known as proof-of-humanity. The United Kingdom’s Information Commissioner’s Office is considering an investigation into the project for potential violations of data protection laws. The French National Commission on Informatics and Liberty has also raised questions about its legality. In response to criticism, Worldcoin released an audit report to address concerns about its data collection practices.
Russia has taken a significant step forward in its efforts to create a central bank digital currency (CBDC), as President Vladimir Putin signed the digital ruble bill into law. The digital ruble is set to take effect from August 1, 2023, giving individuals in the country the choice to use the digital currency. However, the government does not expect mass adoption of the digital ruble until at least 2025, according to Bank of Russia Deputy Governor Olga Skorobogatova.
In a setback for Binance, the leading cryptocurrency exchange has withdrawn its cryptocurrency custody license application in Germany. This comes after concerns were raised by the German Federal Financial Supervisory Authority. Binance intends to reapply for a license in Germany with adjustments to its application reflecting changes in the regulatory environment. CEO Changpeng Zhao stated that the company will focus on becoming compliant with the European Union’s Markets in Crypto-Assets regulations in order to offer its services in European countries.
Former FTX CEO Sam “SBF” Bankman-Fried, who is facing a criminal case, has agreed to a gag order preventing him from making comments that could interfere with his trial. However, Bankman-Fried argues that other potential witnesses, including current FTX CEO John Ray, should also be gagged. The gag order was initially requested after Bankman-Fried was accused by the U.S. government of attempting to interfere with a fair trial by publicly discrediting a former business partner and witness. Bankman-Fried’s lawyers have cited the “toxic media environment” surrounding their client as a reason for the order.
In cryptocurrency market news, Bitcoin (BTC) closed the week at $29,331, Ether (ETH) at $1,876, and XRP at $0.71. The total market cap reached $1.18 trillion. Among the top three altcoin gainers of the week were XDC Network (XDC), GMX (GMX), and Bone ShibaSwap (BONE). The top three altcoin losers were Pepe (PEPE), Gala (GALA), and Injective (INJ).
In a prediction of the week, despite strong U.S. inflation data, Bitcoin remained range-bound and failed to see a significant boost in price. Traders are still anticipating a potential downside for BTC, with the $30,000 resistance remaining in place for over a week.
The U.S. Securities and Exchange Commission has filed charges against blockchain security firm Quantstamp for conducting an unregistered initial coin offering (ICO) in 2017. The SEC alleges that Quantstamp raised over $28 million by selling its QSP tokens without registering the offering as securities. Quantstamp has agreed to return the funds raised in the ICO.
The Alphapo payments provider hack, initially estimated at $31 million, has now been reported to have caused losses exceeding $60 million. On-chain sleuth ZachXBT has identified an additional $37 million allegedly drained from addresses on the Tron and Bitcoin networks. The Lazarus Group is suspected to be behind the attack.
The launch of the memecoin Pond0x (PNDX) resulted in millions of dollars in losses for investors. The token reached a price of $0.36 before collapsing to near zero in just five minutes. Initial reports suggest that PNDX had a faulty transfer function that allowed users to transfer coins from any other user. Investors lost at least $2.2 million in the launch.
In an interview, Hervé Larren, the CEO of blockchain project Bitcoin Ecosystem EOS, discussed the challenges faced by decentralized organizations and the psychology behind investing in “blue-chip” NFTs.
Overall, this week’s developments highlight important regulatory and technological advancements in the crypto industry, as well as the ongoing challenges and risks faced by market participants.
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