This is our roundup of the most interesting crypto news from June and early July. Consistent with our mission, we aim to spotlight the brighter aspects of the crypto sphere, offering optimistic yet grounded perspectives on how cryptocurrencies are integrating into our everyday experiences.
BlackRock CEO Hails Bitcoin as 'Digital Gold', Spurring Cryptocurrency Surge Following ETF Application
In a recent turnaround of views, Larry Fink, the CEO of BlackRock, has described Bitcoin as a digital equivalent of gold. Fink, who once labeled Bitcoin as an "index of money laundering," made these remarks during a Fox Business interview.
BlackRock, the world's largest asset manager overseeing $9.5 trillion, recently lodged an application for a Bitcoin ETF with the U.S. Securities and Exchange Commission. This move has been influential in driving a surge in Bitcoin's value, pushing it to a 12-month peak as institutional investors flock to the cryptocurrency sector.
Fink stated, "I do believe the role of crypto is digitizing gold, in many ways," suggesting its potential to serve as a hedge against the significant financial challenges that a single country may face.
Bitcoin ETF Boom on the Horizon? Major Financial Firms Seek SEC Approval Amid Optimism
Prospective investors in Bitcoin could soon have an abundance of options if US regulators lessen their resistance to Bitcoin-tied exchange-traded funds (ETFs). Major finance corporations, such as BlackRock, Fidelity, and Invesco, have put forth applications to offer US "spot" Bitcoin ETFs physically backed by Bitcoin. Although the US Securities and Exchange Commission (SEC) has previously dismissed these products over concerns of volatility and potential manipulation, the recent BlackRock application has raised optimism among investors that the SEC may soon drop its long-standing opposition.
ETFs represent a broad family of exchange-traded products within a $7 trillion industry, with both crypto-native and major Wall Street firms trying to launch ETFs that hold actual Bitcoin. While several futures-backed crypto funds are available, the SEC hasn't approved any applications for spot Bitcoin ETFs, which are touted as potentially widening participation in the cryptocurrency sector. Unlike futures, which are contracts to buy or sell an asset at a later date, spot Bitcoin transactions involve direct buying and selling of the cryptocurrency.
With BlackRock's application for a spot Bitcoin ETF, there's been a fresh wave of speculation that the SEC might finally approve this type of investment product.
South Korea Fortifies Crypto Investor Protection with Comprehensive New Bill
South Korea's government has made strides in safeguarding cryptocurrency investors by approving a comprehensive crypto bill. The National Assembly recently ratified the Virtual Asset User Protection legislation, targeting unfair trading activities and enhancing investor protection in the crypto realm.
This new bill amalgamates 19 prior crypto-focused bills into one comprehensive law that establishes a clear definition of digital assets and outlines penalties for illegal trading practices such as market manipulation and use of undisclosed information. Crucially, it applies the Capital Market Act to cryptocurrencies with a securities nature.
Under the new legislation, Virtual Asset Service Providers (VASPs) are obliged to safeguard user deposits and provide insurance coverage. These steps aim to fortify investor protection against potential risks like cyber-attacks and system failures.
UK Cryptocurrency Trading Gains Legal Status under New Financial Services and Markets Act
The United Kingdom's reform bill, the Financial Services and Markets Act 2023, has officially become law with the Royal Assent from King Charles, as announced by a government press release.
The law now classifies cryptocurrency trading as a regulated financial activity. This amendment to the Financial Services and Markets Act delineates crypto assets as "cryptographically secured digital representation of value or contractual rights," thereby treating them as regulated financial entities.
The process of Royal Assent is the final procedural step that transforms a bill into an Act of Parliament, following the consensus of lawmakers. Prior to this, the bill had obtained the approval of Parliament's upper house on June 19.
Swift and Chainlink Partner with Major Financial Institutions to Test Blockchain Integration for Asset Transfers
Swift and Chainlink are poised to commence trials with top-tier financial institutions, including BNP Paribas, ANZ, and BNY Mellon. The initiative is focused on leveraging Swift's infrastructure to facilitate the transfer of tokenized assets across multiple blockchain networks.
With the involvement of significant market players such as the Depository Trust and Clearing Corporation (DTCC), Australia and New Zealand Banking Group Limited (ANZ), BNP Paribas, BNY Mellon, Citi, Clearstream, Euroclear, and Lloyds Banking Group, this endeavor underscores the rising acceptance and potential of blockchain technology in traditional financial services. A successful outcome could catalyze a wider incorporation of blockchain into the global finance ecosystem.
Volcano Energy to Invest $1bn in Bitcoin Mining Farm Powered by Renewable Energy in El Salvador
El Salvador-based Volcano Energy plans to invest $1bn in a Bitcoin mining farm in a new public-private initiative. It will be used to establish a 241MW renewable energy project located in Metapán, Santa Ana, capable of generating 72MW of wind energy and 169MW of photovoltaic solar energy. Volcano Energy is focusing on renewable sources for its operation.
Starting with an initial investment of $250m from notable Bitcoin industry leaders, the project will power the Bitcoin mining farm, which is expected to initially boast a computational power of over 1.3 exa hashes per second (EH/s). Cryptocurrency entity Tether, known for its dollar-pegged digital currency, has also confirmed its participation in the venture.
NFA DYOR (Not financial advice. Do your own research.)