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Crypto News Updates

Deutsche Bank Sees Rising Inflation As A Ticking Economic "Time Bomb"

Contrary to many financial institutions, analysts at Deutsche Bank have warned of global consequences that will stem from fiat inflation.

Deutsche bank has forecasted an economic crisis following the rise of U.S. dollar inflation, making it a rare institutional voice to do so.

Contrary to the stance of many policymakers regarding the eventual effects of ongoing stimulus activities and decisions by the Federal Reserve, economists at Deutsche Bank predicted adverse effects of inflation, especially to the most vulnerable in society, in a recent analysis reported on by CNBC.

“The analysis especially points the finger at the Federal Reserve and its new framework in which it will tolerate higher inflation for the sake of a full and inclusive recovery,” per the report. “The firm contends that the Fed’s intention not to tighten policy until inflation shows a sustained rise will have dire impacts.”

“Neglecting inflation leaves global economies sitting on a time bomb,” a Deutsche analyst wrote.

Following the rise of the COVID-19 crisis, the Federal Reserve initiated a major, nearly $2 trillion inflationary stimulus package to bolster the shrinking economy. In this way, COVID-19 and the Fed directed many of those who are afraid of such inflation toward bitcoin investment.

With the global-scale devaluation of fiat currencies around the world, and rampant economic stimulus for policymakers, bitcoin will become all the more important. With a programmatic supply and freedom from control of third parties, like money printers, it represents hard, sound money in a time when that is becoming more and more difficult to find.

Source: Bitcoin magazine

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Inner Mongolia Establishes Hotline To Report Illegal Bitcoin Mining Operations

Inner Mongolia, which recently banned bitcoin mining, has established a hotline for reporting illegal operations.

In an announcement published yesterday, the The Inner Mongolia Development and Reform Commission (DRC) revealed that it has set up a hotline for reporting illegal Bitcoin mining operations taking place in the region.

The announcement listed an in-person address, telephone number and email that people can use to report the operations.

“The autonomous region’s energy consumption … emergency headquarters office has specially set up a virtual currency ‘mining’ enterprise reporting platform,” per a translation of the announcement.

According to this announcement, the complete shutdown and criminalization of unauthorized Bitcoin mining is part of a five-year energy consumption plan. It is seeking reports on mining companies, mining companies posing as data centers, mining companies providing “site leasing” and companies that obtain power through “illegal means” and “engage in virtual currency ‘mining’ business.”

Inner Mongolia is one of China’s biggest regions, with a land mass of over 1 million square kilometers. The region imposed a ban on bitcoin mining in March over purported concerns about pollution, giving miners until this month to cease operations. Up to that point, it had contributed an estimated 8% of total global hash rate.

Source: Bitcoin magazine

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Grayscale Becomes First-Ever Bitcoin Company To Partner With NFL Team

Bitcoin investment firm Grayscale has partnered with the NFL’s New York Giants and will provide cryptocurrency education to personnel.

Cryptocurrency asset manager Grayscale Investments announced today that it has become the firm bitcoin-focused company to officially partner with an NFL team as it is now the official digital currency asset manager partner of the New York Giants.

Grayscale will become the Giants’ presenting home game sponsor and a supporting sponsor of the team’s training camp. And it will also host voluntary educational seminars on cryptocurrencies for Giants personnel, potentially including players.

The announcement suggested that an aspect of this partnership will be onboarding the Giants organization onto bitcoin and cryptocurrency services.

“We are excited to partner with Grayscale, who are innovative leaders in the digital currency market,” said Pete Guelli, New York Giants chief commercial officer, in the announcement. “During our extensive evaluation of the space, we determined that we not only wanted a partner that understood the value of aligning with the Giants brand, but also could guide us in navigating the cryptocurrency ecosystem. Grayscale quickly emerged as a company that shares our passion for the New York market but also has the institutional knowledge and network of partners that we can access as crypto continues to evolve.”

Grayscale is deeply involved in the Bitcoin space, operating the popular Grayscale Bitcoin Investment Trust (GBTC), facilitating a partnership that will see TIME Magazine hold BTC on its balance sheet and more.

Meanwhile, NFL players are increasingly recognizing the importance of Bitcoin, with Russel Okung and Sean Culkin leading the way in opting to have their salaries paid in BTC.

Source: Bitcoin magazine

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JPMorgan Reportedly Planning To Offer A Bitcoin Fund

A news report indicates that JPMorgan will soon offer an “actively-managed” bitcoin fund to clients.

JPMorgan Chase & Co. is preparing to allow its clients to invest in an “actively-managed” bitcoin fund, according to CoinDesk.

“The JPMorgan bitcoin funding could roll out as soon as this summer,” per the report. “Institutional bitcoin shop NYDIG will serve as JPMorgan’s custody provider.”

This fund would reportedly only be available to private wealth clients.

If and when such a fund does become available, JPMorgan would be joining a growing number of legacy financial firms that want to offer bitcoin exposure to clients. Goldman Sachs announced a similar move in March, while Morgan Stanely announced one earlier this month.

But JPMorgan’s potential pivot to bitcoin is particularly notable, due to the chief’s previously-expressed attitude toward the emerging asset. During an institutional investors conference in 2017, JPMorgan CEO Jamie Dimon infamously called bitcoin “worse than tulip bulbs,” saying that, “It won’t end well. Someone is going to get killed.”

However, in a February 2021 interview with Bloomberg, JPMorgan co-president Daniel Pinto sounded optimistic about Bitcoin.

“If over time an asset class develops that is going to be used by different asset managers and investors, we will have to be involved,” Pinto said. “The demand isn’t there yet, but I’m sure it will be at some point.”

Source: Bitcoin magazine

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Gryphon Raises $14 Million For Zero-Carbon Bitcoin Mining Operation

Gryphon Digital Mining has raised $14 million for a zero-carbon bitcoin mining operation.

According to a release, Gryphon Digital Mining has raised $14 million in a Series A fundraise for the launch of a zero-carbon footprint Bitcoin mining operation.

“At Gryphon, our long-term strategy is to be the first vertically integrated crypto miner with a wholly-owned, 100 percent renewable energy supply,” said Rob Chang, CEO of Gryphon Digital Mining, per the release. “Our vision is to further develop and use economically viable, renewable, off-grid energy.”

The announcement noted that institutional investors made up more than 30 percent of the Series A and it closed in a little over two weeks. It also noted that Gryphon has partnered with a data center that grants it access to electricity costs as low as $0.013 per kilowatt hour (kWH). At launch, it expects its mining operation to have 730 petahashes per second (PH/s) of processing power which it thinks can grow to more than 2,000 pH/s by the end of the year.

The release did not detail the specific energy sources that Gryphon expects to leverage, but it did position the firm as one that sees opportunity in fueling the practice through green energy.

“Gryphon has the opportunity to become a market leader by providing reliable, low-cost mining while relying on renewable energy to minimize Bitcoin mining’s carbon footprint,” according to the release.

While there is a popular belief that bitcoin mining is a waste of energy that unduly contributes to issues like climate change, projects like this are demonstrating that Bitcoin mining can actually incentivize and drive use of renewable energy sources.

Source: Bitcoin magazine

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Crypto Council For Innovation Report: Criminals Will Move Away From Bitcoin

A recent report co-authored by an ex-CIA director has found that criminals will increasingly move away from using Bitcoin.

A recent report published by the pro-cryptocurrency lobbying group Crypto Council For Innovation and co-authored by former CIA deputy director Michael Morell analyzed the degree of illicit activity associated with Bitcoin and concluded that criminals will decreasingly leverage bitcoin to launder money.

The report, titled “An Analysis Of Bitcoin’s Use In Illicit Finance,” noted the fact that Bitcoin is pseudonymous (as opposed to completely anonymous) as a reason that other cryptocurrencies that better protect user privacy represent a “far larger” percent of total transaction volume for illicit activities than bitcoin.

Furthermore, it highlighted the fact that fiat currencies are often better tools for obscuring criminal activity than bitcoin is.

“A currently serving official at the [Commodity Futures Trading Commission] added that it ‘is easier for law enforcement to trace illicit activity using Bitcoin than it is to trace cross-border illegal activity using traditional banking transactions, and far easier than cash transactions,’” according to the report.

And, Despite the fact that some regulators and news outlets have highlighted the potential for cryptocurrencies like bitcoin to be used as media for financing terrorism, this report found the contrary.

“On the key issue of terrorist financing, [a] former CIA terrorism expert was quoted as saying that ‘the hype is much greater than the reality and that cryptocurrency is not yet an important platform for terrorist organizations,’” per the report.

Finally, the authors of the report asked themselves the question: “In light of the conclusions we have reached, why do we see such alarmist statements and articles about the threat posed by Bitcoin?”

Firstly, the authors attributed these statements to a lack of understanding of the technology behind Bitcoin, the propensity for “bad” news to drive perception and the fact that “Bitcoin and its decentralized nature seem to pose a disruptive threat to traditional financial institutions.” 

Source: Bitcoin magazine

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COPA Suing Craig Wright Over Bitcoin White Paper Claims

The Cryptocurrency Open Patent Alliance (COPA) has announced that it is suing Craig Wright over his Bitcoin white paper copyright claims.

The Cryptocurrency Open Patent Alliance (COPA) has announced that it has initiated a lawsuit to declare that Craig Wright does not have copyright ownership over the Bitcoin white paper.

“Today, COPA initiated a lawsuit asking the U.K. High Court to declare that Mr. Craig Wright does not have copyright ownership over the Bitcoin white paper,” COPA tweeted, along with an image of a High Court claim form.

Earlier this year, lawyers representing Wright demanded that some of those hosting the paper take it down, as Wright is the real person behind Bitcoin’s pseudonymous creator Satoshi Nakamoto and publicly hosting it violates his copyright. Bitcoin Core developers initially removed the white paper from bitcoin.org, for instance, for fear of legal retribution.

“The Bitoin white paper was included in the original Bitcoin project files with the project clearly published under the MIT license by Satoshi Nakamoto,” according to a followup statement from bitcoin.org, upon rehosting the paper. “We believe there is no doubt we have the legal right to host the Bitcoin white paper.”

Wright has continuously claimed that he is Satoshi and has been met with sustained incredulity from the Bitcoin community.

Now, COPA — which was formed by Square last year to combat stifling industry patents — is taking the legal battle to Wright.

“We stand in support of the Bitcoin developer community and the many others who’ve been threatened for hosting the white paper,” COPA tweeted.

In February, COPA shared the letter that its lawyers sent in response to Wright’s cease and desist letter regarding its own decision to host the Bitcoin white paper.

Source: Bitcoin magazine

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NYDIG Raises $100 Million, Details Bitcoin-Powered Insurance Strategy

NYDIG has announced a $100 million raise of growth capital with strategic partnerships and hires for a bitcoin-powered insurance strategy.

In an April 8, 2021 release, NYDIG, the bitcoin-focused investment subsidiary of Stone Ridge, announced a $100 million raise of growth capital.

Among the list of partners for this fundraise are Starr, Liberty Mutual Insurance, and other property and casualty insurers, joining NYDIG’s existing partnership with New York’s MassMutual. This marks notable investment in a bitcoin-focused group by traditionally conservative companies.

NYDIG also announced that Mike Sapnar, the CEO of major reinsurer TransRE, would become its global head of insurance solutions and oversee all NYDIG insurance activities. Sapnar will be joined by NYDIG U.S. Head of Insurance Solutions Matt Carey, who will be “focused on bitcoin-powered solutions for U.S.-based life insurance and annuity providers,” per the announcement.

“The global property and casualty (P&C) industry is huge, paying out over $1 trillion in claims annually,” said Robert Gutmann, cofounder and CEO of NYDIG, said in the release. “I am excited to welcome Starr and Liberty Mutual to NYDIG, as part of our expansion of bitcoin into new areas of insurance.”

Source: Bitcoin magazine

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Lightning Network Reaches 10,000 Nodes

Bitcoin’s Lightning Network has more than 10,000 operating nodes, nearly doubling within a year.

Rising by approximately 100 percent since this time last year, the number of nodes operating on Bitcoin’s Lightning Network nodes has been rising, according to data from Bitcoin Visuals.

As of April 5, 2021, there were 10,394 Lightning Network nodes with channels and the cumulative network capacity, the amount of bitcoin locked into Lightning channels, has reached a remarkable $68 million.

On April 5, 2020, the number of nodes stood at 5,349 nodes, with a cumulative capacity of merely $6.3 million. Further accentuating the scale of the Lightning Network’s growth, on April 5, 2019, the number of nodes was 4,096.

The Lightning Network layer operates like an auxiliary build over the main Bitcoin network. It helps with speeding up the transaction pace and throughput of the network, which is relatively slow on the main Bitcoin blockchain due to bitcoin’s proof-of-work (PoW) transaction validation scheme. With the Lightning Network, bitcoin transactions can be executed in less than a minute.

Also, judging by Bitcoin’s macroeconomic trends, transaction fees using the main Bitcoin network will continue to rise. As such, the transaction fee cost will become more of an obstacle for justifying certain transaction volumes. This eventual fate of the network makes infrastructure like the Lightning Network necessary, especially for retail-sized transactions.

Source: Bitcoin magazine

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Bitcoin’s “Kimchi Premium” Hits 15 Percent

The so-called “Kimchi premium,” or bitcoin price difference in South Korea, has hit 15 percent.

With TradingView reporting a $57,000 BTC price for U.S.-based exchange Coinbase and a $66,000 for South Korea’s Bithumb at the time of this writing, the Kimchi premium, or difference between the bitcoin price on Western exchanges and South Korean exchanges, has reached 15 percent.

With a name derived from the popular South Korean dish, the Kimchi premium was first identified in 2016, according to a research report from the University of Calgary. Though the current 15 percent premium is notable, the spread has been marked as high as 54.48 percent in January 2018, per the report.

Although the price spread looks lucrative for foreign traders, local regulations limit foreigners from trading cryptocurrency through a South Korean exchange. Also, the regulations limit Korean traders from exploiting the arbitrage opportunities on international exchanges.

“Institutional frictions prevent arbitrageurs from keeping bitcoin prices in Korea aligned with the rest of the world,” the University of Calgary researchers explained. “Divergence in bitcoin prices are not only a Korean phenomenon… international differences in bitcoin prices can be high and persist over long periods of time.”

That being said, this premium reveals a bullish sentiment for bitcoin in the South Korean cryptocurrency market. Judging by the size of the South Korean cryptocurrency market, this high premium for bitcoin may have an effect on global prices going forward.

Source: Bitcoin magazine