Bitcoin
Cryptocurrency Law Is Coming: Prepare for a Rough Journey
New legislation from Brussels seeks to put an end to the fraud and turmoil that has characterized markets like bitcoin, but few if any appear willing to comply.
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The EU’s landmark crypto regulation comes into force within a week – and it doesn’t appear that any major specialized players have managed to get authorized.
The new regime offers players such as exchanges and wallet providers the opportunity to apply for a license that will allow them to operate across the block.
Brussels has boasted of being the first global jurisdiction to establish custom rules for the cryptocurrency market – a market that has seen significant turmoil and manipulation.
But with time ticking, the jury is still out on whether the EU law on crypto asset markets, MiCA, heralds a new era for the industry – or will kill it.
After passing the law in June 2023, French Finance Minister Bruno Le Maire said the landmark legislation will “prevent the misuse of cryptoassets while being supportive of innovation to maintain the EU’s attractiveness.” .
A few months later, top lawmaker Stefan Berger (Germany/European People’s Party) said the rules “put the European Union at the forefront of the token economy around the world.”
Many cryptocurrency users have long rejoiced in their freedom from government control – even as some recognize that regulatory recognition could offer greater credibility and certainty.
As the prospect of enforcing financial-style rules looms ever closer, the mood in the industry becomes more anxious.
Difficult and uncomfortable
“It is a difficult and uncomfortable period,” Faustine Fleuret, president of French crypto lobby group ADAN, told Euronews, citing regulations that are both strict and unclear.
This sadness is shared by Marina Markezic, founder of the Brussels-based European Crypto Initiative, who points out that many crypto companies have not yet told their customers exactly how the law will work.
On June 3, Binance, one of the world’s leading cryptocurrency exchanges, said it would restrict access to unauthorized cryptocurrencies once MiCA takes effect, but others have not been so forthright, she said.
“June 30 is a week away and I, as a consumer, still don’t know what will happen,” said Markezic.
A large part of MiCA is dedicated to stablecoins – cryptographic assets that seek to peg their value to other assets, such as the price of gold or the US dollar.
These are the most difficult parts of MiCA and the first to come into force – other provisions, such as exchange licenses, begin on December 30th.
But there is still debate over what the rules actually mean – for example, whether handling stablecoins means you need to register as a payment provider, says Fleuret.
Brief notice
Worse still, says Fleuret, the European Banking Authority (EBA) only published its final set of technical standards last week, giving traders little opportunity to prepare.
“Less than two weeks before a big, big brick of the MiCA regulation came into effect, the people who have to comply with it didn’t even have all the operational details they need to comply,” she said.
“For newcomers, it is actually much more complicated to be ready by June 30, perhaps impossible,” she said – although she admits that existing licensed payment providers may be in a better position.
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An EBA spokesperson told Euronews that the EU agency finalized and published all 18 sets of standards and guidance before the June 30 deadline.
“The EBA has been calling on the industry to prepare in good time” for the new stablecoin regime and has offered a tool to allow companies to resolve interpretation issues, the spokesperson added.
No approvals?
Corroborating Fleuret’s analysis, Euronews did not identify any major crypto players that have been definitively approved by MiCA.
In April, Paolo Ardoino, CEO of stablecoin issuer Tether, said he was “still discussing with the regulator” his concerns about the law. Circle, whose euro-backed stablecoin appears aimed at EU users, announced last year that it had applied for a MiCA license.
With a week to go, neither company has publicly announced that they have obtained regulatory approval; Neither responded to Euronews’ request for comment.
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Both Markezic and Fleuret are still positive about some aspects of MiCA, which in particular will allow crypto companies to operate across Europe with a more or less clear structure.
But Fleuret fears that the law will not be adapted to the small players that tend to dominate the space.
“The problem with MiCA is that it is not proportionate,” she said. “If you are a startup trying to launch activity in the market now, you would have to apply the same rules as Société Générale”, a French bank that is also venturing into financial technology.
And for all the EU’s fanfare about promoting innovation, the difficult hurdles seem more a feature than a bug.
Big Tech Fears
Those who drafted MiCA were motivated in part by fears that Facebook might issue its own form of money, Libra, linked to a basket of major world currencies.
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Finance ministers protested the idea of a major foreign technology giant creating a currency that could supplant the euro.
The Facebook project fell apart, mainly due to political backlash – but regulators’ fears were confirmed in the spring of 2023, when Terra, a stablecoin that was supposed to maintain its value with the US dollar, fell under market pressure, sending much of the of the cryptographic ecosystem. therefore.
The final version of MiCA imposes strict reserve requirements for euro-based stablecoins and a limit of one million daily transactions for others.
But this could affect existing agreements, as operators don’t always monitor this information, says Markezic.
“Emissions are happening globally and there was no system before about how to align, configure or analyze… how much is emitted within a specific jurisdiction,” she said. “Sometimes issuers don’t know who owns these tokens.”
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Some difficult years
Crypto has had a rough few years. After Luna’s downfall came a period of turmoil and regulatory backlash, and many of the industry’s leading figures are now in prison.
In the US, Sam Bankman-Fried was recently sentenced to 25 years after pleading not guilty to fraud and money laundering during his time running the doomed cryptocurrency exchange FTX.
Similarly, Binance founder Changpeng Zhao was sentenced to four months in prison after pleading guilty to money laundering.
All of this may have tarnished crypto’s reputation, but Markezic is confident that legal credibility could herald a new era.
Established providers like banks “are waiting for regulation,” she said, with a clear set of rules that could take the technology out of its current, somewhat nerdy niche.
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“I think we will talk less about technology and less about stablecoins and… more about utility and what it can bring to the consumer,” she said. “There are a lot of advantages when it comes to seamless transactions, 24/7 processes and so on.”
But even she recognizes that there will be bumps in the road between today’s Wild West and mainstream credibility.
“Many companies will not have the ability to be compliant,” she said. “Very small startups and innovative companies will likely limit their activities in the EU.”
Bitcoin (BTC) Mining stocks like Riot Platforms (RIOT), Marathon Digital (MARA) and CleanSpark (CLSK) retreated in pre-market trading as BTC retreated.
RIOT, MARA and CLSK all fell more than 2%, while other crypto-related stocks such as MicroStrategy (MSTR) and Coinbase (COIN) fell 1.5%.
Bitcoin sell-off continues
Crypto-linked stocks retreated as Bitcoin resumed its downtrend on Wednesday. After rising to $63,750 on Monday, BTC is hovering at $60,0000 and it is unclear whether it will recover.
More importantly, Bitcoin is dangerously close to the crucial support at $58,273, which is the 200-day Exponential Moving Average (EMA). The next support level for Bitcoin is $56,426, representing its lowest level in May.
Bitcoin Price Chart
If Bitcoin drops below this price, it will be a sign that the bears have prevailed, which could take it to the $50,000 level, if not below.
This decline happened after a whale deposited nearly 2,000 Bitcoins to Binance in two separate transactions. While this isn’t always the case, deposits to exchanges often happen when holders are exiting their positions.
The whales’ action coincided with a period in which the German government continues to sell off its Bitcoin holdings. It transferred $52 million worth of coins to exchanges on Tuesday.
As a result, data from CoinGlass shows that the volume of Bitcoin balances on exchanges has started to increase. The volume rose to 2.49 million on Tuesday, from last month’s low of 2.47 million.
Bitcoin balances on exchanges
Bitcoin Mining Companies at Risk
If the Bitcoin sell-off continues, it will put Bitcoin mining companies like Marathon, CleanSpark, and Riot Platforms at risk. These companies have tended to have a close correlation with Bitcoin in the past.
This drop is happening a few months after the halving event, reducing the amount of Bitcoins that miners receive.
To compensate for this drop, most of these companies have added their mining equipment. CleanSpark has reached a hash rate of 20 EH/swhich helped her mine 445 coins in June after mining 417 coins the previous month. She did this after purchasing 5 mining sites in Georgia.
Digital Marathon mined 590 coins in June, down 40% from the same month in 2023 and flat from May.
Riot Platforms, on the other hand, focused on acquiring Bitfarms, a company that mined 189 coins in June.
U.Today – Amid an ongoing sell-off in the cryptocurrency market, Michael Saylor, a prominent advocate and president of MicroStrategy, made a statement on X (Twitter) that reverberated across the crypto space: “Just Bitcoin.”
This two-word tweet comes as the cryptocurrency market faces significant sell-offs as the price of Bitcoin plummets.
Bitcoin, the largest cryptocurrency by market value, began its decline in Tuesday’s trading session, hitting $63,223 at one point before falling further.
Losses deepened on Wednesday as investors considered remarks from Fed Chair Jerome Powell, with Bitcoin hitting intraday lows of $59,509. At the time of writing, BTC is down 2.85% over the past 24 hours to $60,274.
According to data from CoinGlass, the sell-off has resulted in a significant amount of cryptocurrencies being liquidated in the past 24 hours, totaling over $166 million. However, this has not deterred Saylor’s confidence in Bitcoin, as he reiterates his longing for the crypto asset in his tweet.
Cryptocurrency market crashes
Cryptocurrencies fell on Tuesday after Fed Chairman Jerome Powell said the central bank needs to see more progress on inflation before cutting interest rates, which are now at 5.25%-5.50%. Powell revealed at a monetary symposium in Sintra, Portugal, that the United States is moving closer to a disinflationary path.
“We want to be more confident that inflation is moving sustainably downward toward 2% before we begin the process of tapering or easing policy,” Powell said.
Market losses deepened after Wednesday’s economic releases that indicated the labor market is cooling. Recent data showed weaker-than-expected private payroll growth in June, but weekly jobless claims were higher than economists had forecast. The latest figures come ahead of the highly anticipated June nonfarm payrolls report on Friday.
As the cryptocurrency market goes through a period of uncertainty, the coming days and weeks will be crucial in determining the direction of BTC’s price.
Rumors that the long-awaited Grand Theft Auto 6 will use cryptocurrency that has been circulating for more than a year now—and they’re spinning again.
On Wednesday, a pseudonymous Crypto Twitter influencer named Gordon — apparently named after Gordon Gekko from the iconic 1987 film “Wall Street” —shared to his nearly 500,000 followers that “GTA 6 will allow cryptocurrency payments” and that “so far only Bitcoin, EthereumIt is USDT [are] confirmed.”
But in reality, no cryptocurrency has been confirmed for Grand Theft Auto 6, despite ongoing chatter about the rumors. Rockstar Games and parent company Take-Two have made no such announcements this week on the subject, nor have they made any prior announcements, and official trailers and announcements have made no mention of cryptocurrency being included.
However, the tweet — which also included a fake trailer for the game — quickly went viral, with over 500,000 views as of this writing in a matter of hours. When Twitter users asked Gordon for his sources, he would jokingly respond that his “uncle works there” or say that previous reports on the matter were “old” at this point.
But really, nothing has changed since then. DecipherGG’s reported in previous rumors in May 2023, not even since the first official trailer — which initially leaked with “BUY BTC” stamped on itApparently by the leaker in question—premiered last December.
DecipherGG reached out to Rockstar Games for comment but did not receive an immediate response.
Could Grand Theft Auto 6 implement a crypto element when it releases in 2025? It’s certainly possible, and if so, it would be a transformative moment for cryptocurrency adoption by the traditional gaming industry.
Take-Two Interactive has explored the space before, acquiring casual gaming giant Zynga in early 2022, when Take-Two founder and CEO Strauss Zelnick suggested there were “Web3 opportunities” that they could explore better as a team. Zynga has launched its first blockchain game on Ethereum, called Sugartownbut Take-Two has yet to get involved with other brands.
Rockstar Games, on the other hand, prohibited the use of cryptocurrency or NFTs on player-run Grand Theft Auto 5 servers in late 2022, following a rise in the use of NFTs to represent unique player-owned assets on modded game servers.
And given Grand Theft Auto’s satirical tone, the game may be more likely to criticize cryptocurrency and poke fun at caricatures of crypto fans and NFTs, for example, rather than trying to launch its own on-chain currency. But that’s all speculation at this point, as there are relatively few official details about GTA 6.
For now, at least, don’t believe the hype. While Rockstar Games hasn’t officially closed the door on cryptocurrency usage in Grand Theft Auto 6, it hasn’t confirmed anything about it either. However, it’s sure to remain a hot topic in the long run leading up to release, which is currently scheduled for fall 2025.
Edited by Ryan Ozawa.
Bitcoin
Crypto President Trump’s ‘Lesser’ Regulation Will Bless Coinbase’s Bitcoin Leverage, Expert Says – Coinbase Glb (NASDAQ:COIN)
Chris SenyekChief Investment Strategist at Wolfe Researchrecently expressed his opinion on the potential impact of a Donald Trump win the 2024 elections in the cryptocurrency market.
What happened: Senyek suggested that a Trump presidency could ease cryptocurrency regulations, benefiting companies like Coinbase Global Inc. COIN due to its importance Bitcoin BTC/USD Leverage.
“Trump would be less harsh on crypto regulation, and Coinbase would be a big beneficiary of that given its influence on bitcoin,” Senyek said during CNBC’s “Last Call” on Tuesday.
See too: Enhance Your Retirement Portfolio: The Benefits of Adding Cryptocurrency
Why does this matter?:Senyek’s comments come in the context of the former president Donald Trump‘s reported plans to participate at the Bitcoin 2024 convention, which could reinforce his image as a “Crypto President”.
Trump’s potential participation in the Bitcoin 2024 convention, a major event on the cryptocurrency calendar, could have significant implications for the industry.
Pratik KalaHead of Research in DigitalX Limitedhe has predicted a Trump victory in the upcoming elections, but warns that immediate cryptocurrency-friendly regulations may not be a priority.
A recent report by 10x Search explore the recent rise in Bitcoin price and its potential connection to Trump’s strong position in the 2024 election race. The report, titled “Is the Bitcoin Trump Pump Sustainable?”, highlights a 4% spike in Bitcoin’s price following the news that the president Joe Biden will remain in the race despite a poor performance in the presidential debate.
Price Action: At the time of writing, Bitcoin was trading 2.10% lower at $60,860.66, according to Benzinga Pro.
Read next:
Image created using photos from Shutterstock
This story was generated using Benzinga Neuro and edited by Pooja Rajkumari
News and market data brought to you by Benzinga’s APIs
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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