India

IEEE to issue blockchain skill certificates on Avalanche in India

Avalanche was selected as the primary settlement layer for IEEE’s certificate issuance because of the need for an ecosystem compatible with the Ethereum Virtual Machine.

The credentialing system used by the Institute of Electrical and Electronics Engineers (IEEE) will use the Avalanche blockchain to issue tamper-evident certificates in India. 

India is the second-largest IEEE membership base outside the United States, with over 75,000 members. The professional association will issue IEEE credentials or certificates to all trainees and users to make the verification process tamper-proof, instant and secure.

The IEEE will issue blockchain certificates via LegitDoc, a blockchain-based credential lifecycle management built by Zupple Labs. Speaking to Cointelegraph, Zupple co-founder Neil Martis said that the Indian public sector has become more willing over the last 12 months to implement full-fledged blockchain projects over pilots.

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G20 countries aim to develop global framework against crypto-related risks

The G20 also aims to bring together global economies to fight debt distress and hyperinflation in smaller economies like Sri Lanka and Ghana.

The G20 — an intergovernmental forum comprising 19 countries and the European Union — has planned to develop a common framework for helping all countries deal with risks associated with cryptocurrency investments.

Under India’s presidency, the G20 called for coordinated global crypto policies — a vision put forth by the country’s finance minister, Nirmala Sitharaman. However, with multiple ecosystem collapses impacting investors worldwide, Sitharaman believes disparate reforms will not help address the global reach of cryptocurrencies.

Union Finance Minister Nirmala Sitharaman arrives for a business roundtable meeting organized by US India Business Council, in Washington. Source: Press Trust of India

Speaking at the Peterson Institute for International Economics in Washington DC, she highlighted the numerous crypto collapses while revealing the need for a coordinated effort from all jurisdictions:

“Cryptocurrencies are a very important part of the discussion under the #G20India presidency, given so many collapses and shocks in cryptocurrencies. We seek to develop a common framework for all countries to deal with this matter.”

Moreover, Sitharaman also disclosed G20’s aim to bring together global economies to fight debt distress and hyperinflation in smaller economies such as Sri Lanka and Ghana. In this regard, she said:

“In G20, there is an opportunity for India to bring all countries together to address debt distress in middle-income and low-income countries. Multilateral institutions are coming up with resolutions for debt-laden countries in 3 to 5 years’ time.”

India’s G20 presidency will end on November 30, 2023, leaving roughly seven months for the group of 20 nations to carve out blanket crypto reforms that could be implemented across jurisdictions.

On the other hand, the previously struggling economy of El Salvador showcased the importance of an asset like Bitcoin (BTC) in reducing the impact of hyperinflation and dependence on the U.S. dollar.

Related: Crypto regulation is 1 of 8 planned priorities under India’s G20 presidency — Finance Minister

India’s home-grown payment network, the unified payments interface (UPI), is also on an expansion drive.

Singapore’s PayNow rapid payment system recently integrated UPI to allow swift cross-border payments. At the time of the announcement, it was revealed that the State Bank of India, Indian Overseas Bank, Indian Bank and ICICI Bank would facilitate outgoing remittances, with Axis Bank and DBS Bank India facilitating incoming remittances.

Russia talks up prospects of BRICS countries developing new currency

A top Russian official has reportedly claimed that the countries of the BRICS alliance — Brazil, Russia, India, China and South Africa — are working on creating their own currency.

A new world order could be emerging as economic powerhouses increase their efforts to distance themselves from US dollar hegemony.

According to reports, a top Russian official has claimed that the BRICS alliance is working on creating its own currency. BRICS is an acronym for five leading emerging economies: Brazil, Russia, India, China and South Africa.

State Duma Deputy Chairman Alexander Babakov made the comments at the St. Petersburg International Economic Forum event in New Delhi, India, according to local reports.

Babakov reportedly stressed the importance of both nations working towards a new medium for payments, adding that digital payments could be the most promising and viable.

He also said the currency could benefit China and other BRICS members, and not the West.

“Its composition should be based on inducting new monetary ties established on a strategy that does not defend the U.S.’s dollar or euro, but rather forms a new currency competent of benefiting our shared objectives.”

Babakov also reportedly postulated that the new currency would be secured by gold and other commodities such as rare-earth elements.

Countries in the grouping. Source: Library of Congress

This week, former Goldman Sachs chief economist Jim O’Neill called on the BRICS bloc to expand and challenge the dominance of the dollar. In a paper published in the Global Policy journal, he wrote that “the U.S. dollar plays a far too dominant role in global finance.”

A BRICS currency is not a new concept. In 2019, Cointelegraph reported that members of the bloc were discussing the creation of a new digital currency for a unified payments system.

Related: 5 ways CBDCs could impact the global financial system

In a related development this week, China and Brazil reached a deal to trade in their own currencies. The move will remove the U.S. dollar as the intermediary, further empowering both nations to distance themselves from the world’s reserve currency.

According to reports, the agreement will enable China and the biggest economy in Latin America, Brazil, to conduct trade and financial transactions directly. Chinese yuan will be exchanged directly for the Brazilian real and vice versa instead of going through the greenback.

China is racing ahead with its central bank digital currency project, and crypto adoption in Brazil is growing following the legalization of it as a payment method in the country late last year. Meanwhile, Uncle Sam remains determined to continue its war on crypto as financial regulators tighten the screws on the embryonic industry.

Magazine: Unstablecoins: Depegging, bank runs and other risks loom

Developed markets lagging behind in digital payments: BlackRock CEO

In a letter to investors, BlackRock CEO Larry Fink highlighted the benefits of digital assets and said developing nations like the U.S. are lagging behind in innovation.

The CEO of American investment company BlackRock, Larry Fink, highlighted the potential of digital assets and tokenization for the asset management industry in his annual chairman’s letter to the company. 

The letter was published on March 15 and addressed various topics of interest to the firm over the last year, including digital assets. Fink highlighted the rising and sustained interest in these types of assets despite the FTX catastrophe.

He said beyond the hype, “interesting developments” are happening in the space. He especially noted the “dramatic advances” in the digital payment solutions that help forward financial inclusion in many emerging markets like India, Brazil and Africa.

However, according to Fink, developing markets are not at the same pace innovation-wise:

“By contrast, many developed markets, including the U.S., are lagging behind in innovation, leaving the cost of payments much higher.”

BlackRock currently manages around $8 trillion in assets and is one of the largest asset managers in the world. Fink said the asset management industry could have some “exciting applications” of the technology underlying these digital asset innovations.

Specifically, he praised the tokenization of asset classes with their potential in “driving efficiencies in capital markets, shortening value chains, and improving cost and access for investors.”

His statement ended not leaving out the risks and need for regulation of the crypto space but still pointing out that the company will be further exploring digital assets going forward.

Related: It’s not the end of crypto: EU asset manager gives 5 reasons why

This is not the first time Fink has made commentary on decentralized finance. After the fall of FTX, he commented that the FTX Token (FTT) caused the exchange’s downfall because it goes against “the whole foundation of what crypto is.

However, in the same conversation, he openly called the underlying technology of crypto and the blockchain revolutionary.

Back in September 2022, BlackRock released a new exchange-traded fund that invests in 35 blockchain-related companies.

SVB mixup forces India’s SVC Bank to issue a notice of clarification

The similarity in the short forms of the two banks — SVB and SVC Bank — caused a mixup among a few Indian citizens as they took up the concern with the Mumbai-based bank.

The shockwaves caused by the collapse of Silicon Valley Bank (SVB) were felt by countless businesses, including a bank from India with no connection to the California-based banking institution. 

Soon after reports of SVB’s imminent shutdown surfaced on March 10, panic spread across the globe as investments tied to one the biggest banks in the United States depicted an uncertain future. However, a Mumbai-based 116-year-old cooperative bank — Shamrao Vithal Co-operative Bank (SVC Bank) — got caught in the line of fire.

The similarity in the short forms of the two banks — SVB and SVC Bank — caused a mixup among a few Indian citizens as they took up the concern with the Indian bank.

Clarifying all doubts, SVC Bank issued an announcement distancing itself from the failed American bank now managed by the Federal Deposit Insurance Corporation (FDIC). The statement read:

“SVC Bank is completely unrelated to Silicon Valley Bank (SVB) that was based in California. SVC Bank reserves the right to take due legal action on rumor mongers for tarnishing its brand image.”

Furthermore, the Indian bank advised its members, customers and stakeholders to avoid the ongoing rumors of its shutdown. The announcement also disclosed the bank’s profitability in the last year.

Related: Silicon Valley Bank collapse: Everything that’s happened until now

On March 13, U.S. President Joe Biden announced his plan to help the fallen traditional banks, SVB and Signature Bank, “at no cost to the taxpayer.”

On the other hand, Biden’s followers on Twitter highlighted that “everything you do or touch costs the taxpayer!”

Silvergate and SVB bite the dust: Law Decoded, March 6–13.

Elizabeth Warren and Sherrod Brown didn’t miss a chance to attack the crypto industry after bank failures.

Last week, another major quake shook crypto markets. Silvergate Bank — a crypto-fiat gateway network for financial institutions and a significant on-ramp for cryptocurrencies in the United States — shut down operations due to liquidity problems. 

A couple of days later, another ​​Federal Deposit Insurance Corporation-insured institution, Silicon Valley Bank (SVB), was shut down by California’s financial watchdog. The bank provided financial services to several crypto-focused venture firms, including Andreessen Horowitz and Sequoia Capital, with USD Coin (USDC) issuer Circle holding around 20% of its reserves with the bank. Following the news, USDC depegged and lost over 10% of its value in 24 hours.

Some lawmakers, well known for their hostility to crypto, quickly attacked the industry. Senator Elizabeth Warren called Silvergate’s failure “disappointing, but predictable,” calling for regulators to “step up against crypto risk.” Senator Sherrod Brown shared his concern that banks involved with crypto were putting the financial system at risk and reaffirmed his desire to “establish strong safeguards for our financial system from the risks of crypto.”

The most important commentary, however, came on Sunday when United States Treasury Secretary Janet Yellen revealed that authorities were not considering a major bailout of Silicon Valley Bank. According to Yellen, the Federal Deposit Insurance Corporation is considering “a wide range of available options,” including acquisitions from foreign banks.

Biden budget proposes 30% tax on crypto mining electricity usage

Crypto miners in the U.S. could be subject to a 30% tax on electricity costs under a budget proposal by U.S. President Joe Biden to “reduce mining activity.” According to a Department of the Treasury supplementary budget explainer paper, any firm using resources — whether owned or rented — would be subject to an excise tax equal to 30% of the electricity costs used in digital asset mining. It proposed the tax would be implemented after Dec. 31, phased in over three years at a rate of 10% a year, reaching the max 30% tax rate by the third year.

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​​Stablecoins and Ether are ‘going to be commodities,’ reaffirms CFTC chair

Stablecoins and Ether are commodities that should come under the purview of the United States Commodity Futures Trading Commission (CFTC), according to the commission’s chairman, Rostin Behnam.

In a recent hearing, senators questioned Behnam about the differing views held by the CFTC and the Securities and Exchange Commission (SEC) following the CFTC’s 2021 settlement with stablecoin issuer Tether. Behnam said, “It was clear to our enforcement team and the commission that Tether, a stablecoin, was a commodity.” Behnam’s most recent comments oppose a view held by SEC chair Gary Gensler, who claimed that everything other than Bitcoin (BTC) is a security — a claim multiple crypto lawyers rebuffed.

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China announces plans for a new national financial regulator

The Chinese government reportedly has plans for a regulatory overhaul, including introducing a new national financial regulator. The reforms would mean that ​​its current banking and insurance watchdog — the China Banking and Insurance Regulatory Commission — will be abolished. The responsibilities of this commission will be moved to a brand new administration, as will particular functions of the central bank and securities regulator.

This announcement follows a call for reforms for party and state institutions in China from President Xi Jinping. These reforms will also include a bureau for sharing and developing data resources, which will partly replace the duties of the current Office of the Central Cyberspace Affairs Commission.

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India subjects crypto transactions to Anti-Money Laundering law

The operators must store the transactions’ data for ten years and pass it to regulators on demand.

While there’s nothing new in imposing Anti-Money Laundering (AML) standards on crypto, it is only now that the Indian government has decided to notify all interested parties of the obligation to comply with the national AML law.

On March 7, The Gazette of India published a notification from the Ministry of Finance, subjecting a range of crypto transactions to the Prevention of Money-Laundering Act (PLMA) 2002 — namely the exchange, transfers, safekeeping and administration of virtual assets. Financial services related to an issuer’s offer and sale of virtual assets also fall under the PMLA.

The notification doesn’t provide many details, but the PMLA obliges financial institutions to maintain a record of all transactions for the last ten years, provide these records to officials if demanded, and verify the identity of all the clients.

Published as regulators worldwide are tightening AML standards for crypto, the notification will complicate the life of crypto companies in India. And it already has not been too comfortable in recent years. From March 2022, according to amended tax rules, digital assets holdings and transfers are subject to a 30% tax.

Related: India explores offline functionality of CBDCs — RBI executive director

​​Trading volume on major cryptocurrency exchanges across India dropped by 70% within 10 days of the new tax policy, and almost 90% over the next three months. The rigid tax policy drove crypto traders to offshore exchanges and forced budding crypto projects to move outside India.

In February 2023, Indian authorities again demonstrated their tough stance on cryptocurrencies with a preemptive ban on crypto advertising and sponsorships in the local women’s cricket league. This followed a previous ban for the men’s cricket Premier League, introduced back in 2022.

In 2023, while celebrating India’s first presidency of the G20, the country’s Finance Minister, Nirmala Sitharaman, urged international efforts to regulate crypto. She called for a coordinated effort “for building and understanding the macro-financial implications,” which could be used to reform crypto regulation globally.

India explores offline functionality of CBDCs — RBI executive director

In addition to offline functionality, RBI is gauging CBDC’s potential for cross-border transactions and linkage with legacy systems of other countries.

India’s recently launched in-house central bank digital currency (CBDC) — the digital rupee — is now being tested for offline functionality, revealed Ajay Kumar Choudhary, executive director of the Reserve Bank of India (RBI).

The RBI — India’s central bank and regulatory body — launched the wholesale segment pilot for the digital rupee on Nov. 1, 2022, onboarding 50,000 users and 5,000 merchants for real-world testing. As of Feb. 25, around $134 million and 800,000 transactions have been completed via wholesale CBDCs.

Building on this progress, Choudhary said the RBI is looking at the CBDC’s offline functionality. Speaking to CNBC TV18, he stated the RBI is gauging the CBDC’s potential for cross-border transactions and linkage with legacy systems in other countries. He added:

“We are eagerly looking forward to private sector and fintechs’ participation in CBDC. We will see their contribution, especially on offline and cross-border CBDC transactions.”

Moreover, speaking on behalf of the RBI, Choudhary said the CBDC would soon become the medium of exchange and needs all features of physical currency, including anonymity.

India’s motivation for launching the CBDC was to improve regional financial inclusion and spearhead the digital economy. Choudhary also told CNBC TV18 that CBDC would eventually act as a replacement for cryptocurrencies.

Related: Crypto ads and sponsors banned from women’s cricket league in India

On Feb. 21, India’s national payment network, the unified payments interface (UPI), expanded its services to Singapore.

The UPI PayNow integration allows citizens from India and Singapore to send money across borders quickly.

Initially, four major Indian banks — the State Bank of India, Indian Overseas Bank, Indian Bank and ICICI Bank — will facilitate outgoing remittances. Axis Bank and DBS Bank India will facilitate incoming remittances. Singapore’s DBS Bank and Liquid Group will provide the service to users in the region.

FSB, IMF and BIS papers to set global crypto framework, says G20

A series of recommendations and papers setting standards for a global crypto regulatory framework will be released by the institutions in July and September.

The Financial Stability Board (FSB), the International Monetary Fund (IMF), and the Bank for International Settlements (BIS) will deliver papers and recommendations establishing standards for a global crypto regulatory framework, the group of the 20 biggest economies of the world — collectively known as G20 — announced on Feb. 25.

According to a document summarizing the outcomes of the meeting with finance ministers and central bank governors, the FSB will release by July recommendations on the regulation, supervision and oversight of global stablecoins, crypto assets activities and markets.

India’s finance minister, Nirmala Sitharaman, during FMCBG meeting in Bengaluru. Source: Ministry of Finance

The next guidance is expected for September, when the FSB and the IMF jointly should submit “a synthesis paper integrating the macroeconomic and regulatory perspectives of crypto assets.” In the same month, the IMF will also report on the “potential macro-financial implications of the widespread adoption” of central bank digital currencies (CBDCs). According to the G20 statement:

“We look forward to the IMF-FSB Synthesis Paper which will support a coordinated and comprehensive policy approach to crypto-assets, by considering macroeconomic and regulatory perspectives, including the full range of risks posed by crypto assets.”

The BIS will also submit a report on analytical and conceptual issues and possible risk mitigation strategies related to crypto assets. This report’s deadline is not mentioned in the document. A G20 financial task force will also look at the use of crypto assets to fund terrorist activities.

The announcement came after two days of official meetings in Bengaluru, India. In the first financial meeting under India’s presidency, the group addressed key financial stability and regulatory priorities for digital assets, Cointelegraph reported.

During the event, United States Treasury Secretary Janet Yellen said it was “critical to put in place a strong regulatory framework” for crypto-related activities. She also noted that the country is not suggesting an “outright banning of crypto activities.“ Speaking to reporters on the sidelines of the event, IMF managing director Kristalina Georgieva stated that banning crypto should be an option for G20 countries.

Coordinated global crypto policies: G20 key financial stability priority

India’s finance minister called for a coordinated effort “for building and understanding of the macro-financial implications,” which could be used to build global crypto reforms.

The first G20 Finance Ministers and Central Bank Governors (FMCBG) meeting under India’s presidency discussed key financial stability and regulatory priorities. India urged member nations to understand the macro-financial implications of crypto assets and recommended formulating a coordinated global policy.

India’s Finance Minister, Nirmala Sitharaman, has historically supported creating crypto regulations in partnership with other jurisdictions — given the global reach of crypto assets. Under India’s G20 Presidency, this narrative is now a part of mainstream discussions.

India’s Finance Minister Nirmala Sitharaman during FMCBG meeting in Bengaluru. Source: Ministry of Finance.

During the FMCBG meeting held on Feb. 24–25, G20 members discussed the potential of technology innovations while emphasizing balancing associated risks. Key discussions included financial stability and regulatory priorities, policy approaches for advancing financial inclusion and productivity gains for the G20.

In her closing remarks, Sitharaman welcomed support for reforms related to crypto assets. Specifically, the finance minister called for a coordinated effort “for building and understanding the macro-financial implications,” which could be used to globally reform crypto regulation.

She further thanked the International Monetary Fund for releasing a comprehensive paper on the macro-financial implications of crypto assets. On an end note, Sitharaman underlined the need for coordination among the G20 nations “to support responsible technological innovations and safeguard the stability of the financial system.”

Related: India expands national payment network to Singapore: What’s in it for crypto?

The Board of Control for Cricket in India recently released a 68-page advisory asking the Women’s Premier League to refrain from crypto advertising and sponsorships:

“No franchisee shall undertake a partnership or any kind of association with an entity that is in any way connected/related to an entity that is involved/operates, directly or indirectly, in the cryptocurrency sector.”

This follows a men’s cricket Premier League ban introduced in 2022. Before the ban, the Indian Premier League had collaborated with at least two local crypto exchanges: CoinSwitch Kuber and CoinDCX.