By Associated Press | Updated: 20 June 2022
El Salvador’s Bitcoin-boosting president has asked people to be patient after the price of the cryptocurrency fell below $20,000(roughly Rs. 15,50,000) — less than half the price the government paid.
According to the tracking site nayibtracker.com, El Salvador under President Nayib Bukele’s administration has spent about $105(roughly Rs.8,200) million on Bitcoin, starting last September and paying an average of almost $46,000(roughly Rs. 35, 90,000) per coin.
The value of that investment in the currency, also known as “BTC,” is now calculated to have fallen by over 57 percent, or around $61(roughly Rs. 4,800) million.
“I see that some people are worried or anxious about the #Bitcoin market price,” Bukele wrote on his Twitter account late Saturday. “My advice: stop looking at the graph and enjoy life. If you invested in #BTC your investment is safe and its value will immensely grow after the bear market.”
“Patience is the key,” the president wrote.
On Tuesday, when a Bitcoin publication crowed that El Salvador has lost “only” $40(roughly Rs.3,200) million on its investment, Bukele tweeted with apparent incredulity: “You’re telling me we should buy more #BTC?” Bukele became the first leader in the world to make the cryptocurrency legal tender last year and was a devoted booster at least up to May, when he boasted of “buying the dip” in the currency’s price. But the coin has slid further since then.
Finance Minister Alejandro Zelaya sought to put a good face on the situation Wednesday in an interview with a local television station, saying that because El Salvador hasn’t sold any of its Bitcoins, it hasn’t really suffered any loss.
“When they tell me that El Salvador’s budgetary risk has increased because of the supposed loss, that loss doesn’t exist,” Zelaya said. “That must be made clear, because we have not sold.”
However, most companies and governments do write down the value of what accountants call an “unrealized loss,” even if they don’t sell the distressed asset.
Zelaya also insisted the Bitcoin slide doesn’t matter very much for El Salvador, saying that “this doesn’t even represent 0.5 percent of our budget.”
That might prove a hard sell in a country where about one-fifth of the people live on less than $5.50(roughly Rs. 430) per day.
In January, El Salvador rejected a recommendation by the International Monetary Fund to drop Bitcoin as legal tender.
Zelaya said at the time that “no international organization is going to make us do anything, anything at all,” calling it an issue of “sovereignty.” The IMF recommended that El Salvador dissolve the $150(roughly Rs.11,700) million trust fund it created when it made the cryptocurrency legal tender and return any of those unused funds to its treasury. The IMF cited concerns about the volatility of Bitcoin prices, and the possibility of criminals using the cryptocurrency.
Bukele has touted Bitcoin as a way to significantly increase financial inclusion, drawing millions of people who previously lacked bank accounts into the financial system. He has also spoken of the parallel tourism promotion targeting Bitcoin enthusiasts.
Bukele led the push to adopt Bitcoin as legal tender alongside the US dollar. El Salvador’s Legislative Assembly made the country the first to do so in June 2021.
Bitcoin falls below $19,000 as cryptos creak under rate hike risk
By: Reuters, Updated September 19, 2022
SINGAPORE, Sept 19 (Reuters) – Cryptocurrencies fell to fresh lows on Monday on regulatory concerns and as investors globally turned shy on risky assets with interest rate rises looming around the world.
Bitcoin , the biggest cryptocurrency by market value, fell about 5% to a three-month low of $18,387.
Ether , the second largest cryptocurrency, dropped 3% to a two-month low of $1,285 and is down more than 10% in the last 24 hours. Most other smaller tokens were deeper in the red.
The Ethereum blockchain, which underpins the ether token, had a major upgrade over the weekend called the Merge that changes the way transactions are processed and cuts energy use.
The token’s value has fallen amid some speculation that remarks last week from U.S. Securities and Exchange Commission Chairman Gary Gensler implied the new structure could attract extra regulation. Trades around the upgrade also were unwound.
“It’s speculation as to what might or might not happen,” said Matthew Dibb, COO of Singapore crypto platform Stack Funds, on the regulatory outlook.
“A lot of the hype has come out of the markets since the Merge,” he said. “It’s really been a sell-the-news type of event,” he added, given the nervous global backdrop, and said ether could test $950 in coming months.
“Looking at the landscape right now, both fundamentally and technically, it’s not looking great. There’s no immediate bullish catalyst that we can see that’s going to prop up these markets and bring in a whole lot of new money and liquidity.”
Bitcoin once again slips below $20,000
By: Reuters, September 18, 2022
Sept 18 (Reuters) – Bitcoin on Sunday dropped 1.54% to $19,804, slipping from the 20,000 mark after losing $310 from its previous close.
The world’s biggest and best-known cryptocurrency is down 58.9% from the year’s high of $48,234 on March 28.
Ether , the coin linked to the ethereum blockchain network, dropped 3.2 % to $1,422.1 on Sunday, losing $47 from its previous close.
U.S. seizes $30 mln in crypto from North Korea-linked hackers
By: Reuters, September 9, 2022
Sept 8 (Reuters) – The United States has seized over $30 million in cryptocurrency stolen by North Korean-linked hackers Lazarus from the popular online game Axie Infinity, crypto intelligence firm Chainalysis said on Thursday.
The company said in a blog post it played a role in the recovery with U.S. law enforcement and other crypto organizations, without naming them, in the first ever recovery of stolen cryptocurrency by a North Korea hacking group.
Chainalysis and North Korea’s mission to the United Nations did not immediately respond to requests for comment. The FBI did not immediately respond to a request for comment.
The seizures represent about 10% of the total funds stolen in March from Ronin Network, a sidechain built for the play-to-earn game Axie Infinity, Chainalysis said.
Ronin said in March hackers stole about $615 million in cryptocurrency.
“We estimate that so far in 2022, North Korea-linked groups have stolen approximately $1 billion of cryptocurrency from DeFi protocols,” Chainalysis said. He was referring to decentralized finance protocols, an umbrella term for financial services offered on public blockchains.
The U.S Department of Treasury in May sanctioned virtual currency mixer Blender, saying it was used in the laundering process for the Axie Infinity heist.
The Treasury Department in April also linked Lazarus to the attack.
Crypto gaming firm Animoca Brands raises $110 million
By: Reuters, September 8, 2022
LONDON, Sept 8 (Reuters) – Hong Kong-based blockchain gaming developer Animoca Brands has raised $110 million from investors, the company said in a statement on Thursday.
The company said the fund raising values the company “similar to its previous funding round” but did not specify its new valuation.
In July, Animoca said it had a valuation of around $5.5 billion. read more
(This story corrects paragraph 1 to read Hong Kong-based not Singapore)
Binance to convert users’ USDC into its own stablecoin
By: Reuters, September 6, 2022
Sept 5 (Reuters) – Binance, the world’s largest crypto exchange, said on Monday it is introducing “BUSD Auto-Conversion,” which will be used to convert any existing user balances and new deposits of USD Coin (USDC), Pax Dollar (USDP) and True USD (TUSD) into its own stablecoin.
The move is intended to enhance liquidity and capital efficiency for users, the company said in a statement.
Binance said it will remove and cease any trading on spot pairs that include USDC, USDP and TUSD; it will start the conversion on Sept. 29.
USDC, which is principally operated by Circle Internet Financial and is the second largest stablecoin, has a nearly $51.9 billion market capitalization. Binance’s stablecoin, BUSD, is valued at about $19.4 billion, according to crypto data provider CoinGecko.
USDC products affected include saving accounts, DeFi staking subscriptions and crypto loans, which will be closed and liquidated on Sept. 23.
Crypto Exchange FTX Ordered to Halt ‘False and Misleading’ Claims by US Bank Regulator
By Reuters | Updated: 20 August 2022
A US bank regulator ordered crypto exchange FTX on Friday to halt what it called “false and misleading” claims the exchange had made about whether funds at the company are insured by the government. The Federal Deposit Insurance Corporation said a July tweet by Brett Harrison, head of FTX’s US operations, contained misleading claims that funds held at and stocks purchased through FTX were FDIC insured, and ordered the company to remove any misleading language from its social media accounts and websites.
In the tweet, which Harrison has since deleted, he stated that direct deposits from employers to the crypto exchange are “stored in individually FDIC-insured bank accounts” and that stocks purchased via FTX US “are held in FDIC-insured” brokerage accounts. The FDIC said in its cease and desist letter to FTX US that those statements implied that FDIC insurance was available for cryptocurrency and stock holdings, and that the agency does not insure brokerage accounts.
The order, one of five sent to crypto firms by the FDIC on Friday, comes as regulators have ramped up efforts to police crypto firms that may be misleading investors on whether their funds enjoy a government backstop. The issue has come to a head of late, as turmoil in the crypto market has led to stress and the collapse of some high profile firms.
The bank regulator issued a similar cease and desist letter to bankrupt crypto firm Voyager Digital, arguing that the company had misled customers by claiming their funds with Voyager would be covered by the FDIC. Later, the FDIC issued an advisory urging banks dealing with crypto companies to ensure that customers are aware of what types of assets are government-insured, particularly in cases where firms offer a mix of uninsured crypto products alongside insured bank deposit products.
© Thomson Reuters 2022
In a tweet on Friday, FTX CEO Sam Bankman-Fried emphasised FTX is not FDIC-insured, and apologised if anyone misinterpreted previous comments.
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