This week in crypto we’ve seen Ukraine, Coinbase, tax, F1, Teddydoge and Sam Bankman-Fried making headlines. But which stories were the killer whales in the dolphin pod? Let’s find out.
No. 3 – Crypto is “Essential Tool of Ukraine’s Defence” Says Official
Ukraine’s Deputy Minister of Digital Transformation, Alex Bornyakov, said this week that cryptocurrency remains an “essential tool of Ukraine’s defence” after donations continued to come in, despite the crash in the crypto markets.
At least $125 million has been raised through crypto donations and NFT sales since Russia’s invasion in February, largely thanks to Ukrainian officials publicising official crypto addresses
on social media platforms and enlisting artists to create pieces especially to raise money for the defence of the country.
No. 2 – Bill Tabled to Scrap Tax for Crypto Purchases up to $50
Taxation has long been a silent assassin of the ambitions of crypto advocates. Every trade or purchase using any digital asset counts as a taxable event in most countries in the world, meaning a profit or loss must be recorded and added to a tax return – not the kind of thing that people are going to overlook when considering switching from fiat currency.
With cryptocurrency looking like it is going to remain under the banner of a commodity or other asset type for a long time to come, this isn’t going to change soon, and so something else needs to be done in order to help adoption.
Step forward U.S. Senators Pat Toomey and Kyrsten Sinema, who this week tabled the Virtual Currency Tax Fairness Act, which would scrap any tax due on cryptocurrency purchases under $50. This strategy would make using cryptocurrency for everyday purchases much more appealing to the regular user and, with the right technology in place, could see it used more and more in the high street in the way in which it was intended.
No.1 – Coinbase and Kraken Facing Investigations
The top stories of the week concern action being taken against two OG exchanges in the space – Kraken and Coinbase. Both are believed to have ongoing investigations by the Treasury Department’s Office of Foreign Assets Control (OFAC) and the Securities and Exchange Commission (SEC), the details of which were leaked this week.
First Kraken, which the New York Times said was being investigated by OFAC over allegedly allowing users from sanctioned countries, including Iran, Syria and Cuba. Founder Jesse Powell takes a notably avant garde approach to regulations in the U.S., so it wouldn’t be surprising if Kraken was indeed allowing traders from sanctioned countries to use the platform, especially if it was a way to raise the middle finger to the U.S. government.
Coinbase on the other hand is supposedly being investigated by the SEC over the sale of securities to U.S. citizens. Bloomberg says that of the plethora of shitcoins that the exchange has listed in recent months, it believes some are securities – although of course it has decided this after the fact rather than letting Coinbase know up front first.
The SEC used the recent case of insider trading against a former Coinbase product manager to name a number of these coins that it believes are securities, which drew a hot response from Commodity Futures Trading Commission (CFTC) Commissioner Caroline Pham, who called it a “striking example of regulation by enforcement” which could have “broad implications beyond this single case”.
Honourable Mentions
Other tales from the crypto vault are worthy of a mention this week, including:
- F1 cars covered up their crypto adverts last weekend to avoid upsetting regulators in the country
- FTX founder Sam Bankman-Fried hit back at Voyager for saying his bid for the company was a “low-ball bid dressed up as a white knight rescue”
- Two ICO founders admitted fraud this week as the fallout from the 2017 ICO boom continues
We’ll be back next Friday to see which stories catch our eye!
