Debates over cryptocurrency regulation in Russia and other key events of the week
Blocking mining in Kazakhstan, the large cryptocurrency purchases by El Salvador and a detailed overview of digital assets in Getblock’s review
28.01.2022 - 10:05
The bitcoin exchange rate has shown negative values over the past week. In 7 days, the value of the asset fell by 6,24% to $36 620 (according to CoinMarketCap). The second cryptocurrency, Ethereum, lost even more, with the correction approaching the 17% level. Binance Coin was down 10,8%, the asset never managed to return to the top 3 in terms of capitalization, giving way to Tether’s USDT stablecoin.
The total capitalization of the crypto market fell from $1,829 trillion to $1,656 trillion during the week, with bitcoin dominating at 42%. Ethereum’s share is 17,2%. As can be seen on the infographic of the Coin360 portal, the overall market backdrop is in the red zone.
Cryptocurrency regulation in Russia
There have been heated discussions all week about whether cryptocurrencies and mining should be banned in Russia. In the beginning, the Central Bank of the Russian Federation put forward its proposal for a complete ban, which was not supported by either the State Duma or the Ministry of Finance. The State Duma working group members, which is developing the regulation of cryptocurrency circulation in Russia, did not approve the bans proposed by the Central Bank. Moreover, Andrei Lugovoy, the First Deputy Chairman of the Committee on Security and Anti-Corruption, stated that Russia may become a laughing stock because of the central bank’s position.
Russian President Vladimir Putin put an end to the debate by calling for the implementation of market regulation. According to Putin, about 6 million citizens own cryptocurrencies in the country, and the digital asset sector attracts young and promising professionals. In addition, the availability of spare capacity allows for the development of the mining industry.
The outcome of the discussions was the beginning of the preparation of a roadmap to regulate the industry. According to RBC, it will be calculated until the end of 2022.
The main theses of the roadmap include a proposal to conduct all transactions with digital assets through Russian banks. In addition, the authorities plan to introduce the identification of cryptocurrency users and to divide them into qualified and unqualified investors.
Bitcoin price predictions
A correction in the cryptocurrency market has led to various predictions about the future path of bitcoin’s value. Thus, the founder of the Galaxy Digital cryptocurrency bank, Mike Novogratz, believes that the first cryptocurrency may well drop to $10 000 with further recovery. Novogratz has offered a bet to the famous bitcoin skeptic Peter Schiff. If exactly one year later the asset will be worth less than $35 000, Novogratz will give a million dollars to charity or any other cause of Schiff’s choice.
Robert Kiyosaki, the author of “Rich Dad Poor Dad,” opined that one can only get rich by buying an asset when the price is falling. He posted a tweet on the network promising to buy even more bitcoins when the price drops to $20 000.
“I bought bitcoin at $6 000 and $9 000. I will buy more if and when bitcoin tests $20 000. Time to get richer is coming,” the entrepreneur stated.
The large holders such as MicroStrategy’s fund, the President of El Salvador, and Cathie Wood’s Ark Invest fund continue to believe in bitcoin. MicroStrategy CEO Michael Saylor has said he will buy more cryptocurrency regardless of the value and the regulators’ stance. And El Salvador’s President Nayib Bukele bought an additional 410 BTC worth $15 million. According to the president, this is an “extremely low” price. According to the latest figures, the country owns at least 1801 BTC, which at the time of writing is approximately $66 million.
The loudest prediction was made by the Ark Invest fund representatives. According to analysts, the asset’s price may rise to $1 million by 2030. Bitcoin is currently in the very early stages of adoption, and its value will grow as it gains acceptance from other nations.
Blocking mining in Kazakhstan
On January 24, the cryptocurrency mining industry faced negative news from Kazakhstan. The country’s authorities have disconnected all registered miners from the power grids. The ban is related to the past unrest and power outages and will last until at least February 1. A total of 196 companies have been disconnected.
The Chairman of the Association of Blockchain and Data Center Industry in Kazakhstan has reported on the possible collapse of the mining business in the country. In his view, the ongoing problems with power outages will result in miners transferring their activities to more favorable jurisdictions.
It should be noted that earlier Spain announced its readiness to support miners from Kazakhstan. Maria Muñoz, a member of Spain’s Congress of Deputies, stated that her country is the safest place to invest in cryptocurrency. If Kazakh miners decide to move their facilities to Spain, the government will provide them with the necessary assistance and support.
The NFT space continues to gain momentum
The hype around non-fungible tokens continues unabated, and this week a growing number of large companies reported their interest in projects in this area.
The most high-profile news was Youtube CEO Susan Wojcicki’s announcement that the video hosting service may add support for NFT shortly. According to her, Youtube is exploring token integration for video content creators as they see strong demand from them for the technology.
Also this week, the MoonPay platform announced the launch of a service to buy NFT with payment cards. Through the service, the users will be able to buy NFTs issued on Ethereum, Flow, Solana, and Polygon. NFT Checkout will support Visa, Mastercard, Apple Pay, Google Pay, Samsung Pay, SEPA, Faster Payments, and transfers through banks.
The physical masterpieces of art are gradually moving into the virtual world. The heirs of the famous artist Pablo Picasso plan to digitize unpublished works. A total of 1010 NFTs will be released. The first auction will hold Sotheby’s in March, it will feature a ceramic bowl. Part of the proceeds will go to charity.
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