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Crypto stakeholder reacts to Solana’s 17-Hour outage

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  • Crypto stakeholder, Sam Bankman-Fried says Solana network outage is not new to crypto.
  • Bankman says the outage was because of Solana rapid groeth.

Crypto stakeholder Sam Bankman-Fried, CEO of the cryptocurrency exchange FTX has reacted to the recent outage experienced by the Solana network.

The FTX CEO, who reacted during an interview with Bloomberg, said that the 17-hour network outage experienced by the network resulted from its rapid growth.

Reason Solana outage persisted for 17 hours – Crypto stakeholder

Sam Bankman-Fried, during the interview, acknowledged that the outage is not a new thing in the crypto space but said that the 17-hour collapse of Solana’s network was “sad and frustrating.”

“It’s always sad when these happen; it’s always frustrating,” he said.

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According to the crypto stakeholder, SOL’s outage was because its network has rapidly expanded in a short period of time. He said the network could not cope with the increased activity in that short period. He said, however, that now all that problem has been solved.

“What this is really focused on is as you try to massively scale up a blockchain, eventually you test its current limits,” he said.

The crypto stakeholder who also spoke on stablecoin and their involvement in the cryptocurrency space said they add a lot of value to the system and make it easier to interact with everything.

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He said because of that, placing a ban on them would not be a good idea, but rather, US watchdogs should regulate them so they can continue playing a crucial role in the digital asset industry.

Solana’s growth, mild troubles over the month

Although the coin remains one of the top-performing in recent times, it has also faced certain setbacks.

Solana grabbed public attention owing to its sporadic price surge and the explosive growth in the NFT sector, a large portion of which uses Solana’s blockchain. However, the expansion led to some network issues, such as the one mentioned above.

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Days back, Solana went down for hours as users were unable to process transactions.

The CEO, Anatoly Yakovenko, said that the disruption was caused by “Raydium IDO bots trying to snipe the tokens at launch.” After more than 17 hours, Solana resumed operations as validators restarted and upgraded to the current version.

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‘New Blow’ as Large Crypto Exchanges Are Told to Pay British Tech Tax

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Crypto exchanges operating in the United Kingdom – including the likes of Coinbase â€“ will be forced to pay a recently created tech tax – with the British tax body, HM Revenue and Customs (HMRC), declaring that cryptoassets “are not financial instruments.”

The British Treasury last year announced the launch of a new 2% sales charge on online vendors, search engines and social media providers with global revenue of over USD 666.4m and domestic sales above the USD 33.3m mark.

Per the Telegraph, the tax office has informed crypto exchanges that they are subject to the levy, which was created in a bid to make sure the likes of Google and Amazon â€“ who have been criticized for finding tax workarounds in the UK – contribute more to the Treasury’s coffers.

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The same media outlet noted that although Coinbase’s UK operations had reported sales worth just under USD 24m, “the company recently reported that global revenues had quadrupled, meaning it is likely to pass the UK threshold in 2021.”

However, the tax may be short-lived, at least in its current form: earlier this year, the G20 agreed to create a streamlined tax essentially aimed at global tax giants. The measure will force some of the world’s biggest companies to cough up some USD 150bn in extra tax revenue each year.

Last month, the BBC reported that G20 chiefs had agreed to create a global minimum tax rate of 15% for large companies, and would enforce the measure starting in 2023.

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In the meantime, however, the British “tech tax” is still in place – and Coinbase is likely to have to pay it.

HMRC’s ruling that cryptoassets “are not financial instruments” is key. Financial providers are exempt from the tax, but the tax body’s insistence that tokens “do not qualify as commodities or money” means that crypto trading platforms cannot slip through the net.

The same media outlet quoted the crypto pressure group CryptoUK as claiming that it was “unfair” to classify crypto “differently to other financial assets” – particularly as the UK tax body’s American counterparts largely consider coins to be commodities.

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CryptoUK director Ian Taylor was quoted as calling the move “a new blow” to crypto exchanges, who were already reeling from “arduous” licensing measures announced by the regulatory Financial Conduct Authority â€“ ultimately leading to higher fees for exchange customers.

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Crypto Exchanges Facing “Digital Tax” Blow in U.K.

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Cryptocurrencies are neither currencies nor commodities, according to Her Majesty’s Revenue and Customs

Cryptocurrency exchanges have to pay a 2% digital services tax in the U.K., according to a Sunday report by The Daily Telegraph.

They do not qualify for an exemption granted to financial marketplaces since the Her Majesty’s Revenue and Customs office doesn’t recognize cryptocurrencies as “financial instruments.”

The tax on the local revenues of large tech companies was introduced in April 2020.

CryptoUK, a crypto lobbying group, is not happy about the lack of the exemption since it would further stifle the industry.

The U.K. arm of the Coinbase exchange is expected to easily surpass the revenue threshold of £25 million ($33 million) due to the crypto trading boom in 2021.

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However, HMRC is adamant that crypto assets cannot be classified as either commodities or currencies.  

In October, European governments forged a deal with the U.S. to establish a new global tax regime to eschew America’s retaliatory tariffs.

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Bitpanda New Partner Lydia’s 5.5M Users Will be Able to Invest in Crypto

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Major French mobile financial services app Lydia is slated to offer its 5.5m users exposure to a wide range of crypto assets after a partnership with the Austrian crypto exchange Bitpanda.

As part of the deal, Lydia will integrate Bitpanda’s digital asset investment product, dubbed ‘White Label Solution,’ to allow its customers to invest 24/7 in more than 100 digital assets, including cryptocurrencies, fractional stocks, exchange-traded funds (ETF), and precious metals.

Founded in 2013, Lydia is a daily financial “super-app” said to be used by a third of the French 18 to 35 year olds. The app has raised a total of USD 131m in two funding rounds in 2020, though it did not disclose valuation.

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“With Lydia trading, our ambition is to widen access to investment assets, to make it accessible to everyone whether they are simply curious, beginner investors or experts,” said Cyril Chiche, the app’s CEO and co-founder.

“Our goal is to reimagine what it means to invest, by making simple, easy-to-use financial products for everyone,” Eric Demuth, Bitpanda co-founder and CEO, was quoted saying.

Bitpanda raised USD 170m earlier this year in a Series B funding round and earned a valuation of USD 1.2bn, becoming Austria’s first tech unicorn. In its Series C funding round, however, the exchange raised USD 263m, earning a valuation of USD 4.1bn.

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Meanwhile, the exchange has been aggressively expanding its presence across Europe. Just recently, Bitpanda unveiled a partnership with Fabrick, an Italian open finance provider, that will offer digital asset trading services to Italian banks and fintechs. 

The exchange has also hired former JPMorgan executive Joshua Barraclough as CEO of its advanced trading platform Bitpanda Pro.

“We are confident that this is just the beginning: we are committed to offering everyone investment options for any budget and risk appetite,” Demuth added.

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