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Shanghai Man: Economist says El Salvador ‘on road to death’, salaries paid in e-CNY …

Our Man in Shanghai has refused to let recent regulations slow down the news coming from China. Enterprise blockchain, central bank digital currencies and start up projects continue to make a positive impact in a region hoping to grow economic value through technology.

Death march for El Salvador

The debate around El Salvador continued this week as media and officials tried to digest the adoption of Bitcoin as a national currency. JPMorgan stated that there was little economic benefit, and John Hopkins University professor Steve Hanke warned that the move could “completely collapse the economy” of the small nation. The former Bank of China deputy governor Wang Yongli took a very hardline approach, by stating that volatility and a lack of regulation or controls would put the economy on a “road to death.” This quote, appearing in state run media The Paper June 9, was an unusually direct and colorful statement on the issue.

Crypto innovation can be productive

Zhou Xiaoquan, a former governor of the People’s Bank of China, had a few positive things to say about cryptocurrency as a technology on June 11. He spoke at an economic summit in Shanghai and noted the cryptocurrency innovation in China can be productive when it serves the real economy. He also took some shots at other countries, stating that people would be mistaken if they thought other countries were taking the same approach towards building financial services. Zhou, who is one of the most often-quoted economists in the country, felt there was little emphasis on the relationship between financial services and economic value elsewhere in the world. Based on the wild displays at the Miami Bitcoin conference a few weeks ago, his position might be more sound than others would care to admit.

Paid in e-CNY

China’s e-CNY tests continued with the first reported mass payment of salaries in Xiong’an, a district near the capital Beijing. According to Cointelegraph, the pilot received support from a number of national banks and saw subcontractors paying workers their salaries from a digital wallet.

Industrial blockchain worth $22.6B

On June 3, a government organization issued a report entitled the China Industrial Blockchain Development Status and Trend Report. According to the report, in 2020, 222 industrial blockchain policies were issued, 12,059 new blockchain-related patent applications were approved, and 776 new blockchain enterprises were established. The report also claimed that the current market size of the industrial blockchain sector was around $22.6 billion U.S. dollars. Industrial blockchain is an area that China is eager to grab control in, leading to this explosive growth in recent years.

Only 5X the fun

Leading exchange Huobi surprised futures traders by limiting them to only 5x leverage on perpetual swaps and blocking new users from accessing the feature altogether. Futures trading, particularly highly-leveraged futures trading, had always been popular features on exchanges like OKEx and Huobi. It will be interesting to see whether these new decisions to limit risk will be damaging to these large exchanges that still somewhat adhere to regulator rules. It’s also possible that it’s a short-term solution in order to avoid scrutiny during periods of tighter control.

Futures of Singapore

While Huobi was tightening controls on futures traders, Singapore-based platform SynFutures was completing a Series A for $14 million. The round was led by Polychain Capital and included names like Framework Capital, Pantera Capital, Bybit, Kronos Research, WOO Ventures, Wintermute, and IOSG Ventures. SynFutures is creating a trustless derivatives market where users can take positions on assets or anything that has an accurate feed, including Bitcoin, the price of gold, or even the Bitcoin hashrate. What many people don’t know is that the SynFutures team is composed of members from Matrixport, a financial service app that was an offshoot of massive Chinese mining conglomerate Bitmain. Now you know the whole story!

This weekly roundup of news from Mainland China, Taiwan, and Hong Kong attempts to curate the industry’s most important news, including influential projects, changes in the regulatory landscape, and enterprise blockchain integrations.

Shanghai Man: Economist says El Salvador \’on road to death\’, salaries paid in e-CNY …

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CABEI Lends assistance to EL Salvador for Bitcoin Adoption

On Monday, 14th June, the head of the multinational development bank, CABEI (Central American Bank for Economic Integration), announced that the bank would provide technical assistance for the implementation of Bitcoin as legal tender in El Salvador.

In the Monday press conference, The executive President of the Central American Bank For Economic Integration, Dante Mossi, said the development bank is looking forward to collaborating with the finance ministry of EL Salvador for the selection of a technical team to carry out a successful bitcoin implementation process.

Mossi admitted at the Monday press conference that the Government of El Salvador was actively looking for assistance from the financial institution to allow a proper enactment of Bitcoin as a legal tender in the country. 

Mossi seemed pleased while delivering the message to EL Salvador’s government and the President that how proud he feels that the Central American Bank for Economic Integration came out to be the first choice of President Bukele and the Government authorities of El Salvador. Further, Mossi brought up the point that there is no other country in the world that has adopted Bitcoin cryptocurrency as widely as this country has done. He said, protecting public privacy is a big challenge today, and to overcome this, we must choose the most efficient method.

Mossi gave out some details about the formation of the technical advisory team of the bank that would involve CABEI members, the ministry of finance and central bank officials from EL Salvador. 

The development bank also aims at helping in project planning and providing navigation assistance regarding the legal aspects of Bitcoin implementation as the legal currency of El Salvador.

Challenges in Bitcoin Adoption 

Last week, El Salvador turned into the first country to receive Bitcoin as a legal tender after Congress authorized President Nayib Bukele’s recommendation to accept the cryptocurrency.

Early this month, after El Salvador collaborated with digital wallet company “Strike” to foster the country’s advanced financial framework utilizing Bitcoin technology, President Bukele presented the bill to Congress.

After a couple of days, El Salvador’s President Bukele reported that bitcoin mining would be carried out under the nation’s state-run geothermal energy utility by employing power produced from volcanoes. The declaration was made only a few hours later, the Central American country’s CongressCongress cast a ballot to make the crypto a plausible legal tender.

Still, the International Monetary Fund (IMF) cautioned El Salvador about the dangers of utilizing cryptocurrency for everyday exchanges. An IMF group planned to meet with the President of El Salvador as the worldwide association reflected upon another aid package for the country during its recuperation from the Covid-19 pandemic. 

Meanwhile, El Salvador’s President disclosed that he was in touch with the IMF and expressed that he would clarify the operations comprehensively and the situation with the economy regarding how the currency functions as a legal tender in the country.

Conclusion 

President Bukele promises a robust selection of experts from CABEI would be made for effective risk assessment, investment plan, financial education, and regulation. CABEI, on the other hand, seems to be equally invested.

CABEI Lends assistance to EL Salvador for Bitcoin Adoption

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IMF plans to meet with El Salvador’s president, potentially discussing move to adopt Bitcoin

The International Monetary Fund has said El Salvador’s recent decision to make Bitcoin legal tender in the country may raise legal and financial concerns.

In a Thursday press briefing from the International Monetary Fund, or IMF, spokesperson Gerry Rice said the group was already in discussions with lawmakers in El Salvador over a loan to support the country’s economy, having approved emergency funds related to the pandemic last year. However, Rice said an IMF team would be meeting with President Nayib Bukele today and implied crypto would be a likely topic for discussion.

“Adoption of Bitcoin as legal tender raises a number of macroeconomic, financial and legal issues that require very careful analysis,” said Rice. “We are following developments closely, and we’ll continue our consultations with the authorities.”

Spokespeople for the IMF have often voiced concerns about countries adopting digital currency. In March, the group issued a similar warning against the Marshall Islands’ recognizing its digital sovereign currency, called SOV, as legal tender, as it may pose similar legal and financial risks. In that case, a spokesman said the islands’ local economy had been strained by the economic fallout of the pandemic and likely wouldn’t be corrected with the SOV.

Related: Marshall Islands digital currency would ‘raise risks,’ says IMF

In the case of El Salvador, the time between the introduction of ideas and action is seemingly short. President Bukele first announced he would propose a bill making Bitcoin (BTC) legal tender in El Salvador at a pre-recorded video message at the Bitcoin 2021 conference this weekend. The legislation passed with a supermajority in the nation’s Legislative Assembly yesterday.

Though the country is still seeking support from the IMF related to the pandemic this year, it has already begun to consider the energy needs of Bitcoin miners. Bukele said he would be instructing state-owned electrical company LaGeo, to make certain facilities available to miners to utilize geothermal power from the country’s volcanoes — El Salvador currently operates the two geothermal plants in Ahuachapán and Berlín.

“Crypto assets can pose significant risks,” said Rice. “Effective regulatory measures are very important when dealing with them.”

IMF plans to meet with El Salvador’s president, potentially discussing move to adopt Bitcoin

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Mexico lawmakers aim to follow the example of neighboring countries with proposed Bitcoin legislation

Eduardo Murat Hinojosa, a senator of the federal government of Mexico, has said he will be submitting a proposal to lawmakers seemingly aimed at crypto adoption in the country.

In a tweet today, Hinojosa changed his profile picture to feature the senator speaking into a microphone with the iconic “laser eyes,” indicating support for crypto. The lawmaker said he would be “promoting and proposing a legal framework for crypto coins in Mexico’s lower house,” specifically mentioning Bitcoin (BTC).

Hinojosa was not the only Mexico lawmaker indicating their support for crypto. Indira Kempis Martinez, a senator representing the state of Nuevo León, has also switched her profile to show laser eyes, with Hinojosa referring to her as a friend to the cause.

“We are going to lead the shift to crypto and fintech in Mexico,” said Hinojosa.

The social media activity comes as countries in Latin America have seemingly been taking steps towards greater adoption of crypto. In a video announcement to attendees of the Bitcoin 2021 conference last week, El Salvador President Nayib Bukele said he would send a bill to the country’s legislature demanding that Bitcoin be made legal tender.

On Sunday, Paraguayan congressperson Carlitos Rejala hinted that crypto would be connected to “an important project to innovate Paraguay in front of the world” starting this week. Yesterday he added that he was working with local crypto figures “in order for Paraguay to become a hub for the crypto investors of the world.”

Though Mexico has many individual investors who back Bitcoin, authorities in the country reported last year that cartels had been increasing their use of crypto to launder funds. At the time, the head of the Mexican attorney general’s Cyber Investigations Unit said the country’s law enforcement lacked the resources needed to tackle money laundering when crypto was involved.

Mexico lawmakers aim to follow the example of neighboring countries with proposed Bitcoin legislation

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5 Blockchain Predictions Moving Forward

Codezeros

Most of the information and technology in 2021 is on the verge to adapt new changes to attain faster and more predominant communication. That is why Blockchain technology is already on the verge of embarking a stern existent into the framework.

Thus, many blockchain development companies are upgrading day by day and evolving more. This evolution can benefit your business as well.

5 Blockchain Predictions Moving Forward

Stronghold of blockchain’s future

It is through blockchain and identity of several newer technologies that came as a part of cryptocurrencies, like Bitcoin and Ethereum, the whole money transaction format has seen a newer advancement. Apart from merely being seen as a digital payment platform, there is more that is expected from Blockchain technology.

Blockchain has eradicated the complete usage of centralized management entities such as a bank. It is because it is a distributed peer-to-peer ledger system, and money transmission from one continent to another has got easier. The system has brought some newer introductions like data blocks, which are kept in series or chained together while a ledger transaction is made.

One can get truly high transparency thanks to the open-source, impermeable configuration of the blockchain. Each record that passes through blockchain technologies is sent through millions of computers worldwide to get confirmed about the accuracy.

And, this advent of new technology is making the world change. Be it transactions for business or record keeping; the new blockchain technology has completely automated the whole process.

Businesses should embrace this technological change because, firstly, it is cost-effective and also brings a faster solution.

So, here are the 5 most important predictions of blockchain technology.

1. Government data distribution

This move of the government to the Distributed Ledger Technology system has been predicted for a long time because of the rapid digitization of the system.

It is due to the increasing advantages that Distributed Ledger Technology holds, like trust, transparency, and security via encryption and validation features.

2. Greater transparency between industries

Transparency and security will get a level up when blockchain is spread throughout the world. It is well anticipated that in some years, industries will be connected with a single blockchain that is shared all across.

Long had gone the age when each company or industry had systems that differ from company to company. However, with a single system, things become less complex and are better for accessibility to the public. And truly, it sticks with the primary aim of keeping things crystal clear whilst providing great security.

3. Institution-issued cryptocurrency

Along with the usage of the blockchain network, seemingly, the government will put focus on cryptocurrency development. The shift is much needed as it will transform fiat currency into cryptocurrency. A rapid change is needed because cryptocurrency benefits in being more traceable, which has reduced settlement times and is overall more efficient.

Another thing, which came into highlight is that cryptocurrency, just like the fiat currency, is also backed by real assets, and in this, the prices can be manipulated in numerous ways.

Zimbabwe recently shook the world by using Bitcoins to oppose the national currency. And they are doing this to form their indigenous digital currency, which will be nationally available. And this creates a mega opportunity for any blockchain development company to make a mark in the industry.

4. Blockchain and identity

The identity systems are very much defective these days. Firstly, they are more likable to get into errors, they function in isolation, and they are completely porous. However, the blockchain identification platform can be effective here, as it uses a single source to verify identity and assets. The “self-sovereignty” feature of blockchain has brought newer advantages in identity.

1.5 billion people throughout the world have several inadequate ways of proving their identity. However, even the disqualified people will get the ability to access legal documentation and privileges with the help of the blockchain platform.

The information of identification is stored in an open-source encrypted ledger, which makes things more secure than keeping them in the hand of third-world agencies.

5. World Economy via blockchain

The international trading that has been preexisting for years is now found to be an inefficient and dysfunctional process. These demerits of international trade shallows and slows down the motion of trade and dampens trade between nations. International trade in 2021 is full of fraud, counterfeiting, dirty politics, and errors.

Cryptocurrency can eradicate all such issues like fraud and less productivity, as it bundles up several methods of payment, paperwork, and regulation through a single digital international system. This process will also increase the trust between each nation.

Blockchain development is much needed not only because it is advanced but also due to cryptocurrency involvement. The business applications are getting smart contracts and automated tracking and policy enforcement. All of these greatly increase reliability and make things easier.

Conclusion

Adapting and shifting the complete framework of money transaction into Blockchain development is much needed in the world, more of the digitization that is going all around the world.

5 Blockchain Predictions Moving Forward

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