The cryptocurrents are flowing in strange and opposing ways, like the Hudson River at high tide. On the one hand, it fauxrencies remain the preferred tender of the global underworld, underwriting the growing cyberransoms paid by large companies to get the fuel or factory-farmed meat flowing once more. So popular and useful has bitcoin and its ilk been for this that the revelation that transactions therein are not quite as untraceable by law enforcement as hoped counts are genuinely bad news for the sector. On the other, more legitimate, hand, bitcoin is now the co-currency of an actual sovereign state and will soon be available in your 401(k), for better or worse for the millennials likely to bet their futures on it.
The Basel Committee for Banking Supervision.… said that banks should apply a 1,250% risk weight to bitcoin, which is “similar in effect to the deduction of the asset from capital.” If a bank holds $100 of bitcoin exposure, it would give rise to risk-weighted assets of $1,250, which when multiplied by the minimum capital requirement of 8% results in setting aside at least $100, the committee said in its statement…. The committee proposed less-stringent capital requirements for crypto assets that meet certain conditions, such as tokenized traditional assets and stablecoins.
"Cryptocurrency has created opportunities to scam investors, assist criminals, and worsen the climate crisis," [Sen. Elizabeth Warren] said at a congressional hearing. "The threats posted by crypto show that Congress and federal regulators can't continue to hide out, hoping that crypto will go away. It won't. It's time to confront these issues head-on."
The heads of Colonial Pipeline and JBS, and anyone else who’s been paying attention, might justly say it’s actually well past time, but better late than never, we guess, although our money (in this case neither actual nor fake but figurative) is on never.
"We don’t need a state-sponsored bank interfering with this successful free-enterprise system," said Senator Pat Toomey, who instead urged continued growth of private digital currencies.
Bitcoin, Other Crypto Assets Targeted for Stiff Banking Regulation [WSJ]
Warren: U.S. government needs to confront crypto threats ‘head on’ [Reuters]
Pipeline Investigation Upends Idea That Bitcoin Is Untraceable [NYT]
JBS paid $11M in Bitcoin to resolve ransomware attack [CNET]
Bitcoin jumps after El Salvador says it'll start accepting it as legal tender [CNN]
Cryptocurrency Comes to Retirement Plans as Coinbase Teams Up With 401(k) Provider [WSJ]
Millennial millionaires have a large share of their wealth in crypto, CNBC survey says [CNBC]
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