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U.S. Treasury seeks input on cryptocurrency risks, benefits

The U.S. Treasury building is seen in Washington, September 29, 2008. REUTERS/Jim Bourg/File Photo

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July 12 (Reuters) – The U.S. Treasury on Tuesday said it was seeking comment on the on the risks and opportunities posed by digital assets as it seeks to prepare a report for President Joe Biden on the implications of developments such as cryptocurrencies.

The official query builds on an executive order Biden signed in March, which directed government agencies to study cryptocurrencies and other digital asset products, including central bank digital currencies.

“For consumers, digital assets may present potential benefits, such as faster payments, as well as potential risks, including risks related to frauds and scams,” Treasury Under Secretary for Domestic Finance Nellie Liang said in a statement.

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The crypto market, including bitcoin and other products, has rapidly grown in popularity in recent years, despite concerns from regulators and some policymakers that the market lacks sufficient oversight, transparency and consumer protections.

The crypto market has been wracked by turmoil in recent weeks, with a number of high-profile firms and tokens collapsing or refusing to allow customers to withdraw funds in a bid to stabilize themselves.

The Treasury’s query is far-ranging, asking for input on a host of questions, including how businesses are using cryptocurrency, where consumers may not be sufficiently protected, and how the nation’s poorest could benefit or face risk from broader cryptocurrency adoption.

The Treasury is accepting comments until Aug. 8.

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Reporting by Costas Pitas in Los Angeles; Editing by Tim Ahmann and Marguerita Choy

Our Standards: The Thomson Reuters Trust Principles.


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Bitcoin drops 6.9% to below $30,000

June 1 (Reuters) – Bitcoin, the world’s biggest and best-known cryptocurrency, dropped 6.9% to $29,555.35 at 22:03 GMT on Wednesday, losing $2,262.81 from its previous closing price.

It was down 38.9% from the year’s high of $48,234 on March 28.

Ether , the coin linked to the ethereum blockchain network, dropped 7.52% to $1,794.68, losing $145.87 from its previous close.

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Reporting by Shubhendu Deshmukh and Rachna Manojkumar Dhanrajani in Bengaluru

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Bitcoin surges nearly 8% to $31,780

May 30 (Reuters) – Bitcoin rose 7.93 % to $31,780.51 at 2200 GMT on Monday, up $2,334.8 from its previous close.

The world’s biggest and best-known cryptocurrency is up 25.1% from the year’s low of $25,401.05 on May 12.

Ether , the coin linked to the ethereum blockchain network, rose 9.8 % to $1,989.38 on Monday, adding $177.54 to its previous close.

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Reporting by Ann Maria Shibu in Bengaluru; Editing by David Gregorio

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Russia mulls allowing cryptocurrency for international payments, Interfax reports

Representations of the Ripple, Bitcoin, Etherum and Litecoin virtual currencies are seen on a PC motherboard in this illustration picture, February 14, 2018. REUTERS/Dado Ruvic/Illustration

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May 27 (Reuters) – Russia is considering allowing cryptocurrency to be used for international payments, Interfax news agency quoted a government official as saying on Friday.

“The idea of using digital currencies in transactions for international settlements is being actively discussed,” Ivan Chebeskov, head of the finance ministry’s financial policy department, was quoted as saying.

Russian officials are wrestling with how to regulate the country’s crypto market and use of digital currencies, with the finance ministry opposed to the central bank’s calls for a blanket ban. read more

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Discussions have been ongoing for months and though the government expects cryptocurrencies to be legalised as a means of payment sooner or later, no consensus has yet been reached. read more

The finance ministry is discussing adding the latest proposal on international payments to an updated version of a draft law, the Vedomosti newspaper reported on Friday, citing government officials.

Allowing crypto as a means of settlement for international trade would help counter the impact of Western sanctions, which has seen Russia’s access to traditional cross-border payment mechanisms “limited,” Chebeskov said.

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Reporting by Reuters

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G7 countries urge swift regulation of crypto assets – draft

Souvenir tokens representing cryptocurrency networks Bitcoin, Ethereum, Dogecoin and Ripple plunge into water in this illustration taken May 17, 2022. REUTERS/Dado Ruvic/Illustration

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KOENIGSWINTER, Germany, May 19 (Reuters) – The world’s top financial leaders called on Thursday for the swift and comprehensive regulation of cryptocurrencies following turmoil that has seen the demise of the Terra stablecoin last week, a draft communique showed on Thursday.

“In light of the recent turmoil in the crypto-asset market, the G7 urges the FSB (Financial Stability Board)…to advance the swift development and implementation of consistent and comprehensive regulation,” finance ministers and central bankers from the Group of Seven industrialised nations said in the document.

They were meeting in Koenigswinter, near Bonn (Germany), on Thursday and Friday.

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Reporting By Francesco Canepa and Jan Strupczewski; Editing by Angus MacSwan

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Dubai grants crypto exchange Binance a virtual asset licence

A representation of the cryptocurrency is seen in front of Binance logo in this illustration taken, March 4, 2022. REUTERS/Dado Ruvic/Illustration/File Photo

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DUBAI, March 16 (Reuters) – The world’s largest cryptocurrency exchange Binance has been granted a licence to conduct some operations in Dubai, the company said on Wednesday, from where it plans to carry out regional business.

The awarding of the Virtual Asset Licence from Dubai’s recently formed Virtual Asset Regulatory Authority (VARA) comes after Gulf neighbour Bahrain on Tuesday awarded Binance a crypto-asset service provider licence, its first such licence from a Gulf Cooperation Council (GCC) country. read more

“Binance will be permitted to extend limited exchange products and services to pre-qualified investors and professional financial service providers. All licensed VARA service providers will be monitored progressively to open access to the retail market,” Binance said in a statement.

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The crypto company will also anchor a blockchain technology hub in the Dubai World Trade Centre (DWTC), it said.

Financial regulators across the world have targeted Binance, with some banning the platform from certain activities and others warning consumers that it was not licensed to operate in their jurisdictions. read more

The United Arab Emirates (UAE), the Gulf region’s financial capital, has been pushing to develop the virtual asset sector and regulation to attract new forms of business as regional economic competition heats up.

Dubai, one of the UAE’s seven emirates, last week adopted its first law governing virtual assets and established VARA as a regulator to oversee the sector.

Binance said in December it was working with DWTC to help set up an international virtual asset ecosystem in Dubai and assist with the development of virtual asset regulations.

“Binance will be able to operate its regional business from Dubai in the newly announced regulatory ecosystem that is subject to comprehensive legislation and internationally applicable policy frameworks,” DWTC Authority Director General Helal Saeed Almarri said.

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Writing by Lisa Barrington
Editing by Mark Potter

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Japan asks crypto exchanges to act in line with sanctions against Russia

A man stands near an advertisement of a cryptocurrency exchange in Tokyo, Japan March 30, 2018. REUTERS/Toru Hanai/Files

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TOKYO, March 14 (Reuters) – Japan requested on Monday that crypto exchanges not process transactions involving crypto assets subject to asset-freeze sanctions against Russia and Belarus, officials said on Monday.

The request was made after a Group of Seven (G7) statement on Friday that said Western nations “will impose costs on illicit Russian actors using digital assets to enhance

and transfer their wealth.”

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There are growing concerns among G7 advanced economies that cryptocurrencies are being used by Russian entities as a loophole for financial sanctions imposed upon the country for invading Ukraine.

The U.S. Treasury Department issued new guidance on Friday that required U.S.-based cryptocurrency firms not to engage in transactions with sanction targets. read more

“We decided to make an announcement to keep the G7 momentum alive,” said a senior official at Japan’s Financial Services Agency. “The sooner the better.”

The government will work as one to strengthen measures against the transfer of funds using crypto assets that would be in violation of the sanctions, FSA and the Ministry of Finance said in a joint statement.

Unauthorised payments to targets under sanctions, including in crypto assets – such as cryptocurrency and non-fungible tokens – are subject to punishment of up to three years in prison or a 1 million yen ($8,487.52) fine, the FSA said.

There were 31 crypto exchanges in Japan as of March 4, according to an industry association.

($1 = 117.8200 yen)

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Reporting by Tetsushi Kajimoto, Daniel Leussink and Kantaro Komiya; Editing by Jacqueline Wong

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India to tax cryptocurrencies at 30%, puts digital assets in highest tax band

A security guard’s reflection is seen next to the logo of the Reserve Bank Of India (RBI) at the RBI headquarters in Mumbai, India, June 6, 2019. REUTERS/Francis Mascarenhas

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MUMBAI, Feb 1 (Reuters) – India will impose a tax of 30% on income from cryptocurrencies and other digital assets, finance minister Nirmala Sitharaman said while presenting the federal budget on Tuesday.

Aside from placing earnings from cryptocurrencies and non-fungible tokens (NFTs) in India’s highest tax band, Sitharaman also said losses from their sale could not be offset against other income, delivering another disincentive to trading and investment in digital assets.

Industry estimates suggest there are 15 million to 20 million crypto investors in India, with total crypto holdings of around 400 billion rupees ($5.37 billion). No official data is available on the size of the Indian crypto market.

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Proponents of digital currencies have been hoping that the establishment of a formal tax framework could at least spare the crypto industry from some of the more draconian measures that the government had been considering. read more

“Thirty percent tax on income from virtual digital assets, while high, is a positive step as it legitimises crypto and hints at an optimistic sentiment towards further acceptance of crypto and NFTs,” said Avinash Shekhar, chief executive of ZebPay, a cryptocurrency exchange.

Tax consultants reckoned individuals could end up paying more than 30% of their crypto profits in tax and other charges.

“If you made a profit of 100 rupees then including the 30% tax bracket, plus surcharge and cess the total tax outgo will be around 42 rupees,” Amit Maheshwari, partner at AKM Global, a tax and consulting firm told Reuters.

Crypto exchanges also hoped the the new tax regime would signal acceptance of digitial currencies by the authorities, and reassure corporates that they can enter the market.

“We also hope this development removes any ambiguity for banks and they can provide financial services to the crypto industry,” said Nischal Shetty, CEO, WazirX, another virtual currency exchange.

India’s central bank has voiced “serious concerns” around private cryptocurrencies on the grounds that these could cause financial instability. As a result, several banks severed ties with crypto firms.

The finance minister also said that the central bank will introduce a digital currency in the next financial year using blockchain and other supporting technology.

“The introduction of a central bank digital currency will give a big boost to the digital economy. Digital currency will also lead to a more efficient and cheaper currency management system,” Sitharaman added.

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Reporting by Nupur Anand;
Editing by Euan Rocha & Simon Cameron-Moore

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Russian c.bank proposes banning cryptocurrencies, crypto mining

MOSCOW, Jan 20 (Reuters) – Russia’s central bank on Thursday proposed banning the use and mining of cryptocurrencies on Russian territory, citing threats to financial stability, citizens’ wellbeing and its monetary policy sovereignty.

The move is the latest in a global cryptocurrency crackdown as governments from Asia to the United States worry that privately operated highly volatile digital currencies could undermine their control of financial and monetary systems.

Russia has argued for years against cryptocurrencies, saying they could be used in money laundering or to finance terrorism. It eventually gave them legal status in 2020 but banned their use as a means of payment.

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In December, the price of bitcoin fell after Reuters reported, citing sources, that Russia’s regulator was in favour of a complete ban on cryptocurrencies. read more

In a report published on Thursday, the central bank said speculative demand primarily determined cryptocurrencies’ rapid growth and that they carried characteristics of a financial pyramid, warning that bubbles in the market could form, threatening financial stability and citizens.

The bank proposed preventing financial institutions from carrying out any operations with cryptocurrencies and said mechanisms should be developed to block transactions aimed at buying or selling cryptocurrencies for fiat, or traditional currencies. The proposed ban includes crypto exchanges.

Russians are active cryptocurrency users, the central bank said, with an annual transaction volume of about $5 billion.

CRYPTO MINING

Russia is the world’s third-largest player in bitcoin mining, behind the United States and Kazakhstan, though the latter may see a miner exodus over fears of tightening regulation following unrest earlier this month. read more

The central bank said crypto mining created problems for energy consumption. Bitcoin and other cryptocurrencies are “mined” by powerful computers that compete against others hooked up to a global network to solve complex mathematical puzzles. The process guzzles electricity and is often powered by fossil fuels.

“The best solution is to introduce a ban on cryptocurrency mining in Russia,” the bank said.

In August, Russia accounted for 11.2% of the global “hashrate” – crypto jargon for the amount of computing power being used by computers connected to the bitcoin network.

In its report, the central bank pointed to steps taken in other countries, such as China, to curb cryptocurrency activity. It said it would work with regulators in countries where crypto exchanges are registered to collect information about the operations of Russian clients.

In September, China intensified its crackdown on cryptocurrencies with a blanket ban on all crypto transactions and mining, hitting bitcoin and other major coins and pressuring crypto and blockchain-related stocks.

Russia’s regulator said crypto assets becoming widespread would limit the sovereignty of monetary policy, with higher interest rates needed to contain inflation.

It said the long-term potential of cryptocurrencies being used for settlements was limited.

Meanwhile, the Bank of Russia is planning to issue its own digital rouble, joining the global trend to develop digital currencies to modernise financial systems, speed up payments and counter a potential threat from other cryptocurrencies.

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Reporting by Elena Fabrichnaya and Alexander Marrow; Editing by Emelia Sithole-Matarise

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