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US crypto regulations will return Bitcoin to its digital cash origins

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The United States Financial Crimes Enforcement Network, or FinCEN, recently proposed a series of new regulations applying to financial institutions dealing with digital currencies, such as Bitcoin (BTC). To summarize the proposed regulations, exchanges would essentially be required to file a report with FinCEN when a customer makes a purchase in excess of $10,000, and gather Know Your Customer information any time a transaction of $3,000 or greater is conducted using a non-custodial wallet. 

This means that if a customer buys $3,000 worth of Bitcoin and withdraws it to a wallet they control, they would have to not only prove ownership of that wallet but also provide their name and physical address, along with additional identifying information.

Personally, my life stands to change very little. I’ve been living entirely off of cryptocurrency since 2015, unbanked since 2016, and have never used a centralized exchange, receiving all of my coins as compensation for goods and services. But as few live as I do, we will likely see a significant impact on how most cryptocurrency users conduct their business. I would hazard a guess that most users have interacted with a centralized platform requiring KYC.

For the rest of cryptocurrency users, the newly proposed regulations would put a significant friction point on deposits and withdrawals. At present, a user signs up to an exchange, submits KYC documents for approval, and can buy and withdraw Bitcoin to a wallet they control, including a hardware wallet for cold storage. When wishing to realize gains, they can then move the funds back onto the exchange and sell for spending money in the bank.

In the future, however, they may be required to prove ownership of the wallet to which they withdraw, including providing their physical address, and similarly, prove the origin of the funds when moving back on to an exchange. This may lead many users, including the privacy- and autonomy-conscious (of which there are many in the Bitcoin world), to seek other, less intrusive ways of using their digital funds. Making payments directly for the goods and services they desire, rather than first selling for fiat currency, avoids the headache of passing through the regulation-induced friction point every time.

The “centralized exchange closed-loop” experience Bitcoiners will wake up from

There’s a reason why relatively few people have engaged in regular transactions and purchases with Bitcoin — they haven’t needed to. The average user signs up for an exchange account, buys crypto, and may sell to realize some gains. Some of the more hardcore users may even buy a hardware wallet and transfer funds to it from an exchange, which could be an infrequent transaction of significant amounts with no real requirement for speed or particularly low fees. The basic process of buying for investment purposes, and occasionally selling to realize gains or to spend, is relatively smooth with centralized exchanges, which is why so few have ventured far out of this closed loop so far.

Many Bitcoiners have opted to stay inside this closed loop for exactly the same reason they may soon seek to exit it — avoiding friction. Sure, many will simply deal with the extra regulatory steps, but many more, particularly thought leaders and longtime community staples, will choose to stay closer to the cypherpunk ethos.

Bitcoin’s adoption ecosystem will get the push it needs

Bitcoin was born and bred for decentralized digital payments. At some point, this use case took a backseat to a digital store-of-value, and the tools necessary for it to reclaim this purpose haven’t adequately developed yet — foremost among these, of course, is scaling.

Bitcoin chose to pursue off-chain scaling solutions (Lightning Network) and on-chain transaction optimizations (SegWit). Both of these have seen lackluster development over the past several years, with SegWit transactions making up less than half of daily transactions over three years, and Lightning Network growth similarly stagnating, with very few exchanges or other major ecosystem players having integrated it at this point. As noted above, this hasn’t been that much of an issue with the current state of things.

However, when the average user gets direct exposure to the Bitcoin network as it functions today, they’re in for a rude awakening that will either prompt them to disengage entirely or will place pressure on wallets and service providers to prioritize SegWit and Lightning. In a free market, which the cryptoverse largely is, consumer demand drives innovation to meet its needs. If enough Bitcoiners start demanding that Bitcoin work seamlessly for small and efficient transactions (beyond simply posting about it on Twitter), the market will seriously push for the ecosystem to develop to meet its needs.

Hungry competitors line up to take over the digital cash role

Of course, Bitcoin is far from alone in the competition for cryptocurrency for direct purchases. Since its transition to a more digital gold-focused role starting in 2016 or 2017, quite a few hungry competitors have emerged. In the forefront of people’s minds are, naturally, the main Bitcoin forks, Bitcoin Cash (BCH) and Bitcoin SV (BSV). Both have pursued an on-chain scaling approach and have the capacity to field a large number of transactions cheaply, but neither has achieved a compelling enough differentiator yet to fully take over Bitcoin’s share of the payments market. Bitcoin Cash has the clear advantage in terms of integrations into valuable services such as Purse.io but lost significant momentum due to repeated forks, each one taking with it a portion of the community and mindshare. Bitcoin SV has quite a few innovations going for it, including social media platforms and rudimentary human-readable username systems. But with a market ranking firmly outside of the top 10 and with far fewer major integrations than Bitcoin Cash, there’s certainly an uphill battle ahead. Additionally, the mark of Craig Wright has soured the project in the eyes of much of the greater cryptoverse, making partnerships and publicity difficult.

Bitcoin Cash has the clear advantage in terms of integrations into valuable services such as Purse.io but lost significant momentum due to repeated forks, each one taking with it a portion of the community and mindshare. Bitcoin SV has quite a few innovations going for it, including social media platforms and rudimentary human-readable username systems. But with a market ranking firmly outside of the top 10 and with far fewer major integrations than Bitcoin Cash, there’s certainly an uphill battle ahead. Additionally, the mark of Craig Wright has soured the project in the eyes of much of the greater cryptoverse, making partnerships and publicity difficult.

Litecoin (LTC) presents an interesting case as the longest-running payments-focused Bitcoin alternative, but so far, it has not yet managed to come into its own. From 2014 to 2017, itstransaction volume trended downward, only to rebound significantly as Bitcoin’s scaling issues began to arise. Since then, it has served as a testnet for Bitcoin of sorts, as well as an off-chain scaling solution. Litecoin’s own scaling path seems to be uncertain, as its own Lightning Network implementation found even less success than Bitcoin’s, while its current 4x on-chain capacity compared to Bitcoin still leaves plenty of growing room. Will Litecoin remain as a substitute until Bitcoin or another project evolves to fully take the payments lead, or will this be the opportunity it needs to take over the digital cash role? Either way, its fate seems to be inexorably tied with that of Bitcoin.

The dark horse in this division may very well be Dash, whose name is literally an abbreviation of “digital cash” and has competed for this use case longer than any other alternative except Litecoin. And despite steady growth in transaction numbers, regardless of a bull or bear market, it has largely gotten lost in an increasingly crowded field of payments coins, some with crypto celebrity backers, especially after the realignment from a privacy focus to an everyday payments focus.

Unlike its competitors, however, Dash has spent years working on quite a few real improvements to the payments experience, including instant transaction settlement and anti-51% attack protection, making a Dash transaction arguably more secure in seconds than what its competitors could achieve in minutes or even hours — an experience that’s particularly useful for in-person retail payments. This, combined with the recent release onto testnet of the long-awaited “Evolution” upgrade, which not only provides human-readable usernames and contact lists but also fully-decentralized digital identities, could make 2021 an interesting year for the crypto payments space. It remains to be seen whether the combination of instant payments with protocol-level ease of use will be enough to catch the attention of an industry with a notoriously short attention span.

The new U.S. regulations regarding non-custodial wallets may push more cryptocurrency users to skip the exchanges altogether and use their coins to directly buy and sell goods and services. Will this be enough to push Bitcoin to reclaim its peer-to-peer digital cash purpose by finally getting scaling solutions, such as the Lightning Network, developed enough so that they’re easily usable by the average person? Or will one of its children choose this time to shine, taking over the payments space while Bitcoin holds down the investment use case?

The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Joël Valenzuela is a veteran independent journalist and podcaster, living unbanked off of cryptocurrency since 2016. He previously worked for the Dash decentralized autonomous organization and now primarily writes and podcasts for the Digital Cash Network on the LBRY decentralized content platform.

Source: https://cointelegraph.com/news/us-crypto-regulations-will-return-bitcoin-to-its-digital-cash-origins

Blockchain

Elon Musk Teases Bitcoin Maximilsts Once Again

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The CEO of Tesla, SpaceX, and The Boring Company, has taken another humoristic stab at BTC maxis by asking how many are needed to change a light bulb. The wave of comments didn’t disappoint from names like Michael Saylor, Dan Held, Raoul Pal, and more.

  • Ever since the start of the year when Musk said he regretted not buying bitcoin years ago and later revealed that his EV company had actually purchased $1.5B in BTC, the billionaire has frequently been engaging with the community.
  • Most of the discussions used to be in a positive manner, but it all changed when Tesla disabled BTC payments citing environmental issues. When Musk started bashing the cryptocurrency for its high energy consumption levels, most Bitcoin maximalists changed their tunes as well.
  • However, it seems that Tesla’s CEO sees most of it from a humoristic point of view and the latest example, which came earlier today, supports this idea.
  • He reiterated a popular question on Twitter – ”How many Bitcoin maxis does it take to screw in a lightbulb?” Later on, his own response was also quite ironic.
  • Some popular BTC maximalists and other cryptocurrency commentators quickly offered their opinion on the matter. Michael Saylor, the CEO of MicroStrategy, was among the first who also caught the irony – “if you give us 10 minutes, maybe we can hash out the answer,” referring to how the Bitcoin network works.
  • Peter McCormack, the podcaster who recently interviewed the President of El Salvador on the country’s BTC adoption, took a stab at Musk, while Raoul Pal spoke about his views on what the BTC maxi tribe represents.
  • Interestingly, Dan Held, the Head of Growth at Kraken, responded with a reference towards Elon Musk’s favorite meme coin – Dogecoin.
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Source: https://cryptopotato.com/elon-musk-teases-bitcoin-maximilsts-once-again/

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Blockchain

Bitcoin’s Dominance Rises as BTC Reached a 4-Day High at $35,500 (Market Watch)

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Although bitcoin failed to continue upwards after its intraday high of $35,500, its dominance over the market has increased further. This comes as most alternative coins have stalled, except for Dogecoin, which is up by double-digits.

BTC Dominance on the Rise

After the mid-week crash, in which bitcoin slumped below $30,000 for the first time since January, the asset’s performance has been calmer. It recovered most losses and even spiked to just shy of $35,000 on the following day but failed to continue higher as reported.

The bears drove it south to around $32,000, but the trajectory quickly reversed in the following hours. BTC started climbing again and added more than $3,000 of value.

As a result, it charted a four-day high of approximately $35,500. Despite losing over a grand since then, its dominance over the market has actually increased.

The metric comparing BTC’s market capitalization with all other cryptocurrencies is up to 47%.

BTCUSD. Source: TradingView
BTCUSD. Source: TradingView

Alts Stall While DOGE Pumps

Most of the alternative coins have remained stagnant on a 24-hour scale. Although Ethereum recovered from its most violent stages of the crash, it still fails to overcome $2,000 decisively. As a result, ETH trades just north of $1,900 for a second consecutive day.

Binance Coin jumped higher in the past 24 hours and even exceeded $310 at one point, but has retraced since then and is currently around $290. Cardano, Polkadot, Bitcoin Cash, and Chainlink are slightly in the red since yesterday.

In contrast, Ripple, Uniswap, Litecoin, and Solana have marked minor gains. Dogecoin is the most impressive performer once more from the larger-cap alts following a 10% increase to $0.26.

Cryptocurrency Market Overview. Source: Quantify Crypto
Cryptocurrency Market Overview. Source: Quantify Crypto

More fluctuations come from lower- and mid-cap alts. Celo (20%) has surged the most, followed by Nano (16%), Siacoin (12%), THORChain (12%), Curve DAO Token (11%), and Waves (10%).

Klaytn has lost the most from yesterday after a 14% drop. Nevertheless, the cumulative market capitalization of all cryptocurrency assets has remained just shy of $1.4 trillion.

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Disclaimer: Information found on CryptoPotato is those of writers quoted. It does not represent the opinions of CryptoPotato on whether to buy, sell, or hold any investments. You are advised to conduct your own research before making any investment decisions. Use provided information at your own risk. See Disclaimer for more information.

Cryptocurrency charts by TradingView.


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Source: https://cryptopotato.com/bitcoins-dominance-rises-as-btc-reached-a-4-day-high-at-35500-market-watch/

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Blockchain

SOLANAX Private Sale Is On For The Cross-Chain DEX

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[PRESS RELEASE – Please Read Disclaimer]

The cryptocurrency market has left people wondering about the long-term growth prospects and which cryptocurrency they should invest in. Solanax is an automated market maker (AMM) based on the Solana blockchain, which is set to be a game-changer in the cryptocurrency world.

The SolanaX Platform

After parsing through their team of professionals, whitepapers, their project plans, and unique platform capabilities, there is no doubt that once the platform is up and running in full swing, it will undoubtedly change the way people transact today with its simple interface for the public to trade at a record higher blockchain speed and lower gas fees.

  • There are no time-consuming processes or intermediaries.
  • It offers a very simple interface and lower gas fees while initiating the transactions.
  • Solanax increases blockchain speed and makes it more convenient to transact than its peers in the cryptocurrency market.
  • As Solanax is based on Solana’s Proof-of-History verification concept rather than a Proof-of-Work system (as that of Ethereum’s), it will enable users to leverage Solanax’s phenomenal transaction capabilities (Solanax to handle thousands of transactions in a second as compared to Ethereum’s 15).
  • The most crucial part is that while speeding up blockchain transactions and lowering gas prices, Solanax does not compromise on the security aspect.

The Ongoing Private Sale Of Solanax

Solana blockchain is substantially faster compared to its peers, and the ongoing private sale is an opportunity for crypto enthusiasts and investors to participate in this game-changer prospect.

The private sale is still ongoing until Friday, 25th June.

Total Supply: 80 000 000 SOLD Tokens

There will be 20 Million SOLD Tokens distributed before the CEX listing.

Private Sale: Total available token supply – 10,000,000 SOLD

Period: From 06/06/2021 to 25/06/2021

Token Price: $0.1 with a 3months vesting period

Token Price: $0.15 w/o vesting period

Initial Exchange Offering: Total available supply – 10,000,000 SOLD

Final Words

Solanax aims to revolutionize the DeFi exchange network and enhance efficiency levels to new highs. With DeFi gaining popularity, there is an urgent need for the industry to look beyond the older cryptocurrency platforms like Bitcoin and Ethereum. The sluggish transaction speed is one of the prime reasons for Solanax not preferring the Ethereum-like platforms. Besides, Solanax, with its high blockchain speed, simple interface, and low gas fees, is truly a game-changer for crypto aficionados, and Solanax’s Ongoing Private Sale presents the perfect investment opportunity for investors.

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Source: https://cryptopotato.com/solanax-private-sale-is-on-for-the-cross-chain-dex/

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