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Binance, A Cryptocurrency Exchange, Has Decided To Halt Usd Deposits And Withdrawals

The largest cryptocurrency exchange in the world, Binance, has announced that it will stop accepting deposits and withdrawals in US dollars, effective immediately. The business did not provide an explanation for the move.

 

A spokesman for Binance has confirmed to CNBC that the company would temporarily halt all USD bank transactions beginning on February 8th. “We are personally notifying those customers who were impacted.” The company stated that “0.01% of our monthly active consumers leverage USD bank transactions,” and they also mentioned that “we are working hard to reinstate service as quickly as possible.”

 

Binance US, a division of the company that is supervised by the Financial Crimes Enforcement Network of the Treasury Department, stated in a tweet that it is unaffected by the suspension of the exchange’s operations. Therefore, this change will only affect customers located outside of the United States who move money into or out of their bank accounts in dollars.

 

Following the announcement, there was a huge rise in withdrawals from Binance’s cryptocurrency wallets, as millions of dollar-pegged stablecoins such as tether and USDC migrated to competitor exchanges or individual wallets, according to data provided by Arkham Intelligence.

 

According to data provided by DefiLlama, Binance’s daily net outflow of United States dollars was greater than $172 million. Arkham estimates that the firm in question has crypto assets worth a total of 42,2 billion dollars, making this a negligible sum of money in comparison.

 

The representative for the company stated that “We are still massively net-positive on net deposits.” When prices start to level out after a bullish market swing like the one we witnessed last week, which was followed by a bullish market swing, outflows always creep up as some consumers take profits. In January, the price of bitcoin experienced its highest month since October 2021, when it surged by more than 38 percent.

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Tax planning techniques let cryptocurrency investors recoup losses

Investors may be able to offset their losses by reporting cryptocurrencies when submitting their taxes.

The crypto market experienced difficulty in 2022. According to a new report by security services provider Immunefi, the cryptocurrency sector would lose $3.9 billion in total by 2022.

 

Even while negative losses like this are frequently troubling for cryptocurrency investors, there might be a benefit to those who record their cryptocurrency holdings on their taxes.

 

Although cryptocurrency investors achieved significant gains in 2021, Lisa Greene-Lewis, a certified public accountant at TurboTax, told Cointelegraph that things changed significantly in 2022. We’ve seen a crypto winter, and TurboTax wants to assist investors in managing their losses, the spokesperson added.

 

As more new, youthful investors get into the cryptocurrency market, tax-loss harvesting understanding is becoming more crucial, according to Greene-Lewis. 16% of Americans have invested in, traded in, or used cryptocurrencies, according to a Pew Research Center survey that was mentioned in the most recent tax trend report from TurboTax. More than any other age group, those between the ages of 25 and 34 are most likely to have cryptocurrency sales transactions. Many of these people are not aware of tax-loss harvesting, according to Greene-Lewis.

 

Greene-Lewis added that investors in cryptocurrencies can still carry out this activity because those losses roll forward even if the deadline for selling tax losses for the year 2022 passed on December 30.

 

Additionally, Swan Bitcoin’s private client services division, Swan Global Wealth, vice president Steven Lubka, told Cointelegraph that tax-loss harvesting is a fantastic choice for Bitcoin BTC.

 

“This tax method is arguably the most practicable. Swan Global Wealth works with private clients to offer insightful market information, but most people were unaware that tax-loss harvesting was a possibility, he added.

 

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The OpenSea incident demonstrates the need for enhanced cryptographic security

Cryptocurrency must be widely used before avoidable breaches, like the phishing attempt that cost OpenSea $1.7 million, may occur.

 

A significant phishing assault that targeted OpenSea in February 2022 led to the theft of nonfungible tokens (NFTs) valued at approximately $1.7 million from users. Blockchain users reportedly lost $3.9 billion to fraud in 2022 alone, and that wasn’t the only event.

 

There was a chorus of pledges to boost security in the cryptocurrency sector as 2023 drew closer. However, there has been little of a shift thus far, and Blockchain-using businesses still fall short in their efforts to thwart fraud.

 

Businesses will need to transform from the ground up if blockchain technology is to be widely adopted. As the market expands, these platforms may better serve users by emphasizing education and improving procedures to spot harmful conduct.

 

Blockchain platforms must develop their ability to detect harmful activities.

 

In the OpenSea attack, victims were allegedly requested to sign an unfinished contract by the site. The fundamental infrastructure of OpenSea was not breached, but the fraudulent accounts were allowed to use the open-source Wyvern Protocol. Hackers could then transfer ownership of the NFTs without paying for them by signing a fictitious contract using the owner’s signature.

 

After discovering that 80% of the free NFTs produced on the platform were either spam or plagiarized, OpenSea recently changed several earlier regulations. Additionally, OpenSea depends on developer trust, which is only sometimes a reliable risk indicator. These programmers might take advantage of people who sign contracts without reading them by using the API for nefarious ends.

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By June, Indonesia hopes to open its national cryptocurrency exchange

The cryptocurrency exchange was supposed to be established by the end of 2022; however, several challenges prevented this.

 

A national cryptocurrency exchange is expected to launch in Indonesia by June this year, six months earlier than the country’s initial goal of December 2022.

 

At the beginning of Crypto Literacy Month in Jakarta on February 2, Trade Minister Zulkifli Hasan announced the revised target launch date while mentioning that the government is presently determining whether businesses fit their requirements to join the exchange.

 

Zulkifli asserts that the ministry’s crypto exchange may include all five active cryptocurrency exchanges currently registered with the nation’s regulatory authorities.

 

The ministry’s exchange would serve as a clearing house and custodian in the local cryptocurrency market, whereas these exchanges now facilitate all trades within the country.

 

A clearing house acts as a middleman to facilitate buyer and seller transactions. The movement of assets between the two parties would also be managed by it in its capacity as custodian.

 

The commerce minister urged the populace to wait for the national cryptocurrency exchange to be established, warning that doing so would bring chaos. Because most people are unaware of [crypto trading], the government does not want this to have a significant negative impact on the populace.

 

Indonesia had initially intended to launch its cryptocurrency exchange by the end of 2022, but it was postponed due to several challenges, as previously reported by Cointelegraph.

 

The Commodity Futures Trading Regulatory Agency, also known as Bappebti, now regulates the trading of crypto assets in the nation together with commodity contracts, but that authority will transfer to the Financial Services Authority if a national exchange is established.

 

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After FTX Collapsed, Britain Announced Cryptocurrency Regulation

It was announced that the United Kingdom would be taking measures to regulate the cryptocurrency industry to reduce the speculative business practices that ultimately contributed to FTX’s demise.

 

In a much-anticipated dialogue with industry leaders, the government on Tuesday recommended numerous actions to regulate crypto asset firms like regular financial institutions.

 

Increased oversight of financial mediators and cryptocurrency custodians was proposed on Tuesday.

 

The absence of counterparty due diligence and the issuance of risky loans between crypto firms were essential issues in the industry in 2022.

 

According to a statement released late Tuesday night, the proposed changes in the United Kingdom would create a “strong world-first framework bolstering regulations around the lending of crypto assets whilst increasing consumer protection and the operational resilience of enterprises.”

 

Andrew Griffith, the Treasury’s economic secretary, has stated, “We remain committed in our commitment to build the economy and foster technological transformation and innovation—and this includes crypto asset technology.”

 

Although, it is imperative that we safeguard customers who are open to this new technology by establishing and maintaining high, open, and equitable standards.

 

Now that FTX has failed, governments worldwide are scrambling to establish guidelines for the cryptocurrency sector. U.S. and European lawmakers have recommended safeguards for crypto buyers.

 

In a speech given on December 2nd, Griffith said, “recent events in the crypto sector underline the importance for timely, unambiguous, and effective regulation.”

 

As a result of FTX’s purported use of user funds to engage in risky loans and trades, both BlockFi and Genesis Trading under the Digital Currency Group went bankrupt.

 

The proposals made on Tuesday would also mandate that cryptocurrency exchanges release all relevant transparency documents and establish clear admission standards for digital trading assets.

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Crypto Featured News News

Aptos, Metaverse-Affiliated Tokens Lead January Crypto Market Gains

After a sluggish 2022, the cryptocurrency market surged in January, with tokens that plummeted the last year leading the way.

Layer 1 blockchain Aptos’ APT token surged 387% in the CoinDesk Market Index, which measures market performance. Gala Games’ GALA token and Decentral and’s MANA token gained 233% and 149%, respectively.

“When the market turns positive, the hardest-hit coins rally the most,” said MarketVector Indexes digital assets product specialist Martin Leinweber. “Those smaller altcoins have a larger beta to bitcoin up and down.”

Bitcoin and ether, the two largest cryptocurrencies by market capitalization, have risen 40% and 30%, respectively, during a wide digital asset rally. CoinDesk Market Index rose 38%.

Aptos’ rise

Aptos, founded by ex-Meta Platforms personnel and debuted in October, struggled because to concerns about its transaction speeds and tokenomics. The November market tsunami caused by crypto exchange FTX’s failure drove APT’s price to an all-time low of $3 on Dec. 29, down 76% from its $13 IPO, according to CoinDesk statistics. Aptos investors included FTX Investments and A16z.

Leinweber told Coindesk that traders were willing “to pay triple digits in annualized interest to do so” to short APT at the start of the year.

Leinweber stated that while Aptos investor unlocking will start in October, the strong bearish posture in Aptos caused a massive short-squeeze that drove the price up in a month.

Since Jan. 8, Coinglass data showed $115 million in short and $70 million in long liquidations. The pattern may reinforce Aptos trader concerns.

“Before the VC unlocking kick in, the token will need to develop its user base and liquidity significantly to justify its market value,” Leinweber said.

Crypto markets, notably the technology sector, have outperformed major indexes during the previous month. The tech-heavy Nasdaq and S&P 500 have recovered 9% and 5% from their 2022 declines.

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News

The Philippines’ Securities Regulator Wants More Power To Regulate The Cryptocurrency Market

The Philippine Securities Regulatory Commission is taking steps to implement stricter regulations on cryptocurrency, cryptocurrency businesses, and other financial products utilizing blockchain technology.

 

According to new draught guidelines, the Securities and Exchange Commission (SEC) of the Philippines wants to include cryptocurrencies in its purview and strengthen its control over the local cryptocurrency market.

 

The securities regulator submitted draught rules regarding financial products and services—covering cryptocurrencies and digital financial products—for public comment on January 25, the Manila Bulletin, a local news source, reported.

 

In a statement, the SEC said that the proposed regulations will put a recently passed law into practice and grant it “rule-making, surveillance, inspection, market monitoring, and additional enforcement capabilities.”

 

According to the rules, “tokenized securities products” and other financial items created with blockchain or distributed ledger technology now fall under the definition of security (DLT).

 

The SEC will also have jurisdiction over other financial products, including digital financial products and services related to those accessed and delivered through digital channels, as well as their providers.

 

The power to enforce securities laws has also been strengthened. Service providers might be prohibited by the SEC from charging excessive interest, fees, or other costs.

 

The regulator would also have the authority to remove or suspend any directors, executives, or other staff members found to have broken the law. It could force a company to shut down completely.

 

According to local laws, the SEC, the Philippines’ central bank, and the nation’s insurance regulator may develop rules to supplement relevant laws. The SEC may also adopt its rules for applying laws under its purview.

 

The most recent development continues the regulator’s stern campaign against cryptocurrencies.

The SEC warned against utilizing unregistered exchanges operating in the nation in late December 2022, alleging that some businesses were “illegally permitting” Filipinos to access their platforms.

 

 

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News

New York Assembly Introduces A Law On Cryptocurrency Payments For Fees And Taxes

The measure clarifies that state entities may voluntarily accept cryptocurrency payments and that any such agreements should be subject to judicial enforcement.

 

State agencies could accept cryptocurrencies as payment for fines, civil penalties, taxes, fees, and other amounts imposed by the state under a bill filed to the New York State Assembly on January 26.

 

Democratic assemblyman Clyde Vanel, frequently regarded as a crypto-friendly official, proposed Assembly Bill A523, which is currently law in New York State. For a variety of fees, including “fines, civil penalties, rent, rates, taxes, fees, charges, revenue, financial obligations or other amounts, including penalties, special assessments and interest, owed to state agencies,” it permits state agencies to enter “agreements with persons to provide the acceptance, by offices of the state, of cryptocurrency as a means of payment.”

 

The bill clarifies that state agencies can legally agree to take such contributions and that the courts should uphold these agreements, but it does not oblige them to do so.

 

According to the bill, “cryptocurrency” includes but is not limited to bitcoin, ethereum, litecoin, and bitcoin cash. It also includes “any type of digital currency in which encryption techniques are utilized to manage the formation of units of currency.”

 

Stablecoins like USD Coin and Tether may or may not be included in this definition, depending on how it is read. On the one hand, the issuer typically controls stablecoin supply rather than via encryption. However, the bill does acknowledge that some cryptocurrencies have an “issuer,” and it stipulates that agencies may impose an additional fee on the payor if the cryptocurrency’s issuer does so.

 

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Silvergate Suspends Dividends To Protect Its “Very Liquid Balance Sheet”

Silvergate has had a difficult month of January; the dividend suspensions come just a few weeks after the company reported a $1 billion loss for the fourth quarter of 2022 and fired off 200 workers.

 

Dividend payments have been halted by cryptocurrency bank Silvergate in California to protect its “very liquid balance sheet.”

 

The company announced on January 27 that it would stop paying dividends on its Series A 5.375% Fixed Rate Non-Cumulative Preferred Stock to conserve cash.

 

The company stressed that it still retains a “cash position over its digital asset customer-related deposits” despite explaining that it chose to help it weather the crypto winter.

 

As the company navigates the recent volatility in the digital asset business, this decision “reflects the Company’s focus on keeping a highly liquid balance sheet with a strong capital position.”

 

The corporation also stated that as market conditions change, “The Company’s Board of Directors will re-evaluate the distribution of quarterly dividends.”

 

The announcement was made just 11 days after the business reported a significant $1 billion net loss for its fourth quarter of 2022 on January 17. The overall negative market mood, which has led investors to choose a “risk-off” strategy during the past year, was cited by Silvergate as the reason for its dismal performance.

 

The Content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice.

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