This Week in Crypto – No Mainstream for Bitcoin, Russia and Limiting U.S. Sanctions, Bitcoin ETF Approval

Russia and Limiting U.S. Sanctions Using Bitcoin

With the USA imposing sanctions on Russia, the country has taken steps to limit the impact. Over the last week, an Australian news site quoted that there is an economist who has ties to the Russian government as having said the sanctions are forcing the country to take a proactive stance.

With this Russia and its influential leaders, these sanctions are forcing them to shed any US assets they have including dollars and to invest in Bitcoin.

This transition from dollars to BTC could start as early as next month. Vladislav Ginko also said the time is near where other countries might be following suit.

These sanctions have been introduced since US intelligence came to the conclusion Russia interfered with the electoral campaign back in 2016, this was coupled with the poisoning of Sergie Skripal, a former Russian military officer.

It is well known President Putin has shown an interest in BTC. To make the transition from dollars to BTC, there might be a need for an intermediary coin. This might be a token that is created by one of the major Russian banks and would allow Russia to purchase BTC through an exchange.

It was also shown this week, there was an increase in OTC purchase of BTC by Russian nationals.

No Mainstream for Bitcoin Until Regulation

BTC is ten years old, and since then it has made strides to becoming a legitimate currency. But, no matter how hard it tries, it won’t succeed until it has the approval of the SEC (Securities and Exchange Commission).

As of yet, the SEC has not given the go-ahead for any BTC projects and has already rejected ETF plans from companies like the Winkelvoss twins, ProShares and Direxion. The Winkelvoss twins being thrust into the limelight by being in the tangle with Mark Zuckerberg over Facebook’s origins.

This doesn’t mean there aren’t any companies trying, and only last week Bitwise Asset Management filed for an exchange-traded fund. This would be able to track BTC’s performance. Additionally, Wilshire Phoenix Funds has also filed to sell shares from a mixed fund of BTC, US dollars and short-term treasury bills.

What makes things worse, and delaying things is the government shutdown. Currently, the SEC is running with a barebones amount of staff until the US government moves back into proper operation.

Matt Hougan from Bitwise Asset Management admits there needs to be a significant shakeup in the crypto world because there are too many cryptocurrencies around. “Many altcoins are garbage, and the sooner they are cleared out, the better,” he added.

BTC Mining Company Shutting its Doors

The Bitcoin mining company Gig Watt is going out of business. Late last year the company declared from bankruptcy and only lasted for a little over 12-months in their operations. The mining company operated a bit different than other companies where the hardware was actually owned by their customers.

At this point, they paid Giga Watt for the upkeep of their earnings and also for the power usage. These competitive power rates just weren’t sustainable. The company since contacted hardware owners they could pay to have their hardware shipped back to their location.

Even before bankruptcy was filed for by the company, customers were facing problems with their miners facing random shutdowns. At the latter part of November, one of the representatives from the company told clients “we still have power in Moses Lake.”

Within two days of this statement, the Notice of Chapter 11 Bankruptcy surfaced. Giga Watt since reportedly owes almost $500,000 to their electric supplier.

For some clients, operations continued until recently, and it was at this point the utilities were finally terminated due to non-payment.

Cryptocurrency Bubble

Bitcoin ETF Approval not Being Thought About by Japan

ETF funds (exchange-traded funds) saw a rough time in 2018. The crypto industry’s dreams were quickly quashed by regulatory entities which were in the position of overseeing the proposals.

It now appears this will continue throughout this year. Japan’s SEC equivalent (FSA) might seem to be looking at allowing BTC ETF applications. These rumours did come from anonymous sources though, and since then an FSA rep has quoted there is nothing concrete about them considering the approval of the ETF’s.

They also stated the FSA isn’t looking into BTC derivatives either.

As with the original source, these come from unnamed sources, so it is hard to know whether to believe them either way at present.

With all this in play, there are plenty of US-based players who are keen on seeing these ETF’s being pushed through.

International Bank Delivers a BTC Warning

With the crypto winter still continuing and stifling investment from the financial industry, the struggles look likely to continue for longer than the previous 12-months. There were a good many people who expected the explosion in 2017 to lead into mass adoption of cryptocurrencies.

However, a recent survey by the Bank of International Settlements (BIS) has made a stark warning and say the take-up of cryptocurrencies will remain trivial at best.

BIS also dealt another blow and has since warned investors and traders alike they might be losing money on privately minted cryptocurrencies such as BTC.

BIS serves as a lender to central banks and has found many countries are looking at BTC and crypto’s as niche technologies, and worst of all for crypto enthusiasts, the bank doesn’t see these coins as being the future of money.

The most recent report shows no central banks have not reported any significant or public use which has grown wider across cryptos for both cross-border payments or domestic payments. This is the same across all jurisdictions.

The survey went onto reveal that with low acceptance from the retail sector, a mass of compliance issues, and a better understanding by the general public of the risks, and finally some bans from certain jurisdictions, use of cryptocurrencies will remain low or minor.

Lastly, the BIS survey which included over sixty banks from around the world, found many of these have no plans to issue digital versions of their currency which are known as CBDCs (central bank-backed digital currencies).

Leave a Comment

Your email address will not be published. Required fields are marked *

Scroll to Top