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Brazil Investment CEO On Bitcoin Exchange Launch: ‘I’d Rather Crypto Didn’t Exist’

XP Group, owner of the largest investment firm in Brazil, XP Investimentos, confirmed it would launch a cryptocurrency exchange this week – despite its CEO saying he wished it “didn’t exist.”


Benchimol: ‘We Felt Obligated’

As Bloomberg reports quoting Guilherme Benchimol at an event in Sao Paulo, XP will finally give in to investor demand and begin a Bitcoin and Ethereum trading operation after six months of rumors.

“I must confess, this is a theme I’d rather didn’t exist, but it does,” the publication reports him as saying.

We felt obligated to start advancing in this market.

Like many South American markets, Brazil has seen a palpable uptick in Bitcoin 00 trading activity. While its figures do not match those of markets such as Chile, Argentina and Venezuela, weekly volumes for P2P platform Localbitcoins alone regularly top 1.5 million reals ($367,000).

XP Investimentos had been planning its entry into the market since at least April, insiders telling the press at the time a crypto trading platform was incoming. The company registered an entity called XP COIN INTERMEDIACAO in August last year.

The final product will go by the name of XDEX – perhaps a nod to the decentralized exchange phenomenon – and involve a team of around 40, Bloomberg adds.

Bitcoiners Bite Back Against Banks

Brazil’s extant exchange and wider cryptocurrency business sector is meanwhile struggling with an increasingly hostile landscape involving banks.

Similar to complaints in Poland in recent months, a government agency is now investigating claims that those businesses are subject to account shutdowns by institutions which would rather not deal in crypto-related transactions.

“…It does not seem reasonable for banks to apply restrictive measures a priori on a straight-line basis to all cryptocurrency companies, without examining the level of compliance and anti-fraud measures adopted by individual brokerage firm,” the agency told Reuters when the news surfaced this week.

What do you think about XP Group’s exchange announcement? Let us know in the comments below!


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Srp 25

Over $6 Billion in Daily Trading Volume Faked Across Top 100 Exchanges

A new report found that over 70% of the top 100 exchanges on CoinMarketCap are engaging in excessive wash trading from three to thousands of times their stated volume.

[Note: This is a guest article submitted by researcher Marco Paez] 


Two-Thirds of 24 Hour Trade Volume May Be Fake

It’s been a month since CoinMarketCap (CMC) made changes to the way they post exchange volume stats after being called out by multiple sources for supporting bloated volume numbers. An adjusted volume metric was added to the site which changed up the rankings substantially, however, the new adjusted rankings still seemed to be suspect by many in the industry.

Released this week, research compiled by the Blockchain Transparency Institute (BTI) gives clearer insight into how massively overstated the daily volume numbers actually are. Tallying up the volume numbers of the top 130 exchanges, the report found that over $6 billion in daily trade volume is being faked, comprising over two-thirds of the total 24-hour trade volume.

Released this week, research compiled by the Blockchain Transparency Institute (BTI) gives clearer insight into how massively overstated the daily volume numbers actually are.

The largest offenders in the top 10 include Bibox, which appears to be wash trading their volume over 85x, Bit-Z to over 469x, ZB over 391x, LBank 4400x. The worst of the bunch is BCEX at over 22,000x.  All of these exchanges trail Binance in the daily unique visitor’s statistic between 50 and 600x.

The top exchange in the USA is Coinbase, which climbs the ranks up to #3. Another big mover into the top 10 is Bithumb at #4 which overtakes Upbit as the largest exchange in South Korea. Upbit is currently under investigation for fraud, money laundering, and wash trading which correlates with data showing an over-reporting of their volume by 11x.

Binance sits at the top of the chart at #1 with a massive amount of unique daily visitors to back them up.  Bitfinex slides into the number 2 spot behind their high dollar clientele and $10,000 minimum deposit for entry.

KuCoin, Cryptopia See Big Gains

A large chunk of the top 25 exchanges have dropped all the way out of the top 100. According to the data, these exchanges typically have less than 1,000 site visitors per day. The majority of these exchanges also seem to be mass produced, as they all appear to be using the same UI and trading engine.

Coinex, which was left out of CMC’s adjusted volume rankings due to transaction mining, finds itself inside the top 25 using this data. Other transaction mining exchanges such as Coinbene and Bit-Z dropped well outside of the top 25 exchanges from their previous rankings.

Kucoin and Cryptopia are the biggest movers-up the charts landing in at #19 and #24, and moving up from #58 and #90 respectively, after watching all the fake volume ahead of them disappear. Both of these sites have unique daily visitor counts in the top 10 of all exchanges. The BTI report notes that many of their customers are trading on low volume and low market cap coins, which keep them outside of the top 10.

The research team states they used data obtained from SimilarWeb on website traffic coupled with order book research conducted by Sylvain Ribes. His report detailed excessive slippage rates of top 15 exchanges including Okex, Huobi, Lbank, and Bit-Z. The combination of these data sets was plugged into a new formula which produced a vastly different top 25 than what is being reported. A rundown of their methodology for the rankings can be found here.

Data collected from SimilarWeb also reports many of these offender exchanges getting up to 90% of their referral volume from rankings pages, overwhelmingly from CMC. This naturally incentivizes wash trading by any exchange looking to move up the ranks.

When compared, the slippage data of the known respected exchanges and monthly traffic data appears to be in correlation. Binance, Coinbase, Bittrex, Bitfinex, Kraken, Poloniex, and Kucoin all have monthly visitor counts well above the rest of the top 100 exchanges as well as very low slippage when their order books were checked.

The report notes that although their data is reported with an accuracy of 1:1 this does not mean there is no wash trading going on, just that none could be proven using their current model.

The report notes that although their data is reported with an accuracy of 1:1 this does not mean there is no wash trading going on, just that none could be proven using their current model.

Lending credibility to these top exchanges, it was recently reported that Coinbase is building a new system to monitor suspicious trading activity known as the Coinbase Trade Surveillance Program. The system in place is one of the ways Coinbase says it is using to prepare for the $10 billion of institutional money waiting to move into the space.

Gemini also started a similar program in April when it partnered with Nasdaq to monitor its marketplace. Nasdaq’s SMARTS Market Surveillance technology is currently monitoring activity across all of Gemini’s trading pairs. Gemini moved up from #26 to #14 in the BTI rankings.

These types of initiatives continue to be implemented as the space matures in preparing the market for institutional investors. With more important ETF decisions looming this year, these exchanges seek to prove to the SEC that they’re doing due diligence in securing their platforms from manipulation.

BTI’s full rankings list of the top 130 exchanges can be found here.

What are your thoughts on misrepresented and overstated value among major exchanges? Let us know in the comments below!


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South Korea’s Biggest Exchange UPbit 100% Solvent, New Report Finds

A new report from a Korean accounting firm has found the South Korean crypto exchange giant to be 100% solvent in light of recent worries about misconduct. A May raid on the company’s headquarters worried investors, who are now letting out sighs of relief as audits reinforce the company’s integrity.


A Knock at the Door

The Seoul-based company UPbit was able to prove its integrity to investors, Forbes reported on Sunday evening. The audit comes amidst a May 10th and 11th raid on the company’s Gangnam branch by Korean authorities. Forbes reports that:

As part of the raid South Korea’s financial watchdog, the Financial Services Commission (FSC), along with the Korea Financial Intelligence Unit (KFIU), seized hardware and documents from UPbit to evaluate claims from unknown sources that the exchange was insolvent.

South Korea’s Financial Services Commission Announces Creation of Crypto Division

On May 11th, Bloomberg noted the already-skeptical attitude that emerged in some circles prior to the raid, saying:

Before the clampdown, South Korea was something of a ground zero for the global crypto-mania. Volume on local exchanges soared at the end of last year, with Bitcoin and other tokens fetching large premiums in the country relative to international markets. The boom alarmed officials including Prime Minister Lee Nak-yon, who said that cryptocurrencies might corrupt the nation’s youth.

Subsequently, the UPbit raid served to reinforce the views of crypto-skeptics like Lee Nak-yon.

A Sigh of Relief

Bitcoinist reported that subsequent to the raid, Bitcoin 00 dipped below the $9,000 mark amid investor panic. These fears “had a knock-on effect on altcoins, with Ether (ETH) dropping 8.4% to lose $700 support while Ripple (XRP) and Bitcoin Cash (BCH) both fell around 15%.”

The storm surrounding UPbit has seemed to clear, however. South Korean accounting firm Yoojin was tasked with overseeing the audits.

Still, many remained uneasy absent an official statement from the Korean government on the matter. Korean firm Dunamoo, however, has unveiled a report showing the results of the audit, which surely bode well for worried investors. Lee Seok-woo, president of Dunamoo, said:

UPbit currently has the exact amount of money held by the platform’s investors along with additional funds, more than enough to compensate every investor. Hence, UPbit is able to process withdrawals for customers upon the request of its customers and the exchange will continue to release audit reports on a regular basis to prove its solvency.

Investors will surely be able to take a deep breath as the company has assured its stakeholders that all is well. Despite proving solvency, the UPbit scare will surely leave many skeptics resigned to their positions. For the time being, however, investors are able to catch some sleep at night.

What are your thoughts on UPbit emerging unscathed from their audit? Let us know your thoughts in the comments below.


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Square Cash Quietly Reveals It’s Avoiding Public Cryptocurrency Exchanges

In its recently published quarterly report, Square revealed it’s channeling Bitcoin trades from its Square Cash application to private brokers instead of public exchanges.


Jack Dorsey’s Square Cash application enabled Bitcoin purchases and sales for most users early in 2018, adding to its consumer payments suite. Though overall, Square’s profits are substantial, it’s not making a fortune on Bitcoin trades just yet. Square reported just $400,000 profit on $37 million worth of revenue from Bitcoin for quarter two, 2018.

Square hasn’t announced that it has moved to over-the-counter (OTC) trading services for its Bitcoin transactions. The published quarterly report instead quietly revealed that Square “purchases bitcoin from private broker-dealers,” to facilitate Bitcoin trades for users of the application.

Why Over-the-Counter?

There could be a number of reasons behind Square’s choice, firstly it could protect Square from some of the Bitcoin price volatility seen on public exchanges. Sudden large sellouts from weighty Bitcoin owners and market “whales,” move Bitcoin’s price far quicker than on OTC desks. Meltem Demirors, chief strategy officer at CoinShares told CNBC:

Working with a broker likely gets Square better pricing and better execution services than floating orders on the open market, as well as more confidentiality.

Secondly, the company could be looking to avoid some of the security issues and hacks associated with public cryptocurrency exchanges. Private brokers and OTC services may also be providing Square with faster Bitcoin transactions while at the same time hiding Square’s market activity from competitors.  

Square Cash App

Potentially, the move also gives Square more visible compliance from its use of institutional style trading facilities. Square has yet to comment on the matter.

OTC Bitcoin Trading Increasing

A recent study by TABB Group, if accurate, shows that OTC trading of Bitcoin may have overtaken daily Bitcoin trading volumes on public exchanges. Certainly larger trades of Bitcoin by millionaire investors and institutional investors moving over, along with Bitcoin associated enterprises, may be fuelling OTC service demand.

TABB Group puts OTC trading of Bitcoin at $12 billion dollars worth per day, but the study has been refuted by some. According to statistics from coinmarketcap.com daily trading of Bitcoin via public exchanges is around $4.3 billion.

What do you think an increase in OTC Bitcoin transactions means for cryptocurrency markets?


Images courtesy of Shutterstock, Bitcoinist archives

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New Coinbase Pro Platform Off to a Rocky Start Amid Flurry of Criticism

Digital currency exchange Coinbase shuttered GDAX on June 29th and transitioned to Coinbase Pro. The new interface is marketed as an upgrade but has received a lot of initial criticism.  


Coinbase has been very busy over the last few days. Responding to criticism about failures with their customer service, the exchange said on Thursday how they are planning to open a new office in Portland Oregon.

An official announcement from the company says the new location will be hiring for roles based on “customer support, finance, compliance, IT, and HR.” The news comes a few weeks after the exchange officially opened an office in Japan to help “accelerate the global adoption of cryptocurrency.”

Yesterday, Coinbase officially said goodbye to GDAX and invited people to start using the new Coinbase Pro. A company blog post said gdax.com would not be accessible after June 29th, but part of it still apparently lives on, as the design team has emulated GDAX’s interface in one of Coinbase Pro’s color themes.

Hello Coinbase Pro

Coinbase Pro General Manager David Farmer wrote in a blog post how the new interface was built on top of the GDAX trading engine. After June 29th, all GDAX balances and trading history are now automatically seen on Coinbase Pro.

Farmer said GDAX’s API would be functioning until December 31st, 2018 and encouraged those on Coinbase Pro to migrate their API usage away from GDAX.

Coinbase has been advertising the purported upgrades and advantages of Coinbase Pro over the last couple months. A company blog post from May said the platform is “completely dedicated” to the needs of the cryptocurrency trader.

Along with the automatic migration of transactions and balances, Coinbase Pro features a new design that is intended to make “the trading experience easier and more intuitive.” The company says it also has a simplified deposit and withdraw process, better charts for users trying to find historical data, and a new portfolio “that lets customers easily see an overview of their account orders and balances.”

Coinbase Pro touts a variety of benefits on their homepage, including an “industry-leading API”, FDIC insurance protection for USD balances up to $250,000 per customer, and 0% maker fees.

The company said their vision is to give users the ability to “interact with digital assets in new and unique ways,” including through services like staking and protocol voting.

‘This Does Not Look Good’

Coinbase Pro said in a June 29th tweet how a number of customer feedback suggestions from the previous two weeks were live on the platform. This included layout optimizations, more theme options, and a bigger market selector.

But many of the early reactions to the new Coinbase Pro have been negative, and a growing number of people seem to be taking to the internet to try and problem-solve through issues.

Criticism started to emerge on Coinbase Pro’s official Twitter announcement. One user commented and said the new platform is “not a step for the better” and questioned if the team’s “UI or UX designers quit?”

Another said the platform’s GUI was slowing down their computer, pointing out how their utilization was above 25% “the moment the switch to pro occurred.”

Reddit community /r/coinbase experienced a flurry of activity after launch, and a lot of the commentary was not positive.

One user posting on June 30th called for a “Coinbase Pro boycott” after noting they had not seen a “single positive response to Coinbase Pro.” They said they would consider trying to get used to the new platform since Coinbase offered “relative safety” with holding funds, but said it was otherwise “complete garbage.”

Some users said the ability to zoom and scroll back on charts was a positive, but others mentioned how some features were not really usable on mobile devices. One user asked how they can get the GDAX page layout back and questioned if the new platform was even tested before being rolled out. Another simply said the new design was “two steps backwards.”

A couple of people seemed to take things into their own hands and posted ideas and suggestions in response to criticisms about Coinbase Pro.

One user recommended people make their own dashboard with the API in order to customize the platform to avoid issues. Another posted a “fix” for Coinbase Pro’s apparent lagging for high volume traders, which included minimizing browser width to “make the site usable again.”

Since Coinbase Pro is so new, team members are assuredly working on smoothing out any issues and figuring out what needs to be changed. But only time will tell about how many the initial complaints and criticisms will be addressed in future updates.

What are your thoughts on the new Coinbase Pro? Let us know in the comments below!


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Čvn 29

Indian Exchange Says Women More Bullish on Cryptocurrency Than Men

Women in India are making larger individual investments in cryptocurrencies compared to men, according to one local exchange. However, men are leading the charge when it comes to sheer numbers.


Women are Bigger Spenders

Women have turned out to be the bigger spenders in India when it comes to cryptocurrency investments, according to a recent survey conducted by BuyUcoin – a local cryptocurrency exchange. The average female trader invests more than RS 1.4 lakh (roughly around $2,000) in virtual currencies, double the amount their male counterparts invest.

The exchange surveyed more than 60,000 respondents between March and June of this year. According to the BuyUcoin CEO Shivam Thakral, the increased amount of money women invest is tied to their average age:

Usually, woman investors who are buying or trading are over 40 years of age. Therefore, typically these mature investors are able to put in more money. […] On the other hand, more men start investing at an early age with the average age for this investor group being 30.

Nevertheless, in terms of pure numbers, men are leading the charts, with over 90% of the investors being male across the entire country.

The Local Cryptocurrency Environment

In April the Reserve Bank of India (RBI) officially ordered regulated financial entities to refrain from providing their services to all businesses involved in cryptocurrency-related dealings. This move prompted an uproar within the community which resulted in swift counteractions from numerous companies involved in the field.

In May the country’s Supreme Court declined an interim injunction against the ban, responding to a coalition of petitioners comprised of startup companies and four cryptocurrency exchanges. At the time, RBI stated that the Supreme Court cannot interfere with the economic policies of the country.

Nevertheless, those affected by the cryptocurrency ban will challenge RBI’s decision on July 20. The bank has continued to receive mounting criticism over its anti-crypto stance. Local lawyer Varun Sethi, however, laid down the bank’s justification on the matter:

The RBI also responded that no committee was ever formed for analyzing the concept of blockchain before the decision.

This gives confidence to local lawyers currently representing the industry. Rashmi Deshpande, associate partner at Khaitan & Co said of Sethi’s information that the justification of the bank cements the arguments which the cryptocurrency industry is making on the matter:

The grounds on which our writ petition has been filed is that the RBI has not done enough research to ban a business completely.

What do you think of the cryptocurrency situation in India? Don’t hesitate to let us know in the comments below!


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Čvn 25

UK’s Cryptocurrency Task Force Concerned Over Recent Exchange Hacks

The latest hacks in the cryptocurrency industry have had some British MPs questioning whether customers’ funds are safe.


The word “hack” has the ability to send fear into the hearts of many a cryptocurrency holder. Were you affected? Are your funds safe? Will you be compensated if you’re a victim? These are thoughts that run with frightening speed through your mind until you get confirmation.

However, in today’s age of regulation, holders are not the only people on alert. Authorities with their eye on virtual currencies are always ready to ask questions when things go south, as was the case with the recent security breaches of both Bithumb and Coinrail.

Cold Storage is Required

According to Stuff, Iqbal Gandham, the chairman of CryptoUK, sought to reassure authorities by providing some insight. The self-regulating agency represents a range of cryptocurrency trading websites including eToro, Coinbase, and Coinfloor. Gandham has stated that they request that all of their members store at least 90% of their virtual funds offline in an effort to protect them against hacks. He added that “security is improving.”

Iqbal Gandham

Lack of Institutional Support

Even though regulation is the name of the game, solid and clear frameworks are still hard to come by. In fact, Gandham believes that this lack of decisive action has made traditional banks wary of working with cryptocurrency exchanges. This, in turn, has resulted in said exchanges working with foreign banks. He explained:

99.9 per cent [of exchanges] have bank accounts in far-flung jurisdictions and UK consumers are sending their money to high-risk jurisdictions.

Gandham also hoped to allay fears of volatility by noting that although still unpredictable, cryptocurrency prices are not shifting as much as they used to. Regardless, the UK’s cryptocurrency task force will most likely still be keeping a close eye on the markets.

The Possible Impact of Hacks

These security breaches not only set aflutter the hearts of possible victims, but of traders in general as it was believed by many that the breaches led to price declines. This may have been the case with the Mt. Gox hack a few years ago, but according to CNBC’s Brian Kelly, today’s market appears to be too bullish to be substantially affected by breaches.

Two hacks in one month may have cryptocurrency holders wondering how they can protect their funds. The obvious choice is to follow CryptoUK’s lead and store their digital currencies in a cold storage wallet. While some exchanges are working towards improving their security features, this could be a way to retain your peace of mind as well as the possession of your cryptocurrencies if a breach does occur.

Do you agree with Gandham that security is improving in the cryptocurrency industry? Do you think that hacks drastically affect prices? Let us know in the comments below! 


Images courtesy of AdobeStock, Iqbal Gandham

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Čvn 09

South Korea Claims $28M Tax From Bithumb But Finds No ‘Illegal Activity’

· June 8, 2018 · 8:00 pm

South Korea’s National Tax Service (NTS) has requested $30 billion won ($28 million) in taxes from major cryptocurrency exchange Bithumb in a move which has gained positive feedback from the community.


Bithumb ‘Will Not Object’ To Tax Bill

Local media reported on June 8 that Bithumb, which posted revenues of 427 billion won ($397 million) in 2017, will pay the bill following an audit from South Korea’s Internal Revenue Service (IRS).

As a result of the audit, which occurred in April, the IRS also confirmed that investigators had not found “any illegal activities such as tax evasion.”

An NTS official said:

The IRS has conducted a tax investigation against Bithumb for the 2014 to 2017 business years. […] We understand that Bithumb has decided to pay the related taxes without any objection to the imposed tax amount.

Cryptocurrency commentators received the news warmly on social media, noting that Bithumb getting the all-clear from regulators marked a positive step forward for South Korea’s exchange industry.

South Korea Stabilizes Crypto

Earlier this year, the government moved to clamp down on exchange operators, banning multiple accounts and forcing users to link their exchange account with their bank account. Foreign accounts were also halted, along with provisional warnings from authorities that exchanges would soon need to respond to tax obligations from the previous 2017-18 tax year.

The boon for Bithumb, meanwhile, comes as Seoul continues to consider reversing its previous ban on ICOs. A National Assembly committee dedicated to studying the ‘Fourth Industrial Revolution’ recommended during a meeting on May 29 that it plans to “establish a legal basis for cryptocurrency trading, including permission of ICOs.”

Also among its recommendations was making “improvements” to the “transparency” of the local cryptocurrency industry, along with “establishing a healthy trade order,” local news outlet Business Korea reported.

What do you think about Bithumb’s tax bill? Let us know in the comments section below.


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eToro’s 9M Users Set To Increase with US Exchange & Wallet Launch

· May 18, 2018 · 8:00 pm

UK-based trading platform eToro has announced it will launch an international cryptocurrency exchange and mobile wallet, debuting in the US for the first time.


$100M Series E Funds Put To Work

As part of a keynote speech at the Consensus 2018 conference in New York which finished May 16, eToro CEO Yoni Assia confirmed the move, which will provide US traders with ten cryptocurrency pairs.

etoro

“U.S. crypto holders have a strong appetite for diversified portfolios,” he said quoted in an accompanying press release.

The platform’s ambitious plans come as little surprise on the back of a $100 million Series E funding round which it completed in March this year.

Prior to that, eToro had revealed it now counted nine million users on its books as it targeted international markets in Asia.

China Minsheng Capital was the major force behind the funding round, Bitcoinist reported at the time, with Japan’s SBI Group, Korea Investment Partners and World Wide Invest also among the contributors.

Ex-Samsung Executive Leads eToro USA

For the US, which is notorious for its patchwork regulatory landscape regarding trading, the company will create offshoot eToro USA, led by ex-Samsung director of innovation strategy Guy Hirsch.

“We know that there is a strong demand in the U.S. for crypto and we are excited to be able to offer U.S. investors the opportunity to learn about and invest across multiple cryptocurrencies,” Hirsch commented.

It is not yet known how the company will navigate obstacles such as New York’s BitLicense scheme, which has seen multiple cryptocurrency operators deny service to its residents.

The wallet and exchange will see a gradual rollout “over the coming months,” the former “eventually” being available for both Android and iOS devices.

In addition to standard functions, the wallet will also contain as yet unspecified “other features.”

Will eToro’s expansion move boost cryptocurrency trading in the US? Share your thoughts below!


Images courtesy of Shutterstock, eToro, Twitter

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Reserve Bank of Zimbabwe Bans Cryptocurrency Trading, Financial Institutions Given 60 Days to Comply

· May 12, 2018 · 8:00 pm

The financial services regulator for the southern African country of Zimbabwe – the Reserve Bank of Zimbabwe (RBZ) – has banned all financial services institutions in the country from all forms of cryptocurrency trading. The directive was shared in a circular on virtual currencies distributed to all institutions on Friday.


Cryptocurrency Trading Banned Through Banking Services

According to a news report, the circular which was signed by the RBZ registrar of banking institutions Norman Mataruka, the central bank has said that it is taking these measures to protect the public and safeguard the integrity, safety, and soundness of the country’s financial system.

All financial institutions in Zimbabwe which include commercial banks and mobile money service providers have been told to ensure to not use, trade, hold or transact in virtual currencies or provide banking services that would facilitate any individual or entity in dealing with or settling cryptocurrencies.

The ban outlined a swathe of services that include maintaining accounts, registering, trading, clearing, collateral arrangements, remittances, payment and settlement accounts, giving loans against tokens, accepting tokens as collateral, opening accounts of cryptocurrencies exchanges and moving money in accounts relating to cryptocurrency trading.

The RBZ has also directed banks to terminate any existing relationships with virtual currency exchanges in sixty days to liquidate existing account balances.

Zimbabwe does not recognize cryptocurrencies as legal tender and the country does not have a regulatory framework for virtual currencies or cryptocurrency trading. However, it has managed to effect a ban by directing financial institutions to keep their hands off all transaction and services related to cryptocurrencies.

Cryptocurrency Trading Banned Through Banking Services

Exercising Caution and Choking an Industry at the Same Time

The stance that has been taken by Zimbabwe’s central bank isn’t new. The cryptocurrencies space is still facing a lot of scrutiny and regulators in other markets have taken a cautious approach, pushed by concerns around money laundering, tax evasion, fraud and in cases like Zimbabwe, the externalization of foreign currency in response to the country’s foreign currency challenges.

Countries like India and China have explored this route before and in Africa, Kenya’s regulator has also taken a hard stance against cryptocurrencies. They are all meant to be measures against potential risks in a new space.

However, such moves also have a negative impact on legal service providers including entities that solve some problems that affect the economy.

In Zimbabwe, a number of businesses that have emerged in this space over the past few years that include the local cryptocurrency exchanges like Golix as well as outfits that have been using cryptocurrencies to facilitate remittances such as Bitmari will be affected by the directive.

Do you think that regulators that put restrictions on cryptocurrency activities because of the risk of crimes like money laundering are justified? Please let us know in the comments below. 


Image courtesy of AAAB, Shutterstock

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