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Beijing Presses Fast-Food Chain McDonald’s to Support Digital Yuan — China’s CBDC Expected to Launch in February

Beijing Presses Fast-Food Chain McDonald’s to Support Digital Yuan — China’s CBDC Expected to Launch in FebruaryAccording to a recent report, Beijing is pressing the fast-food retail chain McDonald’s to support the digital yuan before the Winter Olympics in China scheduled for February 2022. The report notes that China is also pushing companies like Visa and Nike to join in on the central bank digital currency (CBDC) rollout. Chinese Government Pushes […]

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China’s state planning agency calls for public opinion on Bitcoin mining ban

The move could signal plans by Chinese authorities to amend its previous negative stance on Bitcoin and cryptocurrency mining activities.

China’s National Development and Reform Commission is seeking public opinion on the inclusion of crypto mining in its list of “phased-out” industries.

The call for public comments by the country’s macroeconomic planning agency was contained in a release issued on Thursday.

Back on Sept. 24, the agency added digital currency mining to its list of outdated industries following sweeping crackdowns by authorities in Beijing against crypto miners.

The move offered a definitive stance by the commission after seemingly going back and forth on the issue for the last two years.

As part of the calls for public comments, the agency’s notice requested public feedback from “relevant units” as well as “people from all walks of life.”

The public comment period will last for one month, between Thursday, Oct. 21, and Nov. 21. Members of the public interested in providing feedback on the matter will have four different avenues to make their opinions known, including emails, physical mail and comments sections on the commission’s website.

In a related development, the commission also put out a post on its website stating that the United States had replaced China as the dominant Bitcoin (BTC) mining nation in the world.

Related: Death knell for Chinese crypto miners? Rigs on the move after gov’t crackdown

Indeed, as previously reported by Cointelegraph, the U.S. now accounts for over a third of the global Bitcoin mining hash rate distribution, with Kazakhstan and Russia in second and third place, respectively.

Even before Beijing’s crackdown, crypto miners in North America had been expanding their capacity with massive hardware orders from major manufacturers such as Bitmain and MicroBT.

At the height of China’s dominance, Chinese miners controlled three-quarters of the global Bitcoin hash rate.

Chinese miners driven out by the ban have reportedly moved their hardware to overseas locations, including Kazakhstan, with states such as Texas and Florida looking to attract some of these companies.

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Chinese e-commerce giant JD.com drops NFT series on its own blockchain

JD.com implements its own blockchain to issue free NFTs to attendees of its annual JD Discovery conference.

Chinese online retail giant JD.com is diving into the nonfungible tokens, or NFTs, industry by introducing a special NFT series for its annual JD Discovery conference.

Using its proprietary blockchain platform, JD.com will be distributing commemorative NFT certificates to attendees of the JDD 2021 event in Beijing, the Chinese new agency Sina Finance reported Oct. 20.

JD.com will specifically issue one NFT for free to anyone who signs up for the JDD 2021 conference between Oct. 18 and Nov. 22 through WeChat mini program on the event’s official website.

According to the report, the NFT series features a set of seven NFT models, with each of them containing different images used to identify different forums of the JDD event.

Users who sign up to participate will be also able to get more NFTs by inviting friends to sign up. “Each time one person is successfully invited to sign up, one NFT voucher will be added until all seven NFT models are collected,” the report reads.

The JDD 2021 conference will kick off at the ​China International Exhibition Center on Nov. 22, featuring panels on artificial intelligence and tech innovation. Launched in 2017, the JDD conference has emerged as a major technology event in China, covering topics like smart cities, the digital financial industry, supply chain innovation and others.

Related: Chinese Communist Party warns of NFT hype bubble

The news comes after some major Chinese companies like retail giant Alibaba and technology conglomerate Tencent announced their own NFT projects as well. Alibaba announced the launch of an NFT marketplace in mid-August, aiming to allow trademark holders to sell tokenized licenses to their intellectual property. Tencent previously said it was planning to release its own NFT trading platform.

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BTC price is up 50% since China ‘selflessly’ banned Bitcoin mining

No amount of FUD can keep Bitcoin down, and China has once again given bulls a boost with its bans.

It’s been 150 days since China banned Bitcoin (BTC) mining — and BTC price action has only benefited as a result.

Five months ago, China caused a considerable but not unsurprising stir by doubling down on its hostile environment policy toward cryptocurrency.

Bitcoiners to China: Thanks for the ban

Just like every “ban” before it, China’s move against miners saw temporary price turbulence, matching the biggest physical upheaval in Bitcoin’s history.

As miners powered down and relocated out of China, Bitcoin’s network hash rate fell 50%, with difficulty slowly adjusting for the changes in the months that followed.

Since then, however, a powerful renaissance has occurred, and now the network and its security have practically erased any trace of China’s impact. BTC price action, meanwhil, shows a much clearer trend.

“China banned BTC transactions and mining only 150 days ago,” analyst Willy Woo summarized about the episode.

“Today the network is more decentralised than ever and price has risen +50% . Antifragile.”

As Cointelegraph reported, anti-Bitcoin moves by Beijing have ironically led to price increases, not decreases, and 2021 has now proven itself no different.

The hash rate data further shows how China’s absence has improved decentralization, dissolving a weak point that had characterized mining for years.

Bitcoin hash rate distribution chart. Source: CBECI

Woo had seen the potential pluses behind the mining ban before BTC/USD had even begun to recover, wryly calling China’s actions “selfless.”

The United States, meanwhile, is now estimated to be the largest participant when it comes to the Bitcoin network hash rate.

Miners hodl post-China

Current miner behavior underscores the long-term perspective taken by network participants since China exited.

Related: All-time high weekly close — 5 things to watch in Bitcoin this week

Miner outflows remain low despite BTC’s price nearing all-time highs, while their reserves are near historic lows, data from on-chain analytics firm CryptoQuant shows.

Bitcoin miner outflows chart. Source: CryptoQuant

Both miners and long-term hodlers alike are refusing to sell at current levels amid anticipation of new highs and a blow-off top of up to $300,000 for BTC/USD.

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Asian CBDC projects: What are they doing now?

Governments in Asia are quickly researching or implementing CBDCs. What does this mean for the region’s overdependence on the U.S. dollar?

The rapid growth of mainstream attention toward cryptocurrencies has forced the hands of numerous governments to create their digital alternatives. Over the past few years, interest from various jurisdictions has been pointed towards central bank digital currencies (CBDCs) — digital versions of government-issued fiat.

Given their capacity to use blockchain technology to facilitate a simplified fiscal policy — not to mention calibrate privacy features and even provide cross-border banking services to the unbanked — CBDCs continue to gain even more attention from various governments worldwide.

Already, surveys show more than 80% of central banks are researching CBDCs, with some working on proofs of concept that could eventually lead to the introduction of fully functional CBDCs. Out of the surveyed central banks, 10% plan to offer a retail version of a CBDC in the next three years, with another 20% set to make the move in under six years. 

In Asia, these efforts have been compounded by China’s release of the world’s first CBDC after setting up a task force as early as 2014. By 2016, the People’s Bank of China (PBoC) had already established a Digital Currency Institute, which developed a prototype CBDC.

Major Asian banks have shown great interest in CBDCs as reports show collaborative efforts by Thailand’s, Hong Kong’s and China’s central banks to create a digital ledger technology (DLT) for a CBDC prototype designed to bridge cross-border gaps. 

In this article, we give you a brief look at some developing CBDC projects on the Asian continent.

China

China ranks among the world’s top economies to embrace digital currencies with the release of the digital yuan — a CBDC project issued by the PBoC. 

Dubbed the Digital Currency Electronic Payment (DCEP) China’s digital yuan (e-CNY) is set to completely replace cash payments and has been rolled out in the country’s major cities since April 2020. 

China’s DCEP, while sporting some anonymity features, is controlled, tracked and registered on smartphone apps by the Chinese government, giving them the ability to freeze accounts at will. 

Perhaps one of its advantages is the fact that users on China’s DCEP network can reverse or correct erroneous transactions, which is one of the features that is non-existent on decentralized digital currencies like Bitcoin (BTC). 

As China’s CBDC takes shape, various countries (especially the United States) have grown increasingly concerned that the new CBDC initiative will help China tighten increased surveillance on its citizens and private companies. 

The move is also seen as an attempt to supplant the dominance the U.S. dollar enjoys in international trade. Even so, China’s e-CNY remains highly localized with no significant attempts by the Asian nation to take its CBDC international.

Hong Kong

Just recently, the Hong Kong Monetary Authority (HKMA) released a white paper discussing plans to experiment on the benefits of retail CBDCs for the city’s cross-border markets. 

Hong Kong is now governed under a one-country, two-system framework where it maintains its own financial and judicial system separate from mainland China. However, HKMA is working with China’s central bank to explore the infrastructure development of its digital Hong Kong dollar (e-HKD).

According to the white paper, “The architecture proposed in Hong Kong’s e-HKD features a flexible and efficient two-tier distribution model of a CBDC that enabled privacy-preserving transactions, traceability and cross-border synchronizations of ledgers.”

The white paper is the result of CBDC research by Hong Kong’s major financial authority that has been ongoing since 2017 under the aegis of “Project LionRock.” The HKMA considered the opinions of academic and industry experts and plans to conduct more trials to ensure the readiness of both a retail and wholesale CBDC.

South Korea 

South Korea’s latest move towards a CBDC has seen the Bank of Korea (BoK) make calls for a technology partner to help pilot a CBDC program set to run till the end of the year. 

In a report published by BoK in February this year, the central bank announced plans to test and distribute a digital won while outlining the legal challenges that accompany a state-issued digital currency.

Apart from selecting a technology partner to help with the project, BoK has also announced that its CBDC will first operate in a limited test environment in order to analyze the functionality and security of the CBDC.

According to previous remarks by a BoK official, South Korea’s cash transactions are on the decline, and the central bank is only taking steps in preparation “for the expected changes in payment settlement systems [worldwide].”

The Philippines

In the summer of 2020, the central bank began to consider the creation of a CBDC by forming a committee task force to study the issue.

Bangko Sentral ng Pilipinas had confirmed in a virtual briefing that a committee was set up to look into CBDCs. In the briefing, Governor Benjamin Diokno explained that a feasibility test and an evaluation of the policy mechanisms of issuing a CBDC were underway. 

Like most governments and traditional financial institutions, the officials in the Philippine government were not shy to admit to the significance of blockchain technology. Diokno said, “Cryptocurrency for us has always been beyond the asset itself but more on the blockchain technology that underpins it.” 

In line with these remarks, the Philippine Bureau of the Treasury, in partnership with the Philippines’ Digital Asset Exchange and UnionBank, had launched a mobile application built on blockchain tech for distributing government-issued treasury bonds.

A few months later, however, saw the Philippines’ central bank reject the possibility of issuing a CBDC any time soon. Citing the need for ongoing research and study, the country’s central bank noted that its CBDC research so far could benefit from looking at established use cases of digital currencies in the private sector as well as other industrial applications.

Singapore 

From as early as 2016, the Monetary Authority of Singapore had been looking into CBDC initiatives and is now seeking commercial partners to help develop the currency.

By setting up challenges and competitions to discover and develop a retail CBDC, Singapore was able to establish a healthy diversity of solutions with the participation of more than 300 individuals.

Singapore’s move to launch a CBDC began as a joint project with an institute dubbed “Project Dunbar” that mainly focused on building an in-house retail CBDC for the country. 

Soon after, the Singaporean central bank announced cash prizes for participants issuing digital currency ideas. Finalists in the challenge included ANZ Banking Group, Standard Chartered Bank, Criteo, Soramitsu and HSB Bank Limited, to mention a few. 

Throughout 2021, the Singaporean authorities have maintained a crypto-friendly stance with approvals given to crypto exchange platforms to operate similar to other digital payment token services. 

Cambodia

Cambodia's “Project Bakong” is probably one of the few fully operational retail CBDCs out there. The country’s blockchain-enabled money transfer project was originally launched in October 2020.

By June 2021, the project was reported to have amassed over 200,000 users with an overall indirect outreach of over five million users. What’s more, the first half of 2021 saw Cambodia’s CBDC project hit a transactional throughput of 1.4 million transactions valued at $500 million. 

Developed on a hyper ledger platform, the Cambodian CBDC features mobile connectivity that allows users to connect to financial institutions and make payments without a centralized clearing entity. 

Apart from the declared goal of using the CBDC to wean off dependence on the U.S. dollar, officials also disclosed that plans are underway to explore a cross-border transaction capability through a partnership with Thailand’s central bank and Malaysia’s largest bank.

Japan

In Japan, the country’s central bank joined hands with a group of other seven central banks in October 2020 to publish a report that examined CBDCs

Since then, the Bank of Japan (BoJ) has begun a proof-of-concept to test the core CBDC functions. While the testing phase was scheduled to end by March this year, officials from Japan’s panel on digital currencies have said that the digital yen should be compatible with other CBDCs and that the BoJ is still ironing out its key functions.

An offline capability of the CBDC is one of Japan’s core considerations as it strives to establish a digital currency that is resilient to disruption given Japan’s vulnerability to natural disasters, earthquakes, floods and tsunamis. 

At the start of 2020, Japan’s parliamentary vice-minister for foreign affairs said that Japan’s digital currency could be a joint venture with public and private partners to align Japan’s goal with global changes in fintech.

Thailand

Since 2019, Thailand has joined forces with Hong Kong’s HKMA to test the use of a CBDC that would be used in cross-border payments between financial institutions in both countries. 

According to a press release by the Bank of Thailand, “The development of a CBDC is a key milestone with the potential to alter the financial infrastructure and ultimately the financial landscape which could cause many changes in the roles of many stakeholders.”

Similar to other CBDC initiatives, the Bank of Thailand will seek out consultations and feedback with the general public as well as with the private and public sector on the “development and issuance of retail CBDC.”

The Bank of Thailand plans to start pilot tests for the usage of its CBDC in the second quarter of 2022.

Vietnam

Previously, the Vietnamese government had requested the State Bank of Vietnam to investigate blockchain-based currencies. It appears that Vietnam has joined the growing list of jurisdictions looking into CBDCs despite its previous harsh stance on cryptocurrencies. 

In May 2020, the country’s ministry of finance announced plans to research and formulate a regulatory law for the crypto industry, even as the country experienced high levels of growth in digital currencies. 

In July, the Vietnamese government decided to investigate CBDCs with plans to issue a pilot CBDC, given its utility for a small country in a global financial system that is dominated by the U.S. dollar.

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Coingecko Publishes Q3 Crypto Report — BTC Outperformed Every Major Asset Class, Altcoins Decouple

Coingecko Publishes Q3 Crypto Report — BTC Outperformed Every Major Asset Class, Altcoins DecoupleOn Thursday, the crypto asset aggregation portal Coingecko published the firm’s 2021 third-quarter report which shows a number of different findings. According to the study, for the most part, the crypto economy recovered from the market downturn in May as the top 30 market caps grew by 31% in Q3. The report shows that altcoins […]

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Russia considers new energy tariffs as Chinese crypto miners relocate

Russia’s Irkutsk region saw its energy consumption rates surge by 160% following China’s crackdown on crypto mining.

The Russian Ministry of Energy is looking to introduce special electricity tariffs for cryptocurrency miners following migration of the industry into the country from nearby China.

Russian Energy Minister Nikolai Shulginov announced Wednesday that the authority is working on a new framework to differentiate tariffs between general usage and cryptocurrency mining, local news agency RBC reported Oct. 13.

Shulginov said that cryptocurrency miners in Russia should not consume electricity at residential tariffs, stating:

“We can’t let miners capitalize on the situation at the expense of low residential electricity tariffs [...] In order to maintain the reliability and quality of power supply, we believe it is necessary to prohibit miners from consuming electricity at residential tariffs.”

Some Russian regions have reportedly faced explosive growth in energy consumption, allegedly due to Chinese miners exiting the country amid a nationwide crackdown on crypto.

Russia’s Irkutsk region, located about 1,700 kilometres from China, has reportedly seen its energy consumption rates exceed last year's by almost 160%. Irkutsk Governor Igor Kobzev pointed to “avalanche-like growth” of energy consumption in the jurisdiction, blaming illegal crypto mining activity worsened by the exodus of miners from China.

One of the biggest regions of Siberia, the Irkutsk region is rich with energy resources, hosting several large hydroelectricity stations in cities like Irkutsk, Ust-Ilimsk and Bratsk. The region is home to some crypto mining data centers by BitRiver, the country’s largest crypto mining colocation services provider.

Related: Data center operators have ‘no problem’ with new Russian crypto crackdown

BitRiver founder and CEO Igor Runets told Cointelegraph that the company fully supports the latest initiative by the ministry of energy:

“It is fair and economically sound. Moreover, it will help miners enter the legal field, so the state can take the first step towards regulating the industry, which will ultimately lead to transparency of the entire industry.” 

Runets said that the company pays for its data center electricity at business customer rates, paying “2.5 or 3 times more than individuals.”

Russia has become one of the top locations for Bitcoin (BTC) mining activity following the Chinese miner capitulation. According to the Cambridge Bitcoin Electricity Consumption Index, Bitcoin miners in Russia account for 11% of the total global BTC mining hash rate distribution, bested only Kazakhstan and the United States.

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Geographic Distribution Data Shows US Takes Leading Bitcoin Mining Position After China’s Crackdown

Geographic Distribution Data Shows US Takes Leading Bitcoin Mining Position After China’s CrackdownAfter China has reigned for a number of consecutive years as the dominant bitcoin mining epicenter of the world, the United States has “taken the leading position in bitcoin mining,” according to new data from Cambridge University. Data Shows US, Kazakhstan, Russian Federation Rule the Bitcoin Mining Roost In mid-July, researchers from the Cambridge Bitcoin […]

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US dominates global Bitcoin hash rate distribution after China crackdown

The United States now accounts for more than a third of the total Bitcoin mining activity with Kazakhstan and Russia also becoming major locations.

Following sweeping crackdowns by China against Bitcoin mining activity, the United States has now emerged as the leading nation in terms of hash rate.

According to the Cambridge Bitcoin Electricity Consumption Index (CBECI), Bitcoin (BTC) miners in America account for 35.4% of the total global BTC mining hash rate distribution.

CBECI data also shows Kazakhstan (18%) and Russia (11%) as the next major Bitcoin mining centers outside the United States. These three nations have gained significant market share in the wake of China’s crypto mining ban.

Back in June, Cointelegraph reported that BTC.com, one of the largest Chinese Bitcoin miners, was relocating to Kazakhstan.

Source: CBECI

Perhaps of particular interest is the fact that CBECI data shows a 0% hash rate from China. However, it is possible that covert mining operations are still ongoing despite the ban.

The United States accounting for the greatest share of global hash rate distribution likely completes the expected East−West miner migration following Beijing’s clampdown.

Apart from the China crackdown, North American crypto mining establishments have been upscaling their capacity with significant additions to their hardware capacity.

American miners like Argo Blockchain, Riot Blockchain, Marathon, and several orders have purch large orders of mining rigs from major manufacturers like Bitmain and MicroBT.

Related: Argo Blockchain secures $25M Bitcoin-backed loan from Galaxy Digital

Earlier in October, Cointelegraph reported that Riot Blockchain had tripled its production capacity in 2021 with 2,457 BTC mined during the period.

Places like Texas and Ohio are also expected to play host to mega Bitcoin mining centers that will increase the production capacities of U.S. crypto miners even further.

As previously reported by Cointelegraph, BIT Mining recently inked a joint venture agreement with Viking Data Centers to build an 85 megawatts Bitcoin mining facility in Ohio.

The expansion of the U.S. Bitcoin mining space has also seen more companies pursuing a public listing on American stock exchange markets.

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Binance to suspend Chinese yuan from P2P platform in December

Binance is taking more measures to comply with China’s cryptocurrency crackdown with new restrictions in the mainland.

Binance crypto exchange officially announced on Oct. 13 that the company will delist the Chinese yuan (CNY) from its peer-to-peer trading platform on Dec. 31.

Alongside terminating yuan trading pairs, Binance will continue further restricting access to its platform by users from mainland China, introducing new measures for accounts found to be linked to the region. Binance will specifically limit such accounts to “withdrawal only” mode, limiting transactions to withdrawals, redeeming and closing positions.

Binance emphasized that the company “withdrew from the Chinese mainland market in 2017” and has not been engaged in exchange business in the region since. The exchange says that China-based users have not been able to access Binance since the exit.

Despite exiting the Chinese market back in 2017, Binance cryptocurrency exchange has not yet suspended trades involving the Chinese national currency from its platform.

“Binance does not have any active exchange operations in China. We can also confirm that mobile phone registrations are blocked and the Binance app is not available for download by China-based consumers,” a Binance spokesperson told Cointelegraph.

“We have also taken the added step to delist CNY trading pairs and restrict services on Binance P2P to any China-based users,” the representative added.

The news comes weeks after the Chinese government announced another major crypto ban in late September, with multiple state authorities uniting forces to combat crypto adoption in the country. A number of major crypto firms have been forced to relocate or redirect some of their services.

Related: Bitmain stops shipment of Antminer crypto mining rigs into China

Huobi, one of the world’s largest crypto exchanges, is one company whose revenue is likely to be affected by the new Chinese ban.

“Due to historical reasons, we do have a certain proportion of our user base in mainland China. Retiring mainland Chinese user accounts will have a certain impact on the company’s revenue in the short term,” a spokesperson for Huobi told Cointelegraph on Sept. 28.

“Huobi’s diversified businesses outside of China have reached nearly 70% in terms of trading volumes,” the representative added.

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