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China Bans Financial, Payment Institutions From Cryptocurrency Business



China on cryptocurrency

Chinese regulators have tightened restrictions that ban financial institutions and payment companies from providing services related to cryptocurrencies, marking a fresh crackdown on digital money.

Compared with a previous ban issued in 2017, the new rules greatly expanded the scope of prohibited services, and judged that “virtual currencies are not supported by any real value”.

“Recently, crypto currency prices have skyrocketed and plummeted, and speculative trading of cryptocurrency has rebounded, seriously infringing on the safety of people’s property and disrupting the normal economic and financial order,” they said in the statement.

What are the new measures?

Three financial industry associations on Tuesday directed their members, which include banks and online payment firms, not to offer any crypto-related services, such as account openings, registration, trading, clearing, settlement and insurance, reiterating the 2017 ban.

But the new ban, which was posted by the People’s Bank of China (PBOC), also covers services that were not previously mentioned.

For example, it made clear that institutions must not accept virtual currencies, or use them as a means of payment and settlement. Nor can institutions provide exchange services between cryptocurrencies and the yuan or foreign currencies.

Additionally, institutions were prohibited from providing cryptocurrency saving, trust or pledging services and issuing crypto-related financial products. And virtual currencies must not be used as investment targets by trust and fund products.

Banks and payment companies were also urged to step up monitoring of money flows involved in cryptocurrency trading, and coordinate more closely in identifying such risks.

The directives were made in a joint statement from the National Internet Finance Association of China, the China Banking Association and the Payment and Clearing Association of China.

What’s the Impact of the Latest Crackdown?

The fresh crackdown makes it more difficult for individuals to buy cryptocurrencies using various payment channels, and could impact miners’ business by making it harder for them to exchange cryptocurrencies for yuan.

But banks and payment companies also face challenges of identifying money flows related to cryptocurrencies.

Winston Ma, NYU Law School adjunct professor and author of the book “the Digital War”, said the new rules were designed to completely cut crypto-related transactions out of China’s financial systems, and expects the government to roll out new regulations targeting crypto assets.

Hong Kong’s Bitcoin Association said in a tweet in response to China’s reiterated ban: “For those new to bitcoin, it is customary for the People’s Bank of China to ban bitcoin at least once in a bull cycle.”

Featured image by Charis Tsevis


CumRocket and the Power of Elon Musk Tweet




Elon Musk crypto bubble?

When Elon Musk tweeted “Canada, USA, Mexico”, spelling out an acronym “CUM”, many assumed he was referring to the “United States–Mexico–Canada Agreement” (former NAFTA), but with an Elon Musk twist. Because you know… it would make for a totally better acronym than what they came up with (USMCA).

Or maybe it was just me?

Low and behold, barely a day later Musk decides to bless us with yet another tweet, this time dispelling any doubts one might’ve had regarding the meaning of his previous tweet.

CumRocket To the Moon

Within literal minutes of his “Cum Rocket to the moon” tweet on June 5, CumRocket (CUMMIES) skyrocketed from $0.067 to $0.284 (+330% instant gain) before crushing back down to $0.114 some half hour later, and is currently trading at $0.1746 (+168.95% 24hr gain).

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Spaniards to Be Taxed on ‘Overseas’ Crypto Holdings




As reported by El Economista, the Spanish parliament has voted in favor of a controversial new law that will require Spanish citizens to report their overseas crypto holdings, as the government appears ready to impose more control and regulation over the growing crypto sector.

According to an official government release, the new law will require Spaniards “to report their holdings and operations with cryptocurrencies,” on crypto held both domestically and abroad if the transactions “affect Spanish taxpayers.”

According to the release, information will be required on the balances and holders of the coins, as well as on all types of operations that have been carried out with them.

“Due to their proliferation and popularity among investors and savers, it is necessary to take greater control over cryptocurrencies”

The new regulations will make it “mandatory to inform” the tax body on annual declarations of assets and property.

The bill, named the ‘Law on Prevention and Fight Against Tax Fraud’ (Ley de Medidas de Prevención y Lucha contra el Fraude Fiscal), also contains other provisions intended to fight tax avoidance, and will give tax bodies the power to conduct spot checks on “homes and businesses”.

The bill has been in the works since last year, when the Council of Ministers gave it the green light, and still needs to be ratified, now that the senate voted in favor in a majority vote.

Once ratified, it will see “overseas” crypto holdings integrated into the often criticized Modelo 720 system, which requires Spaniards to complete exhaustive declarations of their overseas real estate holdings.

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Charles Hoskinson Explains Why He Believes Cardano Is Superior to Ethereum 2.0




While Cardano (ADA) supporters like to refer to it as an Ethereum killer, Charles Hoskinson, founder of Cardano, said that Ethereum is actually “killing itself” by replacing the current proof of work (PoW) version with Ethereum 2.0, a new proof of stake (PoS) iteration.

When asked if Ethereum 2.0 could also be seen as a Cardano killer, now that it’s switching to PoS as well, Hoskinson said that he does not see it like that since Cardano is the market leader in PoS, implying hat their longer experience with PoS gives it an upper hand over Ethereum in PoS space: 

“We are leading that fight. We were first to the market… Engine doesn’t make a BMW a BMW. It’s a part of it, but you need a whole ecosystem, a whole collection of things.”


Subjective: Assigning such prominence to the fact that Cardano was the first to market with PoS over Ethereum sounds like a weak argument seeing as Ethereum, along with Bitcon is becoming a household name, whereas Cardano… well, is not yet. So this whole argument of “first to market” that is based solely on the validation protocol being used falls somewhat short and makes us seriously wonder why Mr. Hoskinson would spit in his own cup by implying that being first to market carries such weight, seeing as ETH is actually the grandfather of smart blockchain and the true pioneer of the said space.

Fun fact: The first cryptocurrency to adopt the PoS method was Peercoin. Next, Blackcoin, and ShadowCoin soon followed suit.

Governance, interoperability, and user bases

The creator of Cardano also touched the topic of governance, saying that Ethereum 2.0 has bowed out, which he said would make it hard for the ecosystem to evolve once its founders retire or lose prominence, whereas enabling on-chain governance is a vital part of Cardano’s roadmap.

He also compared Bitcoin (BTC), the largest cryptocurrency by market capitalization, and the grand father of all cryptocurrency, to a “wood-powered steam engine” due to its slow evolvement.

“You have those Bitcoin core developers who desperately want to evolve the system: even though core developers want to implement multiple improvements like smart contracts and side-chains, they can’t get anything done.”


Hoskinson also pointed out that Ethereum is not as interoperable for now as some other similar blockchain projects such as Cardano, Cosmos and Polkadot (among others) that made sidechains available on their network.

And finally, he claims that Eth 2.0 and Cardano on top of different technologies and philosophies also have different user bases:

“We are bringing millions of people in Africa that simply Ethereum doesn’t seem to care about… outside of South Africa and a few well developed places in Africa.”

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