News updates March 13, 2022

1. Bitcoin's inflation is now 5x lower than U.S. dollar's and decreasing:

With more than 90% of Bitcoin (BTC) in circulating supply, its inflation rate has gone down to 1.7% and is now five times lower than that of the United States dollar (USD), positioning the popular cryptocurrency as a potential defense against inflation.

The details of Bitcoin’s declining inflation are demonstrated with a chart that Glassnode’s co-founder Rafael Schultze-Kraft shared in a tweet on March 10, who explained that Bitcoin’s inflation rate was following its “preprogrammed, fully predictable downwards trajectory.” 

As Finbold reported earlier, the inflation rate of Bitcoin in January was 1.8% showing that the flagship digital asset has decreased by 0.1% since in a little over a month.

Meanwhile, the inflation rate of the U.S. dollar continues to soar, hitting 7.9% in February. This is its highest inflation rate in 40 years or since 1981, “even before the oil spike,” as tweeted by Holger Zschaepitz, the senior financial reporter at Welt. 

This means that the inflation rate of Bitcoin at press time was as much as five times lower than that of the U.S. dollar.

Behind the scenes of the growing divergence between BTC and USD inflation;

As Bitcoin continues halving its mining rewards, with the next halving event taking place in May 2024, according to the Bitcoin Clock, we can expect its inflation rate to decrease even further. On the other hand, the inflationary rate of the U.S. dollar is predicted to continue climbing.

What makes Bitcoin an effective hedge against inflation is having a fixed maximum supply of 21 million tokens, of which 18.98 million or 90% is currently in circulation, as per CoinMarketCap data.

Contrary to the digital asset, the USD is a fiat currency, which means it has no fixed supply, and the U.S. Federal Reserve is able to print more whenever it deems necessary.

According to some experts, Bitcoin’s inflation rate is also lower because it is capable of circumventing the majority of political and economic risks associated with the U.S. dollar.

BTC is currently trading at $39,156, an 8% drop from the $42,567 where it stood seven days before, according to CoinMarketCap data.

2. Bitcoin Jumps to $40K as Putin Sees Positive Shift in Ukraine Talks:

European equity benchmarks and U.S. index futures extended gains while major cryptocurrencies jumped as much as 7.6%.

Bitcoin regained the $40,000 level in the past hour after reports of positive developments in talks between Russia and Ukraine.

*Russian President Vladimir Putin said there was “positive movement” in negotiations, which were happening on a “daily basis.” Russia faces sanctions from Western countries among others as leaders worldwide condemn the invasion of Ukraine.

*Putin’s comments buoyed global markets. S&P 500 futures added 1.31%, and futures on the tech-heavy Nasdaq 100 rose 1.65%. Sentiment in Europe was stronger, with Germany’s DAX jumping 3.41% and Stoxx Europe 600 gaining 2.09%.

*Crypto markets were mixed. Bitcoin jumped from $38,600 in European morning hours to slightly over $40,200 as Putin’s comments went public. Ether added 2.4% in the past hour alongside XRP and Solana’s SOL, while Polkadot’s DOT led gains with an 8% rally in the past 24 hours.

*Ukraine’s worsening situation has rippled across global markets. India saw an exodus of foreign capital to the tune of billions of dollars this week while Brent crude touched $140 a barrel. Demand for nickel – alongside a short squeeze – pushed prices of the metal to a record $101,000, while gold touched $2,070 on Tuesday, a level previously seen in August 2020.

3. Upcoming AML Regulations in Estonia to Affect Cryptocurrency Industry

Estonia is preparing to enforce a set of new anti-money laundering rules that will stiffen requirements for crypto companies operating under Estonian license.  

Authorities in Estonia intend to make it harder for companies to join its crypto space. Entities offering digital wallet and online exchange services will have to meet a minimum capital requirement in the amount of €100,000 ($109,000) and those providing custodial services will need to show at least €250,000.

The new legislation will also introduce higher registration fees, stricter due diligence obligations, and heavier regulatory scrutiny. Furthermore, crypto companies will be required to maintain a presence in the country, unlike before.

4. Millennial Investors are Driving India’s Crypto Boom While Shunning ‘Boring’ Stocks

Young Indian investors are shunning “boring” traditional assets like stocks and bonds in favor of pursuing crypto. 

According to a report by CNN Business, India has seen a huge boom in cryptoasset trading since the start of the pandemic, despite concerns from the country’s government officials over digital currencies.

Entrepreneurs are keying in on India, which has Asia’s third largest economy, for its potential to become a “crypto superpower.” The report cites India as having one of the largest internet markets in the world, with over 750 million users and hundreds of millions more yet to come online for the first time. 

The report claims India was second only to Vietnam last year in a list of countries with the fastest growth in cryptoasset adoption. Industry experts have suggested that the country may have more than 20 million crypto investors, with the growth being driven primarily by those under the age of 35. 

Sumit Gupta, CEO and co-founder of exchange CoinDCX, told CNN that many Indian millennials first began investing via crypto. Gupta said that 20 years ago young Indian investors preferred gold or savings accounts, while today’s youthful investors are demanding to have Bitcoin as part of their portfolio.

5. 23-year-old Australian buys $314k property via crypto

A young resident from Queensland, Australia played the long game of accumulating Bitcoin (BTC) and Ethereum (ETH) over several years to eventually overcome the soaring real estate prices during the 2020 bull run and own his dream home.

The 23-year-old Loi Nguyen started his journey as an investor back in 2017 by purchasing a few hundred dollars worth of BTC, ETH and traditional stocks. However, his interest in crypto reached new heights while pursuing an Economics degree.

6. Russians Look To UAE-Based Crypto Firms For Safeguarding Wealth

In the chokehold of international sanctions and economic uncertainty, Russians have reportedly been seeking means of getting their wealth out of the country. Reuters reports that one of the ways being explored and used is crypto.

In their quest to find outlets for their wealth, Russians are looking to countries that have not put sanctions against them in place. This is where Dubai and the UAE come in.

Reuters cites executives of crypto companies, who wished to remain anonymous, saying that their firms have received more than usual business propositions from Russians.

The firms have fielded enquiries from the Belarusians as well, the report noted. Some of the requests were to convert crypto to cash for stashing in the country or other locations. Requests have also been coming in to buy Dubai real estate with crypto according to one broker at a real estate firm that accepts crypto.

Amid the war, the UAE is one of the countries yet to impose sanctions on Russia. In the past, the two countries have maintained amicable ties, so the flight of Russians to the country is not surprising.

7. Web 3 Hackers Are Getting Smarter

The evolution of technology means that even the Internet itself will continue to evolve. From Web 1.0 to Web 2.0, we are now just getting started on the next iteration of the Internet – Web 3.0.

But even in its development stages, Web 3 already has some security challenges that hackers are taking advantage of.

While the decentralized applications (dapps) we can access now are already somewhat Web 3, we aren't really in a Web 3 version of the Internet yet. There is a lot of work that still needs to be done before Web 3 becomes fully functional.

Security is arguably the biggest challenge as regular media reports of Web 3 hacks highlight.

Web 3 can only be successful if the current security challenges are solved, making it nearly impossible for hackers to steal user funds.

Unfortunately, many stories are becoming more and more common as hacks are getting more and more sophisticated.

8. Social Lending Project SHANTI Launches in Cambodia

SHANTI has announced that it’s launching in Cambodia. The project dedicated to bringing peace to the world through blockchain and crypto will make its services available to hundreds of thousands of Cambodians through this debut.

A key goal of the expansion is also to reduce poverty among Cambodia’s population by introducing NutsPay, a blockchain-based social lending project for the cashew nut market. As 80% of the country’s population cannot afford to own a bank account, NutsPay plans to bring financial inclusion through its platform.

SHANTI is the utility token for the project, and holders have many benefits to derive from it. These include a rising loan interest rate depending on the number of tokens held, preferential interest rates for borrowers, and a deflationary token. 

Eventually, the project plans to develop a service that allows holders to exchange their tokens for real money when enough liquidity is available for SHANTI. This will also allow the token to be used for purposes such as grocery shopping, just like any currency.