Weekly Report: China back atop mining charts as Russia mulls crypto legalisation

  • Despite China’s ban on crypto mining, it remains among the leaders in hash rate
  • Portugal is issuing regulations to establish capital gains tax on cryptocurrencies
  • Japanese bank Nomura is launching a crypto subsidiary later this year
  • Russia’s trade minister insists crypto legalisation is not a matter of if but when 
  • Shopify merchants can now integrate Crypto.com Pay for payments on their storefronts

Report: China lags only the US in Bitcoin mining despite ban mid-last year          

Crypto mining, particularly Bitcoin, has and will foreseeably continue being an environmental concern given that it uses a proof of work consensus model, which by design is energy-intensive. Last year, China banned all cryptocurrency mining in the country over the massive power consumption before, later on in the year, issuing a blanket ban on crypto activity.

Newly published data by the Cambridge Centre for Alternative Finance (CCAF), one year later, suggests that the Chinese crypto ban hasn’t taken full effect. The data shows that China only lagged the US last December (recent figures) in Bitcoin mining activity. It recorded 21% of the total Bitcoin hash rate while the US led with 37.84% of the global hash rate.

To think that China is back on the charts after a drop to 0% of the hash rate between July and August last year would only be due to covert crypto mining activities. The CCAF explained that such miners would likely be running small-scale operations and sourcing off-the-grid power to circumvent China’s strict anti-crypto stance.

Kazakhstan, Canada, and Russia complete the top five, with 13.22%, 6.48%, and 4.66% in hash rate, respectively.

Here’s why Portugal’s ‘Crypto tax haven’ status could soon be over 

Portugal is known to the community for its tax-less crypto environment, a factor that has supported the evolution of crypto and blockchain technology in the country. This could, however, change soon. Local news outlet Sapo recently reported that a crypto tax could soon be established.

The news outlet noted that finance minister Fernando Medina said in a working session last Friday that the government intends to enlist new regulation, among whose effects would be the introduction of a capital gains tax on cryptocurrencies. Notably, it’s not that lack of taxation on crypto gains had been legally established, but rather was a result of a gap in regulation.

Dubbed ‘Bitcoin Haven,’ Portugal has grown popular with crypto traders who relish the lack of taxation in their activities. Even with the change set to come, information on specifics such as the rate to be enforced remain unrevealed; therefore, predicting a massive migration might be too soon.

The comments made by the minister of finance were echoed by António Mendonça Mendes, the secretary of state in charge of tax affairs. He proposed establishing a VAT tax and stamp tax on cryptocurrencies.

Japanese bank Nomura is reportedly launching a crypto division later this year

Nomura is on track to launch a crypto subsidiary as per a publication by Financial Times sent out last Monday. With a plan to debut the crypto unit sometime later this year, it would enable the bank to allow customers to interact with products around crypto, non-fungible tokens (NFTs), stablecoins, and decentralised finance.

According to individuals familiar with the matter, the unit would be wholly under the bank and projected to have approximately 100 staff by 2024. The Japanese mammoth bank aims to grow the division so that its able to can compete with the banking giants already offering users digital assets.

As of the end of last week, Nomura said it completed its first over-the-counter Bitcoin derivatives trade. According to a published statement, the options and futures trade on Bitcoin was conducted in collaboration with Cumberland DRW on derivatives exchange CME Group.

Intending to serve the increasing demand that the bank is currently seeing, Rig Karkhanis, the head 0f markets at Nomura, Asia ex-Japan, said the new product would allow it to serve interested institutional clients. The move places Nomura among the major world banks, including JPMorgan and Goldman Sachs, that have delved into offering clients exposure to cryptocurrencies via various products.

It is a matter of when not if, Russian official says about crypto legalisation

The Minister of Industry and Trade in Russia, Denis Manturov, has weighed in on the conversation around cryptocurrencies. Manturov believes that the legalisation of cryptocurrencies for use in completing payments in the country is a matter of when this will happen.” 

Speaking at the New Horizon educational event, local news outlet TASS reports that Manturov explained that this is the case as now both the government and central bank are reading from the same page on matters crypto. In effect, he insists that legal crypto use will come sooner or later in one format or another.” 

The reported change of heart by the Central Bank of Russia (CBR) has only come around recently. Earlier this year, it had submitted proposals for a blanket ban on cryptocurrencies, citing several matters, among them environmental and money laundering concerns.

Chair of the Finance Market Committee at the State Duma Anatoly Aksakov, speaking at the Moscow Academic Economic Forum this week, said that Russia would, by the end of the year, allow Russia blockchains to offer DFAs – cryptocurrencies.

Aksakov said DFAs would provide a solid alternative to the fiat standards such as the USD or EUR for financial settlements.

Shopify merchants can now integrate Crypto.com Pay at no cost

Singapore-based cryptocurrency trading and exchange platform Crypto.com Tuesday announced that all Shopify merchants can now add the Crypto.com Pay option to their stores. Both parties will benefit from thE move. 

Crypto.com will seek to expand its reach, while Shopify can now serve a customer base who’d rather pay for their goods and services using crypto.

The exchange said that merchants who sign up for the new platform by June 30 would enjoy zero settlement fees for the first month. Afterwards, they would pay a 0.5% proportion in fees. According to the CEO of Crypto.com, Kris Marszalek, the firm is keen on offering even more merchants and consumers the ability to use cryptocurrencies.

Merchants will not require any physical interaction to set up the new product. Once up and running, the systems will enable interaction with token blockchains, including Bitcoin, Ethereum, Shiba Inu, Dogecoin, and its native CRO. 

With the token plunging earlier in the month, its stakers have seen their revenues slashed, with those at the lowest tier seeing the worst of it – 0% in rewards on staked tokens.

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