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US Treasury Secretary Shares Trump’s Concerns on Crypto, Stresses Compliance

United States Treasury Secretary Steven Mnuchin shares President Donald Trump’s concerns on the use of cryptocurrency to finance illicit activity, and stresses the role of enforcing FinCEN regulations with respect to crypto-dealing organizations. Mnuchin made his remarks at a press conference on July 15.

Mnuchin called the use of cryptocurrencies to fund illicit activity a national security issue, saying that billions of dollars have been used for this purpose:

“Cryptocurrencies such as Bitcoin have been exploited to support billions of dollars of illicit activity, like cybercrime, tax evasion, extortion, randomware, illicit drugs, human trafficking … This is indeed a national security issue.”

In response to a question from the press, Mnuchin further commented on the ostensible role of crypto as a means to finance crime, saying:

“I think to a large extent, these cryptocurrencies have been dominated by illicit activities and speculation.”

Secretary Mnuchin also echoed the Presidents’ latest Twitter posts on cryptocurrencies, saying: “As the President has said: ‘Bitcoin is highly volatile and based on thin air’” and “Treasury takes very seriously the role of the U.S. dollar as the world’s reserve currency.”

As previously reported by Cointelegraph, President Trump tweeted out a series of anti-crypto and anti-Bitcoin remarks on July 12, following his “Social Media Summit” for conservative personalities. Trump remarked that the value of crypto is “highly volatile and based on thin air” and that they can “facilitate unlawful behavior.”

According to Mnuchin, the Treasury has stressed — to Facebook and Bitcoin (BTC) users among others — that digital financial services are bound by the same Anti-Money Laundering and Combating the Financing of Terrorism policies as traditional institutions such as banks.

Additionally, he said that any crypto transmitters must comply with the Bank Secrecy Act (BSA) and register with the Financial Crimes Enforcement Network (FinCEN): a bureau of the Treasury. FinCEN is the federal regulator that implements the BSA in practice, and has authority over all money service transmitters — including cryptocurrency projects such as Libra.

Mnuchin also established the Financial Stability Oversight Council’s Working Group on Digital Assets, which reportedly includes key regulatory players such as the SEC, CFTC, and the Fed in addition to FinCEN. The idea of this group is to mitigate purported regulatory risks associated with cryptocurrencies.

Trump Banning Bitcoin Is Feasible But Highly Unlikely, Says Economist

United States president Donald Trump would cause a Bitcoin (BTC) price crash if he banned it, but the law would likely prevent him, economist and trader Alex Krueger concluded on Twitter July 15.

Trump, who announced his distaste for cryptocurrency in general last week, initially failed to impact market sentiment. A subsequent breakdown over the weekend sent Bitcoin below $10,000.

Publishing a dedicated thread on the chances of Trump banning the cryptocurrency, Krueger argued he could theoretically have some success.

By targeting entry and exit points for retail and institutional investors, the president would turn Bitcoin into an isolated, more illiquid asset as it is used by lay consumers. 

“Trump could also go after fiat onramps, by simply forbidding banks to service crypto exchanges, or by requiring banks to not service exchanges unless conditions XYZ are fulfilled (and make that practically impossible),” Krueger summarized.

In reality, however, Trump would need to convince Congress of the need to ban Bitcoin, and lawmakers could overturn his demands, even if they occurred via an executive order or similar emergency measures.

A ban is thus feasible but the probability of it becoming law is extremely low, Krueger concluded. 

His comments came several days after mainstream media suggested Trump had inadvertently made Bitcoin a campaign issue for the upcoming 2020 presidential elections. 

As Forbes noted, competing hopefuls, notably Andrew Yang, have long held an opposing view — that Bitcoin is in fact something to be embraced at national policy level.

Hacked Bitpoint Exchange Finds $2.3M in Stolen Crypto

Japanese cryptocurrency exchange Bitpoint has discovered over 250 million yen ($2.3 million) in cryptocurrency — part of a $32 million sum that was stolen last week, local English language daily The Mainichi reports on July 14.

According to The Mainchi, Bitpoint found the stolen cryptocurrency on overseas exchanges that were using a trading system provided by Bitpoint Japan. Bitpoint told The Mainchi that the recent discovery brings the total sum of lost founds down from 3.5 billion yen ($32 million) to 3.02 billion yen ($28 million).

The exchange was initially hacked on July 12. 2.5 billion yen ($23 million) of stolen funds belonged to customers while 1 billion ($9.2 million) belonged to the exchange. Hackers stole Bitcoin (BTC), Litecoin (LTC), Ether (ETH) and XRP from the exchange’s hot wallets.

Bitpoint suspended all services following the hack, while the exchange’s parent firm Remixpoint Inc. shed 19% following the theft. Remixpoint went untraded in Tokyo following the attack due to a reported glut of sell orders.

The recent incident involving Bitpoint follows a record-breaking hack of Japanese exchange Coincheck in January 2018, wherein $534 million of NEM tokens were stolen from Coincheck’s low-security hot wallet.

Bitpoint was one of several exchanges to receive a business improvement order from Japan’s finance watchdog, the Financial Services Agency (FSA), in June of last year. One of the FSA’s main concerns was the exchanges’ compliance with Anti-Money Laundering and Know Your Customer requirements.

The agency also expressed concerns that customer funds were not being kept sufficiently separate from those of the exchanges.

Drafted “Keep Big Tech out of Finance” Act Surfaces Days Before Libra Hearings

A drafted bill entitled “Keep Big Tech out of Finance” has surfaced online, allegedly deriving from within the United States House of Representatives Financial Services Committee. The document’s metadata dates it July 12.

The bill’s provenance is unconfirmed, but crypto news site The Block quotes an inside source as saying it is with the Financial Services Committee. 

The document reads: 

“A large platform utility may not establish, maintain, or operate a digital asset that is intended to be widely used as medium of exchange, unit of account, store of value, or any other similar function, as defined by the Board of Governors of the Federal Reserve System.” 

The alleged bill goes on to define “a large platform utility” as a tech company that earns annual global revenues in excess of $25 billion. 

Given that Libra is scheduled for hearings before the Senate Banking Committee on July 16 and with the House Financial Services Committee on July 17, this bill seems clearly designed to preempt congressional authority to take decisive action on the issue of Libra.

Libra has attracted commentary and criticism from many corners. Chair of the Financial Services Committee Maxine Waters initiated the congressional hearings on Libra on June 18 by calling for a moratorium on the project. As Cointelegraph reported at the time, Representative Waters wrote: 

 “Given the company’s troubled past, I am requesting that Facebook agree to a moratorium on any movement forward on developing a cryptocurrency until Congress and regulators have the opportunity to examine these issues and take action” 

The night of July 11, US President Donald Trump tweeted similar concerns about the lawfulness of crypto usage, expressing opposition to Libra, Bitcoin and cryptocurrencies as a whole, instead promoting the continued dominance of the US Dollar.

Brazilian State Launches Blockchain Platform for Government Contract Bids

In Brazil, the state of Bahia has launched a blockchain application to track the process of public bidding on government contracts, according to a report by Cointelegraph Brazil on July 12.

The blockchain-based solution, called Online Bid Solution (SOL) was reportedly developed by Cayenne Technology and Design. Bids will reportedly be completely transparent and secure due with the application of blockchain tech.

According to Bahia government, the intended beneficiaries of SOL appear to be the Brazilian agriculture industry. The solution is designed to help connect agriculture organizations in Bahia with suppliers and workers throughout Brazil, as well as provide transparency on the contract bidding process.The state of Bahia said that there are over 1,000 organizations projected to use SOL:

“The application, already available in the Play Store and the Apple Store, will be used by about 1,100 agricultural associations and cooperatives in the states of Bahia and Rio Grande do Norte, under the Bahia Productive and Governo Cidadão, financed through a loan agreement between the state governments and the World Bank.”

As previously reported by Cointelegraph, the Brazilian coffee farming cooperative Minasul announced plans to issue a blockchain token for coffee farmers. Farmers will reportedly be able to earn tokens as a reward for harvesting coffee beans, and use the proceeds to purchase a variety of goods. This is purportedly a useful economic system for the farmers, since this method of financing does not require registration in a notary’s office.

Ethereum-Based Augur Enhancement App Veil Closes Up Shop

The Ethereum-based predictions platform Veil is shutting down, according to an official Medium post on July 11.

As of July 11, no new markets will be added to the platform. Trading will be disabled entirely on July 24. Veil co-founder Paul Fletcher-Hill recommended that users redeem open positions, withdraw positions from active markets, and withdraw Veil Ether and convert it to Ether. 

Veil was a type of extension to the Ethereum-based predictions market Augur. Augur is a predictions market — that still exists — that uses smart contracts to let users create and bet on the outcome of any event with the cryptocurrency Ether. 

For instance, the top three bets listed on the Augur market, at press time, are “Will Novak Djokovic be the 2019 Wimbledon Men’s Singles winner?,” “Who will Win the The First Democratic Primary Debate?,” and “Will Serena Williams be the 2019 Wimbledon Women’s Singles winner?”

In April, Augur also added the option to use the stablecoin by MakerDAO, DAI, on its platform.

According to its website, Veil was intended to “bring Augur mainstream” and improve user experience by speeding up its transaction processes. Veil purportedly let users trade on the Augur marketplace faster via the 0x protocol, and provided instant settlement by allowing users to sell their shares to Veil before native finalization of Augur transactions on the blockchain.

In discussing the reasons Veil did not meet its success goals,  Fletcher-Hill noted a number of issues, including that the platform may not have been friendly enough to crypto novices:

“We didn’t offer a good onboarding experience. Crypto as a user base is still early, and we didn’t make it easy enough for users without crypto or a wallet to get started.”

Some other areas of concern he noted include not being decentralized, not being regulated, and perhaps trying to offer too many options as a broad-scale predictions market. Fletcher-Hill wrote:

“ultimately we failed to find a good fit between what we were building and the market as it exists today. … But today the community of users is small, and we think there are higher impact products and services we can build for the immediate future.”

As previously reported by Cointelegraph, Augur came under fire from Reddit and major crypto exchange Binance due to having an apparent design flaw. The flaw apparently allows users to run scams, of sorts, by issuing predictions with unclear or contradictory conditions for resolution.

Binance also said that low liquidity, barebones functionality, complex mechanics, and an unclear approach to governance were additional issues it saw with Augur.

McAfee on BTC, Exile & the US: ‘No Way the Current System Can Survive’

When people outside of crypto think of John McAfee, they think computers, cybersecurity, anti-virus software. But in the world of crypto and blockchain, you think of a yacht in tropical waters, passionate — and sometimes, admittedly, inebriated — tweets on tech and crypto… and an enviable amount of partying. 

When I called McAfee to talk on record, he was sitting at a table outside a cafe in Cuba with palm trees and patches of blue sky behind him. 

We talked about McAfee’s presidential campaign in the United States, his relationship with the U.S. government, cryptocurrency mass adoption and why he’s actually a patriot in exile. 

Olivia Capozzalo: You tweeted recently that Libra is a “grotesque distortion of the original intent of Cryptocurrency — economic freedom.” 

John McAfee: Libra is a universal, digital identification that’s going to be rolled into the cryptocurrency, meaning that everything that you do with that currency can be monitored and traced back to you. 

Now, I’m a firm believer in privacy and even anonymity when it comes to our financial transactions. 

We each have the right to earn a living and to do what we wish with the money that we earn. I mean, if not, then we are still under the control of the financial system we’re trying to escape from.

That is the purpose of digital currency: to give control of currency back to the people rather than to governments and institutions that can control the currency that we use. 

Watch our interview with John McAfee here:

And you need to understand how important currency is. If we don’t have freedom of currency, we don’t have freedom of anything.

To get that freedom, we have to have a decentralized system, and we have to have a system that provides a degree of privacy — because without privacy, then we still are controlled.

The reverse of privacy is a system where everything that you do is known. This is what Facebook has produced.

Please God, we cannot tolerate this. Now, they can produce it, but we do not have to use it.

Please understand that using Facebook is the abdication of everything that we have worked for for almost 10 years. So understand what it is, let them do what they want, but please, God, do not accept it as your standard of currency.

It will be the end of your freedom and the end of your privacy.

Exile in Cuba

OC: So, you’re in Cuba right now. Are you getting a sense of cryptocurrency use there or people’s relationship to crypto or blockchain.

JM: Well, keep in mind Cuba is a very unique country. It’s the only communist country in the Caribbean area — the closest communist country to America. Cryptocurrency has had very little impact on the economy here, on the people. And very few people understand it or know anything about it. 

For safety reasons, I’m trying to keep my mouth shut here and talk about crypto in other parts of the world because I really have no choice of anywhere else to go.

But, I can’t go anywhere. I was run out of America; I went to the Bahamas. I went to the Bahamas because America was charging me with income tax violations. 

Well, it’s true. I haven’t paid taxes in eight years, and I never intend to pay them again. 

To me, they are unconstitutional in America and they’re illegal. 

I went to the Bahamas because they have no income tax at all. According to international law, you cannot extradite someone from a country where the crime that you are extraditing them for is not a crime in that country. So, if you have no income tax, not paying it is not a crime. 

So, the U.S. then manufactured a bunch of other things — murder, money laundering and racketeering — which every country would have to extradite me for.

Their intent was to drop those charges as soon as they collected me and delivered me to America, and then continue to prosecute me on income tax. Now, I don’t want to play those games, so I came to Cuba. 

Cuba has never extradited an American citizen and if they extradite me, it would be an extraordinary exception.

OC: Can you explain your stance a little bit more about income tax? Why do you say it’s illegal in the U.S.?

JM:

Our constitution states very clearly, Congress shall pass no laws to inhibit, restrict or in any way hinder an individual’s ability to earn a living. 

Now, if you’re taking 25% of my money, if you’re making me work for you — the government — for one quarter or one third of the year, I insist that is inhibiting my ability to make a living. 

OC: So, you’re running your presidential campaign in exile. And the base of your campaign and your personal ideals is economic freedom, as you’ve been describing.

But on the other hand, Cuba is actually very low on the economic freedom index. I’m wondering if you see any contradiction in that.

JM: Well, not in the least. Let me ask you who creates that index? Is Cuba asked about it? Do people come to Cuba and actually study what’s happening here? Let me tell you something: This is the most entrepreneurial society I have ever been in. 

Yes, the government does restrict absolutely everything in terms of your making a living. However, there is an undercurrent just below that. There is an economic, entrepreneurial system, which I have never seen before. It’s the same thing in every communist country — in Russia, it was the same. 

So, you know people are making $20 a month, and yet, they’re buying cars that cost $60,000. Now, how do you do that? Ask simple questions, right? They’re doing it by being creative, by adhering to the laws of the government and at the same time, managing to make a good living. 

Keep in mind, America has strangled the Cuban economy for 63 years through embargoes. They can’t get building materials, they can’t get paint to paint their frigging houses. They can’t get parts to maintain their cars. 

One of the first days I was here, I bought a Bic lighter and along the bottom were seven tiny, little holes. And I asked the person: What is this? He said, “Oh it’s been refilled.” They will refill a throw away lighter seven-10 times until the flint wears out. It costs $0.10 to have them refilled, rather than $2 to buy a new one. I’ve never seen creativity like that before. 

So, people all band together to figure out how they can live. Jesus, I’ve never seen anything more entrepreneurial. 

So, do not buy America’s garbage propaganda, because I promise you: All those indexes, they have to pass the U.S. government’s approval. 

They have the airplanes, the bombs, the battleships. They tell the world what to do. They think they are the world’s policeman. So, don’t buy all this s— about being that low on the index. How do you know? Come here and take a look. I promise you: You will be startled.

Running for U.S. president

OC: I want to ask a little bit more about your plan to run for president of the U.S. If you were president, what would the role of cryptocurrency be in the U.S.?

JM: Okay, let me start off by saying this is my second run. I ran in 2016 under the Libertarian Party. I lost to Governor Johnson for the primary nomination. I did not want to win in 2016. 

In 2016, I thought the largest problem America faced was it was lagging behind in cybersecurity. So, I spoke on the national stage for a year about that and that’s all I talked about. 

Now, I could not possibly be president even if I had a platform, even if I wanted to, if I dressed in a business suit and didn’t curse. No matter what I did, I can’t be president. Jesus, God — I’m John McAfee. However, I can certainly run for president. 

So, let’s not talk about what I would do the first day in office. Let’s talk about what I’m going to do while running, which is to raise awareness — not just in the U.S., but around the world. 

I want to educate people about how fiat currencies are their prison and the means that governments use to make a society of slaves.

This is a terrible situation. You have a prison of the mind — certainly in America. And this is what I want to educate people about. We take control first of our economy, of our currency, of our ability to survive, buy food, clothes and shelter. Without the currency, you cannot do that. That is how you’re controlled. So, this is what I’ll be talking about.

McAfee vs. the U.S. Government

OC: Last month, you tweeted about having terabytes of incriminating data on corruption in governments. Could you go into a little more detail about what kind of data we’re talking about and how you got the data? Can you share some of it or reveal some of it?

JM: Let me give you an example of the kind of data. I was in the Bahamas. The U.S. government had manufactured these charges against me to get me extradited from the Bahamas so they could try me for the IRS crimes. The people who operate illegally with the U.S. government in the Bahamas were the head of the police force and the head of the armed forces in the Bahamas.

So, I outed those people. They both had secret bank accounts. I published the name of the bank, the account numbers on the secret accounts. The deposits that came in to these accounts, the dates, the amount and from who and the withdrawals in cash totaling many times their annual salary. So, now I’m wanted in the Bahamas.

This is hard data that I have on almost everybody in the world. Why? Because people tell me everything. When someone finds out a piece of information, I’m probably the first person they gave it to. I have it on everybody, Okay? I don’t want to bring anything down. I’ve never had a problem with the CIA other than that they keep harassing me. 

The CIA is as fragmented as any other element of our government, there are decent people and there are crooks. 

And believe me, I could bring down the U.S. government, like I almost brought down the Bahamian government. 

OC: How does the CIA harass you? Have you seen people following you?

JM: Oh, my security sees them all the time. They alert me to them: “Oh, this car is following us,” and I say, “Well, get the license number.” I have it checked out and it’s always owned by some obscure element of the U.S. government. 

Of course they’re following me — God almighty, I am a rebel. I’m an outrage to the stability of the U.S. corrupt government. Not the whole government, good Lord. There are some decent people there. But unfortunately, there are many indecent people. James Comey of the FBI. Jesus, God. One of the most corrupt individuals in the world — a total scumbag.

I mean there are many people in high positions that can control what’s going on. Now, I haven’t released anything. However, if anything happens to me… absolutely. I’ve got dead man switches everywhere. Within a day of my disappearance or untimely death, there will be every newspaper in the world pouring through more documents than they could have 100 people pour through in 100 years. 

So, no — it will be chaos. But right now, I just want to be able to live happily, try to make a better world for my children and grandchildren and fish from time to time.

OC: It sounds like you’re succeeding at the moment.

Promo in the crypto industry

OC: You’ve openly spoken about promoting projects, and often on your Twitter, you’ll do a video about a particular company. Can you talk a little bit about your vetting process for these companies, given our industry is known for seeing a large number of scams?

JM: Well the first thing I do is I have the company checked out.

I would say 90% of what’s happening in crypto is a scam.

The problem with that is, since it is, trolls and others can point to anything and say, “That’s a scam,” and people will believe it. It’s a very complex and subtle interchange of energies. But the first thing I do is I say, “Are you real? Are you people real?” and have the people checked out. It’s a very trivial thing: Have you ever been in jail? Have you ever run out on another company and left people hanging? It’s simple.

But before I even do that, it has to be a project that appeals to me. 

Then, I do my thing. And people call them scams — or I don’t care what they call them. I’ve checked them out. They’re doing the best they can. They don’t all succeed. There is not a universal success rate for anything in life. But they all attempt it. They all try and they all have good developers and — for whatever reason — if they do not, it’s not because there was a scam or because they weren’t trying. It’s simply because it didn’t work. 

OC: Do you generally invest in the companies that you promote?

JM:  No, I do not. I wish I was in a position to invest. Keep in mind, especially now that the IRS has shut down all my banks, I’m living hand-to-mouth. So, no. But what I invest is my time and my advice. 

I think my advice — you know, coming from a 74-year-old man who’s been in business since he was 23 — is worth something. And people generally take my advice. 

People do stupid things — I don’t know why. They’re looking for the money before they build the product. It doesn’t work that way: You’re not going to sell something that doesn’t exist. Or, they won’t put the product out soon, so they can get the money now rather than making sure it doesn’t have bugs. 

Listen, you have to have a solid product, because if you put something out and you promoted it and it’s got a bug, then everybody fails. You’re dead in the water after all of this work. Wait another two months. Advice like this is just invaluable to young people.

Mass adoption of crypto

OC: What needs to happen for people to use cryptocurrency on a mass scale?

JM: We have to have more friendly user interfaces. You’re not going to get the average plumber and give him a crypto wallet and say, “This 150-digit number is an address. It means something. You must copy it somehow or take a picture of this.” 

No. Please, God. That scares people. We need something that has a name. Frank Smith. Okay, I want to send Frank Smith 50 Bitcoins or five or a fifth or whatever. That’s cool. By the way, I don’t think crypto trading is the end-all for crypto. I mean, that might be the entry point, but the end-all is where we f—ing buy things with the crypto that we have, for heaven’s sake, rather than trading it constantly. But that’s coming… that will come. 

I think in 10 years there’ll be no fiat anywhere in the world. Everything will be electronic, everything will be cryptocurrency. 

In five years, I think the majority of people will be using crypto for the majority of their purchases. I mean, already you can buy houses, cars, almost everything with crypto — some services even. 

You can even buy prostitutes — both male and female — with crypto these days. I think in two years time, we’re going to see a quadrupling of both the number of businesses that accept crypto and the number of people that are using it not to trade, but to actually buy and sell.

OC: But people also need to be convinced that cryptocurrency is better for them to use than fiat currency.  

JM: Here’s an example — and if this doesn’t sell you, nothing will. Let’s say I’m doing business with somebody in England or Germany — in another country — and in order to get started, I’ve got to make a down payment. All right, so I’ve got to get out of bed, get dressed, hop in my car, drive to the bank, fill out a bunch of forms, sign them, get approval from the bank and they will say, “Well, within 24 hours, it’ll be there.” 

Or I can not get out of bed, grab my smartphone — even if I do have to copy and paste a 150-character string — push send and go back to sleep. I’ve got 60 seconds versus an entire hour. 

Which would you rather do? This is one example. Please, God. It’s so superior to our current system that there is no way the current system can survive. 

Bitcoin price predictions

OC: Recently, crypto analyst Mati Greenspan pointed out that there is an 86% chance that Bitcoin will be worth less than 50K by 2020. Are you concerned about the bet that you made?

JM: No, good Lord. Listen, anybody with common sense, and who can add and subtract and multiply, actually can count the total transactions in the world every year. And look at the number of dollars and yen and British pounds and euros and Chinese yuan. So, that’s about $2,000 trillion. There’s only 21 million Bitcoins and actually 7 million of those are lost forever. 

If Bitcoin were the only currency, it would be worth a trillion dollars per Bitcoin. Now, it’s not the only currency.

Take the growth at this point, the number of users and the fact that it’s going to be three times as large by the end of 2020. If it’s not worth a million dollars, then something’s wrong with math. 

I can’t lose this bet. It’s not possible mathematically. Understand, the market is an artificial thing right now. As Bitcoin gets more and more utility, it will be less artificial and more real. And it’s getting that way right now. So, to those that go “nah, that’s impossible,” please go back to school and take fourth grade math — that’s all you need. Figure it out.

OC: All right. Well, I think that’s all I have for today. Thank you so much for your time.

JM: Thank you very much.

This interview has been edited and condensed.

Trump Tweeting About Bitcoin Is ‘Achievement Unlocked,’ Says Coinbase CEO

Donald Trump saying he is not a fan of Bitcoin (BTC) and cryptocurrency is “yuge” for the industry, commentators were suggesting after new tweets on July 12.

In the hours after the United States’ president delivered his lackluster appraisal of crypto, the Bitcoin price stayed stable, only to then begin growing to hit 1% gains Friday. 

Negative or not, for proponents, the event marked a psychological milestone for Bitcoin, as Trump had previously held off from mentioning it in public. 

The fact that he felt the need to bash Bitcoin publicly feeds the narrative that it is both independent of global powers and unable to be crushed by them, Coinbase CEO Brian Armstrong stated, leading the responses.

“Achievement unlocked! I dreamt about a sitting U.S. president needing to respond to growing cryptocurrency usage years ago. ‘First they ignore you, then they laugh at you, then they fight you, then you win.’ We just made it to step 3 y’all,” he tweeted.

Armstrong exemplified the buoyant mood among Bitcoiners. Others likewise thanked Trump for the free publicity, noting a surge in interest documented by Google Trends, while the president being wrong in his opinion also became a talking point on social media. 

“Congratulations BTC community — the president of the United States feels we are worthy of a tweet now,” cryptocurrency entrepreneur, Simon Dixon, added. “Bitcoin has outperformed USD by 23,440,508% since it started being priced in USD.” 

Max Keiser, the RT host and regular Bitcoin bull, considered Trump to have nullified his chances of reelection in 2020, while eToro senior analyst, Mati Greenspan, described his words as an “early nomination for the most bullish tweet of the year.” 

Despite the conversely more stable price performance since the tweets, the possibility of a ‘Trump pump’ occurring for Bitcoin was also gaining traction among analysts.

“Trump is bullish for Bitcoin generally because his media tactics wobble geo-political uncertainty. Thanks for all the dollars flowing into Bitcoin,” cryptographer and Hashcash inventor, Adam Back, added.

In the meantime, another, lesser-known cryptocurrency took the opportunity to capitalize on the buzz. TrumpCoin (TRUMP), an altcoin all but unknown since it appeared in March 2016, was up 28% Friday.

Trump Tweets Opposition to Crypto, Specifically Libra and Bitcoin

Disclaimer: This story is breaking and will be subject to updates.

United States President Donald Trump voiced his opposition to cryptocurrencies as a whole, citing Bitcoin and Libra specifically, in a series of tweets published around 8:15 p.m. EST on July 11.

The full text of the three tweets reads: 

“I am not a fan of Bitcoin and other Cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air. Unregulated Crypto Assets can facilitate unlawful behavior, including drug trade and other illegal activity….

“…Similarly, Facebook Libra’s ‘virtual currency’ will have little standing or dependability. If Facebook and other companies want to become a bank, they must seek a new Banking Charter and become subject to all Banking Regulations, just like other Banks, both National…

“…and International. We have only one real currency in the USA, and it is stronger than ever, both dependable and reliable. It is by far the most dominant currency anywhere in the World, and it will always stay that way. It is called the United States Dollar!”

What prompted Trump to issue these tweets is a matter of speculation. They came the night of Trump’s “Social Media Summit,” a closed-door conference that brought together many right-wing social media notables. The event may have put Facebook at the top of Trump’s mind. 

Presumably, the impending congressional hearings on Facebook’s Libra Project, scheduled for next Tuesday and Wednesday, July 16 and July 17, also inspired Trump to tweet on the subject.

The intended result of these tweets in terms of policy or practice remains uncertain.

Bitcoin Price Slips 10% in 24 Hrs as Fed Raises Facebook Libra Concerns

Bitcoin price (BTC) shed more than 10% on July 11 as markets appeared to react to criticism of Facebook’s Libra from a senior United States lawmaker.

Market visualization

Market visualization courtesy of Coin360

Data from Coin360 sees the majority of cryptocurrencies firmly in the red Thursday, hours after Federal Reserve Chairman Jerome Powell said Facebook’s offering should not continue development.

Libra, which aims to act firstly as a cross-border payment method, allegedly buoyed Bitcoin throughout recent weeks, with commentators arguing its public profile was driving publicity and uptake of Bitcoin itself. 

Powell’s demands, which follow similar words from representatives of the Senate House of Financial Services Committee, leant weight to that theory.

“Libra raises serious concerns regarding privacy, money laundering, consumer protection, financial stability,” he said during a speech before a congressional committee. “These are concerns that should be thoroughly and publicly addressed.”

“These are concerns that should be thoroughly and publicly addressed.”

At press time, BTC/USD traded down 10.4% at $11,530, having risen as high as $13,160 in recent days. 

Bitcoin 7-day price chart

Bitcoin 7-day price chart. Source: Coin360

The drop places the pair still within its recent corridor between around $9,700 and $13,800, with volatility still in evidence across crypto markets. 

Altcoins, meanwhile, delivered noticeably worse performance as Bitcoin price fell, with several assets in the top twenty by market cap shedding 15% or more.

Ether (ETH), the largest altcoin, lost a similar amount to Bitcoin, hitting $272 and firmly losing support at $300 once again.

Ether 7-day price chart

Ether 7-day price chart. Source: Coin360

Among the worst performers were Bitcoin SV (BSV), which lost 17.2%, and EOS (EOS), which was down 20.2%.

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Fed Chair Says Facebook Needs to Satisfy Regulatory Concerns Regarding Libra

Federal Reserve Chair Jerome Powell said there needs to be broad satisfaction with the way Facebook is handling regulatory concerns regarding its forthcoming stablecoin Libra. Powell gave his comments in a hearing before the House Financial Services Committee on July 10.

Rep. Steve Stivers asked Powell during the meeting, “if Facebook can’t sufficiently answer your questions about anti-money laundering, Know Your Customer, what would your message be to the banks that provide banking to Facebook, and what would your advice to Facebook be?” Powell replied:

“ … I just think it cannot go forward without there being broad satisfaction with the way the company has addressed money laundering, all of those things. The number of concerns that I list at the beginning, data protection, consumer privacy, all of those things will need to be addressed very thoroughly and carefully.”

Powell also discussed how the project falls outside traditional regulatory bounds, highlighting the scale of the proposed cryptocurrency project:

“I think it’s something that doesn’t fit nearly or easily within our regulatory scheme. It does have potentially systemic scale.”

Chairwoman Maxine Waters also questioned Powell on whether the Fed has concerns about monetary policy with respect to Libra. Powell answered similarly, saying:

“Libra raises many serious concerns regarding privacy, money laundering, consumer protection, and financial stability. These are concerns that should be thoroughly and publicly addressed before proceeding.”

Powell previously testified on Libra in a press conference on June 19. When asked about the Fed’s role in regulating Libra, Powell suggested that they would not have direct authority, but would nonetheless be influential:

“… we don’t have plenary authority over cryptocurrencies as such. They play into our world through consumer protection and money laundering and things like that. But, I would say that … through international forums … we have significant input into the payment system and, as you know, play an important role in the payment system here in the United States.”

As previously reported by Cointelegraph, Maxine Waters, members of the House of Representatives Committee on Financial Services and a number of advocacy groups have called for a moratorium on Libra’s development.

David Marcus, the head Libra’s corresponding digital wallet service Calibra, has now replied both via a public Facebook post and in a letter to Waters and the committee to assuage their concerns and promise cooperation.

Charlie Lee: Next Month’s Halving Will Be a ‘Shock’ to Litecoin Mining

Litecoin (LTC) creator Charlie Lee has predicted that miners may shut up shop after the coin’s upcoming halving this summer. 

In an interview with Australian crypto news site Mickey on July 10, Lee reflected on the possible implications for Litecoin’s mining ecosystem when the planned halving kicks in and current block rewards on the network are reduced by 50%. “It’s always kind of a shock to the system,” he said, explaining: 

“When the mining rewards get cut in half, some miners will not be profitable and they will shut off their machine. If a big percentage does that, then blocks will slow down for some time. For litecoin it’s three and a half days before the next change, so possibly like seven days of slower blocks, and then after that, the difficulty will readjust and everything will be fine.”

Given that the reduction of mining rewards reduces the cryptocurrency’s supply, anticipation of the halving is generally thought to be accompanied by a corresponding price appreciation — but Lee gave a more nuanced perspective of how supply, demand and market sentiment interrelate:

“In terms of the price, the halvening should be priced in because everyone knows about it since the beginning. But the thing is people kind of expect the price to go up. So a lot of people are buying in because they expect the price to go up and that’s kind of a self-fulfilling prophecy. So, because they’re buying in, the price does actually go up.”

As Mickey notes, Litecoin’s last halving — back in August 2015 — saw the coin peaking in early July of that year, going on to lose almost 50% in value by the time of the block rewards reduction — and hitting a 75% in the halving’s aftermath.

To press time, Litecoin is reporting an almost 36% gain on its 3-month chart, but remains almost 67% down from its all-time highs in December 2017, according to Coin360 data

LTC 3-month price chart

LTC 3-month price chart. Source: Coin360

Meanwhile, Anthony Pompliano — the co-founder of crypto asset management firm Morgan Creek Digital Assets — has recently predicted that one of the largest drivers of continued price appreciation for top crypto Bitcoin (BTC) will be its halving, citing classic supply-demand economics as a major contributing factor to his $100,000 forecast by the end of 2021.