Maitland/AMO Cryptocurrency Monitor – 25 March 2020
The Big Read
CoinTelegraph writes that the coronavirus pandemic was just the spark that ignited the current global economic meltdown, not its cause, according to the CEO of Binance Changpeng Zhao, who argues that coronavirus has shown the world’s economy is too weak. Asked whether he felt conditions this year were different from the global financial crisis of 2008, he summarized: “In 2008, there wasn’t a pandemic pausing global economy. But I believe the Coronavirus is just a trigger, not the root cause. Our economy should be stronger, at least strong enough to survive some shocks.”
CoinTelegraph writes that financial markets are facing their worst crisis since 1929 and people are looking for alternatives to protect themselves from this crash, with one option being considered by many is cryptocurrency. In response however, the Bank of China has continued its anti-crypto narrative in a long post titled “3.15 Protection of Financial Consumption Rights and Interests”. In the post, bank officials warn the public about cryptocurrency investment, calling out the three main scams seen on crypto exchanges.
Forbes writes that the bitcoin and cryptocurrency community is reeling from the sudden market downturn in the face of the coronavirus crisis, with bitcoin prices swinging wildly over recent days. Now, as potential bitcoin buyers are weighing whether to jump back into the market, a senior Russian official has warned its delayed bill on digital assets will include a ban on issuing and selling cryptocurrencies. “We believe there are big risks of legalizing the operations with the cryptocurrencies, from the standpoint of financial stability, money laundering prevention and consumer protection,” Russia’s central bank head of legal, Alexey Guznov, told Russia news agency Interfax this week.
CoinDesk reports however that Bitcoin’s price shot up along with gold and stock futures after the U.S. Federal Reserve announced a quantitative easing package with no upper limit to support the economy amid the coronavirus crisis. Immediately after the announcement, bitcoin jumped from $5,860 to $6,628 in an hour.
New Kid on the Block – The Technologies, Funds and ICOs you should know about
CoinTelegraph writes that the Italian Red Cross is now seeking Bitcoin donations to purchase emerging medical equipment after its first-crypto initiative surpassed its goal of $10,710 in three days. After reaching its first goal so quickly, the Red Cross has continued to continue its Bitcoin fundraising campaign. The charity organization has now set a goal of almost $26,000 to purchase equipment for emergency operations. The Dutch Red Cross is also accepts BTC donations.
Chainalysis has announced a partnership with Paxful to boost the Bitcoin marketplace’s KYC compliance efforts. Paxful, the global, P2P Bitcoin marketplace, uses Chainalysis KYT (Know Your Transaction) to monitor cryptocurrency transactions in real-time and Chainalysis Reactor to build investigations when it detects suspicious activity. Together, these tools amplify Paxful’s compliance expertise and set a new compliance benchmark for P2P cryptocurrency exchanges globally.
Scams, Sanctions and Suspicious Activity
CoinTelegraph writes that the SEC has frozen the assets of Meta 1 Coin, an alleged crypto scam backed by a former state senator that promised investors returns of up to 224,923% without ever having any actual tokens. The regulator initially froze Meta 1’s assets on March 16 and is charging the firm’s operators with fraud. Currently, the SEC seems to be pursuing fines and disgorgement rather than jailtime for those involved.
CoinTelegraph writes that despite YouTube’s many aggressive actions against cryptocurrency-related content, the crypto community spotted on March 23 a fake account impersonating Brad Garlinghouse, CEO of major blockchain company Ripple, in order to promote a fake airdrop scam. The apparent scam account has around 277,000 subscribers and contains only one video, which promotes a fake giveaway in the third-biggest cryptocurrency, XRP.
Bulls & Bears of the week
“The coronavirus pandemic and its severe social, political and economic repercussions give digital currencies one more chance to shine” - Marcelo M. Prates, a lawyer at the Central Bank of Brazil
“We’re seeing some really bullish bitcoin price action along with other asset classes” - Vijay Ayyar, head of business development at cryptocurrency exchange Luno