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Regulation warning for all crypto investors

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Cryptocurrency is gaining popularity with nations like El Salvador embracing digital coins

However, the sector remains mostly unregulated, and there’s a new warning for those wanting to invest.

In a world turning to digitalisation, cryptocurrencies are on the trend. They’re volatile, and just a single tweet by Elon Musk can see them rise or fall.

As more people start investing there remains plenty of talk around risks associated with cypto – and how regulated it really is. 

Nations around the world are working through regulatory framework, including in most recent weeks, The European Union

The EU’s framework for regulating crypto is one step closer to ratification.

Last week the European Council, which sets the EU’s political agenda, adopted its position on the Markets in Crypto Assets framework, according to a statement on its website. 

This means that the Council and the European Parliament can now enter into negotiations on the proposal for regulation before it is formally adopted as law. 

But in most recent weeks the spotlight’s been on Australia – after the countries biggest bank made a bold move. 

As more younger Australians choose cryptocurrency investments to fast-track their savings, The Commonwealth Bank, now wants a slice of the pie.

CBA’s head of retail banking, Angus Sullivan, says the bank is now setting up its own pilot platform to buy, sell and hold cryptocurrencies.

So – as popularity grows – could we see more banks around the world like HSBC, CITIBANK OR ANZ join the party? 

Within Australia,  legal framework for cryptocurrency investments appears to be in the works

The industry made hundreds of submission to a Senate Select Committee chaired by Liberal MP Andrew Bragg looking into how to tighten up the industry, however while players in the cryptocurrency industry say they want more regulation, history shows investors respond poorly to new rules.

In November 2019, the price of Bitcoin crashed when China accelerated a crackdown on cryptocurrency businesses.

In most recent weeks India now plans to join China – proposing a ban on private cryptocurrencies. 

It follows – just months ago – a major scam linked to the popular Netflix series Squid game – where someone on the internet created SQUID COIN and soon later took off with millions of dollars from those that invested in it. 

Cryptocurrencies are known for their wildly unpredictable price fluctuations, damage to the environment and use by criminals to try to disguise illegal activities, such as money laundering.

The boss of the CBA says One of the biggest risks banks face when it comes to cryptocurrencies is being left out of the market altogether.

You can learn more about the world of cryptocurrencies on our episode of Turning Point tonight as Ahron Young speaks to top executives from Crypto.com

Tune in for that episode – at 6:30 PM AEDT right here on ticker news or catch up on Turning Point with Ahron Young on demand here

Anthony Lucas is reporter, presenter and social media producer with ticker News. Anthony holds a Bachelor of Professional Communication, with a major in Journalism from RMIT University as well as a Diploma of Arts and Entertainment journalism from Collarts. He’s previously worked for 9 News, ONE FM Radio and Southern Cross Austerio’s Hit Radio Network. 

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New York closes in on Robinhood dodgy crypto arm

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Robinhood has been fined $30 million for alleged violations of anti-money-laundering, cybersecurity and consumer protection rules

New York state is closing in on the company’s crypto arm, with concerns the trading platform isn’t devoting enough resources to address compliance and cybersecurity risks.

It follows several regulatory probes into Robinhood in recent months.

In a statement, lawyers say the company has made “significant progress” in building legal, compliance and cybersecurity programs.

As part of the settlement deal, Robinhood Crypto will also be required to have an independent consultant to evaluate compliance practices moving forward.

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At what times does the world invest in crypto?

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New figures are out on when the most activity on the Bitcoin Network happens

Coin Metrics has found European and U.S. business hours is a hotspot for crypto investment on the Bitcoin Network.

It’s understood U.S. investors use the services in the morning hours, while Europe waits for later in the day.

Analysts are reporting a drop in the share of activity happening during Asian hours.

It seems like the use of Bitcoin in Asian markets fell around a year ago, which coincides with China’s crack downs on crypto mining.

The figures looked at when changes to wallets took place, before they were segmented based on the opening hours of various global exchanges.

Coin Metrics looked specifically at the Hong Kong Stock Exchange, London Stock Exchange, and the New York Stock Exchange.

Analysts also looked at Ethereum data, which is less clear than Bitcoin. However, the company believes Ethereum trading also tends to occur during U.S. waking hours.

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Is this the beginning of the end for bitcoin?

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Concerns investors will lose faith in the crypto following Tesla’s sell-off

Tesla’s bitcoin sell-off has analysts concerned, after the company dumped $936 million worth of crypto, or 75% of its total holdings.

Following the news – the crypto’s price dropped and gains seen just last week were brought back down to earth.

So now the world’s biggest EV manufacturer has dropped the majority of its Bitcoin stake, should we all be doing the same?

On an earnings call, Musk said his company dumped its holdings due to the uncertainty around China’s Covid lockdowns.

He noted it’s important for Tesla to maximise its cashposition during this difficult economic period.

“The reason we sold a bunch of our bitcoin holdings was that we were uncertain as to when the Covid lockdowns in China would alleviate. So it was important for us to maximise our cash position.”

ELON MUSK

But does this really stack up? Or is it just an excuse following a nice rally?

Up until Wednesday, the last week had been good for Bitcoin, gaining 12 per cent in just seven days.

While other cryptos including ethereum and solana surged even more dramatically.

Musk says his company is still open to increasing bitcoin holdings in future.

But some analysts predict other big investors will use Tesla’s bitcoin sale as a justification to offload their own digital coins and send the price even lower.

“We are certainly open to increasing our bitcoin holdings in future, so this should not be taken as some verdict on bitcoin. It’s just that we were concerned about overall liquidity for the company.”

elon musk

They say like or not Musk can move markets and this is something to be conscious of.

But while the Tesla sell-off caught many off guard, analysts also stress this isn’t game over for Bitcoin and ebbs and flows are all just part of the market.

“The Tesla sell-off can trigger a new wave of related dumping from corporate bitcoin holders, most of which might also be distressed by the ongoing global economic downturn.”

ANDREY DIYAKONOV FROM CHOISE.COM SPEAKING TO CNN

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