European Union Drafts Law Suggesting Consideration of Eurocoin

A draft document issued by the European Union suggests that the union should consider issuing its own digital currency.
Will the EU wage war on crypto?
Reuters reported on Nov. 5 that the draft in question — which is still subject to amendments — urges member states to develop a common approach to cryptocurrencies, possibly banning high-risk projects.
If the draft in its current form is approved, which could happen as early as next month, it could have far-reaching consequences. More precisely, Reuters suggests that such a law could escalate into an EU regulatory campaign against cryptocurrencies.
European Central Bank to consider Eurocoin
The draft prepared by the Finnish EU presidency also suggests that the European Central Bank should consider issuing its own digital currency:

“The ECB and other EU central banks could usefully explore the opportunities as well as challenges of issuing central bank digital currencies including by considering concrete steps to this effect.”

The draft will be discussed this Friday, and perspective on its adoption will be presented on Dec. 5.
As Cointelegraph reported in a dedicated analysis in late September, Europe’s digital currency is being increasingly seen as an answer to Facebook’s Libra stablecoin.

Peter Schiff: China's Gold-Backed Crypto Would Be Bearish for Bitcoin

China launching a digital counterpart of the yuan backed by gold puts Bitcoin (BTC) at a disadvantage, veteran gold bug Peter Schiff claims. In a tweet on Nov. 2, Schiff, notorious for his cynicism when it comes to Bitcoin, attempted to counter criticism of his stance by Keiser report host, Max Keiser. 
Schiff tells Keiser: gold backing beats BTC
“According to @maxkeiser I’m an idiot because I think #gold is better money than #Bitcoin,” he wrote. 
Schiff also repeated his oft-quoted idea that Bitcoin has no intrinsic value: 

“He also claims China is about to launch a crypto currency backed by gold. This is bullish for gold and bearish for Bitcoin. A crypto backed by gold is much better than one backed by nothing!”

Keiser did not respond publicly, having kept a markedly low profile on social media throughout October.
Official hints at gold role
As Cointelegraph reported, China appears to be advancing efforts to issue a digital currency in the wake of Facebook’s own token, Libra. 
Its backing remains uncertain, with an ex-Congress official last month suggesting it would come in the form of a peg to China’s gold reserve among other factors. 
China’s recent endorsement of blockchain technology meanwhile appeared to have an instant positive impact on Bitcoin markets. Nonetheless, local media subsequently tempered the hype, advising citizens not to take the support as proof of a change of stance regarding cryptocurrency. 
Beijing outlawed cryptocurrency trading in September 2017, a situation which officially remains the same despite rumors that investors are using different on-ramps to gain access.

President Erdogan: Turkey to Finish Testing Digital Lira in 2020

Turkey’s President Recep Tayyip Erdogan directed that the government should finish testing the national central bank digital currency (CBDC) in 2020. The country’s national blockchain-based digital lira is planned to be issued by the Central Bank in accordance with the 2020 Annual Presidential Program, Cointelegraph Turkey reported on Nov. 5.
Digital lira ‘instant payment’ pilots should be finalized by the end of 2020
Published on Nov. 3, the Presidential Program specifies that the first trials of the digital lira should be conducted and finalized by the end of 2020, according to a document published by Turkey’s official national publication Resmi Gazete on Nov. 4.
Within the pilots, the government reportedly plans to develop a software platform for instant payments based on the digital lira. Alongside the central bank, the project will also involve the national tech innovation agency — the Scientific and Technological Research Council of Turkey, also known as TUBITAK.
As reported by Cointelegraph Turkey, the launch of the digital lira is part of the country’s objective to strengthen the local economy. The document reads:

“The main objective is to establish a financial sector with a strong institutional structure that can respond to the financing needs of the real sector at a low cost, offer different financial instruments to a wide investor base through reliable institutions and support Istanbul’s goal of becoming an attractive global financial center.”

Industry adoption rises in Turkey
The inclusion of the digital lira in the 2020 Annual Presidential Program of Turkey follows previous plans outlined by the state in the country’s 2019-2023 economic roadmap issued in July 2019. In addition to a CBDC, the government is interested in implementing blockchain technology for transportation and customs as well as public services and administration.
In September, the government of Turkey announced plans to set up a national blockchain infrastructure to deploy distributed ledger technology in public administration.
As reported Nov. 1, Changpeng Zhao, CEO of major cryptocurrency exchange Binance, will be a speaker at the Turkish Capital Markets Summit 2019 in Istanbul from Nov. 19–20, 2019.

US Federal Reserve Hiring New Manager to Research Digital Currencies

The United States Federal Reserve is hiring a manager for its Retail Payments section in Washington, D.C.
On Nov. 3, the U.S central bank posted a new job opening to its website, looking for a new manager who is expected to contribute to the research of digital currencies, stablecoins and distributed ledger technologies. 
Besides the principal duties and responsibilities, the position also requires the manager to promote and contribute to the development and implementation of new policies, regulations and research in relation to retail payment systems. 
The new hire will be part of the Retail Payments section, which oversees the Federal Reserve Banks’ check and automated clearinghouse services, facilitates research in retail payments innovation, and addresses policy and regulatory issues concerning retail payment systems.
The listed maximum salary grade is federal grade 29, meaning that the Fed is willing to pay up to $250,700 per year.
A month ago, two members of the U.S. House of Representatives Financial Services Committee asked the Federal Reserve whether there are any plans to launch a U.S. dollar digital currency, expressing their concerns that the importance of the U.S. dollar could be in jeopardy “from wide adoption of digital fiat currencies.”
The fact that the central bank has now expanded the role of its Retail Payments manager to include digital currencies, stablecoins and distributed ledger technologies, could be an indication that the Federal Reserve is at least researching the possibility.
“To end US dollar dominance makes no sense”
In September, former Federal Reserve official Simon Potter said that proposals to end the U.S. dollar’s dominance by replacing it with a digital currency make no sense. He added:

“I see no argument that makes sense to have something that complicated out there when you have large, liquid capital markets in the U.S. Not having one currency that you can basically price things and have a deep market in, that makes life much harder for the global economy.”

Crypto News From the Spanish-Speaking World: Oct. 28–Nov. 3 in Review

The Spanish-speaking world has seen major cryptocurrency and blockchain developments with the Argentinian tax agency applying taxes to transactions with e-wallets, the central bank of Argentina tightening its restrictions on exchanges, and the Dash Latam community ceasing its operations.
Here is the past week of crypto and blockchain news in review, as originally reported by Cointelegraph en Español.
The Argentinian tax agency will apply taxes to operations with electronic wallets
In Argentina, the Federal Public Revenue Administration (AFIP) will apply a value-added tax (VAT) and income tax withholding regime for operations on electronic wallets. The new tax regime aims to put this activity on equal terms with purchases made with debit and credit cards. The AFIP explained:

“The percentages that must be withheld will depend on the payment instrument selected when paying with the electronic wallet, that is, with a debit or credit card. Those percentages will be similar to those established for direct purchases: 0.5% for debit cards and 1% for credit cards, in most cases.”

The central bank of Argentina tightens exchange restrictions
Cointelegraph en Español reported on Nov. 1 that the Central Bank of the Argentine Republic (BCRA) is adding new foreign exchange measures that further restrict citizens’ freedom to buy and sell currencies.
Local card issuers will now be required to have central bank approval to access foreign exchange markets and make payments abroad using cards in games of chance, foreign exchange operations, transferring funds to investment managers abroad and acquiring cryptocurrencies.
Dash LatAm community ceases operations
DashLatAm, an organization promoting the adoption of the Dash (DASH) cryptocurrency in Latin America, has announced that it is ceasing its operations.In a statement, Dash LatAm announced the definitive closure of its operations in eight countries and 20 cities where they were working with their respective communities. Dash Latam was active in Colombia, Venezuela, Peru, Ecuador, Guatemala, Brazil, Spain and Trinidad and Tobago.
Executive director of Dash Latam George Donnelly said that Dash Latam decided to close after it was left without funding nearly six weeks ago, which led Donnelly to lay off approximately 80 staff members and cease operations in all the cities in which it was active.
The Argentine peso devalued 27% after Fernandez won the presidential elections
Cointelegraph en Español reported on Oct. 29 that the Argentine peso suffered a double-digit devaluation that already exceeds 26.51%, since the return of Peronism to power after four years of absence.
Peronism is an Argentine political movement based on the political ideology and legacy of former President Juan Domingo Perón and his second wife Eva Perón. Just recently, Alberto Fernandez, candidate of the left-leaning Peronist opposition, was voted into office as President of Argentina.
According to the South American peer-to-peer Localbitcoins exchange website, a Bitcoin (BTC) is quoted at an average value of 751,496.28 Argentine Pesos on the country’s domestic market. This means that Argentines must pay an 82 peso per U.S dollar premium in order to acquire the cryptocurrency currently trading around $ 9,200. At press time, foreign exchange markets are trading one U.S. dollar for 59.63 Argentine pesos.

Canada Pushes to Regulate Crypto Adoption, Forgoing Volatile BTC Past

Recently, Canada’s central bank has been leading working groups with global partners exploring a blockchain future. Their crypto presence has soared with Ernst & Young’s announcement that it is using Toronto to test its public government expenditure blockchain. But what is the cryptocurrency landscape currently like in Canada? 
The history of crypto in Canada may seem as volatile as a token with a small market cap, yet mainstream use and adoption have been on a consistent incline since 2013, when Canadians started pushing mainstream adoption. Now, the Canadian government is leading working groups. What else has the country been up to in the blockchain space?
The first thing that comes to everyone’s mind when it comes to the Great White North is that the founder of Ethereum, Vitalik Buterin, grew up in Canada — but Etherum isn’t all the country has provided to the crypto space. Here are some more notable stories from Canada’s blockchain history.

The world’s first Bitcoin ATMs
Canada contributed to Bitcoin’s (BTC) mainstream use early on by opening the world’s first Bitcoin ATM at a coffee shop in Vancouver in 2013. The ATMs were released by Bitcoiniacs and Robocoin. Bitcoin was trading at around $200 at the time and, during the first day, the kiosk performed 81 Bitcoin transactions equaling around 81 BTC.
The ATM is considered a strong driver for attracting new people to cryptocurrency, with around a third of its users new to Bitcoin. In an interview with Cointelegraph back in 2013, Robocoin CEO Jordan Kelley marveled at how easy it was for people to get started with Bitcoin. According to industry monitor CoinATMRadar, there are at least 715 cryptocurrency ATMs in Canada, with 85 in Vancouver and 227 in Toronto. 
Operation Cryptosweep
It is easy to agree that the initial coin offerings (ICOs) craze produced more losers than winners, as many took advantage of the hyped-up funding method to conduct scams. In response, state and provincial securities regulators in the United States and Canada launched probes into potentially fraudulent crypto investment programs as part of the North American Securities Administrators Association’s Operation Cryptosweep in 2018. The initiative is reportedly the largest coordinated investigation held by state and provincial officials targeting suspicious crypto investment products, and has resulted in over 200 investigations of ICOs and crypto-related investment products.
Operation Cryptosweep has issued at least 77 actions against crypto programs, including the infamous BitConnect, which has gone down in history as one of the largest cryptocurrency scams.
Vancouver mayor suggests a ban on Bitcoin ATMs
The mayor of Vancouver, Kennedy Stewart, suggested a complete ban on Bitcoin ATMs in the summer of 2019 due to Anti-Money Laundering (AML) issues associated with the ATMs. The associated police report claims that criminals could purchase a Bitcoin ATM for their own needs for a few thousand dollars, and then deposit their cash into that ATM “as many times as required” to profit from or eliminate the transaction fees.
While many Canadian governing bodies have already taken steps against cryptocurrency, British Columbia’s review into the alleged money laundering activities is ongoing. Canada saw the amount of money laundering claims triple last year to 2,466 claims. 

When speaking to Cointelegraph, Andrey Peshkov, the CEO of money transfer app USDX Wallet, dismissed the concerns surrounding money laundering using cryptocurrency in Canada, remarking:

“I do not think that cryptocurrency holders try to laundering money in Canada because they are obligated to pay taxes. Many countries do not require holders to pay taxes from their crypto income making them more attractive to bad actors.”

Related: Head of Crypto Capital Arrested in Connection With Money Laundering
Flexa and Coinsquare integrate physical retail payments for Canada 
However, not all news surrounding Canada recently has been negative.The Winklevoss-backed cryptocurrency payments service Flexa, which allows merchants such as TopGolf to accept cryptocurrency, has seen strong acceptance around the country. 
Related: Where to Spend Bitcoin: A Global Overview From Ljubljana to Zurich
Current estimates show that over 7,500 businesses have signed up on the platform to offer crypto payments to their customers, indicating that business owners in Canada see a need to provide payment solutions in crypto. 
Canada audits QuadrigaCX exchange
A review of Canada in cryptocurrency would not be complete without talking about QuadrigaCX, a defunct Canada-based exchange. The company began grabbing headlines ever since its CEO Gerald Cotten was declared dead in India without ever having revealed the keys to access the company’s cryptocurrency reserves. When these reserves were discovered inaccessible, the business became insolvent, declaring bankruptcy. 
Related: QuadrigaCX Users Lose $190M as Speculations Over Cotten’s Death Swirl
The Canadian company’s bankruptcy trustee was Ernst & Young, a Big Four accounting agency. A bankruptcy trustee oversees the exchange’s insolvency proceedings focusing on auditing from a tax and creditor perspective.
Recently, the widow of QuadrigaCX Founder Gerald Cotten, Jennifer Robertson, paid $9 million in assets to the users of QuadrigaCX through EY. Robertson wrote in a personal statement, “The vast majority of my assets and all of the Estate’s assets are being returned to QCX to benefit the affected users.”
While the widow may not have been aware of her husband’s alleged malfeasance, what happened suggests that Canada is determined to rid cryptocurrency of fraud to protect both investors and holders. According to EY, Robertson’s late husband created fake accounts under several pseudonyms and used them to trade users’ money on the QuadrigaCX platform to show artificial income. The auditor also said that much of the funds were eventually transferred to personal accounts that he controlled. 
High-paying employment in Blockchain Consensus report
The Blockchain Consensus report was released on Oct. 4, 2019 by the Chamber of Digital Commerce Canada, exploring the blockchain ecosystem in Canada. The report takes a closer look at Canada’s blockchain ecosystem, breaking down insight by region and company size. The report also states that government commitment is desperately needed to move this highly innovative technology sector forward by providing legal clarity.
Further, the report includes statistics that highlight the average annual blockchain salary in Canada sitting at more than $98,000 Canadian dollars, making blockchain careers among the highest-paying in the country. The CEO of Shortex, Vladimir Prosvirkin, remarked on this report to Cointelegraph:

“Canada is one of the leading countries adopting blockchain technology on a corporate level. Every second company is invested in blockchain somehow last year. Due to the country’s low energy cost, high internet speeds, and favorable regulations, blockchain and cryptocurrency industries have always prospered here.”

Piloting government spending tracking in Toronto
In an effort to increase transparency, EY started tracking how public funds are spent in the capital city of Toronto. As reported by Cointelegraph on Oct. 16, the system can track the government’s public funds as they move through different state agencies, providing transparency to the public. 
According to EY, data provided by the platform can potentially be used to better inform future decision making on policies. Upon the pilot program’s launch, EY issued a statement, “Blockchain technology can positively impact processes from tax collection to open data to public spending.” A Bitcoin-conscious and highly functioning city like Toronto may benefit from greater transparency in government spending and provide an important use case. 
G-7 working group on stablecoins
On Oct. 13, 2019, the Bank of Canada released results from the G-7 working group on stablecoins that was tasked with “investigating the impact of global stablecoins” as a whole. While much has been written about the strong language in the report, such as “Stablecoins pose a threat to financial security,” it also outlines ways in which governments and digital securities can work together. Participants included the Bank of England, the Bank of Canada, the Bank of France, the European Central Bank, the Bank of Italy, the Bank of Japan and the United States Department of Treasury.
On the eve of the G-7 working group, Anthony Pompliano, co-founder and partner at Morgan Creek Digital, noted that it has taken only a decade from Bitcoin’s creation for the “decentralized digital currency to go from basically the fringes of the internet to now being discussed at the G-7 and other regulatory offices.”
Challenges lie ahead for stablecoins
The report goes on to outline the challenges that stablecoins need to overcome in order for them to remain in compliance. Focusing on private stablecoins, the report highlights that stablecoins, regardless of size, pose some major risks such as regulatory, security, and those relating to financial reporting and misconduct. 
Further, the paper addresses challenges and risks that globally adopted stablecoins like Tether (USDT) pose to monetary policy, financial stability, the international monetary system and fair competition. Jude Regev, the founder of Element Zero, an open-source network that provides branded stablecoins and a fee-free on-chain SmartSwap, noted to Cointelegraph:

“Private stablecoins will need to be more similar to a shield that protects purchasing power and provides security against hacking. When Central Bank’s like Canada issue their own digital currencies and other countries do the same, being able to create stable interoperability between each countries’ fiat onboarding will add the most value to the ecosystem.”

Based on international conversations and the working session led by Canada in conjunction with other countries, it is clear the country sees both value and risk in stablecoins. The working document shows a future where digital currency will utilize banks only as a means for fiat onboarding. The document seems to address two known stablecoin protocols, an algorithmic stablecoin like DAI and asset-backed stablecoins like Tether. 
Toward the future
Canada’s blockchain history is marked by triumph and struggle. The Crypto Canucks are constant drivers and mass adoption is incoming through all the perceived barriers. From the first Bitcoin ATM to considering banning Bitcoin ATMs to leading the international community toward adoption, the Great White North has been at the forefront for both cryptocurrencies’ benefits and risks. 
While adoption continues to increase, inappropriate regulation could potentially hinder some projects in the country. Guidelines may end up forcing private stablecoins to comply with securities laws in big countries or to even become banks, significantly raising the barrier to entry. Alternatively, countries may turn to outlawing private stablecoins altogether for fear of harm coming to their existing banking systems.

China’s Central Bank Introduces Certification System for Fintech Products

China’s central bank, the People’s Bank of China (PBoC), will use a new system to certify 11 types of fintech hardware and software products relating to digital payments. 
On Oct. 29, the PBoC alongside China’s market regulator, the State Ad­min­is­tra­tion for Mar­ket Reg­u­la­tion (SAMR), jointly released a set of documents for the new nationwide Certification of Fintech Products (CFP) system. The documents include definitions of fintech products that require certification as well as rules for its proceedings.
The listed products include em­bed­ded ap­pli­ca­tion soft­ware, cloud computing platforms, user front-end software, security carriers and chips, as well as point of sale terminals and ATMs.
In the document titled “Fintech Product Certification Rules,” the PBoC and SAMR stated that, in order to obtain a CFP certificate from the central bank, applicants will have to pass a prototype examination as well as on-site inspections.
The certificate is valid for 3 years and requires a renewal after the expiration date, the authorities noted. During the validity period, CFP bearers will have to pass random inspections at any stage of the production process, the document says.
Additionally, CFP carriers will be prohibited from using certification for advertising purposes, while incorporation of the certificate to their logo is authorized.
PBoC denies digital renminbi launch readiness 
The new announcement of China’s central bank comes just a month after the bank publicly denied reports that its central bank digital currency (CBDC), a digital renminbi, was about to launch. On Sept. 24, the PBoC claimed that the financial institution needs time for research, revealing that there is no specific timetable for the CBDC launch.
On Oct. 28, China recorded a sharp growth of interest in blockchain technology after President Xi Jinping called for faster adoption of blockchain tech. Earlier today, Cointelegraph reported that the Guangzhou government formed a new $140 million subsidy fund in order to encourage the development of blockchain initiatives.