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American University Of Paraguay To Accept Tuition Payments In Bitcoin

The American University of Paraguay will accept bitcoin tuition payments, ahead of forthcoming bitcoin legislation in the country.

The American University of Paraguay shared on Twitter that it will accept tuition payments in bitcoin, as well as other cryptocurrencies, beginning on August 1, 2021.

“From August 1, you will be able to pay all your tuition and fees with cryptocurrency,” a translated version of the tweet read. “We take an important step towards innovation.”

The university is one of Paraguay’s most prestigious educational centers and has been in operation for over 30 years. But it is still unclear how the university plans to accept or hold the BTC it receives as tuition payment on a technical level, but it has not indicated any plans to liquidate the bitcoin upon receipt.

Bitcoin Adoption, Legislation In Paraguay

The new move, which is part of the university’s program of innovation and modernization, adds a new facet to a bitcoin legislation bill to be outlined in the country in July.

According to Paraguayan deputy Carlos Rejala, the country plans to legislate bitcoin as a medium of exchange in its commercial sector next month. Rejala also said that whether the bill it plans to present will seek to make bitcoin a full legal tender in the country or not is still uncertain and yet to be defined.

Paraguay’s most prominent entertainment group, Grupo Cinco, has also demonstrated interest in accepting bitcoin and other cryptocurrencies. The company will allow its 50,000 monthly customers to pay with bitcoin at its 24 outlets, including restaurants, nightclubs and pubs. In addition, as more companies and organizations begin accepting bitcoin, the more likely it becomes that the bitcoin bill will pass in the country’s congress.

“We are talking about leading Paraguayan entrepreneurs who have a lot of influence over the youth,” Rejala said. “This is extremely important because it will be much easier for my fellow deputies to support the bill if there is social support at a local level.”

Paraguay is following El Salvador’s steps and seems on its own path to officially become a bitcoin supportive country in less than a month. If the proposed bill passes, it will set the stage for Paraguay to welcome bitcoin businesses, entrepreneurs and even miners.

Source: Bitcoin magazine

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NYC Mayoral Lead Wants City To Be Center For Bitcoin

New York City mayoral election frontrunner Eric Adams said he will make the city a center for Bitcoin if elected.

Eric Adams, the New York City Democratic mayoral front runner, said today, after voting closed for the primaries, that he would turn the city into a bitcoin hub within one year.

“I promise you, in one year … you’re going to see a different city,” Adams said in his election night party speech. “We’re going to become the center of life science, the center of cyber security, the center of self-driving cars, drones, the center of bitcoin, we’re going to be the center of all the technology.”

According to The New York Times, Adams is currently leading New York City’s mayoral race with around 32% of votes. But the primary election results will likely not be known until mid-July, when they are expected to be announced.

Former presidential candidate Andrew Yang, a longtime bitcoin fan who has made similar promises, was running second in line before he decided to drop out of the race earlier this week. Now, The New York Times data shows that Adams’ closest rival is Maya Wiley, who is more than 75,000 votes behind.

Adams didn’t elaborate on how he plans to achieve his ambitious goal of turning New York City into a Bitcoin hub, but he did send a message to his primary competitor in this regard — Miami Mayor Francis Suarez.

“Miami, you had your run. We’re bringing our businesses back,” said Adams.

But the mayoral candidate might be facing fierce competition, as Miami has already started taking tangible measures to bring bitcoin to city-level adoption.

Suarez has set a personal goal to turn his tropical city into a bitcoin-savvy economy before 2022. The Miami mayor, who bought bitcoin himself after U.S. President Joe Biden announced a $1.9 trillion stimulus bill, has already seen the city commission explore paying city employees in bitcoin, allowing residents to pay taxes and fees in bitcoin and using city funds to invest in bitcoin. Furthermore, Suarez has recently sought to attract bitcoin miners to his city.

On the other hand, New York’s own legislation might pose difficulties for Adams to outpace Miami and turn his city into the center of Bitcoin. The notorious BitLicense, a business license for bitcoin activities issued by the New York State Department of Financial Services, entails considerable costs to those wishing to operate in the state. Apart from the $5,000 application fee, a report calculates that gathering and constructing all of the information for the application process can amount to over $100,000. In addition, BitLicense’s extensive requirements pose a privacy concern for many in the bitcoin industry, who see it as intrusive and unjustly targeting bitcoin startups. For instance, prominent Lightning network startup Strike — which is helping El Salvador establish bitcoin as legal tender — does not work in New York.

Source: Bitcoin magazine

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Gemini Trust Buys $4 Million In Carbon Credits To Offset Bitcoin Holdings

Bitcoin exchange Gemini Trust purchased $4 million in carbon credits to offset its BTC holdings and broaden appeal to investors.

Bitcoin exchange Gemini Trust, run by the Winklevoss brothers Cameron and Tyler, has purchased around $4 million in carbon credits to help offset the alleged carbon emissions footprint of its bitcoin held in custody, reported Bloomberg.

“We want to build a better world” with Bitcoin, Tyler Winklevoss told Bloomberg. “It’s also important to be sustainable as we navigate into that vision.”

Gemini purchased the carbon credits indirectly through a donation to Climate Vault. This Delaware-based, nonprofit, nonstock corporation seeks to facilitate organizations to achieve net-zero carbon emissions by leveraging existing offset markets.

The nonprofit, which directly purchased the permits, said the Winklevoss donation would prevent over 341,000 metric tons of carbon from entering the atmosphere. Gemini claimed that these offsets cover all of the bitcoin held by the trust, which amounts to an average daily balance of 250,843 BTC so far this year — around $8.3 billion at the time of writing.

According to Bloomberg, Gemini currently serves as the custodian for nine exchange-traded funds (ETFs) and two closed-ended, publicly-traded funds in North America. But with this recent purchase, part of the Gemini Green initiative, the company seeks to appeal the bitcoin investment case to more institutional investors. Corporations worldwide, especially investment funds, have lately received intense environmental, social and governance (ESG) pressure from the public.

“We are just playing our part to address the ESG conversation and component of Bitcoin that a lot of people have heard about, and they can come to Gemini and use Gemini Green custody, and they can fulfill their ESG mandates,” Winklevoss told Bloomberg.

ESG disclosure by investment funds and related entities has become increasingly demanded. As a result, investors now seek to add more ESG-compliant businesses into their portfolios and better appeal to subsequent retail investors who are increasingly concerned about the environment. But the ESG narrative hasn’t escaped criticism. The broad array of fields encompassed by its acronym gets dizzyingly translated into investment ideas, showing that it lacks clarity.

Nonetheless, the Winklevoss purchase of carbon credits might not only spur additional interest by institutional investors, which is one of the important drivers of adoption, but could also bring a tangible contribution to the planet, as tons of carbon are stopped from entering the atmosphere.

Source: Bitcoin magazine

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Chinese Crackdown: Bitmain Stops Rig Sales, Exodus Ensues, Hash Rate Declines

China’s bitcoin mining crackdown has led to Bitmain halting mining rig sales, exodus of miners and decline in the hash rate.

Bitmain Technologies, the world’s largest manufacturer of bitcoin mining rigs, is halting global spot sales of its machines to aid the secondhand market for rigs in China, according to Bloomberg.

Today, Bitmain told the local mining community that the company’s decision is a product of the recent price plunges of new mining equipment. Since April, top-tier bitcoin mining rigs in China have been priced down by 75%, fueled by Chinese miners going offline after the country’s recent crackdown on bitcoin.

By halting sales, Bitmain claims it can help miners targeted by Chinese authorities to get better prices for their machines when exiting the industry. And in the long run, the mining rig maker giant could also benefit if the reduced supply ends up triggering a price increase for new rigs.

Last month, China’s state council stated that the country should act on a renewed crackdown on bitcoin mining and trading. Since then, local governments have been targeting bitcoin miners with shut down orders and inspection notices, a priori in fossil fuel-powered energy plants only.

More recently, however, bitcoin mining operations in provinces with renewable energy sources have also been targeted. Miners in the Sichuan province, for instance, have also fallen prey to the widespread crackdown. The region’s hydropower grid, a park initially set up by the government to attract energy-intensive industries to utilize excess energy produced in the rainy seasons, had become a hotbed for bitcoin mining farms but is now dismissing them.

Insider Information Claims “Great ASIC Exodus” Is Underway

China’s crackdown on bitcoin mining activities has compelled companies to reconsider their business strategies. BIT Mining, for instance, is now applying an “overseas deployment strategy.” The owner of the BTC.com pool has already delivered the first of three batches of mining equipment to Kazakhstan, where part of its operations will be housed going forward.

Kevin Zhang, vice president at bitcoin mining-focused firm Foundry, tweeted that BIT Mining’s move represents an upcoming trend of hash rate transfer away from China — which he calls the “great ASIC exodus.”

According to Zhang, who claims he has been in touch with leaders in the Chinese bitcoin mining sector, industry insiders estimate that around 70% of China’s bitcoin mining capacity has already gone offline. And the prediction is that nearly 90% of the hash rate in the country might be off-grid by the end of the month.

“In the most extreme cases,” Zhang tweeted, “some colleagues in Kangding, Sichuan have been instructed by the power plants/stations they have installed their mining facility on to remove ALL infrastructure (low-medium voltage, racks/shelving, containers, etc…) with 1-2 weeks notice.”

Impacts On The Bitcoin Hash Rate

As many bitcoin miners in China rush to leave the country, the Bitcoin network hash rate is set to decline until they successfully get their machines online in overseas locations. Although the move of miners out of China was an ongoing trend, these abrupt shutdown orders have done some damage. In under 30 days, the Bitcoin network’s total hash rate has fallen by more than 40%.

However, a reduction of hash rate does not necessarily hurt the Bitcoin network’s security. For instance, Coin Metrics co-founder Nic Carter released a video explaining the likely effects of China’s bitcoin mining ban. Carter reiterated that a loss of hash rate wouldn’t negatively impact the network’s security and highlighted that by forcing bitcoin mining out of China, Bitcoin’s carbon emissions would be reduced as miners relocate to greener power plants abroad.

Source: Bitcoin magazine

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First Mideast Bitcoin Fund Lists On Nasdaq Dubai Exchange

The Bitcoin Fund has become the first bitcoin investment fund to trade in the Middle East after being listed on the Nasdaq Dubai exchange.

The Bitcoin Fund, a Canadian, closed-end bitcoin investment fund, became the first of its kind to trade in the Middle East after being listed on the Nasdaq Dubai Exchange, reported Bloomberg. With the Mideast listing, the fund intends to allow trading of its shares around the globe, around the clock.

According to its prospectus, the fund aims to provide its unitholders with exposure to bitcoin and the daily BTC price movements in U.S. dollar terms, as well as the opportunity for long-term capital appreciation. But the fund does not hedge U.S. dollar exposure back to the Canadian dollar. Moreover, the Canadian fund applies a HODL mentality to its bitcoin funds and does not speculate on the short-term movements of the BTC/USD price.

The Bitcoin Fund invests in long-term holdings of bitcoin purchased from spot markets and over-the-counter counterparties to achieve its investment objectives. The goal, per its prospectus, is to provide investors with a more convenient alternative to a direct investment in bitcoin, in which case they don’t need to buy and custody bitcoin themselves. However, this also means that investors in the fund will only enjoy bitcoin’s price appreciation at the cost of failing to reap the benefits provided by self-sovereign money.

The fund may also take alternative investment avenues to get bitcoin exposure. Such routes include leveraged positions, which wouldn’t exceed 25% of the net asset value (NAV) of the fund, as well as the use of derivatives, provided that the fund’s aggregate exposure in the futures market doesn’t exceed 5% of its NAV.

Furthermore, with the listing in the Middle East, the Canadian fund now seeks to provide worldwide trading at all hours. Since the fund in the Toronto Stock Exchange (TSX) trades at North American market times, the Dubai listing, live eight hours ahead of New York time, would trade at the almost exact opposite periods.

Source: Bitcoin magazine

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Canaan To Begin Mining Bitcoin Itself, Setting Up Operations In Kazakhstan

Leading bitcoin mining rig manufacturer Canaan will start mining BTC itself and is setting up new operations in Kazakhstan.

Bitcoin mining rig manufacturer Canaan, one of the largest mining hardware providers worldwide, has announced that it is making its first foray into mining bitcoin itself by setting up mining operations in Kazakhstan.

“We believe that our self-operated Bitcoin mining business will help us improve our financial performance as well as expand our business scope and customer base,” Canaan chairman and CEO Nangeng Zhang said in the announcement. “As we integrate more industry resources into our operations, we believe this business segment will enable us to revitalize our mining machine inventory, shield us from bitcoin volatility and ensure our inventory sufficiency during market upturns.”

According to the announcement, Canaan’s new business diversification strategy delivers on the company’s strategic plans for 2021, announced earlier this year. The Chinese ASIC maker will now venture into bitcoin mining with the hopes to capture more returns if demand for its mining rigs declines.

Earlier this month, Canaan had also expanded its business by establishing its first overseas after-sales service center. The center, which was also set up in Kazakhstan, provides the company’s local customers with services such as machine testing, warranty, maintenance and technical consultation and support.

The bitcoin mining rig maker is based in China and produced the world’s first ASIC machine in 2013, remaining in business ever since. However, Canaan is now being compelled to expand its business models and penetrate overseas markets, likely due to its home country’s recent negative stance toward the industry, after seeing its own pleas against this crackdown fall on deaf ears.

After China’s state council called for a renewed crackdown on bitcoin mining and trading in the country, many companies in the industry have been facing challenges. For instance, BIT Mining — the bitcoin mining company behind the BTC.com pool, which accounts for nearly 10% of the Bitcoin network’s total hash rate — recently saw some of its operations go offline. As a result, the company has started moving its mining machines overseas, also to Kazakhstan.

Similarly, bitcoin trading and related activities haven’t been spared in the China-wide crackdown. Primary internet services in the country, such as Google-like Baidu and Twitter-like Weibo, for instance, have lately been censoring keywords related to bitcoin exchanges. And, this week, the People’s Bank of China (PBOC) met with leading financial institutions in the country, including payment services giant Alipay, to demand that citizens be stopped from transacting with bitcoin exchanges and over-the-counter dealers altogether.

Source: Bitcoin magazine

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With Bitcoin Clarity, El Salvador Allows Strike To Abandon USDT

How Lightning Network startup Strike went from using USDT in El Salvador to helping the country build financial infrastructure with Bitcoin.

When El Salvador passed a law making bitcoin legal tender in the country, it did not just set itself on a path to add the payment option to existing infrastructure. It provided regulatory clarity that allowed an existing Bitcoin-forward platform to better serve its citizens.

Thanks to the regulation, Strike, the Lightning Network-focused startup helping El Salvador build its national bitcoin-based payments system, will no longer need to substitute U.S. dollars with Tether’s USDT stablecoin.

Why Strike Had To Use USDT In El Salvador

Strike CEO Jack Mallers shared on a recent episode of the “What Bitcoin Did” podcast that, before his first trip to El Salvador to work with the Bitcoin Beach community, he connected with some financial institutions in the country and discovered that it was illegal for a financial service to custody dollars on behalf of a user. In addition, there was no regulatory clarity on Bitcoin in El Salvador at that time.

As a result, he immediately saw an impairment to helping the majority of the country’s population that does not have access to the traditional banking system by implementing Strike.

Consequently, Strike, which leverages dollars and the Bitcoin Lightning Network to allow instant, cheap payment transfers worldwide without intermediaries, had to resort to using USDT to achieve basic, minimum-viable-product functionality in El Salvador.

However, after the country’s president’s bill to make Bitcoin legal tender was approved, Strike was able to secure partnerships with some of the biggest banks in El Salvador, which will be interoperable on Lightning. The resulting system, Mallers said, will replace what is the equivalent of automated clearing houses in the U.S. with the Lightning network, without the need for USDT.

“Tether is no longer a part of anything,” Mallers said on the podcast. “Tether was part of the plan originally because it had to be, because I didn’t have a choice.”

The Benefits Of Abandoning Tether

The ability to abandon USDT on the platform is one that should be highly preferable to many in El Salvador, given Tether’s issues as a project.

Since its launch in 2014, Tether stated that its USDT tokens were fully backed one-for-one by U.S. dollars in bank accounts. But it pivoted in 2019 to say that its reserves included traditional currency, cash equivalents and other assets and receivables. Such a move spurred skepticism and criticism in the Bitcoin community. And the New York Attorney General has found Tether to have misrepresented the assets backing USDT and obscured the loss of $850 million in user funds. Currently, only 4% of Tether’s reserves are cash.

On the podcast, Mallers celebrated that Strike no longer needs to use the controversial USDT for its financial services in El Salvador.

“You know, you launch with Tether, learn, be a good listener and a good observer, end up meeting with the president and helping define regulatory clarity in the country and then you roll Tether out,” Mallers said. “And you help the country build the most inclusive, resilient, and reliable financial infrastructure that any country has ever seen in human history.”

Mallers also shared that Strike will be integrating with the country’s two top “cash point distributors,” a solution that allows “unbanked” people to walk into a physical location with dollars or an app balance and walk out with cash. With this integration, Strike will be available on over 1,000 cash points across El Salvador and other countries in Central America, allowing people to easily port physical dollars into or out of their Strike app balance.

Source: Bitcoin magazine

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VanEck Files To Offer Bitcoin Futures Mutual Fund

Investment firm VanEck has filed with the U.S. SEC to offer a bitcoin futures mutual fund in the U.S.

A new filing with the U.S. Securities and Exchange Commission (SEC) indicates that investment firm VanEck Associates Corporation wants to offer a bitcoin futures mutual fund in the United States.

“The [Bitcoin Strategy] Fund seeks to achieve its investment objective by investing, under normal circumstances, in bitcoin futures contracts … as well as pooled investment vehicles and exchange-traded products that provide exposure to bitcoin,” per the filing. “The Fund does not invest in bitcoin or other digital assets directly.”

According to the filing, the fund will make its indirect bitcoin investments through a subsidiary and that investment could reach up to 25% of the value of the fund’s total assets. The subsidiary, a wholly-owned limited company based in the Cayman Islands, operates under the islands’ laws and can invest in bitcoin directly.

Additionally, the filing shows that the fund’s target exposure to bitcoin investments will be approximately 100% of the fund’s net assets. But it may rise above that level when the fund chooses to employ leveraged exposure in bitcoin.

If bitcoin investments don’t consume all of the fund’s net assets, it may resort to alternative investment vehicles to provide liquidity, serve as margin or collateralize the fund’s or the subsidiary’s investments. According to the filing, such alternative avenues include U.S. treasuries, money market funds, cash and cash equivalents, mortgage-backed securities issued or guaranteed by U.S. government agencies and even sovereign debt obligations of non-U.S. countries.

The Bitcoin Strategy Fund’s portfolio will be managed by Gregory Krenzer, who will be primarily responsible for the day-to-day portfolio management of the fund. Krenzer has been with VanEck since 1994 and has over 25 years of experience in financial markets.

This filing is not VanEck’s first related to bitcoin. The company filed for a bitcoin exchange-traded fund (ETF) with the SEC at the end of 2020, but its approval has recently been delayed.

Source: Bitcoin magazine

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Barred From China, BIT Mining Has Started Moving Bitcoin Mining Operations To Kazakhstan

Following power cuts to its bitcoin mining operations in China, BIT Mining is moving rigs to Kazakhstan.

Bitcoin mining company BIT Mining, owner of the BTC.com mining pool and the corresponding domain name, announced today that it has successfully transferred the first of three batches of bitcoin mining machines from China to Kazakhstan. The company expects to deliver 2,600 mining rigs total to the Central Asian country by July 1, 2021.

“We are committed to protecting the environment and lowering our carbon footprint,” Xianfeng Yang, CEO of BIT Mining, commented in the announcement. “We have been strategically expanding our operations overseas as part of our growth strategy. Following our investments in cryptocurrency mining data centers in Texas and Kazakhstan, we are accelerating our overseas development for alternative high-quality mining resources.”

The first batch of 320 bitcoin mining machines recently delivered to Kazakhstan, capable of around 18.2 peta hashes per second (PH/s), is expected to begin operation in Kazakhstan in under five days. However, BIT Mining’s largest share of hash rate in this transfer will be delivered through the second and third batches. Combined, they will amount to 2,600 machines and have a 102.3 PH/s hash rate capacity.

BIT Mining’s total hash rate capacity is far greater than this total though, with its BTC.com mining pool accounting for 9,741 PH/s –– around 9% of the Bitcoin network’s total hash rate. This move to Kazakhstan is part of the company’s overseas deployment strategy. Over the coming quarters, it plans to ship its remaining mining machines to other data centers outside of China.

BIT mining’s overseas deployment strategy was likely born from the recent bitcoin crackdowns in China. In mid-May, the country’s state council shared a statement saying that the government would “crack down on bitcoin mining and trading behavior and resolutely prevent the transfer of individual risks to the society.”

According to the announcement, the company’s indirectly held subsidiary, Ganzi Changhe Data Center, received a notice from the Sichuan State Grid informing it that the grid would cut its power supply by June 19. This notice hence confirms that Sichuan was reportedly issuing shut down orders to bitcoin miners in the province. BIT Mining’s data centers in Sichuan, including Ganzi Changhe, contributed to around 3% of the company’s total revenues in May 2021, per the announcement.

Source: Bitcoin magazine

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Mining Farm Turning Waste Coal Into Bitcoin Raises $105 Million

Stronghold, a bitcoin mining company that claims to eliminate 200 tons of waste coal for each bitcoin mined, has raised $105 million.

According to a press release sent to Bitcoin Magazine, Stronghold Digital Mining, an ESG-friendly and vertically-integrated bitcoin mining company based in Pennsylvania, has raised $105 million in two private placements of equity securities.

The firm is focused on converting coal waste directly into value through bitcoin mining.

“Coal waste fires have been wreaking havoc in my home state of Pennsylvania for the last hundred years,” said Bill Spence, co-chairman of Stronghold, per the release. “Not only are these coal fires a major source of greenhouse gases, but the acid runoff and ash from these uncontrolled burning piles pose serious threats to the health, environment and water quality of the surrounding communities.”

Waste coal in Pennsylvania. Source: Stronghold.

Spence also commented on the strategy employed by Stronghold and the role it plays in reducing the impact of coal waste fires.

“Simply put, we employ 21st-century crypto mining techniques to remediate the impacts of 19th and 20th century coal mining in some of the most environmentally neglected regions of the United States,” he said.

Waste coal acid mine drainage (AMD), the largest water polluter in Pennsylvania according to the release, is formed when rain or snow meets the sulfur-rich waste coal dumps. As a result, aquatic life near these sites is threatened because the AMD runs off and contaminates nearby streams and rivers.

Stronghold’s first power generation plant, known as the Scrubgrass Plant, has sought to restore the usability of geographical areas that have previously been damaged by waste coal and the inevitable formation of AMD. The mining farm can achieve this goal by converting the waste coal into power and mining bitcoin. According to the release, the company eliminates around 200 tons of waste coal for each bitcoin mined.

Stronghold’s Scrubgrass Plant. Source: Stronghold.

Stronghold plans to employ the latest investment raised to have a more significant environmental impact in the region. The company expects to have over 28,000 bitcoin miners in operation by the end of 2021, and it has already sketched expansion plans. The bitcoin mining firm is currently negotiating to expand its operations and acquire additional facilities with over 200 megawatts of power capacity.

Bitcoin mining, an energy-intensive activity necessary to fully decentralize and secure the Bitcoin network, has received its share of criticism and comparisons lately. But cases such as Stronghold’s demonstrate that Bitcoin mining can not only be green but also help the planet restore some damages that date back a century.

Source: Bitcoin magazine