News Updates September 01, 2022

1. Iranian Government Approves 'Comprehensive and Detailed' Crypto Regulations

The government of Iran has finalized a set of cryptocurrency regulations. A “comprehensive and detailed” law ratified by the administration provides a regulatory framework for cryptocurrency, including their authorized usage and crypto mining, a government official reportedly said.

 *Iran Finalizes Crypto Regulations*

The Iranian government has evaluated all issues relating to cryptocurrencies and approved a set of cryptocurrency regulations, Reza Fatemi-Amin, the minister of Industry, Mines, and Trade, told reporters at the conclusion of an automotive industry event in Tehran Sunday.

He explained that the government has ratified a “comprehensive and detailed” law that defines cryptocurrency regulations, including the use of fuel and electricity for crypto mining and the authorized uses of cryptocurrencies, Tasnim news agency conveyed.

The minister added that under an agreement between his ministry and the central bank of Iran, cryptocurrency can be used to pay for imports. He additionally noted that local business owners can import cars using cryptocurrencies instead of the U.S. dollar or euro.

The use of cryptocurrency to pay for imports is seen as a way to circumvent U.S. sanctions imposed on the Iranian finance and banking sector, allowing Iran to trade with countries similarly embargoed by U.S. sanctions, including Russia.

cryptocurrencies. In August 2019, the Iranian central bank banned crypto trading inside the country but the government has since allowed the use of cryptocurrencies, like bitcoin, to pay for imports. The authorities have not disclosed which other cryptocurrencies are allowed to be legally used for this purpose.

Iran also legalized cryptocurrency mining in August 2019. The country then established a licensing framework for crypto miners, requiring them to obtain authorization, identify themselves, pay higher tariffs for electricity, and sell their mined bitcoins directly to the government.

However, in December last year, the Iranian government ordered licensed cryptocurrency miners to temporarily stop operations due to extreme weather taking a toll on the country’s power grid during the cold months. Tavanir, the Iran Power Generation, Distribution, and Transmission Company claimed that illegal cryptocurrency mining in Iran accounted for nearly 85% of the industry’s power consumption. The national electricity company then announced a four-month ban on crypto mining in May. The authorities lifted the ban in mid-September after licensed crypto mining facilities voluntarily shut down their operations to ease the electricity burden.

2. Bitcoin futures volume hit a 21-month low in August, as ether volume surged

* Bitcoin futures trading volume across exchanges for August came in at $941.5 billion

* This was bitcoin’s lowest month by trading volume since November 2020.

* Ether, meanwhile, surged in volume as traders placed bets on The Merge.

Bitcoin futures trading volume, in dollar terms, clocked its lowest levels since November 2020 in August. 

According to The Block Research data dashboard bitcoin futures trading volume for August came in at $941.5 billion across exchanges. That's the first month it was under $1 trillion since December 2020 — when volumes were $970.1 billion — and the lowest since November 2020, when volumes were $779 billion. 

The drop in bitcoin futures volume came as trading in ether futures boomed ahead of The Merge: a September date for Ethereum's big move to proof of stake were confirmed last month.

BlockFi's trading commentary on Monday noted the forward curve for ether futures continues to be impacted by The Merge. "We see September futures at -16% basis on Deribit as market continues to maintain a long spot vs. short forwards position into The Merge," it read. 

Ether futures crossed $1 trillion for the first time since May 2021, when they reached $1.64 trillion. Trading volumes for the second-largest cryptocurrency by market cap were $1.05 trillion in August, up from $934.9 billion in July.

cryptocurrencies closed the month down. Bitcoin shed 14%, while ether fell 4.7% since August 1.

The 21Shares research team noted in its monthly review that there were $950 million worth of liquidations from the crypto futures market over the last two consecutive weekends in August, which may have escalated the downward trend of bitcoin and the broader market.

Over $600m of long and short positions were liquidated on August 19 following the meeting minutes of the Federal Reserve and over $350m was liquidated following Jerome Powell’s speech announcing hawkish measures to tame inflation," the team wrote.

3. Crypto bank Sygnum to open metaverse hub in Decentraland

* The hub will feature a CryptoPunk receptionist, NFT gallery and event space.

* The space will officially launch to the public with a livestream event on Sept. 27.

Swiss crypto bank and asset manager Sygnum will open a hub in metaverse platform Decentraland at the end of September, the company announced on Thursday.

The hub will feature a CryptoPunk receptionist, NFT gallery and event space. It will also showcase the bank’s web3 product innovations and provide an entry point for investors into the metaverse economy.

Our new metaverse hub is the natural place to showcase Sygnum’s Web3 innovations and provide a trusted entry point for investors into the fast-growing Future Finance economy,” said Martin Burgherr, Sygnum chief clients officer, in a statement.

This isn’t Sygnum's first foray into web3. It has previously tokenized a blue-chip NFT — Cryptopunk #6808 — the very same CryptoPunk which will now be its receptionist in Decentraland, and developed products such as regulated Ethereum staking on open blockchains.

It is also a member of the governing council of the South Korean metaverse blockchain Klaytn, which was recently revealed as the new blockchain partner for DeFi Kingdom's Serendale.

The space will officially launch to the public with a livestream event on Sept. 27.

Sygnum follows investment banking giant JPMorgan into Decentraland, which opened the Onyx Lounge in January. Named after its crypto-focused unit, when it opened it featured an image of bank CEO Jamie Dimon, which transforms into a jpeg image of Onyx's former leader Christine Moy.

4. US dollar smashes yet another 20-year high as Bitcoin price sags 2.7%

There seems to be no stopping the greenback as risk assets, including Bitcoin, pay the price for renewed strength.

Bitcoin (BTC) faced familiar pressure on the Sept. 1 Wall Street open as the U.S. dollar hit fresh two-decade highs.

Data from Cointelegraph Markets Pro and TradingView followed BTC/USD as it fell to $19,658 on Bitstamp, down 2.7% from the day’s high.

The pair faced stiff resistance trying to flip the important $20,000 mark to solid support, with macro cues further complicating the picture for bulls.

That came in the form of a resurgent U.S. dollar index (DXY) on the day, which beat previous peaks to reach 109.97, its highest since September 2002.

Other commentators, including crypto account TXMC Trades, noted the declining Japanese yen as an additional dollar booster. USD/JPY hit 140.21, marking its highest since August 1998

Dollar at levels last seen in 2002. Key time here it seems. Bulls need a reversal. Bears need a break out,” NorthmanTrader founder, Sven Henrich added, noting that the DXY relative strength index (RSI) was “very stretched.”

 *Bitcoin mining has never been more competitive even as BTC loses 13% in August*

Just days after the August Consumer Price Index (CPI) inflation print would be due, payouts as part of the Mt. Gox rehabilitation process would begin after years of legal work.

Creditors would thus start to receive a share of almost 140,000 BTC, last traded at a price below $500 a coin.

While the resulting selling pressure is a topic of debate, the launch coincides with the Ethereum Merge, where the largest altcoin by market cap jettisons proof-of-work for proof-of-Stake as its consensus algorithm.

5. California Passes Bill To Regulate And License Crypto Firms

California’s state legislature has passed a bill that requires crypto firms to have a license of operation in the state. The bill was passed in the upper and lower houses of the legislature and is now awaiting passage or a veto from Governor Gavin Newsom.

The Digital Financial Assets Law, a bill potentially requiring crypto service providers to register before operating in California has been passed by the California State Senate this week. The bill was approved the following day in the California State Assembly. The bill is now in the hands of Governor Gavin

The Digital Financial Assets Law, a bill potentially requiring crypto service providers to register before operating in California has been passed by the California State Senate this week. The bill was approved the following day in the California State Assembly. The bill is now in the hands of Governor Gavin Newsom, who will either veto it or set the bill in motion.

If passed, the bill would amend the state’s financial code, bringing virtual assets under its purview from January 2025. The bill states that anyone engaging in “digital financial asset business activity” would have to obtain a license from California’s Department of Financial Protection and Innovation before being able to operate legally. If not followed, firms could face a civil penalty of up to $100,00 per day, for each day in violation of the law.

The bill was introduced in February this year by Democratic Assembly member Timothy Grayson. The bill defines a “digital financial asset” as a “digital representation of value that is used as a medium of exchange, unit of account, or store of value, and that is not legal tender, whether or not denominated in legal tender.” Grayson said in a statement upon the bill’s passage within his chamber that.

6. EU-UK Stands Divided Over Crypto Regulations; Here’s How

The global digital asset industry is trading under volatility looking for much-needed clarity over regulations. However, reports suggest that European Union (EU) and the United Kingdom (UK) stand divided over the laws related to crypto.

 *UK crypto regulations are not apt?*

As per the report, the financial services and market bill is being ready by the UK parliament. While the new financial Conduct Authority rule is in development for high risk investments. On the other hand, Europe has a deal on markets in crypto assets (Mica) Regulations.

The UK is planning to start by regulating over few specific crypto assets and service providers in the beginning. Meanwhile, EU’s Mica covers crypto assets broadly. It is being compared that the UK is just dipping its toe with lean digital settlement assets. Earlier, the UK introduced a bill to regulate stablecoins used for payment.

Meanwhile, the EU has a broad investment focus which directly implies that new crypto assets need to be published. It will also be liable for providing outlines like white paper.

 *Will Mica save crypto investors?* 

The report states that contrasts in UK and EU regulations extend to service providers. As the UK will be focusing on fewer services like exchange and custody. On the other hand, the EU’s Mica carries a more heavy definition which covers trading, transmitting orders and more. This will also cover custody and crypto to crypto exchanges.

However, the UK is planning to regulate crypto investment risk warnings. This step will make investors get a clear understanding of the benefits and protection over crypto dangers. However, investors might find the regulations hard to understand.

The new FCA rules are straightforward and build to prevent risks. However, supervisory effectiveness remains the key as the crypto assets will not be protected by deposit insurance or other schemes.

Mica and the UK will be imposing liability on service providers for custody losses including cyber attacks over digital wallets.

7. US Asked Binance for Documents Related to Money-Laundering Probe

In late 2020, U.S. federal prosecutors asked crypto exchange Binance to submit internal documents related to its money-laundering checks and communication involving CEO Changpeng "CZ" Zhao, Reuters reported Thursday, citing a written request.
The Justice Department asked the company to hand over messages between Zhao and other executives on matters related to detection of illegal transactions and customer acquisition in the U.S., the report added.

The authorities also sought any company records with instructions that "documents be destroyed, altered or removed from Binance's files" or "transferred from the United States," the report said.
Binance has been under the radar of U.S authorities for some time now, with the Commodity Futures Trading Commission looking at allegations of insider trading and market manipulation by the crypto exchange.
In a tweet, CZ said that his "chat messages are semi-public anyway."

As has been well documented, regulators across the globe are reaching out to every major crypto exchange to better understand our industry. This is a standard process for any regulated organization and we work with agencies regularly to address any outstanding questions," a Binance spokesperson said.

8. Crypto Lender Celsius Faces Another Group of Customers Who Want Their Money Back

More than 60 of Celsius’ custodial-account holders petitioned a bankruptcy court to force the crypto lender to send them their funds back outside of the proceedings.

A group of custodial-account holders at Celsius has formally asked the court overseeing the crypto lender’s bankruptcy case to authorize the return of their funds.

The ad hoc group petitioned the New York Bankruptcy Court for the Southern District of New York on Wednesday for a declaratory judgment to require Celsius to allow withdrawals from the custodial accounts. Celsius filed for bankruptcy proceedings in July after freezing withdrawals in mid-June. The company is hoping to restructure its operations and use revenue generated from a still-being-built mining operation to survive.

The group is composed of 64 people who hold at least $22.5 million in cryptocurrencies with Celsius’s custody service, according to the filing. It is separate from the Unofficial Committee of Creditors (UCC), another organized set of Celsius customers.

According to the filing, the group’s cryptocurrency is deposited in custodial accounts rather than the yield-generating “Earn” product. This means Celsius should have held the funds in segregated storage on behalf of the group’s members, who retain title to the funds, according to the filing. Because of this, the filing claims, the customers should be able to receive their funds back separately from the outcome of the bankruptcy proceedings.

The Court made clear at various hearings that if Custody Assets are not property of the estate, such assets should be returned to users,” the filing said. “Following discussions with the Debtors and their advisors and the Creditors’ Committee and its advisors, Plaintiff has been unable to obtain return of its Custody Assets, and the Debtors have not lifted the freeze with respect to Plaintiff’s Custody accounts.”

The account holders say Celsius still has in its possession the same type of cryptocurrencies that they deposited, and the funds remain separate from the rest of Celsius’ funds. The firm, therefore, has the ability to allow them to withdraw their funds, it just hasn’t done so.

The Debtors’ continued refusal to honor withdrawals of all Custody Assets has created tremendous hardship on their users as set forth in hundreds of letters filed on the docket and in statements made by users at hearings in the Chapter 11 Cases. As it is not the Debtors’ property, the Debtors should not continue to hold Custody Assets during the Chapter 11 Cases and cannot use them to pay the Debtors’ creditors’ claims,” the filing said.

The filing goes on to explain the distinction between Celsius’ custodial-account holders and customers of the Earn program.

The effort to create this ad hoc group has taken several weeks. CoinDesk first reported on Aug. 1 that some customers felt Kirkland & Ellis, Celsius’ law firm, could have filed to have the funds returned well before Wednesday.
There will be a hearing on Sept. 1 to discuss the motion and other issues.

9. Crypto Call Centers Duping People Across Europe Busted By Ukrainian Cops

Crypto scammers come in different shapes and faces. In this part of the globe, they come from call centers — agents who sweet-talk their targets and steal their money.

Since Russia’s invasion of Ukraine on February 24 this year, hundreds of soldiers and civilians have been killed by atrocities.

In the midst of damage and death, however, scammers take advantage of the circumstance by employing technological means to separate their victims from their money.

Recently, the police and the Security Service of Ukraine launched an operation against a call center that was defrauding people.

The scheme was intricate. Call center agents deceive unwary customers with the use of eloquence and the power of persuasion.

They utilized software that conceals their actual phone number in order to appear legit. This is coupled with bogus websites for institutions and exchanges that facilitate the trading of fiat currency, cryptocurrencies, gold, and securities.

Within the European Union, local and foreign nationals were targeted by this scam.

Recently, Ukraine’s crypto market has experienced a significant expansion. Just this March, President Volodymyr Zelenskyy signed the Virtual Assets Bill. This piece of law legalizes digital assets nationwide.

Additionally, the measure establishes the legal status of crypto assets and the papers required for exchanges to register in the country.