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Reserve Bank of India Pulls Back From Central Bank Issued Crypto

Reserve Bank of India Pulls Back From Central Bank Issued Crypto

A news report today by the Hindu BusinessLine revealed that the Reserve Bank of India has shelved its plan to issue a central bank digital currency.

Plans to issue a central bank digital currency was first declared in April of last year. The initial plans may have been driven by the burden of current rising costs in printing paper fiat money. However, it had set up an interdepartmental group to investigate the possibility of a central bank issued and controlled cryptocurrency. Reports were generated on the feasibility to that effect, however, findings have not been made public.

Around the same time, it had already put pressure on the development of cryptocurrency business in the country, cracking down on ICOs, exchanges and the ban on banking services for crypto-related transactions.

According to the news outlet, it quoted an undisclosed source saying “The government doesn’t want the digital currency anymore. It thinks it is too early to even think about a digital currency.” Moreover, they had not received any further response from the RBI about the matter.

The source further reports that the initial attempt to launch the digital currency was to check concerns over black money, money laundering, and cybersecurity threats. It would seem the findings may have expounded on such as the sudden retracting of their decision comes off as a surprise, seeing how some days ago, a report was released suggesting that the committee overseeing cryptocurrency was considering legalizing digital currencies – one would have thought it was a favorable premise to launch the rupee back cryptocurrency.

Further, the source also quoted the founder of cryptocurrency exchange and blockchain start-up Belfrics, Praveen Kumar saying: “It is premature for RBI to launch crypto-rupee, as more understanding of the crypto economy needs to be achieved. It is the right decision to delay the process and see how the publicly traded peer-to-peer economy is shaping up.” It is of the opinion that the crypto space in the country should be given more time to develop while watching how other smaller nations like the UAE and Singapore are adapting to the new technology.

Saudi Arabia had announced last year that its state-managed cryptocurrency will be launched in association with the United Arab Emirates (UAE) in 2019 as a solution for international payments.

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Research Claims 1 out of 40 Bitcoins Seized by Government at Some Point

According to research by The Block Crypto, 453,000 Bitcoins have been seized by various governments at some point in the past. This is 2.6% of the 17.366 million Bitcoins in circulation, approximately 1 out of 40.

Some 85.6% of these seized coins came from the Silk Road shutdown and a crackdown on a crime group in Bulgaria. It is important to note that the amount of seized Bitcoins at any given time is much less than the total, as since governments usually auction off the seized funds for cash.

Theoretically, Bitcoin cannot be seized if used properly, since Bitcoins are cryptographically secured with a private key. However, if not stored properly or if forceful persuasion tactics are used, private keys can end up being revealed.

The Silk Road is probably the most well-documented seizure. A total of 174,000 Bitcoins were seized from the Silk Road when Ross Ulbricht was arrested in October 2013, worth nearly USD 54 million at the time. All of these have been auctioned off.

In May 2017, the Southeast European Law Enforcement Center (SELEC) announced that it had seized 213,519 Bitcoins worth USD 500 million, and these are believed to be in the coffers of the Bulgarian state. There is some controversy over whether this happened, due to conflicting official statements released by the Bulgarian government.

Other seizures include 24,518 Bitcoins by Australia in May 2016 from a Silk Road merchant, 11,000 Bitcoins by Europol in July 2015, 6,060 Bitcoins by the United States in April 2014, 4,000 Bitcoins by the United States in June 2018, another 3,813 Bitcoins by the United States in January 2018, with many smaller ones.

The United States and Europe are responsible for practically all of the seized Bitcoins in the world, besides the one incident in Australia. Bulgaria officially claims to not have the stash of 200,000 seized Bitcoins and the United States in one estimate has no more than 10,000 seized Bitcoins after auctions.

 

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Chilean MPs Bring Blockchain Resolution to Parliament

Two members of the Chilean government put forth a blockchain adoption resolution Thursday. It is currently being reviewed by the lower house of the country’s parliament, Camara de Diputados.

The members of parliament (MPs) Miguel Angel Calisto and Giorgio Jackson presented the drafted resolution to the government with the hopes of implementing a ”blockchain ecosystem” for Chile in the near future.

Calisto made the argument that the technology could be used to add transparency and trust to the work carried out by different public agencies, also reducing the risk of private information that they have access to being used in a malicious way. He told parliament: “It is the moment that these new technologies that are at the forefront of innovation, are seen as a real option in a Chile that must look to the future and ensure the good of all its citizens.”

Jackson added that that aim of the blockchain resolution is to increase cybersecurity standards and reduce bureaucracy within public services but that blockchain should not be limited to this, pushing that it’s ”transformative” and ”revolutionary” potential of decentralizing information should be explored further.

He also made a point that instituting blockchain data sharing solutions could save costs, citing a recent report produced by the Chilean Economic Prosecution office which points to the increasingly challenging financial situation that maintenance of notaries has become for the government.

Calisto and Jackson first registered the resolution in August, backed by eight of their colleagues. In it, the resolution appeals to president Sebastian Pinera to take action in instituting blockchain solutions in the country, with an offer to conduct studies into the potential advantages of blockchain-based security and energy solutions.

The president of Chile’s Central Bank, Mario Marcel, said in May that he was considering the establishment of regulation around cryptocurrencies to prevent them being used in the country for any illicit activities. Pointing to terrorist financing and money laundering, in particular, Marcel said that formulating a legal structure around digital currencies could help ”monitor risks”.

 

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Malaysia Pushes Top Industries to Blockchain

Malaysia’s top three industries are being propelled into blockchain adoption in an effort to promote economic growth alongside transparency, efficiency, and sustainability with the help of a government task force.

The sectors being targeted by the Malaysian Industry-Government Group for High Technology (MIGHT) task force include renewable energy, palm oil, and Islamic finance.

In the energy sector, the government task force has held discussions with local companies to investigate how blockchain can assist in the growth of renewable energy users. Blockchain was decided to be of use in this area by providing transparency over how the energy was generated, be it from sustainable sources or not, meaning that customers can choose to purchase only green energy if they wish to do so.

Palm oil has become a contentious commodity due to a lack of ethical labor practices in its production, including reports of child labor coming from several countries. With blockchain, MIGHT wants to give buyers the ability to see that the palm oil they are purchasing from Malaysia comes from a government-approved ethical production line, while also setting up the government infrastructure necessary to monitor production in the country. Australia has also used a similar blockchain strategy to monitor the origin of sugarcane entering the country.

Islamic banking in 2016 accounted for 28% of Malaysia’s financial sector, with the government hoping they can increase this to 40% by 2020. MIGHT believes that blockchain can be used to offset the high costs of the strict ethical regulations that Sharia laws require from financial and banking services. Similar operations have already begun appearing in the Middle East where banks have started pegging debt to gold units, presenting this as a blockchain smart contract.

Bitcoin News has previously reported on the compatibilities of cryptocurrency and Sharia-compliant financial practices, with the first Islamic law abiding crypto exchange launched earlier this month opening the market up for Muslims.

 

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UK Government Questioned on Protection of Domestic Blockchain Industry in Bear Market

A question was posed to Lord Bates in parliament Monday regarding the UK’s ability to support the domestic blockchain industry in the current bear market that Bitcoin and other cryptocurrencies are facing.

Lord Taylor of Warwick asked his colleague: “Her Majesty’s Government, what assessment have they made of reports that the value of crypto-currencies in the United States is falling, and of the potential effects that such a decline might have on the UK blockchain industry?”

Lord Bates, Minister of State at the Department for International Development responded, saying that as of yet the government has not made a formal assessment of the implication that the current market performance might bring. He added, ”However, the Government continues to monitor developments in the cryptocurrency market.”

The Cryptoassets Taskforce was pointed to by Lord Bates as evidence that the government is taking the potential risks of cryptocurrencies seriously. The taskforce comprises of members from HM Treasury, the Bank of England, the Financial Conduct Authority (FCA) and members of parliament, and maintains responsibility for determining any issues that the blockchain industry might face.

A report from the Cryptoassests Taskforce is due this Autumn, and Lord Bates’s pressing question will hopefully be answered within the publishment.

A ‘balanced approach’