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Why Are Meme Coins Appealing to New Investors? | Video

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You’ll continue to see a lot more new users join crypto because of stablecoins and activity around that. Versus some of these other use cases, not to say that Game Five won’t on board. Lots of users just so far. I think stablecoins have been the biggest source of new sort of users and new new introductions to crypto. It’s Monday, July 8th and this is Markets Daily. A show where we get into the minds of some of the most experienced and smartest investors. CEO S analysts, founders, researchers, and anyone with a hot or smart take on the markets. Now, before we get into our discussion today, you know what we’re gonna do. We’re gonna take a look at what’s going on in the news. This morning, we saw a little bit of a crypto crash over the weekend, the CD 20 index was down 7% and Bitcoin was in the red 5% this morning. Nearly all assets in the CD 20 were flashing red, suffering even bigger losses than Bitcoin either was down 5.8% sold down almost eight and XRP down 7%. Now, if we zoom out and take a look at Macro events. City research is predicting eight federal Reserve cuts starting in September through July next year. And bettors on poly market think that the fed will have 1 to 2 rate cuts by the end of this year. Now, lastly, if we look at Bitcoin ETF investors in the United States, they were buying the dip on Friday. We saw inflows topping 100 and $40 million joining the show. Now to make sense of what’s going on in the markets this morning is switchboard co-founder Chris or Meta Chris. Good morning. Hi, Jen. Thanks for uh having me. Of course, thanks for being here. Now, like I mentioned, just now, we saw a crash over the weekend. Make sense of this for us. What do you think drove um the markets over the weekend leading up to this morning? Yeah. So for starters, you know, I, I tend to heavily discount the weekends. Um You know, most traders are out on vacation especially, you know, if you look at last week, you had the Fourth of July, you had uh uh a European VC summer. As many people uh say folks traveling for ecc et cetera. So, you know, I, I again, not to totally ignore moves on the weekend, but I think they should be have lower weight, particularly depending on volumes um than, than stuff that happens during the week. Um But yeah, to your point, you know, you had a continued sell offs from both, um, the Mount Gox News as well as the German government and sentiment is just RR lower. Um, everything changes on a whim and, you know, it’s for those that have been in, uh, crypto for a long time, you know, you kind of get used to these sorts of sentiment changes. Well, the Mount Gox News has been, um, the driver of selling pressure for probably about a week now. Talk to me about what you’re watching there. Do we expect to see the price of Bitcoin go even lower? Yeah, so it’s unclear, you know, so the Mount Gox stuff has been, let’s call it known for a very long time. You know, there were folks uh buying uh claims to Mount Gox back in 2017, you know, about fairly high levels uh even in that era. Um So really, it’s just a question of, you know, the people that have been sitting on it, the claim buyers, um folks that, you know, have been waiting for these distributions for call it 10 years, you know, what percentage of them um are inclined to sell their holdings. Um And we’ll see, I, I think, you know, it’s not necessarily clear to me that, you know, you’re going to see 50 or 100% of those folks um immediately liquidate. Um That being said, you know, there naturally will be some sellers. And I think that combined with um what’s been happening with the German government liquidating and just the overall sentiment around crypto in general at this particular moment. Um hasn’t been uh the best if you were to take a, a stab make a prediction for us as to how many of the Mount Gox claims holders might sell. Do you have a prediction for us? And you don’t have to, sometimes I put people on the spot on this show and I understand it might be hard to make a prediction on the spot. Yeah, I mean, it’s just tough to, to tell. But what I would say is, you know, if you think of so first off, I think the question is what, you know, a what percent was sold or resold the claims and I think a large percentage of that was resold. You know, there are people that are traders that might want to take profits. But for those that were holding, you know, you don’t hold this for 10 years. Um you know, uh and have convictions or the asset class that early um to, to, to sell unless you really need to or you’ve changed your, your thoughts. So I, I suspect it will probably be less than what people think in terms of those that did not sell their claims to financial institutions. But we’ll see. All right now, looking at the markets this morning, we’re seeing a little bit of a bounce back from the numbers I mentioned at the top of the show. A little bit of a recovery happening now, if you are allocating a portfolio, what assets would you be looking at? Yeah. So again, you know, for, for legal reasons, we can’t give a price or financial advice. Um, but, you know, I think with your thinking as an allocator, you know, like when I did, uh uh back in the day with, um, working with a lot of these folks, um you primarily are targeting the most liquid large cap assets, right, the Bitcoins, the east of the world and to a lesser extent Seoul and other, you know, quote unquote blue chips within crypto. So I think, you know, you’re seeing more of that, take the attention. Um and I think that, you know, there’s been a lot of negative sentiment recently, particularly around A Ts. Um that’s not to say that it, it can’t or won’t change. That’s just sort of where things have been recently. Let’s talk a little bit more about A LTs. What do you think is driving the negative sentiment around A LTs? Do you think that that will recover by the end of the year? How do you expect to see the A LTs sector perform? Yeah. So again, without, you know, going into specifics around any single names, I just, you’re seeing a lot more sellers and a lot more supply in the market than there is demand. Um And you know, right now the, let’s call it a lot of the inflows have primarily been focused on, let’s say large cap assets, you know, the Bitcoins, these souls of the world. Um and to a lesser extent, you know, from a retail perspective, meme coins. Um So again, from where the attention is and, and where you’ve seen activity, trading inflows, outflow, even outflows in some cases, right? It’s primarily been focused on large caps and meme coins and less so on a lot of the new launches. Or else now, I want to talk about ETF S because we had the Bitcoin ETF approval in January. We are all waiting for the E ETF to hit the market. Some thought that we would have, we would have seen E ETF S trading in the United States by now, but we haven’t seen that happen just yet. Is that something you’re closely watching? And do you think that E is going to react the same way to the news that Bitcoin did at the beginning of the year? Yeah, we’ll see. I mean, I think people are expecting it to be something similar in the sense that, you know, they’re expecting the ECT have to be a hit, you know, to launch and have inflows. Um But we’ll see right again, a lot of it is, it’s not clear that demand is going to be there, given the way things have been trading. Um but you know, most people remain optimistic and given what we saw with the Bitcoin ETF, right, even if that recreates itself to some percent or to some extent on youth, you know, it’s, it’s gonna be positive for the space. Tell me a little bit more about what you mean there when you say it’s not clear that the demand is going to be there for the ET ETF because a lot of research firms have come out, a lot of, as a man have come out and said, we’re gonna see billions of dollars flow into these products when they hit the market. For sure. So again, you know, not financial advice, my personal opinion is we will see, you know, a large amount of demand, but again, to, to what extent, right, you know, you kind of had a lot of people banking on the ECTF thesis over the past six months. Um and you know, it, again, it remains to be seen, what are day one inflows going to look like? Right? Are you gonna see $10 billion day one? Who knows? You know, that would be a lot. But I mean, it again, if, if you compare it to what you saw with BT C, I think the rational expectation, the rational thing that, you know, expectation around, it would probably be some percentage less than what you saw with Bitcoin. It’s just a question of what is that gonna actually look like on day one, right? Or week one. Now, given your background, I want to turn to the DFI sector, we don’t always get to talk about defi on this show. But if you’re looking at what’s going on in defi and you’re comparing it to what’s happening. Um you know, with Bitcoin, with Ether, with the ETF S, what’s going on there, is it following a similar trajectory? So I think, you know, going into the cycle, a lot of investors, you know, had the opinion that let’s call it als and everything around that would be beta, let’s say to Bitcoin E and some of the large caps, um what we’re seeing is dispersion and basically stuff that’s non correlated to um or less correlated, better said to what’s happening with the large caps. So, you know, mean coin sort of exist in their own land. Uh And I think from our perspective and what we’re seeing is, you know, we’re tracking on chain launches, we’re track tracking transaction activity, we’re tracking a lot of other things. And you can use that I think is a bit of a barometer around that. You know, how many coins are launching on a given day on pump dot phone, right? Um Things like that are actually pretty interesting and useful in novel metrics to, to track. And um it has been trending down over the past week, but again, you can’t really use one week as an example, right? If you zoom out in the broader context, activities just exploded over the past six months, what do you think is driving that explosion of activity. Yeah, I mean, a lot of it is for meme coins in particular, right? A lot of it’s speculation but it’s also excitement. It’s hype. You know, it’s, you see, you know, lots of folks launching their own communities in their own coins kind of similar to what you saw in the NFT era um back in 21 and 22. So, you know, again, we’ll see what happens as it matures, but I, I think that meme coins are here to stay. Um And again, you know, it’s not just about looking at the large caps or large cap being coins. Um It’s also looking at what’s been happening on the margin with new launches and hype around new things. Now you talk about this speculation and I know people who watch the show. Now, I love a good meme coin. I think they’re super fun. But what do you think it tells us about the market? If anything that there has been so much interest in these speculative meme coins over the past, let’s say six months. Yeah, I mean, I think a lot of it is they’re easy to understand and for a lot of folks, it’s fun, right? Um And comparing to the other narratives, um it’s a, it’s an appealing, it’s an appealing narrative to a lot of people that are in the ecosystem, not just um uh uh you know, the speculators and the builders, but it appeals to a much broader audience of people that may not have otherwise been exposed to crypto, but now have some way to feel like they can partake in it and it feels fun to them. Um Now, is it sustainable? We’ll see. But I think, you know, on the net, right meme coins do bring in and attract a new crowd to crypto. And the hope is that maybe they come for the memes, they stay for all the other benefits of it. I like that come for the memes. Now, I want to talk about um maybe specific sectors of, of DFI, specifically A I tokens and Game Five. We’ve, we’ve talked about that on the show in the past couple of weeks. We’ve taken a look at some data that says, despite what’s happening in the D five sector A I tokens and Game Five are seeing increasing interest from investors for different reasons. Have you noticed that when you’re looking at the data that you’re tracking? Yeah, I mean, I, I think a I for sure has had a ton of excitement and hype. Um And there’s a lot of people interested in that, you know, again, I think what you’re seeing on sort of traditional uh web two, you know, all the interest around A I, everybody’s looking for additional ways to, to incorporate crypto to that. So whether it’s, you know, decentralized computer inference or, you know, sort of more on the data side and the place that folks are, are working on, there’s a lot of hype and excitement around that. Um That kind of transcends all the other market sentiment that you’re seeing. So I think we’ll continue to see more people building and, and active there. Any A I crypto projects that are interesting to you. Again, I can’t name single names, but there’s a lot that are, that are exciting. Um I think for me personally, the the most interesting is probably decentralized inference. Um So, you know, there’s quite a few protocols working on that. Um And yeah, I mean, the other sort of side of it is decentralized data. And in particular, you know, this concept that whether it’s a deep in whether it’s the apple other applications, you can sell your own data, build a much better training data set. And that can be used to ultimately make better models than what you see sort of from the web two giants, we’ll see them. And the second sector I wanted to ask you about is game five. And at coin desk, we are uh in a game five theme week. And so I want to get your perspective there. We’re seeing a lot of web three gaming projects launching tokens, we’re seeing more layer twos pop up that are supporting gaming and game five. What do you see the trajectory of that sector looking like? Yeah, so I mean, you know, game five as a whole and and just games in general or hit driven businesses, you know, the best games in any market, it does not matter, will perform well. Um Just like by the way, the best movies will perform well whenever they’re, they’re released. Uh So think of it from that context of it’s less about game buy as a sector and more about interest in specific games and things that people are really excited about. Um Now I’m excited for, you know what hopefully will be the massive web three breakout game beyond just what you see right now that gets lots of sort of new users and on board new users to crypto the same way you kind of see that with me coins, hopefully you’ll see it with game five as well. Yeah, I wanted to ask you about that. You know, you said that meme coins are bringing a new audience to crypto who are coming for the memes or the fun similarly gamey. It sounds like you’re saying that about and A I tokens, is there one specific, I guess part of the crypto world that you think is going to bring those next million or billion users to the industry? Yeah, I mean, I think right now, you know, if the people the mean coin or what better said a lot of the crowd, the mean coins are attracting are also the folks that would likely also be playing right? Many of these games. So without narrowing it down to any one. You know, it’s kind of two sides of the same coin, right? It’s, you want to use crypto to have fun or, you know, uh do things that, you know, join a new community, have a new perspective, et cetera, et cetera. And that’s different than what you see with sort of a I um deep in another infra, right? Which is trying to accomplish, you know, a particular use case. So they’re just different crowds. I think right now, the answer is probably neither out of any of those sectors in terms of on boarding. You know, more folks, the best onboarding uh tool I think to date in crypto has been stable coins and you know, to do uh not to do a curveball, but I think you’ll continue to see a lot more users join crypto because of stablecoins and activity around that versus some of these other use cases. Not to say that game five won’t on board. Lots of users just so far. I think stablecoins have been the biggest source of new sort of users and new, new introductions to crypto. It’s interesting you bring up stablecoins. I think when we um talk about crypto, we often have a very North American focus. Um And, and I know that we, we try and break that, but when you say stablecoins will bring a new, a bigger and newer audience to crypto, I assume that you’re talking about outside of North America. Now I’ve asked a few people on this show in the past weeks, you know, what they think the killer use case for stablecoins will be. What do you think that is? Yeah. I mean, I think to date it, it’s been payments and particularly in a lot of areas where, you know, payment systems have been really difficult. Um, it just makes sense. It’s a great product and I think even in the West, you know, you still see a lot of people that, you know, are now using staple coins for peer to peer payments. Um And there’s been a lot of folks working on that, you know, building really great products around it. Um But I think, you know, from a, just a onboarding perspective, the number of people, this is the potential to on board. Everybody needs a wallet, everybody needs a bank account. Um Not everybody needs a video game. That’s true. And I was, I was wrong to assume that you were speaking about outside of North America. Tell me more about it is more from account perspective, but it’s just we’re seeing adoption everywhere, right? Even if it’s more in certain regions. Tell me a little bit more about that. Use case when you’re talking about peer to peer payments specifically, what are you talking about? Are you talking about maybe folks who are on Shopify or doing ecommerce using stablecoins? Are you talking about remittances? What does that look like to you, I mean, for me, I, I put it in broadly and just payments as a category, I lump everything into it. But I think the areas where you’ve seen the most growth have been peer to peer payments in developing countries, you know, to your earlier point, um, followed by what I think will be more and more service providers accepting stablecoins for their own operations. I mean, if, if you’ve ever tried to send an international wire, it’s a pain um particularly to regions that don’t have, you know, great sort of us d correspondent banking. So in those regions, you know, stable coins are just a 10 X better product. And now I have to ask you because I know that you previously um did some work at Circo, we learned last week that Circle was the first stable coin issuer to be licensed under the MICA regulations in Europe. Is there any particular region that you think is making big waves when it comes to stablecoin regulation right now? Any particular region that you think we’re going to see people uptake the product uh more than others? Yeah, no, great question. Again, I can’t comment on uh for Circle, you know, but uh very excited to see that they received approval for it. Um and see more, both US CC and US C adoption um across, across the region. Um I think from uh where it’s interesting uh perspective, I think, you know, for better or for worse. Some of the work that is being done in the US around CBD CS is, is pretty interesting. Right. If you are able to, whether it’s a first party sort of Federal Reserve or whether it’s through private institutions such as circle. Um, I think the idea that, you know, you have stable point, first rails in large developed countries is really cool and exciting. Um, so whether, you know, you actually see regs pass in the US around that or, or in other nations, um I think the countries that adopt stable point infrastructure, the fastest will be, will have the most to gain from it. Do you think? Um I guess in that example you just gave are CBD, CS and Stablecoins almost one and the same in the future that you envision for stablecoins. Not quite right. I think there’s, there’s a bit of nuance but for purposes of just building stablecoin first infrastructure, um it has similar ramifications. Um And you know, the, the example I would give is if you can pay, for example, let’s say your taxes and stable coins, does it really matter if it’s a CBD C or if it’s say us DC, I think the end user isn’t really going to care as much about that distinction versus sort of crypto natives. We care about the distinction as do many others. But for purposes of it, you know, I think it’s more just about the adoption and seeing those rails be implemented more and more in our day to day lives. I would love if I could pay my taxes in stable coins and the government could just see all of the transactions and take the taxes and I wouldn’t get the anxiety that I get every tax season. I think that’s the use case. That is most exciting to me, Chris. Well, if they, if they accept it for that, uh think about what else will be accepting at that point, Chris, thank you so much for joining the show this morning. It was a pleasure.

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Regulation

Crypto community gets involved in anti-government protests in Nigeria

BlockChainBulletin Staff

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Crypto Community Engages in Nigeria's Governance Protests

Amid the #EndBadGovernanceInNigeria protests in Nigeria, a notable shift is occurring within the country’s cryptocurrency sector. As the general public demands sweeping governance reforms, crypto community leaders are seizing the opportunity to advocate for specific regulatory changes.

Rume Ophi, former secretary of the Blockchain Stakeholders Association of Nigeria (SiBAN), stressed the critical need to integrate crypto-focused demands into the broader agenda of the protests.

Ophi explained the dual benefit of such requirements, noting that proper regulation can spur substantial economic growth by attracting investors and creating job opportunities. Ophi noted, “Including calls for favorable crypto regulations is not just about the crypto community; it’s about leveraging these technologies to foster broader economic prosperity.”

Existing government efforts

In opposition to Ophi’s call for action, Chimezie Chuta, chair of the National Blockchain Policy Steering Committee, presents a different view. He pointed out The Nigerian government continued efforts to nurture the blockchain and cryptocurrency industries.

According to Chuta, the creation of a steering committee was essential to effectively address the needs of the crypto community.

Chuta also highlighted the creation of a subcommittee to harmonize regulations for virtual asset service providers (VASPs). With the aim of streamlining operations and providing clear regulatory direction, the initiative involves cooperation with major organizations including the Securities and Exchange Commission (SEC) and the Central Bank of Nigeria (CBN). “Our efforts should mitigate the need for protest as substantial progress is being made to address the needs of the crypto industry,” Chuta said.

A united call for support

The ongoing dialogue between the crypto community and government agencies reflects a complex landscape of negotiations and demands for progress.

While actors like Ophi are calling for more direct action and the inclusion of crypto demands in protest agendas, government figures like Chuta are advocating for recognition of the steps already taken.

As protests continue, the crypto community’s push for regulatory reform highlights a crucial aspect of Nigeria’s broader fight to improve governance and economic policies. Both sides agree that favorable regulations are critical to the successful adoption and implementation of blockchain technologies, signaling a potentially transformative era for Nigeria’s economic framework.

Read also : OKX Exchange Exits Nigerian Market Amid Regulatory Crackdown

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Cryptocurrency Regulations in Slovenia 2024

BlockChainBulletin Staff

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Cryptocurrency Regulations in Slovenia 2024

Slovenia, a small but highly developed European country with a population of 2.1 million, boasts a rich industrial history that has contributed greatly to its strong economy. As the most economically developed Slavic nation, Slovenia has grown steadily since adopting the euro in 2007. Its openness to innovation has been a key factor in its success in the industrial sector, making it a prime destination for cryptocurrency enthusiasts. Many believe that Slovenia is poised to become a powerful fintech hub in Europe. But does its current regulatory framework for cryptocurrencies support such aspirations?

Let’s explore Slovenia’s cryptocurrency regulations and see if they can propel the country to the forefront of the cryptocurrency landscape. My expectations are positive. What are yours? Before we answer, let’s dig a little deeper.

1. Cryptocurrency regulation in Slovenia: an overview

Slovenia is renowned for its innovation-friendly stance, providing a supportive environment for emerging technologies such as blockchain and cryptocurrencies. Under the Payment Services and Systems Act, cryptocurrencies are classified as virtual assets rather than financial or monetary instruments.

The regulation of the cryptocurrency sector in Slovenia is decentralized. Different authorities manage different aspects of the ecosystem. For example, the Bank of Slovenia and the Securities Market Agency oversee cryptocurrency transactions to ensure compliance with financial laws, including anti-money laundering (AML) and terrorist financing regulations. The Slovenian Act on the Prevention of Money Laundering and Terrorist Financing (ZPPDFT-2) incorporates the EU’s 5th Anti-Money Laundering Directive (5MLD) and aligns with the latest FATF recommendations. All virtual currency service providers must register with the Office of the Republic of Slovenia.

2. Cryptocurrency regulation in Slovenia: what’s new?

Several notable developments have taken place this year in the cryptocurrency sector in Slovenia:

July 25, 2024:Slovenia has issued a €30 million on-chain digital sovereign bond, the first of its kind in the EU, with a yield of 3.65%, maturing on 25 November 2024.

May 14, 2024:NiceHash has announced the first Slovenian Bitcoin-focused conference, NiceHashX, scheduled for November 8-9 in Maribor.

3. Explanation of the tax framework for cryptocurrencies in Slovenia

The Slovenian cryptocurrency tax framework provides clear guidelines for individuals and businesses. According to the Slovenian Financial Administration, the tax treatment depends on the status of the trader and the nature of the transaction.

  • People:Income earned from cryptocurrencies through employment or ongoing business activities is subject to personal income tax. However, capital gains from transactions or market fluctuations are exempt from tax.
  • Companies:Capital gains from cryptocurrency-related activities are subject to a 19% corporate tax. Value-added tax (VAT) generally applies at a rate of 22%, although cryptocurrency transactions that are considered as means of payment are exempt from VAT. Companies are not allowed to limit payment methods to cryptocurrencies alone. Tokens issued during ICOs must follow standard accounting rules and corporate tax law.

4. Cryptocurrency Mining in Slovenia: What You Need to Know

Cryptocurrency mining is not restricted in Slovenia, but income from mining is considered business income and is therefore taxable. This includes rewards from validating transactions and any additional income from mining operations. Both individuals and legal entities must comply with Slovenian tax regulations.

5. Timeline of the development of cryptocurrency regulation in Slovenia

Here is a timeline highlighting the evolution of cryptocurrency regulations in Slovenia:

  • 2013:The Slovenian Financial Administration has issued guidelines stating that income from cryptocurrency transactions should be taxed.
  • 2017:The Slovenian Financial Administration has provided more detailed guidelines on cryptocurrency taxation, depending on factors such as the status of the trader and the type of transaction.
  • 2023:The EU adopted the Markets in Crypto-Assets (MiCA) Regulation, establishing a uniform regulatory framework for crypto-assets, their issuers and service providers across the EU.

Endnote

Slovenia’s approach to the cryptocurrency sector is commendable, reflecting its optimistic view of the future of cryptocurrencies. The country’s balanced regulatory framework supports cryptocurrency innovation while protecting users’ rights and preventing illegal activities. Recent developments demonstrate Slovenia’s commitment to continually improving its regulatory environment. Slovenia’s cryptocurrency regulatory framework sets a positive example for other nations navigating the evolving cryptocurrency landscape.

Read also : Hong Kong Cryptocurrency Regulations 2024

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A Blank Sheet for Cryptocurrencies: Kamala Harris’ Regulatory Opportunity

BlockChainBulletin Staff

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A Blank Sheet for Cryptocurrencies: Kamala Harris' Regulatory Opportunity

photo by Shubham Dhage on Unsplash

As the cryptocurrency landscape continues to evolve, the need for clear regulation has never been more pressing.

With Vice President Kamala Harris now leading the charge on digital asset regulation in the United States, this represents a unique opportunity to start fresh. This fresh start can foster innovation and protect consumers. It can also pave the way for widespread adoption across industries, including real estate agencies, healthcare providers, and online gaming platforms like these. online casinos ukAccording to experts at SafestCasinoSites, these platforms come with benefits such as bonus offers, a wide selection of games, and various payment methods. Ultimately, all this increase in adoption could propel the cryptocurrency market forward.

With this in mind, let’s look at the current state of cryptocurrency regulation in the United States, a complex and confusing landscape. Multiple agencies, including the Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC), and the Financial Crimes Enforcement Network (FinCEN), have overlapping jurisdictions, creating a fragmented regulatory environment. This lack of clarity has stifled innovation as companies are reluctant to invest in the United States, fearing regulatory repercussions. A coherent and clear regulatory framework is urgently needed to realize the full potential of cryptocurrencies in the United States.

While the US struggles to find its footing, other countries, such as Singapore and the UK, are actively looking into the cryptocurrency sector by adopting clear and supportive regulatory frameworks. This has led to a brain drain, with companies choosing to locate in more conducive environments.

Vice President Kamala Harris has a unique opportunity to change that narrative and start over. Regulation of cryptocurrencies. By taking a comprehensive and inclusive approach, it can help create a framework that balances consumer protection with innovation and growth. The time has come for clear and effective regulation of cryptocurrencies in the United States.

Effective regulation of digital assets is essential to foster a safe and innovative environment. The key principles guiding this regulation are clarity, innovation, global cooperation, consumer protection, and flexibility. Clear definitions and guidelines eliminate ambiguity while encouraging experimentation and development to ensure progress. Collaboration with international partners establishes consistent standards, preventing regulatory arbitrage. Strong safeguards protect consumers from fraud and market abuse, and adaptability allows for evolution in response to emerging trends and technologies, striking a balance between innovation and protection.

The benefits of effective cryptocurrency regulation are multiple and far-reaching. By establishing clear guidelines, governments can attract investors and mainstream users, driving growth and adoption. This can, in turn, position countries like the United States as global leaders in fintech and innovation. Strong safeguards will also increase consumer confidence in digital assets and related products, increasing economic activity.

A thriving crypto industry can contribute significantly to GDP and job creation, which has a positive impact on the overall economy. Furthermore, effective regulation has paved the way for the growth of many businesses such as tech startups, online casinos, and pharmaceutical companies, demonstrating that clear guidelines can open up new opportunities without stifling innovation. This is a great example of how regulation can allay fears of regressive policies, even if Kamala Harris does not repeal the current progressive approach. By adopting effective regulation, governments can create fertile ground for the crypto industry to thrive, thereby promoting progress and prosperity.

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South Korea Imposes New ‘Monitoring’ Fees on Cryptocurrency Exchanges

BlockChainBulletin Staff

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South Korea Imposes New 'Monitoring' Fees on Cryptocurrency Exchanges

Big news! The latest regulatory changes in South Korea are expected to impact major cryptocurrency exchanges like Upbit and Bithumb. Under the updated regulations, these platforms will now have to pay monitoring fees, which could cause problems for some exchanges.

Overview of new fees

In the latest move to regulate cryptocurrencies, the Financial Services Commission announced on July 1 the revised “Enforcement Order of the Act on the Establishment of the Financial Services Commission, etc.” update “Regulations on the collection of contributions from financial institutions, etc.” According to local legislation newsThe regulations require virtual asset operators to pay supervisory fees for inspections conducted by the Financial Supervisory Service starting next year. The total fees for the four major exchanges are estimated at around 300 million won, or about $220,000.

Apportionment of costs

Upbit, which holds a dominant market share, is expected to bear more than 90% of the total fee, or about 272 million won ($199,592) based on its operating revenue. Bithumb will pay about 21.14 million won ($155,157), while Coinone and GOPAX will contribute about 6.03 million won ($4,422) and 830,000 won ($608), respectively. Korbit is excluded from this fee due to its lower operating revenue.

Impact on the industry

The supervision fee will function similarly to a quasi-tax for financial institutions subject to inspections by the Financial Supervisory Service. The new law requires any company with a turnover of 3 billion won or more to pay the fee.

In the past, fees for electronic financial companies and P2P investment firms were phased in over three years. However, the taxation of virtual asset operators has been accelerated, reflecting the rapid growth of the cryptocurrency market and increasing regulatory scrutiny.

Industry reactions

The rapid introduction of the fee was unexpected by some industry players, who had expected a delay. Financial Supervisory Service officials justified the decision by citing the creation of the body concerned and the costs already incurred.

While larger exchanges like Upbit and Bithumb can afford the cost, smaller exchanges like Coinone and GOPAX, which are currently operating at a loss, could face an additional financial burden. This is part of a broader trend of declining trading volumes for South Korean exchanges, which have seen a 30% drop since the new law went into effect.

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