In today's market, when the Bitcoin price dips, the rest of the cryptocurrencies tend to follow suit. Photo: iStock
The lowest yuan/dollar daily reference rate in more than a decade seems to have sent traders flocking to Bitcoin. Photo: iStock

Crypto asset markets have been in decline for the past week or so and Bitcoin has, as ever, been dominating the scene, with the uncontested king of crypto’s market share as high as 70% during the week. Bitcoin’s price has been sliding since it sat at a year high of almost $14,000 at the end of June and seemed to be rallying last week until it once again rapidly plunged to below $10,000 at the middle of this week.

Bitcoin is well used to the volatility, of course, but is not used to the amount of political attention it is now getting, especially in Washington. Donald Trump took to Twitter last week to brand Bitcoin an “unregulated crypto assets” that can “facilitate unlawful behavior, including drug trade and other illegal activity.” He later added to that tweet to tersely say that “Facebook Libra’s ‘virtual currency’ will have little standing or dependability.”

Then US Treasury Secretary Steve Mnuchin joined in the debate on Facebook’s Libra project to say that the social media giant will need to meet “a very high standard” before it moves ahead with any digital currency plans. Mnuchin echoed sentiment previously aired by US regulators, in that crypto was perfectly acceptable providing operations are carried out legally and in compliance with money laundering rules.

Mnuchin added that Bitcoin was a “recognized store of value,” which in light of everything else that is being said about cryptocurrencies in Washington at the moment, can be viewed as a positive for crypto. However, speakers at the Senate Banking Committee this week continued to remain very concerned about Facebook and the possibility that it can manipulate finance in the same way that it has done with information.

Facebook “is dangerous” was the sentiment echoed by several US senators during the two hearings on Libra this week with the social media giant being lambasted by a string of senators, with one even referring to its crypto as a ‘shxt coin.’ 

Back in Asia, the world’s largest cryptocurrency exchange, Binance, has been reportedly looking at South Korea as the venue for a new local exchange. CEO Changpeng Zhao– or simply “CZ”, as he seems to prefer – revealed that the firm was working with partners to make inroads into one of the industry’s largest markets. Binance has been in talks with South Korea-based fintech firm BxB, but further details are thin on the ground. CZ previously hinted at a potential expansion to South Korea at the Blockchain Partners Summit in Seoul in July 2018, but the move has yet to be confirmed.

Still in South Korea, the blockchain-based identification market is continuing to heat up as the mainstream tech giants ramp up their research and development. Samsung has linked up with three Korean mobile carriers and three financial services firms to form a consortium which aims to launch a blockchain-based mobile identification system as early as next year. The project hopes to do away with intermediaries so that organizations and individuals can certify their own identities online. Firms involved in Samsung’s consortium include KEB Hana Bank, Woori Bank, KOSCOM, SK Telecom, KT and LG UPlus. The move cements Samsung’s leading mainstream tech sector role in blockchain development. In February, it rolled crypto wallet services into its latest flagship smartphone model, the S10.

India’s crypto angst continues with a leaked draft bill that proposes a blanket ban on all crypto assets. The bill titled “Banning of Cryptocurrency & Regulation of Official Digital Currencies,” that was circulated by a local lawyer, states that “no person shall mine, generate, hold, sell, deal in, issue, transfer, dispose of or use cryptocurrency in the territory of India.” The draft also proposed the possibility of a central bank cryptocurrency called the “Digital Rupee,” although the Reserve Bank of India has yet to confirm its plans.

The fallout from last week’s Bitpoint hack in Japan is still being measured. According to reports, more than 50,000 users were affected in the $30 million hack. President of the Japanese exchange, Genki Oda, told reporters that of the 3 billion yen stolen, customers owned 2 billion yen, while just under a billion consisted of the company’s own holdings. He promised to reimburse customers once services had resumed. Last Thursday’s hack resulted in the theft of several crypto assets including Bitcoin, Ethereum, Bitcoin Cash, Litecoin and Ripple’s XRP token, which were stored in hot wallets on the Tokyo-based exchange.

Also in Japan, there are more reports on the development of an alternative to the SWIFT interbank transfer protocol. Swift is the current global banking money transfer standard, but recent efforts by the likes of San Francisco-based blockchain firm Ripple have demonstrated how slow and expensive it can be. The Japanese project has been approved by the G7-backed Financial Action Task Force (FATF) after it was proposed by Japan’s Ministry of Finance and the Financial Services Agency (FSA). The initiative expands on Japan’s already crypto-friendly status and has been developed to boost the country’s fintech industry. Reports indicate that the international network for cryptocurrency payments will not be ready for a couple of years.

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