What’s happening crypto people? We’re back with all the latest excitement and intrigue from the last week. There’s MORE good news from China, an interesting development at Stellar, and word of a state-backed digital asset from Turkey. Fill your boots.
In April, China’s National Development and Reform Commission (NDRC) published a draft list of industries it recommended the government should eliminate. Among these was crypto mining. This week, the government agency delivered its final recommendations and in keeping with the new pro-crypto sentiments coming out of Beijing, the NDRC has removed any mention of eliminating Bitcoin mining 🥳🥳🥳🥳
The NDRC is a national macroeconomic planning agency. Its recommendations are only used to help local authorities work out which industries need funding, so Bitcoin was never going to be banned, as some claimed. What this news does mean is that there will no longer be an effort to stop the flow of resources to China’s Bitcoin miners, so their growth will be allowed to continue. It is another indicator of the positive stance the country is taking.
And in more good news, Shanghai’s commerce commission and the city’s branch of the People’s Bank of China (PBoC) yesterday issued a joint statement saying blockchain can solve asymmetries in trade finance and provide authenticity for trades. Reuters reported that the regulators noted that “Blockchain also lowers cost thresholds for trading institutions, particularly in the export/import markets”.
💶 EU to launch digital Euro?
A draft statement from the European Union has proposed that the European Central Bank (ECB) should look at issuing its own central-bank-backed digital currency, known as a CBDC.
The statement notes that: “The ECB and other EU central banks could usefully explore the opportunities as well as challenges of issuing central bank digital currencies including by considering concrete steps to this effect.”
The draft, seen by Reuters, is set to be approved by EU member states next month. However, a source familiar with the matter has pushed back on the Reuters report, saying, “There’s absolutely no commitment at this stage to put in place a new cryptocurrency.” The source adds that: “The statement is to highlight the need for a proper regulatory framework for those stablecoins and as a consequence, different ideas should be explored. One of them is the possibility of having something that is managed by the ECB [European Central Bank] and other central banks.”
Either way, interesting times.
On Monday, The Stellar Development Foundation (SDF) revealed that it has burned 55 billion lumens (XLM), worth roughly $4.3 billion. That leaves a total of 50 billion XLMs in existence, down from 105 billion prior to the burn.
The funds were originally allocated to pay for the development of the XLM ledger and for giveaway programs, which are now being halted. The SDF claims that the move is part of a push to reshuffle its development strategy.
SDF explained in a blog post that:
“We’ve plotted the next ten years of Stellar’s growth and even with our greatly increased ambitions for SDF, we’re confident these funds will be enough to see us, and the network, through. At the same time, we’re ending Stellar’s World Giveaway Program (for individual airdrops) and our Partner Giveaway programs, both of which were created at the network’s inception. 50 billion of the 68 billion lumens in those programs have also been burned. We believe the number of lumens we hold now aligns better with our mission. SDF will not burn any additional lumens.”
The company blog post goes on to explain that the remaining funds will be used to develop the Stellar blockchain, foster use cases, and support network partnerships.
📈 Bakkt picks up steam
Bakkt recorded its second-highest volume on Tuesday, as the Bitcoin futures platform starts to pick up steam. Volumes reached 1061 traded contracts worth $10 million, up 96% on the previous day.
Next month, Bakkt will begin offering options on futures, a derivative tool for mitigating price risk.
🇹🇷 Turkey to launch state-backed crypto asset in 2020
President of Turkey Recep Tayyip Erdoğan has instructed his government to finalise testing of a national digital currency - the digital Lira. The Lira has been in the works since at least June, when it was announced by the country’s Vice President. The TUBITAK technology centre is developing the project.
It is expected that testing of the Lira will be completed by December 2020 and will be issued as part of the 2020 Annual Presidential Program.
The announcement was made as part of Erdogan’s "Annual Presidential Program" document, which outlines Turkey’s return to economic stability. The document explains that: “The main objective is to establish a financial sector with a strong institutional structure that can respond to the financing needs of the real sector at a low cost, offer different financial instruments to a wide investor base through reliable institutions and support Istanbul’s goal of becoming an attractive global financial centre.”