The European Central Bank announces EUROchain distributed ledger. View in browser

“Bitcoin: A Swiss bank account in your pocket!" ~ Barack Obama”, the 44th president of the United States

Market State

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The cryptocurrency market is back above $200 billion again. Last week the market was quite volatile. Bitcoin dropped to as low as $6900 last Friday before recovering over the weekend. Currently it’s trading at around $8300. Bitcoin turned 11 years old on the 3rd of January. According to a report by Bank of America Securities, if you invested $1 in Bitcoin at the start of the decade, it would now be worth more than $166,200. The price of Ether steadily grew over the last week. The recent Muir Glacier hard fork decreased the average block time on the Ethereum blockchain from 17.16 seconds to 12.96 seconds. Faster Ether blocks increase the number of Ether blocks mined daily. This means Ether miners are earning more coins. Ether is up from $130 to $142 during the last week.

Central banks around the world are exploring development of their own cryptocurrency. Legislators have been busy examining the cryptocurrency space and developing their way to gain control over decentralized cryptocurrencies. The Iranian president has proposed a cryptocurrency for Muslim countries to evade US sanctions. Both China and European Union are actively working on their own central bank digital currencies (CBDCs). More and more organizations are looking to harness the benefits of cryptocurrency and blockchain technology. Even the United Nations considers it is crucial to embrace blockchain technology in this digital age. Both China and European Union are actively working on their own central bank digital currencies (CBDCs). More and more organizations are looking to harness the benefits of cryptocurrency and blockchain technology. Even the Secretary-General of the United Nations considers it crucial to embrace blockchain technology in this digital age.

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Quiz of the week

What is the smallest denomination of Ether?

  1. Satoshi
  2. Ada
  3. Wei

Scroll down to see the answer at the end of the newsletter.

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Top stories of the week
The European Central Bank Announces EUROchain Distributed Ledger

On the 17th of December, the European Central Bank (ECB) published an official research paper entitled “Exploring anonymity in central bank digital currencies”. According to the paper the ECB set up a EUROchain, an in-house private blockchain platform, as a learning tool for 18 European countries (Austria, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, the Netherlands, Portugal, Slovenia, Spain and Sweden). The EUROchain is the first DLT research network between a large group of central banks, and it was developed in cooperation with Accenture, a technology consulting and services company and R3, an enterprise blockchain software firm on Corda platform. The network consists of a cross-functional team of payment specialists and IT experts at the ECB and the national expert network (experts from 18 national banks who are involved in local market networks). The paper discusses the benefits of EUROchain network that focuses on fast and efficient retail payments in the euro area. ECB considers it to be important that EUROchain meet different requirements, which are allowing users some degree of privacy for lower-value transactions, while still ensuring that higher-value transactions are subject to mandatory AML/CFT checks. Unlike projects such Facebook’s Libra, EUROchain’s proof of concept is not a stablecoin directed at consumers. Instead, it focuses on bank to bank integration of DLT and enterprise blockchains which means it is designed for improving global payment settlements between central banks and member banks. EUROchain proof of concept payment system is a system with two tiers, where the currency is issued (and taken out of circulation) only by the central bank and distributed by intermediaries. The central bank would rely on intermediaries that could access the central bank ledger and reserve balances at the central bank, enabling the use of the ECB digital currency between users. The intermediaries process transactions for their institutional clients who receive custodial services from the central bank. Therefore, the ECB digital currency will still be a centralised currency like Facebook’s Libra and it has already been criticized for missing the entire idea of decentralized currency.

Secretary-General Says United Nations Must Embrace Blockchain Technolgy

António Guterres, secretary-general of the United Nations (UN) said in a statement provided to Forbes by his office, that blockchain or distributed ledger technology (DLT) should be among the emerging technology used by the United Nations. According to Forbes the statement from Guterres shows that cryptocurrency and the underlying blockchain technology is being seriously explored at the highest levels of the largest organizations in the world. This isn’t the first time that Guterres, advocated blockchain technology. In July 2018, Guterres announced the launch of a “High-Level Panel on Digital Cooperation” which discussed blockchain technology as one of its main topics. While China seems largely focused on using the blockchain as a way to prevent money laundering and better track its citizens’ transactions, the United Nations work has been more focused on giving donors increased assurance their donations are being spent how they wish, while reducing waste in the organization’s giant supply chain. In October 2019, Guterres presented a United Nations budget to the United Nations General Assembly Fifth Committee (which is responsible for administrative and budgetary matters) for the first time in 45 years. The budget included additional $3.3 million, about a 10% increase over last year to maximize support for the Sustainable Development Goals (SDGs). First set in 2015, the 17 SDGs, including ending poverty and responsibly producing and consuming goods, are expected to be completed in the 2030s. According to an Emerging Technologies Whitepaper from the UN, blockchain will support sustainable development through better identification. More than one billion people do not possess legal identification will be given access to services, various kinds of rights and opportunities via a personal identification on the blockchain that can't easily be corrupted.

President of Iran Proposes Cryptocurrency To Muslim Nations to Fight Economic Sanctions

During the Kuala Lumpur Summit in Malaysia, where leaders of Muslim countries attended, the president of Iran, Hassan Rouhani, proposed creating a cryptocurrency for Muslim nations to fight American economic domination in international trade and cut reliance on the dollar. Iran has been hit with severe economic sanctions by the US which has driven Iran’s economy into recession. Iranians have been protesting violently against a sharp rise in gasoline prices that followed the sanction. The Iranian government has been looking for a solution to circumvent the US sanctions and even explored the use of cryptocurrencies. Rouhani said that “the US has used economic sanctions as the main tools of domineering hegemony and bullying of other nations.” Rouhani suggested the creation of a special banking and financial system among Muslim nations, using local currencies for trade as well as creating a Muslim cryptocurrency and giving each other trade privileges to deepen linkages.

Burger King in Venezuela Now Accept Cryptocurrencies

Burger King branches in Venezuela are now letting their users to pay with Bitcoin, Ether, Litecoin, Binance Coin, Dash and Tether. Burger King has partnered up with Cryptobuyer, a Panama-based cryptocurrency merchant gateway startup and Bitcoin ATM operator to roll out nationwide crypto payment options. Cryptobuyer’s point of sale system has already launched in Centro Sambil Caracas, the sixth-largest shopping mall in South America and will soon expand the crypto payment option to 40 Burger King locations across the country this year. Jorge Farias, CEO of Cryptobuyer said regarding the situation “Venezuela, is another example of how this region is ahead of the curve in adopting cryptocurrency as a real method of payment. Hyperinflation, cash shortages, deteriorated banking and communication infrastructure presents a mix of circumstances that make it a perfect place to deploy real world cryptocurrency solutions. Such factors will push the use and adoption of these cutting-edge technologies, and we are really proud to lead this push.”

US Lawmaker Urged To Launch a Comprehensive Cryptocurrency Regulations

On the 17th of December, US Congressman Paul Gosar has introduced a new cryptocurrency bill in the House of Representatives titled the “Cryptocurrency Act 2020”. Earlier last year, in September, congressman Warren Davidson introduced the Token Taxonomy Act of 2019, and in October, Commodity Futures Trading Commission (CFTC), Financial Crimes Enforcement Network (FinCEN) and Securities and Exchange Commission (SEC) has issued a joint statement on activities involving digital assets, which requires cryptocurrency businesses to comply with banking and financial services laws in the US. All three initiatives were designed to give regulatory certainty for the US cryptocurrency market. The “Cryptocurrency Act 2020” classifies three types of digital tokens, they are crypto-commodities, crypto-securities, and cryptocurrencies. These digital token classes will determine which government agencies are responsible for the creation of regulations and enforcement. The regulatory agencies mentioned in the bill are the CFTC, the SEC, and the FinCEN. The SEC will be designated as the regulator of crypto-securities. The CFTC will be responsible for crypto-commodities while FinCEN will gain regulatory control over cryptocurrencies. According to the draft bill, these three agencies will publicly publish detailed lists of licensing, certification requirements and registrations necessary to participate in the US crypto market. If the bill is approved, it could reshape the entire crypto market in the US.

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Quiz answer

What is the smallest denomination of Ether?

The correct answer is “C”.

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