As the year reaches its end, the news cycle for cryptocurrencies keeps rolling with big announcements and events — and we’re looking at what’s driving the week’s top stories.
Will Russia Ban Cryptos?
Recent reports out of Russia suggests its Central Bank is considering a ban on investments into cryptocurrencies, like the ban imposed in China. Cryptocurrencies are, of course, becoming more popular among retail investors. But the huge volatility in the crypto market makes many central banks anxious about the potential risks to consumers.
While it is illegal to perform transactions with cryptocurrencies in Russia, consumers are currently able to invest and buy crypto through exchanges. This has led to two radically different options being considered by Russian officials. The first is a full prohibition of the acquisition and ownership of cryptocurrencies. The second is to authorise the establishment of cryptocurrency exchanges and regulate operations to ensure the government can tax their transactions.
Reuters reports suggest the position of the Russia’s central bank is the former, and they are advocating for a “complete rejection” of all cryptocurrencies.
A working group of the Russian government’s lower house will meet to review the report by the Central Bank this month. A decision is expected by May 2022, when Russia conducts its spring session of parliament.
UK Banning Crypto Ads
Moving to another part of the globe, the UK’s advertising watchdog is making headlines for banning ads by crypto and investing heavyweights like eToro, Coinbase, and Luno.
The advertising watchdog explained that the prohibited ads were “banned for irresponsibly taking advantage of consumers’ inexperience and for failing to illustrate the risk of the investment.”
The Coinbase promotion was a paid-for Facebook advert that stated: ”£5 in bitcoin in 2010 would be worth over £100,000 in January 2021. Don’t miss out on the next decade — get started on Coinbase today.”
In its ruling, the ASA said the ad was misleading because consumers would understand the advertisement to mean that there was a guaranteed return on consumers’ investment with a similar appreciation.
This crackdown by the UK regulator is likely the start of continued scrutiny of cryptocurrency promotions that are becoming mainstays across billboards, television programming, and live sports. As advertising ramps up over the Christmas period, more crypto currency promoters may be in the firing line.
The Future of Crypto Transfers
Meta (previously known as Facebook) has officially begun testing cryptocurrency transactions through its subsidiary, Whatsapp. The transactions make use of Meta’s digital wallet Novi and are currently only accessible to a limited number of people in the United States.
The test allows Whatsapp users to send and receive money with no fees within a chat conversation on their app. Meta is utilising the Paxos Dollar (USPD) stablecoin — a cryptocurrency pegged to the value of the US dollar. Because of the equivalent value, Whatsapp users benefit from the speed, security, and low fees inherent to cryptocurrency while enjoying the ability to withdraw US dollars from the transaction straight away.
In similar news, Block (previously Square) is allowing consumers to gift cryptocurrencies through their Cash App. Users in the US may send Bitcoin and traditional stocks as gifts to other Cash App users.
With over 2 billion users on Whatsapp and 70 million on Cash App, expect these US exclusive features to be a trial run to a much bigger roll out. What this means for cryptocurrencies more generally is yet to be determined. The presence of these peer-to-peer apps will surely reduce transaction volumes on cryptocurrency exchanges and bring crypto to the fingertips of previously untapped investors.
Upcoming Initial Coin Offerings
An initial coin offering (ICO) is the cryptocurrency equivalent to an initial public offering (IPO). During an ICO, cryptocurrency projects will promote their project and sell an initial allocation of coins to investors to raise funds.
Through ICOs, investors get the opportunity to invest early on the next big crypto. As an example, at Ethereum’s ICO Ether tokens were sold for a mere $0.31 each, compared to its approximately $3,900 value now. Of course, for every successful ICO, there’s a litany of unsuccessful projects.
Here’s a list of the latest ICOs that are about to drop:
|Coin||ICO End Date|
|AngelsCreed (ANGEL)||23 Dec 2021|
|Nxtech Network (NX)||26 Dec 2021|
|Santos FC Fan Token (SANTOS)||27 Dec 2021|
|Again Project (AGAIN)||31 Dec 2021|
|Ouro (OGS)||5 Jan 2022|