BIS Releases Survey on CBDC Initiatives; New Crypto Products Launch
The Bank for International Settlements (BIS) recently released the results of its 2021 survey of central bank digital currencies (CBDCs). According to the survey, 90 percent of the 81 central banks surveyed are exploring CBDCs to varying degrees, with more than half of those respondents now developing CBDCs or running concrete experiments. The survey also found that central banks are particularly interested in retail CBDCs, and the share of central banks currently developing a CBDC or running a pilot increased from 14 percent in 2020 to 26 percent in 2021.
After a several-week delay, three new cryptocurrency exchange traded funds (ETFs) were approved by regulators to launch in Australia this week, giving Australian traders five crypto ETFs to choose from now. And in Brazil, this week the largest Brazilian digital bank by market value announced it was adding the option for customers to buy and sell bitcoin and ether on its platform. According to reports, while users will be able to buy and sell cryptocurrency with Brazilian reals, they initially will not be able to withdraw or deposit cryptocurrencies.
In a final development, S&P Global recently assigned a credit rating to a decentralized finance (DeFi) platform for the first time. The DeFi company, Compound Treasury, received a B-, or junk, rating by S&P Global. The DeFi company reportedly has a stable outlook, but ratings issuers cited the uncertainty of regulatory conditions around stablecoins and the company’s “very low” capital base as concerns leading to the rating.
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2022 NFT Market Data Released; Brands Continue NFT Initiatives
According to a recent Chainalysis blog post, the “explosive” growth of the non-fungible token (NFT) market during 2021 may finally be “stabilizing” in 2022. Among other findings, the post explains that while the number of active participants in the NFT marketplace continues to grow, transaction volume has fluctuated greatly, with the “vast majority” of transactions now occurring at the retail level (below $10,000 worth of cryptocurrency) rather than the institutional level (over $100,000 worth of cryptocurrency). Despite such market volatility, according to Chainalysis, NFT collectors have sent over $37 billion to NFT marketplaces in 2022 as of May 1.
Hoping to capitalize on the spending trend, earlier this week a South Korean automotive manufacturer reportedly dropped a collection of 10,000 “shooting star” ethereum-based NFTs via its company-branded website. But there’s a catch. According to a press release, each of these unique NFTs has adopted a “reveal” method. This means that buyers currently see only a placeholder image as the connected media. The actual images – variations on the theme of “ metamobility ” – will reportedly be unveiled to NFT holders later this month.
In other NFT news, to celebrate mom on her special day, a U.S. floral gift retailer reportedly launched a free NFT giveaway via its social media channels. According to reports, the Polygon-minted NFTs feature limited edition digital artwork specifically designed “to reflect the special and unique bond fostered between a child and mother.”
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OFAC Sanctions Cryptocurrency Mixer, Adds New Public Keys to SDN List
Late last week, for the first time ever, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned a virtual currency mixer. The mixer, Blender.io, was added to OFAC’s List of Specially Designated Nationals and Blocked Persons (SDN List) in connection with its use by Lazarus Group, a hacker group with strong ties to the Democratic People’s Republic of Korea (DPRK), which recently executed a nearly $620 million hack of a large online cryptocurrency gaming platform. According to a press release, a significant portion of the stolen funds was laundered by the hacker group through Blender.io. Mixers, touted for their privacy-enhancing functions, are often used by illicit actors to blend various transactions together in order to obfuscate the mixed funds’ origins and destinations. In addition to Blender.io, OFAC added to the SDN List multiple cryptocurrency public keys that were reportedly used by the Lazarus Group to launder illicit proceeds.
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Multiple Crypto Enforcement Actions Announced by CFTC, DOJ and SEC
Last week, the U.S. Commodity Futures Trading Commission (CFTC) announced that the U.S. District Court for the Southern District of New York (SDNY) entered consent orders with three co-founders of the BitMEX derivatives trading platform. The consent orders required each founder to pay civil penalties of $10 million and enjoined them from committing further […]
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