In the United States, cryptocurrencies will proliferate more as investment assets than as tools for payments, the Federal Reserve indicated. This and more news in this practical daily summary so that you are always informed with the most recent events that occur within the crypto world.
Bitcoin and Blockchain Adoption
📍Cryptocurrencies are the new investment trend for Americans, according to the report on economic well-being in the United States, published by the FED. The United States Federal Reserve (FED) has published the report “Economic Well-Being of U.S. Households in 2021,” where he reveals economic data on Americans and discusses, for the first time, cryptocurrencies as potential investment assets.
According to the report, the use of cryptocurrencies as investment assets has grown significantly among the US population, making it more likely that this type of digital asset will continue to be used more as an investment mechanism than as a payment tool, the report noted.
The Federal Reserve stated that although less than a quarter of the US population has had contact with cryptocurrencies, the use of these digital assets was more common as an investment than for commercial transactions. In addition to this, the FED also indicated that people who used cryptocurrencies as a form of payment lacked bank accounts and traditional credit cards. All of this exposes the potential of cryptocurrencies as a tool for financial inclusion.
📍A Japanese bank will create a new company to offer crypto custody services. Japan's Sumitomo Mitsui Trust Bank has announced that it will create a new subsidiary focused on crypto assets. Its plan is to offer cryptocurrency custody services, to give its institutional investors and corporations access to digital assets.
According to the bank, its institutional clients will be able to manage cryptocurrencies and non-fungible tokens (NFT) within a safe and regulated environment.
The initiative by Sumitomo Mitsui Trust Bank, which follows that of the Japanese bank Nomura, seeks to help its clients enter the world of cryptocurrencies in a reliable way.
NFT and DeFi Markets
📍Spanish fashion house Balenciaga plans to adopt cryptocurrencies as a means of payment. Bitcoin and Ethereum will be the cryptocurrencies that the fashion house Balenciaga will accept as payment methods from its flagship stores in the United States and also from its online store.
According to media reports, the renowned Spanish fashion house revealed this week that cryptocurrencies will be part of its long-term growth plan. In the future, Balenciaga will integrate several of the main cryptoassets on the market, such as Bitcoin and Ethereum, into its payment methods, although it also revealed that the cryptocurrencies listed among its payment options will largely depend on the provider it chooses for this.
Despite the sharp decline that cryptocurrencies are currently experiencing, the Spanish company indicated that fluctuations in the value of these digital assets “are nothing new.” Balenciaga does not rule out the possibility that its customers can pay for its designs using crypto assets in its famous stores.
CBDC and Central Banks
📍The Bank of France predicts that CBDCs will become a “superior” payment system in the coming years. François Villeroy de Galhau, governor of the Bank of France, said that in the next 3 years it is likely that the CBDC become a superior payment system.
During a panel at the World Economic Forum, the governor of the French bank said that wholesale CBDCs could be the first to go mainstream. In March this year, during his keynote speech at the World Economic Forum, BIS Innovation Summit 2022Villeroy said that CBDCs are not the enemy of DeFi, but rather that this kind of digital currency, issued by a central bank, could help decentralized finance be successful and sustainable.
Villeroy de Galhau believes that Europe should not be left behind in the development of this financial innovation.
Rules and Regulations
📍South Korean regulation forces exchanges to prevent confidential transactions on the Litecoin network. Several cryptocurrency exchanges in South Korea have warned about the sensitive transactions that the Litecoin network's MimbleWimble privacy protocol allows its users to perform.
Under the Act on Reporting and Use of Specific Financial Transaction Information, Korean crypto exchanges are subject to implementing strict KYC and AML controls to prevent financial crimes and illicit activities. Due to the regulation, since Litecoin's update, which allows its users to make private transactions, exchanges have been forced to warn about such transactions.
According to crypto journalist Colin Wu, these warnings may lead to exclusion of the Litecoin (LTC) cryptocurrency of the Korean market.
Continue reading: A Swiss bank with 132 years of history will launch services in Bitcoin and other cryptocurrencies
