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U.S Federal Reserve official claims crypto is a ‘giant garbage dumpster’

The year 2020, so far, has been good for the larger cryptocurrency market, with many of the top cryptocurrencies gaining significantly with respect to their valuations. However, there remain a lot of questions about the use, potential, and the negative impacts of such cryptocurrencies. Minneapolis Federal Reserve President Neel Kashkari is the latest to comment on the negatives of cryptocurrency.

Kashkari, at a recent event, made waves after he said that cryptocurrencies are “like a giant garbage dumpster,” and that they lacked the basic characteristics of any stable currency. According to the exec,

“The reason that the dollar has value is because the US government has a legal monopoly on producing the dollar. In the virtual-currency and cryptocurrency world, there are thousands of these garbage coins out there[….]and finally, the SEC is getting involved in cracking down on this.”

And while Kashkari did agree to the fact that cryptocurrencies could be useful in the future, he argued that at present, cryptocurrency is nothing but burning garbage. He also went on to refer to them as “noise and fraud.”

Kashkari added,

“The barrier to entry to creating a new cryptocurrency is zero. I’m seeing more noise and more fraud than I’m seeing anything useful. Maybe five years from now or 10 years from now or 20 years from now something useful will emerge from this, but so far, all that’s emerging is burning garbage”

This isn’t the first time a major banking official in the United States has come forward to give their opinion on cryptocurrencies, however. Jerome Powell, Chair of the Board of Governors of the Federal Reserve, had also criticized digital currencies recently, stating that a public ledger would not be that feasible in the United States, unlike China. Powell had also admitted that Facebook’s Libra project was a sort of like a wake-up call to the Fed.

He wasn’t the only one. President Donald Trump’s Treasury Secretary Steven Mnuchin recently announced the United States’ plans to regulate cryptocurrencies and monitor rules around money laundering and other illicit activities with an aim to improve transparency surrounding digital currencies like Bitcoin.

However, not all U.S officials are against the introduction of cryptocurrencies. Member of the U.S Federal Reserve’s Board of Governors, Lael Brainard, recently noted that the emergence of projects like Facebook’s Libra has resulted in central banks considering a “Fedcoin.” In fact, several countries across the globe such as China and Japan are looking into launching a sovereign digital currency of their, probably all thanks to Libra.

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Crypto Today: Bitcoin troubles still linger underneath $9000

Here’s what you need to know on Thursday

Markets

BTC/USD is currently trading at $8911 (+1.50%), the price has stabilized but remains vulnerable underneath $9000. 

ETH/USD is currently trading at $235 (+4.20%), a near-term pick up after the recent bout of selling pressure, however, the strong resistance should be noted at $250. 

XRP/USD is currently trading at $0.2455 (+5.50%), the bulls will need to break back above $0.2500 to regather decent upside momentum. 

Among the 100 most important cryptocurrencies, the best of the day are WAXP $0.045937 (+27.55%), HBAR $0.037804 (+22.49%) KNC $0.534237 (+15.15%) The day’s losers are ABBC $0.0964287 (-4.42%), MOF$0.964287 (-3.30%), WICC $0.226634 (-2.25%).

Chart of the day: BTC/USD daily chart (the price was caught by a secondary ascending trend line of support, preventing the price from free-falling)

Market

Jeff Dorman – the chief investment officer of the crypto firm Arca, commented on Bitcoin being touted as a safe-haven. He said: It’s irresponsible for anyone to say that bitcoin is truly a ‘safe haven.’ Look at how gold and Treasuries and equities react instantaneously to global fears. Bitcoin and digital assets live outside that workflow. Azimo, a London-based online remittance platform has joined forces with Ripple blockchain project, in a bid to leverage the latter’s XRP-powered on-demand liquidity (ODL) solution for faster, cheaper cross-border payments to the Philippines, according to a press release.

On Feb 26, according to the data analytics provider Skew, over $150 million worth of Bitcoin was liquidated on the trading exchange BitMEX, the most seen since the new year began. Millions of dollars of long and short positions caused the value of the cryptocurrency to fall to $8,580, a decrease of more than 6%. Prices in the session, have since recovered the beating seen on Wednesday.

Regulation

According to a report by Bloomberg, San Francisco-based blockchain project Ripple Inc. Could soon face a lawsuit that, according to the firm, could topple the market for the firm’s digital token, XRP.

Industry 

Action film star Steven Seagal has been fined for unlawfully touting cryptocurrencies and acting as the brand ambassador for a controversial initial coin offering (ICO), called Bitcoiin2Gen (B2G). The Hollywood star, 66, has agreed to pay a combined $314,000 in fines and penalties, the Securities and Exchange Commission (SEC) said in a statement on Thursday.

Cryptocurrency exchange Binance has partnered with public blockchain protocol Shyft Network as it readies itself to comply with Financial Action Task Force (FATF) regulations. The Shyft Network was designed to provide a decentralized solution for crypto industry players to fulfill global compliance standards, including the FATF’s “travel rule.”

Quote of the day

It’s irresponsible for anyone to say that bitcoin is truly a ‘safe haven.’ Look at how gold and Treasuries and equities react instantaneously to global fears. Bitcoin and digital assets live outside that workflow.

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Two Crypto Altcoins Are Up 111% and 95% This Year As Bitcoin, Ethereum and XRP Breakdown Continues

With Bitcoin, XRP, Ethereum and nearly the entire cryptocurrency market in the red, two mid-cap altcoins are bucking the trend.

Analyst Crypto Michaël tells his 49,000 followers on Twitter that he believes traders are starting to become opportunistic by buying the dip in Chainlink (LINK) and Tezos (XTZ). Michaël also believes ETH is starting to show signs of life against BTC.

At time of publishing, Chainlink is up 6.44% in the last 24 hours at $3.62, according to CoinMarketCap. Tezos is up 2.98% at $2.77.

“LINK and XTZ providing an example of the strength of this market. During 2016/2017 several retracements were done, after which a strong bounce occurred. Even ETH/BTC is now showing strength. There’s some opportunities in bull markets to buy the dip, this might be one.”

Chainlink is designed to give companies a seamless way to take data that is external to blockchain applications and place it on-chain. The token is designed to reward operators that power the network. Tezos is a proof-of-stake blockchain platform that allows token holders to earn rewards in return for powering the network.

Michaël is keeping his eye on the big picture and says the largest cyptocurrencies by market cap need to step up and show signs of life. The key, he says, is whether Bitcoin can bounce off of the $8,700 area.

“Markets showing some relief bounces. Majors still need to step in. There’s always the fear of buying dips and people rather buy green candles, they always will. Coming days will decide whether $8,700 becomes the low on $BTC. And that’s still +$1,800 since January 1st.”

BTC is currently at $8,717, down 5.16% in the last 24 hours. Ethereum is down 8.83% at $218.95 and XRP is down 5.10% at $0.2304.

Since the start of 2019, Bitcoin is up 19.24%, Ethereum is up 67.69% and XRP is up 18.84%. Chainlink is up 95% and Tezos is up 111% since January 1st.

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Crypto Tax Plan Recommended To South Korean Government

  • Tax experts have advised that the Korean government should be applying a low-level trading tax on profits in cryptocurrency.
  • According to a local news report, the government in the nation is expected to announce its tax reform plan at the end of this year.

Tax experts in South Korea have advised that the Korean government should be applying a low-level trading tax on profits in cryptocurrency before giving the public transfer income tax. According to a local news report, the government in the nation is expected to announce its tax reform plan at the end of this year.

Such a low-level trading tax was pushed in the agenda because of the lack of legal infrastructure to enact transfer taxation on transfers.

In a seminar that went down on the 21st of February, the South Korean government was advised by members of the Korean Tax Policy Association to act on this plan. The main argument was made that by taking such an approach to integrating income tax on crypto, it will see the most efficiency.

The proposal by the tax expert was agreed by the blockchain Association in Korea. Such a recommendation was justified as they said:“Related laws are still absent and the taxation infrastructure is still insufficient to cover cryptocurrencies and, as such, some supplements need to be added on the expense calculation side.”

On top of this, the association went on to say that before imposing a transfer tax, the clarity on defining cryptocurrency acquisition costs is a necessity. However, given that digital assets are being traded at such different rates on the different platforms in Korea, this isn’t going to be easy to define

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