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US Politician Uses Crypto to Buy Cannabis for Tax Remittance Demo

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A Californian politician has become the first elected official to use cryptocurrency to purchase cannabis in the United States.

A press release shared with Cointelegraph on Sept. 11 revealed that Berkely City Councilmember Ben Bartlett used Bitcoin Cash (BCH) and the stablecoin Universal Dollar (UPUSD) to make the purchase at Ohana Cannabis, a dispensary in Emeryville, CA.

The purchase was part of a live demonstration of crypto-financial technology conducted by blockchain company Cred and the Blockchain Advocacy Coalition. The latter is a group of California-based businesses and consumers that work to promote transparent blockchain legislation at a state and national level.

Cannabis Tax Remittance Via Stablecoin

According to the press release, the initiative forms part of the Blockchain Advocacy Coalition’s sponsorship of a new bill (AB 953) that would enable California to accept cannabis tax remittance via stablecoin. During the demonstration, the team at Cred was reportedly on hand to explain the ins and outs of blockchain and stablecoin technology to local elected officials.

The transaction involved Ohana accepting Bitcoin Cash by using Cred’s LBA token as a translation utility, with sales and city tax proceeds settled in Universal Dollar. 

Universal Dollar — which runs on the Ethereum blockchain and is pegged to the US dollar — was developed by the Universal Protocol Alliance, a coalition of blockchain firms including Cred, Uphold and Blockchain at Berkeley. 

In a statement, Dan Schatt — co-founder of Cred and the Universal Protocol Alliance — outlined:

“Not only does crypto result in significant cost reduction for consumers and merchants, but it also enables highly productive tax collection, transparency, and predictability for city and state governments.”

Crypto for the Green Rush industry

As the press release notes, 70% of California’s state cannabis industry is unbanked, significantly increasing both the risks and costs faced by local governments required to accept tax remittance in large cash deposits.

Councilmember Bartlett remarked that in providing a cash-free mechanism for cannabis tax remittance, the proposed AB 953 bill represents a piece of innovative legislation appropriate for the 21st-century so-dubbed Green Rush industry.

The politician has now reportedly requested Berkley City staff to prepare a report on acceptance of cannabis taxes using stablecoin technology.

Back in 2018, the state of Ohio was hailed for its pioneering acceptance of Bitcoin (BTC) for enterprises’ tax liabilities. Several other U.S. states had pursued — but not yet succeeded in implementing — similar initiatives prior to Ohio.

Source: cointelegraph

Crypto

Craig Wright Claimed He Would Reveal a Critical Bug in Bitcoin and Litecoin — Then Didn’t

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November 15, 2019, has come to pass, and yet another claim from Craig Wright has proven to be nothing more than conjecture.

One year ago, Wright claimed in a tweet that after a year’s time, he would release details on an alleged unrepairable flaw in both Bitcoin (BTC) and Litecoin (LTC) that essentially renders both coins dead on their feet.

According to the so-called ‘responsible disclosure’ tweet, the bug has something to do with the segregated witness (SegWit) upgrade that was rolled out for both Bitcoin and Litecoin in 2017. Wright also mentioned that both cryptocurrencies would be “shown to have no utility” and “are dead” before signing off with “Dead coin walking.”

However, despite the warning that Bitcoin and Litecoin would be rendered broken, both Bitcoin and Litecoin appear to be running just fine. The only noteworthy thing that did happen today was a flash-fill of the mempool, which resulted in temporarily higher transaction fees and longer waiting periods for unconfirmed transactions on the Bitcoin blockchain. Fortunately, this was only a temporary issue that has already resolved itself, according to Jochen-Hoenicke.de’s real-time mempool charts.

On the more practical side of things, Bitcoin did lose some ground today as its market capitalization fell to just over $153 billion, while its market dominance still hovers around 66%. Similarly, Litecoin is also suffering slight losses, losing just over 3% of its value amid a negative downturn for most cryptocurrency markets.

This isn’t the first time Wright has predicted the demise of Bitcoin and various other cryptocurrencies. Back in May 2019, he created a blog post where he said, “When BTC disappears, it will not disappear slowly, it will disappear in moments.” Similarly, in November 2018 Wright could be seen threatening to crash the Bitcoin market, whereas just days prior, he had threatened Roger Ver because he supported the Bitcoin Cash (formerly Bitcoin ABC) side of the November 2018 Bitcoin Cash fork.

Since Craig Wright claims to be sitting on a nest of over 800,000 BTC, one might think that destroying Bitcoin’s credibility and value would be a relatively simple task. After all, he would only need to dump a fraction of his stash to completely crash the Bitcoin market.

However, since it is quite clear that Wright isn’t actually Satoshi Nakamoto, this almost certainly won’t happen. Until then, Wright’s threats against Bitcoin are likely to remain exactly that — just threats.

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IRS is Investigating Cryptocurrency ATMs and Kiosks

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The Internal Revenue Service (IRS), which is the revenue service wing of the U.S. government, recently announced that it would be launching investigations into cryptocurrency ATMs and kiosks regarding tax evasion matters. In addition, it would also look into whether they were being used to aid in the purchase of controlled substances, money laundering, and other similar crimes.

Cryptocurrency kiosks and ATMs are today a popular method used by crypto enthusiasts to purchase and sell digital assets. According to a recent interview, their uptake in the United States has been on the rise in the past few months, which may explain the concerns raised by the IRS. The IRS is concerned as they become more popular and accessible, more people will start to use them as a means of tax evasion.

Concerns Raised by the IRS

For the IRS, the main issue lies in the fact that any person can walk up to any one of the crypto kiosks or ATMs and receive BTC after depositing hard cash. Naturally, the Internal Revenue Service would want to get to know such users and their intentions with the crypto. The authorities would also investigate where they got the money to purchase digital assets.

Nonetheless, their interest is not only in the users but in the owners as well. They would like to know the people who have been making money by availing the crypto ATMs and kiosks to the public for use.

According to the IRS:

“The device owners are required to abide by the same know-your-customer, anti-money laundering regulations, and we believe some have varying levels of adherence to those regulations.”

Law Enforcement Agencies

John Fort, the Investigation Chief at the IRS opines many other agencies have raised the same concerns. Fort added that together with his team, they have already reached out to other agencies in the law enforcement sector that would like to have such information.

He further stated that some agencies, together with their allies had already started monitoring the devices to check whether they were being used for illegal activities. Currently, no case has been filed yet. However, Fort was also quick to point out that their inventory has some ongoing cases.

The IRS official stated that there was a possibility that the open cases may or may not be directly linked to various bank accounts. While noting that there is an increase in the use of these devices, he admitted that this was not a simple solution. If not carefully attended to, it could end up forcing people to start using foreign exchanges.

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Crypto Analyst Tone Vays Unveils $100K Bitcoin (BTC) Timeline – Plus Ethereum, XRP and Ripple Updates

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From an updated take on Bitcoin’s next potential bull run to new support for BTC, ETH and XRP, here’s a look at some of the stories breaking in the world of crypto.

Bitcoin

Crypto analyst Tone Vays is updating his timeline on when he thinks Bitcoin may hit $100,000.

In a new interview with BlockTV, Vays pours cold water on predictions that BTC will break through its all-time high next year.

“Once we break $20K, we can go to $50K or $100K pretty quickly, but I’m not expecting us to break $20K in 2020. I’m really looking for the bull market to really take off around 2022, 2023.”

Vays says he’s still bearish on Bitcoin and thinks the leading cryptocurrency will break below $7,000 before May of next year.

“To me, the big run up was 80% exit out of altcoins, 20% institutional investing. Now that the price is starting to go down, they’re probably not as eager. They’ll wait for a bottom because that’s why they’re a little bit smarter.

At the moment, I still see lower prices. I still think we’re going to go lower than $7,000 before the halving. But after that, that would be the final secondary low. Hopefully it’ll be higher than the $3,000 low back in December. And then we can finally start a bull market after the halving.”

Ethereum and XRP

The crypto exchange Binance is rolling out support for the Turkish lira.

An updated list of coins available for purchase on Binance.com reveals that the exchange is working with the digital wallet company Papara to offer Bitcoin (BTC), Ethereum (ETH) and XRP in exchange for the lira.

So far, Binance does not allow customers to sell crypto assets for the lira.

Source: Binance

Ripple

Ripple says a new survey shows many financial service providers still have major concerns about the legality of blockchain technology.

The survey questioned 1,053 professionals across 21 countries who are working directly with payment services at their organizations.

According to the San Francisco startup, 35% of respondents say regulations are too uncertain, and 32% believe current regulations are too restrictive.

“These regulatory concerns, however, vary notably by a payment service providers’ adoption stage, level of digital channel usage and location. Not surprisingly, the next wave of adopters (those nearing implementation) are less concerned about regulation than the late adopters (those in conversation).

Similarly, digital banks that have already transformed the bank model are less concerned than traditional retail banks. Respondents in emerging markets have even stronger concerns about regulations being prohibitive, and advanced markets are the most concerned about uncertain regulations.”

You can check out the full survey here.


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