3 countries pursuing crypto regulation

3 countries pursuing crypto regulation

South Korea is among the countries leading the charge on regulatory frameworks for crypto. [Image via Mathew Schwatrz]

There’s never a dull moment on the blockchain. Here’s what you need to know this week:

Several countries are making headway on crypto regulation. How South Korea, India, and Italy are thinking about cryptocurrency laws.

Key cryptoverse quotes. Berkshire Hathaway’s Charlie Munger didn’t mince words about his distaste for crypto, and other soundbites from the week.

Noteworthy numbers. The going price for a rare Giannis Antetokounmpo NFT trading card, and other key stats from the week.

WORLDWIDE WEB3

How 3 countries are preparing to regulate crypto

As global crypto adoption continues to accelerate —  more than 4% of the world’s population now holds crypto — so have international calls for regulatory clarity for digital assets. To keep pace, a number of countries are attempting to establish clear policy guardrails. Among the G20 nations debating major regulatory moves are South Korea, Italy, and India. Here’s a look at what they're considering.

  • India became head of the G20 last year and said that creating a global consensus for crypto policy is a priority for their year-long leadership role. India’s Finance Minister, Nirmala Sitharaman, aims to establish a global agreement before pursuing domestic crypto policies, which the country is researching alongside the International Monetary Fund. In February 2022, the country imposed a 30% tax on crypto profits, though digital assets are still not formally legalized. 

  • Italy has registered 91 crypto firms ahead of the EU’s landmark Markets in Crypto Assets (MiCA) framework, expected to pass in April. Among MiCA’s key policies are licensing rules for crypto wallets and exchanges, and reserve requirements for stablecoins. While Italy’s central bank is working with local regulators to begin setting up the “authorization and supervision activities” defined by the MiCA, the country also plans to promote the use of distributed ledger technology to improve the efficiency of its financial systems.

  • South Korean authorities recently released guidelines to govern blockchain-based traditional securities, which would enable approved entities to issue tokenized versions of securities (like company shares) and be governed by the same laws as the country’s traditional financial markets. Meanwhile, South Korea currently has 17 crypto policies under consideration, including things like stablecoin reserve and fair trading requirements, all of which would inform the country’s Digital Asset Basic Act, which aims to offer a comprehensive legal framework for South Korea’s bustling cryptoeconomy.

Why it matters… With 420 million global crypto users and growing, governments all over the world are recognizing that clear regulation is a necessity. In the U.S. however, while politicians have signaled interest in following suit, the pace appears to be far slower, meaning the country risks falling behind others without clear priorities and next steps. As the chief global regulatory officer at the Crypto Council for Innovation put it: “If [the U.S.] wants to be the leading digital economy in the world, then we need rules of the road.”

TAKES

Key quotes from the cryptoverse

Alt In… “One peculiarity about the rally in January was the outperformance of many altcoins over blue-chip names like BTC and ETH,” wrote David Duong, head of institutional research at Coinbase, in his most recent Monthly Outlook. Read the full report for Duong’s take on what to make of this “surprising” occurrence. 

CryptNo Bowl… “There’s zero representation in that category on the day at all,” was how the executive vice president of ad sales for Fox Sports described the lack of crypto companies advertising at this weekend’s Super Bowl, one year after the so-called ‘Crypto Bowl’ featured ads from FTX, Crypto.com, eToro, and, yes, Coinbase (we were the ones with the bouncing QR code, not Matt Damon). This year, instead of crypto, you’ll get lots of ads for booze.

Mung Slinger… “It’s a gambling contract with a nearly 100% edge for the house” was how Warren Buffett’s right-hand man, Charlie Munger, dismissed  cryptocurrencies in a WSJ op-ed calling for their ban. Given that Buffett had previously referred to crypto as “rat poison,” Munger’s FUD perhaps wasn’t a surprise, but the 99-year-old’s thanking of “the Chinese communist leader for his splendid example of uncommon sense” for banning crypto was probably not a phrase on anyone’s bingo card.

NUMBERS TO KNOW

$13.7 billion

Amount that Meta lost on its metaverse ambitions in 2022, with $4.28 of that total in the fourth quarter, per the company’s latest earnings report. Over the summer, CEO Mark Zuckerberg told CNBC’s Jim Cramer that he aims to “get to around a billion people in the metaverse [each] doing hundreds of dollars of commerce” by the second half of the decade. 

$187,000

Sale price (about 114 ETH) of a single-edition NFT trading card of Milwaukee Bucks all-star Giannis Antetokounmpo, a record-high transaction for NFT/fantasy sports platform Sorare NBA. It’s an impressive sale for a platform that launched last October amid the crypto winter. The current record for rival NBA Top Shot, which launched during the 2021 bull run, is a Lebron James collectible that sold for nearly $388,000.

49.049%

The percent of Bitcoin’s circulating supply that hasn’t moved in at least two years, an all-time high. This means that nearly half of wallets that have held onto BTC since at least February 2020 have hodl-ed through the 2021 bull market and 2022’s bear market, indicating growing long-term commitment among BTC investors.

38%

Percent increase in NFT sales volume from December to January, according to crypto analytics firm DappRadar (via Decrypt). January’s NFT sales totaled $946.7 million — up from $683.9 million in December — the largest total since June 2022.

TUNE IN

Solana co-founder Anatoly Yakovenko chats with Brian Armstrong about what’s next for SOL

In the latest episode of Around the Block, Coinbase CEO Brian Armstrong sits down with Solana creator Anatoly Yakovenko to discuss everything you’ve ever wanted to know about SOL. In a wide-ranging chat, the two crypto leaders speak about Solana’s origins, its resilience following FTX’s collapse, its web3 mobile phone, and much more.

DISCLAIMER

This material is the property of Coinbase, Inc., its parent and affiliates (“Coinbase”). The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Coinbase or its employees and summarizes information and articles with respect to cryptocurrencies or related topics that the author believes may be of interest.

TOKEN TRIVIA

What is an example of hot storage?

A

A piece of paper with your private keys, kept in a safety deposit box

B

A crypto wallet connected to the internet

C

A wool-lined crate

D

Any crypto account protected by two-step authentication

Find the answer below.

Trivia Answer

B

A crypto wallet connected to the internet