News updates January 27, 2022

1. What Today's Fed Decision Could Mean for Crypto. At 2:30 p.m. Eastern time Wednesday, the Federal Open Markets Committee (FOMC) will discuss the decisions reached during its latest two-day meeting that started yesterday. The announcement will have a huge bearing on the direction of the U.S. economy as a whole. It may have particularly pronounced impacts on both short- and long-term trends for the cryptocurrency industry.
   The FOMC is expected to firm up at least two elements of the Federal Reserve’s plans for the year, though both have been broadly telegraphed. There may be more details about the schedule for “tapering” the Fed’s bond-buying program, which more than doubled its balance sheet during the coronavirus pandemic to nearly $9 trillion. The tapering and divestment schedule has significant implications for inflation and capital markets.
2.  Nigerian Lawmakers Urged to Consider Regulating Crypto Industry After Proposal to Jail Ponzi Operators.

   As Nigerian lawmakers debate a bill that proposes a ten-year jail term for operators of Ponzi schemes, a leader of a Nigerian blockchain lobby group, Senator Ihenyen, has urged the country’s lawmakers to consider crafting a law to govern the cryptocurrency industry. He argued that an “unregulated crypto space is not in anyone’s best interest.”

   Ihenyen, who heads the Stakeholders in Blockchain Technology Association of Nigeria (SIBAN), however, concedes that while the proposed bill does not expressly mention or refer to digital currencies, crypto Ponzi schemes are included in what the lawmakers call “prohibited schemes.”

   The remarks by the leader of SIBAN follow reports that Nigerian lawmakers had passed a bill to repeal and re-enact the country’s Capital Markets, Investment and Securities Act for a second reading. Ibrahim Babangida, one of the lawmakers leading the push to have the law changed, is quoted in a Premium Times report explaining why this needs to be changed. He said:

   The bill prohibits Ponzi/Pyramid Schemes as well as other illegal investment schemes and prescribes a jail term of not less than 10 years for promoters of such schemes.

3. Crypto policy advocacy group warns of 'disastrous' provision in a new US bill. 

   According to a Wednesday Twitter thread from Brito, the America COMPETES Act recently released by House members contains a provision that he said would be “disastrous” for crypto users from both a privacy and a due process standpoint. According to the Coin Center director, a section of the bill on the “prohibitions or conditions on certain transmittals of funds” proposed by Representative Jim Himes would give the U.S. Secretary of the Treasury “unchecked and unilateral power to ban exchanges and other financial institutions from engaging in cryptocurrency transactions.”

   Under the proposed framework, the Treasury Secretary would be able to employ the Bank Secrecy Act to require certain financial institutions to report information around transactions potentially connected to money laundering, as well as prohibit them from serving account holders with alleged ties to illicit funds. The provision, according to Brito, would essentially bypass the existing checks and balances on the Treasury Secretary’s authority in this area.

   “First, the law requires that Treasury engage in a public rulemaking before instituting a prohibition,” said Brito. “Second, the secretary can impose a surveillance special measure through a simple order, but its duration is limited to 120 days and must be accompanied by a public rulemaking [...] While not full due process, these limitations at least alert the public and gives the public some opportunity to comment on a special measure's merit or constitutionality.”

4. Utility Seeks $800,000 From Russians Mining Crypto With Cheap Power

   The main utility company in Irkutsk is looking to collect almost $800,000 from owners of crypto farms that have allegedly caused a spike in electricity consumption in the Russian region. The supplier accuses the miners of burning cheap household electricity in what is, in fact, a business activity.

   The main utility company in Irkutsk is looking to collect almost $800,000 from owners of crypto farms that have allegedly caused a spike in electricity consumption in the Russian region. The supplier accuses the miners of burning cheap household electricity in what is, in fact, a business activity.

5. Global Crypto Owners Predicted to Surpass 1 Billion This Year

   The number of global crypto owners is expected to exceed one billion by the end of the year, according to a report  “Nations can no longer afford to ignore the growing push to crypto by the public. We may in many cases expect a friendlier stance towards the crypto industry,” the company said.

   There Will Be More Than 1 Billion Crypto Owners Worldwide This Year, Report Shows
    “Crypto Market Sizing” report last week showing an analysis of cryptocurrency adoption worldwide.

   The global crypto population increased by 178% in 2021, rising from 106 million in January to 295 million in December, the analysis shows, elaborating:

   The number of crypto users is expected to break one billion by the end of 2022..

   The report explains that crypto adoption in the first half of 2021 was “remarkable,” adding that the main driver of growth was bitcoin.

6. Kazakhstan Shuts Down Crypto Mining Farms Till February

   Data centers minting cryptocurrencies in Kazakhstan were cut off from the nation’s power grid this week and will remain unplugged for the rest of January. The measure comes as the country faces electricity shortages blamed on crypto mining and blackouts in the cold winter months.

   Crypto Miners in Kazakhstan Left Without Power
   Bitcoin mining facilities in Kazakhstan were disconnected from the electricity supply on Monday, Jan. 24, and will remain shut down through Jan. 31, local media revealed. The restrictions have been imposed after the state-run grid operator, KEGOC, issued a blackout warning to 196 organizations across the country on Jan. 21, 

   All 69 registered mining companies have been informed by the power utility about the cuts with letters citing “the tense situation with maintaining the balance of electricity and capacity in the unified energy system” as the main reason. A copy of the notice was posted on Telegram by the journalist Serikzhan Mauletbay and his colleagues.

7. Mark Zuckerberg's Meta in Talks to Sell Assets in Crypto Project Diem: Report

   Meta, formerly Facebook, is reportedly in talks with investment bankers to sell its assets in the cryptocurrency project Diem, formerly Libra. The diem USD stablecoin was supposed to be issued by Silvergate Bank but it failed to get regulatory approval.

   Meta Reportedly Seeking Buyers for Diem Crypto Project
   Mark Zuckerberg’s Meta, formerly Facebook, is trying to sell its assets in the cryptocurrency project Diem, formerly Libra, Bloomberg reported Tuesday, citing people familiar with the matter.

    Meta owns about a third of the venture; the rest is owned by other members of the Diem Association, one of the people said.

   The Diem Association is considering a sale of its assets as a way to return capital to its investor members, the people explained. They added that Diem is in discussions with investment bankers about selling its intellectual property and finding a new home for the project engineers.

8. Tesla's Latest Financial Statement Shows Bitcoin Worth $1.26 Billion

   Elon Musk’s electric car company, Tesla, did not sell any bitcoin in the fourth quarter, according to the company’s latest financial statement. Tesla is holding bitcoin worth $1.26 billion. The company still has not resumed accepting bitcoin payments but now accepts the meme cryptocurrency dogecoin (DOGE) for some merchandise

   Tesla Did Not Sell Bitcoin in Q4
   Tesla released its Q4 and FY2021 financial statements Wednesday. The company’s unaudited balance sheet shows net digital assets of $1.26 billion at the end of December last year. This amount is unchanged from the third quarter