Here are the top news from the cryptocurrency sector that you may have missed this week
Brazil approves Ethereum ETF in Latin America
QR Capital, a blockchain setup in Brazil, revealed on Wednesday this week via a Twitter post that it is set to establish the first Ethereum exchange-traded fund (ETF) in the Latin America region. The new ETF, dubbed QETH11, will be the second to receive approval from the Brazilian SEC after the March approval of an ETF founded by Bitcoin. Once implemented, QETH11 will be listed in Sao Paulo on the B3 stock exchange.
QR Asset Management, which takes part of the largest crypto exchange in the country, will manage the new ETF. The company described the product as one that would provide a reliable, non-complex, and secure way to access Ethereum through the preferred consumer brokerage service. Brazil follows the path of Canada, which has been quite receptive to cryptocurrencies, having approved three ETFs since the turn of the year.
The United States, on the other hand, has not been as accommodating to the SEC in the country delaying and granting extensions to ETF applications by companies in the country. Following approval, Fernando Carvalho of QR Capital has expressed his hope that the US SEC will follow the path and begin approving ETFs in the country.
British police seize $ 250 million in cryptocurrency
UK police announced this week on Tuesday that $ 250 million worth of cryptocurrencies were taken in an investigation into money laundering schemes in the country. The police Economic Crimes Command seizure amounts to one of the largest seizures made in the force’s history and follows another seizure made late last month when $ 160 million worth of cryptocurrency was seized.
While delivering a statement, Graham McNulty, the Metropolitan Police Deputy Commissioner, noted that there has been a change in the landscape and that criminals are increasingly using technological developments to advance their activities. He acknowledged that cryptocurrencies had become the preferred resource for criminals seeking to launder their money and praised that the department is well-equipped with officers equipped to tackle such activity.
British Police Detective Joe Ryan hailed the seizure as a milestone and promised that investigations will continue for months to come as the war against suspected money launderers continues. However, the police did not reveal which specific cryptocurrencies had been seized.
JP Morgan: El Salvador’s acceptance of Bitcoin will seriously affect the blockchain
A JPMorgan team suggested last week through a report Thursday that El Salvador’s Bitcoin decision could spell trouble for both the country and the blockchain once the use of coins begins. The Central American country recently approved the use of Bitcoin as accepted legal tender. The team argued that even with Bitcoin’s daily trading volumes ranging from $ 40 billion to $ 50 billion, the majority of this portion is traded between crypto exchanges.
Analysts further indicated that the majority of Bitcoin holdings are reserved in illiquid wallets, and up to 90% of them remain immobile for more than a year. On the other hand, El Salvador’s daily transactions reflect 4% of the total chain transactions and a little more than 1% of the total volume of transactions during the past year.
The team suggested that there is an inherent incompatibility of Bitcoin and El Salvador and as such, once the new tender is launched as a medium of exchange, the lack of liquidity of Bitcoin would prove to be a significant impediment. Recent polls have indicated that there is still widespread doubt about the new legal tender and that potential acceptance rates would not be high as Salvadorans continue to prefer the dollar.
Woori Bank is South Korea’s newest crypto custodian
Reports on Sunday revealed that Woori Bank of Woori Financial Group in South Korea will become the third and last major institution in the country to offer crypto custody services. The report stated that Woori Bank intends to collaborate with Coinplug Inc., a fintech solutions company, to launch the new company named D-Custody.
The move would make Coinplug the majority shareholder, followed by Woori Bank, which would provide the escrow services. The demand for crypto custody services in South Korea has been astronomical, courtesy of the government’s decision to tighten its grip on regulations covering crypto assets. Investors have become increasingly reluctant to own crypto themselves.
South Korea’s crypto regulations have led to a ban on banks from offering direct crypto services in recent months, forcing them to venture into partnerships to provide such services to clients. Additionally, South Korean surveillance has also pushed regulations that will render employees at crypto exchanges unable to trade cryptocurrencies on their respective exchanges starting in September.
Federal Reserve Prepares to Release Crypto Report in September
Speaking on Wednesday when he presented the semi-annual monetary policy report to Congress, Federal Reserve Chairman Jerome Powell revealed that the body would release a report on crypto assets, CBDC and stablecoins in early September. Powell indicated that the country was at a critical point in establishing regulations for these assets and, consequently, for the CBDC, the opinion of the public and the Congress would be sought to determine the probable benefits and disadvantages.
More on CBDC, Jerome Powell insisted on the need for the United States to get it right rather than fast. As such, he dismissed the idea that the Chinese digital yuan could be usable in the US, stating that all US citizens and those of other countries that depend on the dollar should understand a potentially useful CBDC.
China has been developing its national CBDC since 2014 and recently expanded testing for the digital currency. Powell also pointed out that if a government-controlled digital dollar were to develop, then they could be curtains for digital assets like Bitcoin that are independently controlled.