Swedish pension fund Alecta dumps First Republic Bank shares after price plummets

March 21, 2023 Coin Telegraph

Banking

The Swedish fund was the bank’s fifth largest shareholder; the fund’s CEO said the uncertainty surrounding First Republic was too great.

Private Swedish pension fund Alecta has sold its shares in First Republic Bank, the American bank struggling to stay afloat after a serious drop in share value, a bank spokesperson announced March 21. Alecta was the bank’s fifth-largest shareholder.

Alecta took a loss in the deal after losing funds in the collapses of Silicon Valley Bank (SVB) and Signature Bank. First Republic Bank’s shares fell 87% after SVB was forced to close earlier this month. Regarding the latest developments, Alecta CEO Magnus Billing told Bloomberg:

“The uncertainty about First Republic’s future was too great, partly due to the fact that the lender was downgraded to junk status.”

According to media reports, Alecta took a $728 million loss on the sale of its First Republic shares. That loss came on top of roughly $862 million Alecta had in SVB and $310 million in Signature Bank before their closures.

The pension fund’s board asked Billing to investigate whether its "investment strategy, risk allocation and mandate for asset management is optimal” last week. The fund was also in communication with the Swedish Financial Supervisory Authority on its investment in the U.S. banks.

Alecta has about $116 billion in assets under management, representing the accounts of 2.6 million individuals and 35,000 companies in Sweden. The fund’s solvency ratio was unaffected by the losses from the U.S. banks.

The CEO of Alecta, the Sweden pension fund that lost over $1 billion in the SVB fallout, is concerned about "breaking the markets" if central bank tightening is "too aggressive" https://t.co/CHdP5OUDE5 pic.twitter.com/yQzD5Yj59m
— Bloomberg TV (@BloombergTV) March 14, 2023

After reaching a low of $12.15 on March 20, First Republic Bank’s shares were selling for $17.11 at the time of writing.

Silicon Valley Bank, which largely served the tech startup industry, filed for bankruptcy on March 17 after being forced to sell bonds at a loss to cover a bank run. Signature Bank was closed by New York state authorities on March 12 in an action supported by federal regulators. The bank held deposits of several crypto firms, including Coinbase, Celsius and Paxos, although a New York State Department of Financial Services spokesperson denied the closure was related to crypto.

CBDCs could provide smooth cross-border payments, says Bank of Israel official

March 15, 2023 Coin Telegraph

CBDC

Yoav Soffer, the advisor to the deputy governor and CBDC project manager, spoke at Tel Aviv FinTech Week, explaining how a recent CBDC experiment proved efficient in cross-border transactions.

At Tel Aviv FinTech Week 2023, Yoav Soffer, the advisor to the deputy governor at the Bank of Israel, touched on the topic of central bank digital currencies (CBDCs) as an efficient cross-border payment option.

The talk comes after the Bank for International Settlements (BIS) concluded its research on international retail and remittance payments via CBDCs between the central banks of Israel, Norway and Sweden. The BIS project is called “Project Icebreaker.”

Soffer, who is also the project manager for the CBDC program for the Central Bank of Israel, said that while domestic payments in Israel have become “very easy, convenient and cheap,” the same is not true for payments outside of the country.

“Cross-border payments are often perceived to face challenges of high costs, low speed, limited access and insufficient transparency according to the financial stability board.”

Soffer touched on the result of an example transaction that took less than two minutes. Moreover, he stressed that this model would significantly reduce the costs of sending funds internationally and is “much more competitive in terms of the foreign exchange transaction."

*Yoav Soffer speaking at Tel Aviv FinTech Week 2023. Source: Cointelegraph*

He continued to say that the technological requirements for countries to join the model are very limited and once a prototype is built, onboarding should essentially be a domino effect.

“Once you build it for three countries, you could build it for 180 countries. Therefore, it's also very scalable.”

However, he did say that in employing such a program, ways to provide liquidity for CBDC providers would need to be considered, as well as the integration of policies. Soffer said privacy is another major consideration that the BIS team was aware of during the project.

Despite over a hundred countries looking into the possibilities of CBDCs, the sentiment around these centralized digital currencies is mixed. They have useful capabilities, such as efficient cross-border transactions, though some say they could threaten consumers’ future.

Former CFTC Chair Christopher Giancarlo recently stressed that CBDCs should protect privacy and not be a surveillance tool as many fear. A congressman in the United States, Tom Emmer, also commented that they could be ‘easily weaponized’ to spy on U.S. citizens.

BIS Releases Report On ‘Project Icebreaker’ — Develops Cross-Border Retail CBDC Payment Model

March 8, 2023 Bitcoin.com

Binance approved to offer crypto services to Swedish customers

January 11, 2023 Coin Telegraph

Binance

The decision from Sweden’s financial authority followed regulators in France, Bahrain, Spain and Dubai granting similar approvals for Binance in 2022.

The Swedish Financial Supervisory Authority, one of the country’s financial regulatory agencies, has granted the local arm of crypto exchange Binance approval to manage and trade digital currencies.

According to a Jan. 11 announcement, Binance said following “months of constructive engagement” with the financial regulator, the Swedish FSA granted Binance Nordics AB registration status on Jan. 10. This decision effectively allows Swedish residents to access Binance’s crypto services.

"Sweden fully adopts EU laws and has further local requirements, so we have been careful to ensure that Binance Nordics AB has adopted risk and AML policies to match this exacting standard,” said Roy van Krimpen, Binance’s lead in the region. ”Our next big task will be the successful migration and launch of local operations, including hiring of local talent, organizing more events and delivering more crypto education in Sweden."

Hej Sweden #Binance has been granted registration by the Swedish Financial Supervisory Authority.

Furthering our commitment to compliance across Europe, this registration gives residents in Sweden access to a broad range of our regulated crypto and Web3 services.
— Binance (@binance) January 11, 2023

The decision from Sweden’s financial authority followed regulators in France, Bahrain, Spain and Dubai granting similar approvals for Binance in 2022. Authorities in certain countries including the U.S., United Kingdom, Canada, and Japan previously cracked down on the exchange’s operations, warning potential investors about the risks surrounding digital assets.

On Jan. 10, a U.S. court approved of a preliminary deal allowing Binance.US to purchase more than $1 billion in assets from Voyager Digital, which declared bankruptcy in July. FTX had planned to acquire Voyager’s assets prior to its collapse in November, leaving them up for grabs once again.

The state of crypto in Northern Europe: Hostile Scandinavia and vibrant Baltics

October 30, 2022 Coin Telegraph

Coin Telegraph

The Nordics remain a cold place for crypto, but Estonia still leads as the public blockchain adopter.

Despite the turbulence that broke out in the crypto market this summer, there is an important long-term marker that should be considered in any complex assessment — the combination of adoption and regulation. The latest report by EUBlockchain Observatory, named “EU Blockchain Ecosystem Developments,” tries to measure this combination within the European Union, combining the data on each and every member country from Portugal to Slovakia.

As the original report counts more than 200 pages, Cointelegraph prepared a summary with the intent to capture the most vital information about the state of crypto and blockchain in Europe. Cointelegraph started from a group of countries that are usually labeled as Western European and continues with a review of Northern European states.

Sweden

Numbers: $39.9 million (40 million euros) raised in initial coin offerings (ICOs), 15 blockchain startups launched.

Regulation and legislation: According to the report, the country still lacks any definite crypto and blockchain legislation: “One must often use the existing legal framework and force blockchain to fit within that framework.” The principal supervisory authorities in the country are the Swedish Financial Supervisory Authority and the Swedish Data Protection Agency.

Taxes: While the report lacks any information about the tax regime regarding crypto in the country, the local tax advisers specify that capital gains from selling crypto are subject to a 30% tax.

Notable initiatives: The Swedish land-ownership authority Lantmäteriet began testing blockchain technology in 2016, which resulted in a pilot project to develop future real estate transactions by using smart contracts. In June 2018, developers completed the first successful transaction on the platform. Together with Nasdaq, one of Sweden’s major banks, SEB, initiated the Nordic Fund Ledger — a consortium to improve mutual fund trading by applying blockchain. An initiative should have been launched in 2020, but by the publishing time, there is no evidence it did.

Local players: 3Box, a decentralized user data storage system, AIAR, an Ethereum-based education platform, and Bitrefill, a digital gift card and mobile airtime provider that accepts crypto as a payment method.

Denmark

Numbers: $32.4 million (32.5 million euros) of total funds raised by blockchain projects, 24 blockchain startups.

Regulation and legislation: Denmark has no laws specifically addressing cryptocurrencies. In 2021, Danske Bank, the largest bank in Denmark, stated that it won’t offer any cryptocurrency services to customers itself, but also that it wouldn’t interfere with transactions coming from crypto platforms.

Taxes: According to Coincub, crypto gains incur an income tax of around 37%: “If you’re a high earner, your crypto gains — as part of your overall income — could go up to 52% tax.”

Notable initiatives: In 2018, Copenhagen-based shipping giant Maersk and IBM announced the launch of TradeLens, a blockchain-enabled shipping solution designed to promote more efficient and secure global trade.

Local players: As the report specifies, perhaps the most important names among the Danish crypto startups would be the ones that were established in the country but registered in other jurisdictions, such as Chainalysis, Blockshipping and MakerDAO.

Finland

Numbers: 18 blockchain startups

Regulation and legislation: The chief supervisory authority for everything crypto-related in the country is the Finnish Financial Supervisory Authority. In 2019, the Act on Virtual Currency Providers came into effect. It demands registration from any entity that aims at Finnish customers while providing or marketeering its crypto-related services. The Virtual Currency Act does not draw any distinctions between different types of digital currencies.

Taxes: Profits from the exchange or sale of crypto are subject to capital gains tax, which makes up 30% of the income not exceeding $29,922 (30,000 euros) and 34% on the excess above this limit.

Notable initiatives: Back in 2018, the Finnish government announced the collaboration with Essentia to build blockchain-based solutions for smart logistics.

Local players: SOMA (SOcial MArketplace), a decentralized peer-to-peer (P2P) platform on Ethereum for trading and exchange of physical goods, LocalBitcoins, a P2P platform for digital currencies, and Haja Networks, a developer of distributed and decentralized database solutions based on blockchain solutions.

Norway

Numbers: $26.9 million (27 millions euros) of total equity funding, 22 blockchain solution providers.

Regulation and legislation: The advisory and supervisory authorities regarding blockchain and crypto are the Norwegian Data Protection Authority, the Financial Supervisory Authority (FSA), Norges Bank and the Norwegian Tax Authority. The FSA has previously noted that a legal framework and rules for investor protection are needed if cryptocurrencies become a suitable investment for consumers. However, according to the report, “It is unlikely that Norway will enact additional legislation on cryptocurrencies until the EU adopts its flagship cryptocurrency legislation, the Regulation on Markets for Crypto-Assets (MiCA).”

Taxes: As in other Scandinavian countries, crypto assets in Norway are subject to the general capital gains tax. The annual tax rate for private individuals constitutes 22%; the same percentage goes for legal entities due to a flat corporate income tax rate. However, an individual would pay more if his yearly income exceeds certain levels.

Notable initiatives: In 2021, The FSA established a regulatory sandbox to encourage fintech innovation. The Central Bank of Norway is actively exploring a central bank digital currency (CBDC), which is now proceeding through a two-year phase of technical testing.

Local players: Choose, a cryptocurrency platform backed by CO2 emission permits, ViPi Cash, an online platform facilitating global money transfers using blockchain technology, and Diwala, a decentralized platform for skill verification of individuals through the decentralized ledger technology.

Latvia

Numbers: 15 blockchain startups

Regulation and legislation: Crypto remains largely underregulated in the country. In 2020, the chief local financial regulator, the Financial and Capital Market Commission, urged investors to “be particularly vigilant, as cryptocurrencies operate in an infrastructure that is currently characterized by lower regulation than in the financial and capital markets.”

Taxes: The Latvian PIT Act defines crypto as a capital asset subject to the general capital gains tax, which is 20%.

Notable initiatives: In 2019, the Economic Ministry of Latvia introduced two blockchain-based pilot projects. The first one should strengthen the supervisory capacity of the State Revenue Service and reduce the shadow economy through the implementation of a blockchain-based cash register. The second would ease the process of acquiring limited liability company status by using blockchain systems in the Enterprise Registry.

In 2021, the national air carrier airBaltic added Dogecoin (DOGE) and Ether (ETH) as payment options. It started to accept Bitcoin (BTC) as early as 2014.

Local players: Blockvis, a blockchain development and consulting group, Velvet, a blockchain-powered solution for online identification, and Soft-FX, a software developer, which collaborated with a list of major cryptocurrency platforms such as Binance, Bifinex and others.

Lithuania

Numbers: 31 blockchain startups, $1.09 billion (1.1 billion euros) raised by local startups

Regulation and legislation: The report calls Lithuania “one of the most pro-blockchain countries in Europe.” It became one of the first countries to issue regulations on ICOs back in 2018. From 2019, every digital assets provider needs to be registered with the country’s Centre for Registers.

Taxes: Corporate tax for the crypto companies stands at 15% and the same flat rate goes for the individual’s income.

Notable initiatives: In 2018, the Bank of Lithuania launched a digital currency sandbox called LB Chain, which is envisioned to become a prototype for central bank-issued blockchain-backed coins.

Local players: DappRadar, a market intelligence vendor for decentralized applications (DApps), Bankera, a blockchain-backed digital bank, and BirDegree, a blockchain-based and gamified online education platform.

Estonia

Numbers: $284 million (285 million euros) raised, 200+ blockchain solutions providers

Regulation and legislation: Estonia was the first European country to provide clear regulations and guidelines for digital currencies. The local law recognizes digital currencies as “value represented in digital form that is digitally transferable, preservable, or tradable, and that natural persons or legal persons accept as a payment instrument.” However, digital currencies are not considered legal tender and do not otherwise possess the legal status of money.

Taxes: Digital currencies are qualified as property and their exchange is subject to a capital gains tax of 20%.

Notable initiatives: The blockchain-enabled e-Residency program allows anyone to start and manage an EU-based company completely online and, according to the report, “has proven a significant facilitator of blockchain business activity in the country.” However, it should be noted that when the country tightened the definition of virtual asset service providers (VASPs), more than 1,000 licenses were revoked from crypto firms.

The country utilizes a highly scalable and privacy-focused keyless signature infrastructure blockchain, which is being used in healthcare, property, business and succession registries, along with the state gazette and the country’s digital court system.

Local players: Idealogic, a full-cycle software development firm with strong expertise in product design and custom software development in Fintech, Cryptodevelopers.net, a developer of cryptocurrency wallets, and Solve.care, a healthcare blockchain technology company.

Key takeaways

Discussing the report takeaways with Cointelegraph, Kristina Lillieneke, CEO at BlackBird Law and a member of EU Blockchain Observatory, explained the rather low numbers demonstrated by Scandinavian countries regarding the crypto industry. While she agreed with the important factor of high taxes, Lillieneke pointed out such regional problems as regulatory uncertainty and fear-mongering among banks and media.

“Most banks have been blocking their customers from trading in crypto and founders of crypto companies have had their bank accounts forcibly closed. As most people are still dependent on the fiat banking system in the Nordics this is a strong deterrent to making innovations,” she said.

The expert drew the example of Sweden, where the local financial authority, Finansinspektionen, leads a non-stop crusade against Bitcoin. Erik Thedéen, the head of Finansinspektionen, has written numerous articles sharply criticizing Bitcoin and claiming it is only used by criminals to launder money and finance terrorism and is a large threat to the environment.

Recent: What the Russia-Ukraine war has revealed about crypto

Lillieneke expressed pessimism regarding any possibility of a U-turn in the Nordics, even with the upcoming pan-European MiCA framework. In her opinion, MiCA itself doesn’t contain any cure for the familiar problems:

“The regulations in Europe seem only to aim at limiting the market and innovation around everything that is decentralized and has the potential of empowering people while it favors centralized solutions run by the states, the EU or big-tech.”

More controversy comes with the recent transformation of Estonia, which has been one of the earliest blockchain adopters in the world and conducted a crypto-friendly policy until 2021, when the new guidelines for VASP licensing demolished all the previous gains for the industry. However, speaking to Cointelegraph, Marianna Charalambous, research project manager at the University of Nicosia and member of the EU Blockchain Observatory, noted that the country still remains one of the leaders in public blockchain implementation.

“Estonia remains an advocate of public sector blockchain initiatives on a national and European level, as a wide number of blockchain applications are being implemented in the public sector. Looking at the use of blockchain on an institutional level we can identify a different approach compared to the private sector which has been affected by the new legislation,” she stated.

Crypto users renew calls for Satoshi Nakamoto to win Nobel memorial prize for economics

October 13, 2022 Coin Telegraph

Business

Major figures in the crypto space argued the Bitcoin creator was the most deserving candidate for the economic award, despite the fact Satoshi's true identity remains unknown.

Bitcoin enthusiasts on social media platforms have reiterated their annual petition to have the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel awarded to Satoshi Nakamoto.

On Oct. 10, the Royal Swedish Academy of Sciences announced three recipients of the economic prize — former Federal Reserve chair Ben Bernanke, and U.S. economists Douglas Diamond and Philip Dybvig — for “research on banks and financial crises.” Many crypto enthusiasts have argued for years that the pseudonymous creator of Bitcoin (BTC) was the most deserving candidate for the economic award, first instituted in 1968, “according to the same principles as for the Nobel Prizes that have been awarded since 1901,” according to a description from the institution.

“In 2008, Bernanke printed money to bail out banks who proliferated a subprime debt bubble that caused a global financial crisis,” said crypto artist Lucho Polleti on Twitter. “Satoshi created Bitcoin, a money system that gives all humans economic freedom through the separation of money state. Satoshi deserves a Nobel Prize.”

The Nobel Prize in economics belongs to Satoshi Nakamoto, not Ben Bernanke.
— Jameson Lopp (@lopp) October 10, 2022

Some people, including crypto podcaster and Morgan Creek Digital co-founder Anthony "Pomp" Pompliano, have previously said Satoshi was entitled to more than just an economics prize. Pomp tweeted in 2019 that the BTC creator deserved the Nobel Peace Prize by establishing “a currency that can assume global reserve status without anyone having to engage in violence.”

Satoshi Nakamoto deserves the Nobel Peace prize and the Nobel prize for Economics. https://t.co/o8KNF1A6yU
— McKenna (@Crypto_McKenna) October 10, 2022

Others like Blockstream chief strategy officer Samson Mow have argued neither award applies as they’re emblematic of an outdated system:

No, Satoshi shouldn’t win the Nobel Prize because it’s a fiat construct used to prop up the legacy financial system. If you want to honor Satoshi, run a #Bitcoin node. https://t.co/t0MDlJel2J
— Samson Mow (@Excellion) October 10, 2022

It’s unclear if Satoshi would be eligible to receive either prize, given their identity has never been publicly revealed. It could make more sense to honor other known early contributors to the ecosystem, such as former BTC core developer Gavin Andresen, or developer and recipient of the first Bitcoin transaction, Hal Finney. However, Finney passed in 2014 and a Nobel Prize "cannot be awarded posthumously" according to the statutes of the Nobel Foundation.

Though not the winner of the economics prize this year, Satoshi has been publicly honored by many crypto users in a variety of ways. In September 2021, a crypto group set up a bronze statue of the legendary Bitcoin creator at a park in Budapest. Nakamoto continues to be the subject of crypto-related art, memes, online discussions, and speculation as to their identity — as an individual or group.

Sweden Needs Power for More Useful Things Than Bitcoin Mining, Energy Minister Says

July 18, 2022 Bitcoin.com

Swedish Central bankers snipe Bitcoin mining, cite rampant energy use

June 10, 2022 Coin Telegraph

Bitcoin mining

A report by the Riksbank makes the case for banning Bitcoin mining in Sweden over proof-of-work energy consumption concerns; Bitcoin Twitter was quick to react.

Another day, another environmental attack on proof-of-work (PoW) mining. A report shared by the Swedish central bank argued that energy-intensive Bitcoin (BTC) and cryptocurrency mining should be banned.

The Swedish central bank, known as the Riksbank, is the oldest central bank in the world. In a damning report entitled, "Cryptocurrencies and their impact on financial stability,” the bank had a crack at PoW cryptocurrency mining. PoW mining employs energy-guzzling data centers that solve puzzles to secure blockchains. The report stated:

“Recently, some extraction of crypto assets has been established in northern Sweden, where it consumes as much electricity as 200,000 households do on an annual basis.”

For Knut Svanholm, a Bitcoin author who recently penned "∞/21M" told Cointelegraph, "A Central Bank has no business telling people what they can and cannot do with their electricity."

"If they really cared about the environment they'd shut their own operation down for good tomorrow morning."

The paper cites peers at the environmental agency and the Swedish Financial Supervisory Authority, equivalent to the United States Securities and Exchange Commission, in its examination of Bitcoin's energy use:

“The proof of work method, which is used to confirm transactions and extract new cryptocurrencies, should be banned in favor of other, less energy-intensive methods.”

Svanholm has a different take: "Bitcoin mining is guessing a number over and over again. [...] As so many other Swedish institutions have done before them, they [the central bank] choose to comment on something that they don't understand and have no business having even an opinion on."

The report comes as little surprise given that banks and governments regularly take aim at PoW energy use. The report also flies in the face of Bitcoin adoption in Sweden. Home to a number of Bitcoin startups, Sweden is advanced in terms of European Bitcoin adoption.

Prominent Swedish Bitcoiners including Svanholm as well as Christian Ander, founder of Swedish Bitcoin exchange BTX, were quick to refute the report on Twitter. Svanholm shared a Youtube video that argued that “none of the energy used for Bitcoin mining goes to waste.”

Här är en liten video jag och några kompisar har gjort om ämnet: https://t.co/uz4p5Ap7EC
— knutsvanholm.com ∞/21M (@knutsvanholm) June 10, 2022

Ander called the report “highly inappropriate.” He tweeted:

“Energy consumption must be neutral, production must be regulated. Do not regulate what individuals do with it.”

As the bank’s friends at the International Monetary Fund march onward with a central bank digital currency — as it would use less energy — the figures for Bitcoin mining are stark. In late 2021, Bitcoin took first place for the cleanest industry in the world for its high renewable energy mix. In neighboring Norway, Bitcoin miners use 100% renewable energy, while Bitcoin miners worldwide strive to make the world a better place.

The proposed ban from the Swedish central bankers also lands the day a report examining the energy efficiency of crypto transactions was published. The report stated:

“When Bitcoin Lightning layer is compared to Instant Payment scheme, Bitcoin gains exponentially in scalability and efficiency, proving to be up to a million times more energy efficient per transaction than Instant Payments.”

Bitcoin's Lightning Network recently hit the 4,000 BTC milestone showing its promise as a payment solution. Lightning payments take place off-chain and use considerably less electricity than the Bitcoin miners that secure the network's layer one.

Nonetheless, research from Cambridge Centre for Alternative Finance states that Bitcoin consumes an estimated 15GW of electricity each day. In meme-worthy material, back-of-the-napkin math from one Twitter user claims that clothes driers in the U.S. consume more energy:

(reposting the math here, for ref)

- There are 130M US households
- An avg household uses 12000 KWh / yr (EPA)
- Dryers are 6% of household energy consumption (EPA), which = 720 KWh / yr
- 720 KWh * 130M = 93.6 TWh
- Bitcoin uses 70-120 TWh (estimates vary)

^ that's just the US
— Daniel Ƀrrr (@csuwildcat) February 15, 2021

An Our World in Data report demonstrated that the global sports industry emits three times the emissions of the Bitcoin network. It begs the question, why do central banks continue to attack PoW’s energy usage? And which financial institution will fire the next shot?

Is Bitcoin (BTC) a Currency? Sweden’s Central Bank Weighs In on the Largest Crypto Asset

May 23, 2022 The Daily Hodl

Google Trends Study Shows SHIB Is the Most Popular Crypto in the UK

April 27, 2022 Bitcoin.com

Sweden

Sweden

Denmark

Finland

Norway

Latvia

Lithuania

Estonia

Key takeaways

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