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Kenya has the highest percentage of cryptocurrency owners in Africa. UNCTAD data indicate

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According to the most recent data from the United Nations Conference on Trade and Development (UNCTAD), Kenya has the highest percentage of people who own cryptocurrencies out of all the African nations. UNCTAD stated that it advises the imposition of taxes that discourage cryptocurrency trading in order to counter the growing use of cryptocurrencies.

The data in the latest (UNCTAD) policy brief, Kenya’s digital currency ownership as a share of the population of 8.5% is the highest in Africa and the fifth-highest globally. Only Ukraine with 12.7%, Russia (11.9%), Venezuela (10.3%), and Singapore (9.4%) have a higher proportion of crypto-owning residents than Kenya.

Kenya Has Highest Proportion of Crypto Owning Citizens in Africa UNCTAD Data Shows

UNCTAD report June 2022.

According to the data, 7.1 percent of South Africans owned or held cryptocurrencies in 2021, placing the nation second in Africa and eighth overall. About 6.3 percent of people in Nigeria, one of the largest cryptocurrency markets in the world, own or hold cryptocurrencies. According to the UNCTAD data, this means that in 2021, out of the 211 million people who called the country home, just over 13 million were owners of digital currencies.

Australia had the lowest percentage of its population who owned cryptocurrency during the study period (3.4 percent) among the 20 nations that were examined.

Meanwhile, in a report on its findings, UNCTAD acknowledged that cryptocurrencies have grown in their popularity because they are “an attractive channel through which to send remittances.” The UN agency also said it found that middle-income individuals from inflation-hit developing countries own or hold cryptocurrencies because these are seen “as a way to protect household savings.”

Singapore is considering new restriction for cryptocurrency trading.

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The central bank is considering adding more restrictions to the trading of cryptocurrencies, according to the Monetary Authority of Singapore (MAS), which has informed Parliament. Limits on retail participation and regulations on the use of leverage when transacting in cryptocurrencies are some of them.

Tharman Shanmugaratnam, the minister in charge of the Monetary Authority of Singapore (MAS), answered a parliamentary question about the regulation of cryptocurrency Monday.

Murali Pillai, a member of the Singapore Parliament, asked whether the MAS “intends to implement further restrictions on cryptocurrency trading platforms with a view to protect unsophisticated persons from entering into such trades which are considered highly risky.”

The minister in charge of the MAS explained that since 2017, the central bank “has consistently warned that cryptocurrencies are not suitable investments for the retail public.”

He detailed that in January, the central bank restricted “the marketing and advertising of cryptocurrency services in public areas, and disallow cryptocurrency trading being portrayed in a manner that trivializes its risks.” Since then digital payment token (DPT) service providers in the country have taken actions to meet the central bank’s rules, including “removing cryptocurrency ATMs from public areas and taking down advertisements from public transport venues,” he noted.

The minister further revealed:

MAS has been carefully considering the introduction of additional consumer protection safeguards. These may include placing limits on retail participation, and rules on the use of leverage when transacting in cryptocurrencies.

Minister Shanmugaratnam opined, “Given the borderless nature of cryptocurrency markets, however, there is a need for regulatory coordination and cooperation globally.” He elaborated, “These issues are being discussed at various international standard-setting bodies where MAS actively participates.”

The MAS reiterated its crypto warning Monday:

Cryptocurrencies are highly risky and are not suitable for the retail public. People can lose most of the money they have invested, or more if they borrow to purchase cryptocurrencies.

In the midst of political and economic uncertainty, Argentina Turns to Stablecoins

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Stablecoins are being used by Argentineans to protect their savings against recent uncertainty brought on by the resignation of a number of important government officials. Along with other notables, the country’s minister of economy resigned over the weekend, causing unrest that led to an increase of 11% in the price of stablecoins on some exchanges.

Due to the current political and economic unrest in the nation, the rate at which Argentineans exchange their native fiat currency, the peso, for dollars has drastically decreased. Martin Guzman, the country’s economy minister, abruptly resigned, shocking many because he was a key figure in the agreement the nation reached with the International Monetary Fund (IMF) to restructure its debt to the body.

Other significant ministry officials, such as Ramiro Tosi, Roberto Arias, and Rodrigo Ruete, also resigned in response to Guzman’s resignation. Due to this, the peso to dollar exchange rate on various cryptocurrency exchanges reached record highs. According to Bloomberg, the rate reached 257 Argentine pesos on the Binance exchange, a rise of 6.6%. On the Lemon Cash exchange, prices jumped 11% to 279 pesos.

The situation has caused Argentinians to rush to exchange their pesos for foreign currencies like the U.S. dollar and also for dollar-pegged stablecoins like USDT. Even with the appointment of a new economy minister, Silvina Batakis, the market did not recover to its previous rates. According to local media, the exchange rate fell even lower to 280 pesos per dollar, even reaching the 300 pesos per dollar mark on some exchanges.

Furthermore, the volumes of stablecoins traded increased significantly. Some operators reported increases of 500% in volumes traded during some hours of the weekend, with most traders trying to anticipate the rise in traditional markets to take advantage of the arbitrage opportunities.

The exchange rate of the digital dollar went over the exchange rate of the physical dollar, showing that Argentinians prefer to purchase these variants due to the simplicity of trading them again for other goods and also for the different uses they afford compared to dollar bills. The movements are consistent with a survey conducted by Americas Markets Intelligence in April, which found that 12% of the population have invested in crypto, and 18% were interested in investing in crypto.

Colombia will issue land registry certificates using the Ripple Ledger.

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The Ripple Ledger will be used by the Colombian government’s new system to store and authenticate property titles. The National Land Agency hopes to use the system, which was created by a third-party business called Peersyst Technology, to issue a record number of land adjudications for citizens.

There are businesses and governments using blockchain technology for other purposes, even though its primary applications currently involve assets with transactional value, such as cryptocurrencies. The Ripple Ledger, the asset’s underlying blockchain, will be used by the Colombian government to help with the country’s land title issuance.

The announcement was made by Peersyst Technology, a third-party company that worked with Ripple to complete the digital implementation of the National Land Registry. The company stated:

The solution has been implemented for AgenciaTierras is based on xrpstamp which allows to register digital assets on XRPL and verify their authenticity with QRCode.

This means that the new system will allow for the issuance of land-related documents and verification of their authenticity without requiring third parties for the process.

The project includes the ripple-based solution to help many landowners who still lack official documents proving their ownership of the land they live on normalize their status. In order to ensure confidence in the solution chosen by Colombia, Peersyst Technology stated that this solution aims to certify more than 100,000 land adjudications in the near future.

There are other, comparable projects in Latin America that aim to use blockchain technology to advance various governmental objectives. By using blockchain to record every interaction, the Brazilian Blockchain Network, a project that aims to create a common infrastructure for institutions to build apps on, aims to increase the transparency of how the government operates.

Similarly, a cryptocurrency bill approved by the Panamanian National Assembly, which was partially vetoed by president Laurentino Cortizo due to money laundering concerns, included an initiative to create a blockchain-based ID system to facilitate access to ID-related services for a broader audience in the country.

Colombia has also recently taken the first steps to regulate cryptocurrency exchanges with a bill being approved in its first discussion by the Columbian Congress.

Bank of Russia is prepared to legalize cryptocurrency mining if miners export coin production

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The legalization of cryptocurrency mining would be supported by the Central Bank of Russia, provided that the earnings from the activity are converted to fiat currency outside of Russia. The regulator’s most recent stance on the subject follows a softening of its position on the potential use of cryptocurrencies for payments, even if only globally.

Moscow’s central bank is now prepared to support the legalization of cryptocurrency mining, provided that Russian miners are required to sell the coins they earn abroad. Kirill Pronin, the director of the Bank of Russia’s Financial Technologies Department, recently made a statement to that effect.

The central bank, which earlier this year proposed a blanket ban on the majority of related activities, including mining, has been the most outspoken opponent of cryptocurrencies in Russia’s ongoing policy debates. The government’s position has begun to shift, though, as a result of opposition from other institutions and financial constraints brought on by the conflict in Ukraine.

Last month, Governor Elvira Nabiullina said that cryptocurrency payments could be accepted as long as they didn’t “penetrate” the Russian financial system. She also argued that because virtual currencies like bitcoin are so unstable and risky for potential investors, they shouldn’t be traded on Russian platforms.

This week, Pronin noted that mining is one of the ways to obtain cryptocurrency in the form of fees for the validation of crypto transactions carried out by miners, even though it would not be under the supervision of the Central Bank of Russia (CBR). He was quoted as saying, “The legalization of mining can be discussed, but in this regard, we believe a number of conditions must be met.”

Ivan Chebeskov, the director of the Financial Policy Department of the ministry of finance, emphasized that some significant crypto mining businesses with headquarters in the Russian Federation have also been compelled to deal with foreign restrictions when withdrawing funds. He proposed that in order to provide liquidity to the sector, Russia might need to build its own exchange infrastructure.

However, Kirill Pronin reaffirmed that, in accordance with the CBR, the cryptocurrency created by Russian miners should be sold outside of Russia and not be permitted to amass there. Avoiding providing incentives for its subsequent use in domestic payments is the key.

Besides the new bill “On Digital Currency,” expected to comprehensively regulate Russia’s crypto space, a dedicated draft law “On Mining in the Russian Federation” was submitted to the State Duma in April. Members of the lower house of Russian parliament propose to recognize crypto mining as a business activity using Russian information infrastructure and equipment located in the country.

Mark Zuckerberg’s announcement of the Metaverse Digital Wallet led to Meta ending its cryptocurrency project Novi.

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The downfall of the cryptocurrency project Novi has been announced by Meta Platforms, formerly Facebook. It is suggested that users withdraw money as soon as possible. The announcement came after Meta CEO Mark Zuckerberg revealed the launch of a digital wallet for the metaverse.

Facebook owner Meta Platforms Inc. (Nasdaq: META) announced Friday that its crypto project pilot Novi “is ending soon.” According to its website:

Novi will no longer be available for use after September 1.

In Friday’s announcement, Meta explained that starting July 21, users will no longer be able to add money to their Novi accounts.

Additionally, as of September 1, neither the Novi app nor Novi on Whatsapp will be accessible, and users won’t be able to access their Novi accounts.

Users have been advised by the company to withdraw their Novi balances prior to September 1. Any funds still available after that date will be transferred to the debit cards or bank accounts indicated on their Novi accounts.

According to its website, Novi is a digital wallet that uses cryptocurrency to enable instant, fee-free money transfers for users. Oct. 2017 saw the beta release of Novi by Meta with Coinbase as its custody partner.

The balances of Novi accounts are kept in USDP (pax dollar), a stablecoin produced by the regulated Paxos Trust Company. Diem, formerly known as Libra, was the cryptocurrency Meta ultimately intended to use for the service. The business, however, ran into numerous regulatory obstacles and ultimately abandoned the plan. The Diem Group (or “Diem”intellectual )’s property and other technological assets related to operating a blockchain-based payment network were acquired by Silvergate Capital, according to a statement made in January.

Meta has been ramping up its metaverse business. CEO Mark Zuckerberg said last week that his company aims to attract billions of people to use the metaverse, generating massive revenue for Meta.

Zuckerberg also announced on June 22 that Facebook Pay is rebranding to Meta Pay. Moreover, he unveiled a digital wallet for the metaverse. “Beyond the current features, we’re working on something new: a wallet for the metaverse that lets you securely manage your identity, what you own, and how you pay,” the Facebook co-founder detailed.

Costs of Ethereum Transfer Network fees are still falling and have reached a 19-month low.

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On Saturday, the average network fee for transfers on Ethereum dropped to 0.0016 ether, or $1.67, reaching a low not seen since November 2020. As Ethereum gas fees have been steadily declining since May 11, 2022, average fees on Saturday have been as low as 32 gwei, or $0.69, per transfer.

On July 2, 2022, Ethereum’s average gas costs reached a low that had not been seen in 19 months or since November 12, 2020. The amount of ethereum (ETH) needed to push a transaction onto the blockchain network is known as the gas or network fee.

Similar to the Bitcoin (BTC) network, ETH rewards its miners with gas fees in exchange for confirming transfers. Early ETH transfers were insignificant, and from August 2015 to July 2016, the average gas fee per ETH transfer was less than a U.S. penny.

Between July 2016 to May 2017, Ethereum network fees were between $0.01 to $0.10 a transfer. Nowadays Ethereum fees are a bit more pricey and on May 12, 2021, average fees reached $69 per transaction.

Between August 2021 to February 2022, fees did not drop lower than $20 per transfer. At times throughout that period, fees hit $30, $40, and $50 increments for every transaction made depending on the day. On May 1, 2022, the average network fee jumped to $196 per transfer, thanks to a popular non-fungible token (NFT) sale that day.

The aforementioned fees only apply to sending ether as well, and an Opensea contract, decentralized exchange (dex) swap, or an ERC20 transfer can cost even more.

Median-Sized Fees Tap $0.69 per transaction, L2 Fees Slip Lower

On July 2, 2022, average fees tapped a low of 0.0016 ether or $1.67 per transfer. The last time fees on the Ethereum network were this low was in mid-November 2020. On November 12, 2020, the average ETH fee was 0.0034 ether per transfer or $1.55.

Ethereum Transfer Costs Continue to Slide — Network Fees Tap a 19-Month Low
Average ethereum fees via bitinfocharts.com on July 2, 2022.

Moreover, on Saturday, the web portal etherscan.io’s gas tracker shows the highest Ethereum network fee slipped as low as 32 gwei or $0.69 per high priority transfer. Etherscan.io’s data indicates an Opensea sale will cost $5.05 for the transaction, a Uniswap trade is $6.10, and to forward an ERC20 like tether (USDT) it’s $1.79 per transaction at the time of writing.

The median transaction fee, according to metrics from bitinfocharts.com, is 0.00065 ether, or $0.695 per transaction. Layer-two (L2) transaction fees are cheaper as a result of Ethereum’s average and median network fees being much lower than they have been in the previous 596 days.

According to data from L2fees.info, a transaction on Loopring costs less than a penny, a transfer on Zksync is $0.01, and a transaction on Metis Network costs $0.01. On Saturday, optimism is $0.03, Boba Network is about $0.06, and Arbitrum transaction fees are $0.10. This weekend, transactions with Polygon Hermez and Aztec Network each cost $0.25 and $0.35 respectively.

South African MTI and Its Operator Are Accused of a $1.7 Billion Bitcoin Fraud by a US Regulator

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A $1.7 billion bitcoin fraud involving Mirror Trading International (MTI) and its operator has been charged by the U.S. Commodity Futures Trading Commission (CFTC). The largest cryptocurrency fraud scheme case brought against the regulator so far involves this action.

The CFTC announced Thursday that it has charged a “South African pool operator and CEO with $1.7 billion fraud involving bitcoin.” The regulator added:

This action is CFTC’s largest fraud scheme case involving bitcoin.

The derivatives watchdog has filed a civil enforcement action, charging Cornelius Johannes Steynberg and Mirror Trading International Proprietary Ltd. (MTI) with “fraud and registration violations.”

From approximately May 18, 2018, through March 20 last year, “Steynberg, individually and as the controlling person of MTI, engaged in an international fraudulent multilevel marketing scheme … to solicit bitcoin from members of the public for participation in a commodity pool operated by MTI,” the CFTC detailed, elaborating:

During this period, Steynberg … accepted at least 29,421 bitcoin — with a value of over $1,733,838,372 at the end of the period.

The announcement adds that the CFTC “seeks full restitution to defrauded investors, disgorgement of ill-gotten gains, civil monetary penalties, permanent registration and trading bans, and a permanent injunction against future violations of the Commodity Exchange Act and CFTC Regulations.”

The derivatives watchdog described:

The defendants misappropriated, either directly or indirectly, all of the bitcoin they accepted from the pool participants.

The CFTC concluded: “Sternberg is a fugitive from South African law enforcement, but was recently detained in the Federative Republic of Brazil on an Interpol arrest warrant.”

Bill Proposed by Senator Indira Kempis To Make Bitcoin Legal Tender In Mexico

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A bill to recognize bitcoin as legal tender in Mexico has been put forth by senator Indira Kempis. The difficulties Mexican citizens encounter when attempting to access financial products and education serve as the basis for the bill’s action. The Central Bank of Mexico, however, has opposed the integration of bitcoin into the nation’s financial system.

Another country in Latam looking into the potential benefits bitcoin could have for its economy is Mexico. A bill to change Mexico’s existing monetary law and make bitcoin legal tender was unveiled this week by senator Indira Kempis. The proposal, which aims to follow El Salvador’s lead in becoming the first nation in the world to accept bitcoin as legal tender, mentions how this could alter the financial literacy of many citizens.

The document bases its recommendation on the fact that Mexico is one of the continent’s least educated and financially inclusive nations. According to the proposal, 56% of the Mexican population still lacks access to a bank account, meaning that more than 67 million people still have no access to the most basic of financial instruments.

In the same vein, 68% of citizens don’t have access to financial education, which ostensibly renders most Mexicans unable to take educated decisions regarding savings, mortgages, or how to deal with credit.

The course of action taken by the government and the Central Bank of Mexico is in conflict with the legislation that Senator Kempis has proposed. The organization revealed in January that it was working to develop a digital peso, its own central bank digital currency (CBDC), and that it was anticipated to be in use by 2024 as a means of assisting Mexicans with their issues with financial inclusion.

Additionally, Mexico’s finance minister, Arturo Herrera, declared in June that using cryptocurrencies inside the country’s financial system was forbidden and that his position was unlikely to change in the near future. This measure was announced after Ricardo Salinas Pliego, one of the richest men in Mexico, reported he was working to make Banco Azteca the first bank to accept bitcoin in the country.

JPMorgan predicts a short deleveraging cycle for the cryptocurrency market.

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Image Credit: DANIEL LEAL-OLIVAS

According to a report released on Wednesday by JPMorgan (JPM), the failure of cryptocurrency hedge fund Three Arrows Capital (3AC) shows that the effects of this year’s bear market in cryptocurrencies are still being felt.
The bank stated that while it is difficult to determine how much more deleveraging still needs to take place, its indicators suggest the process is already well along.
According to the report, the industry’s multiple failures shouldn’t come as a surprise given the deleveraging environment and the market capitalization of digital assets’ 70% decline since November.

The entities that employed higher leverage in the past are now the most vulnerable, the bank said. “Whether it is miners having borrowed to expand operations using their bitcoin as collateral, or corporates such as MicroStrategy (MSTR) having borrowed in the past to invest even more heavily into bitcoin, or hedge funds using futures to lever their positions, or retail investors borrowing via margin accounts to invest in various cryptocurrencies.”

The failure of 3AC is a manifestation of this deleveraging process, the note said, adding that the process seems well advanced, “making the bottom formation process in crypto markets more volatile.”

Bitcoin (BTC) miners are another source of stress for crypto markets, JPMorgan said, given the pressure to sell their tokens to deleverage or to cover the cost of their operations. Selling of bitcoins by miners intensified in June, and will likely continue into the third quarter, it said.

The weakest crypto companies, those with high leverage and lower capital levels, are the most challenged. Conversely, those with the healthiest balance sheets are most likely to survive and will emerge stronger once this current phase is over, the report said.

JPMorgan identifies two reasons to suggest that the cycle may not be very protracted: The fact that stronger crypto companies with more robust balance sheets are stepping in to help contain the contagion, and the continued healthy pace of venture capital (VC) funding, an important source of capital for the digital assets ecosystem.

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