Happened in Crypto: Apple's Ban on Payments Ruled Unlawful, an much more

Ondřej Koraba

Will UK regulators collaborate with the crypto sector? Is the US Securities and Exchange Commission chairman's approach to digital assets inconsistent? How will the recent decision by a Californian court regarding Apple impact crypto and NFT apps?

Discover the answers to these questions and more in our periodic summary of news and events that are influencing the world of virtual currencies.

UK's FCA Seeks Collaboration with Crypto Industry for Regulatory Framework

The United Kingdom's financial regulator, the Financial Conduct Authority (FCA), aims to collaborate with crypto companies to create a regulatory framework for the industry. FCA Executive Director Sarah Pritchard emphasized the need for cooperation during London's City Week conference, inviting the industry to provide input to ensure effective crypto regulations.

Acknowledging the mainstream adoption of crypto, Pritchard highlighted the advantages of early engagement in shaping regulations that benefit markets, consumers, and firms. Currently, the FCA's responsibilities are limited to ensuring UK crypto firms comply with Anti-Money Laundering and Counter-Terrorist Financing legislation. Pritchard noted that the FCA would have more powers to regulate crypto once the government legislates on the issue.

The FCA has registered 41 crypto firms and is working with the government on proposals to regulate stablecoins.

Source: Cointelegraph

China's Metaverse: A Government-led, Economy-focused Approach

China's metaverse is emerging differently from Western visions, with a government-led, economy-focused approach. While Western metaverses proposed by Meta, Microsoft, and Decentraland target consumers, China's virtual worlds prioritize supporting the economy.

China's Central Commission for Discipline Inspection defined the metaverse as a combination of digital twins (virtual representations of real-world objects), mixed reality (merging digital and physical experiences), and blockchain. However, the government effectively banned cryptocurrencies in September 2021, impacting the development of China's metaverse by separating virtual spaces from digital assets.

Chinese authorities have also cracked down on gaming, limiting the industry's growth in the metaverse. Despite these restrictions, the government supports metaverse components it believes could benefit the economy directly. Digital twins were included in Beijing's 14th Five Year Plan, and an action plan by five ministries aims to grow the virtual reality industry to ¥350 billion ($51 billion).

In China, the metaverse is expected to serve the nation's physical economy instead of being a virtual world for socializing, working, and playing.

Source: Wired

Crypto Community Reacts to Gensler's 2018 Video Equating Crypto with Cash

A 2018 video of Gary Gensler, now head of the United States Securities and Exchange Commission (SEC), has surfaced, showing him stating that cryptocurrencies are similar to commodities or cash and not securities. 

The video is from a "Blockchain and Money" class Gensler taught at MIT before joining the SEC. In the video, Gensler notes that most ICOs don't trigger US securities laws, with three-quarters of the market being "non-securities, just a commodity, cash, crypto." 

However, since becoming the SEC chair, Gensler has taken a more stringent approach to regulating the crypto industry. His current stance on cryptocurrencies and their potential classification as securities seems to be at odds with his previous statements. 

This apparent contradiction has led to criticisms and reactions from notable figures in the crypto community such as Coinbase CEO Brian Armstrong and ShapeShift founder Erik Voorhees, who accuse Gensler of hypocrisy and question his change in opinion on the matter. Although some defend Gensler, arguing that his views as a professor may differ from those as a regulator.

Source: Cointelegraph

Meta Struggles with AI Progress Amid Chip Project Mishaps and Metaverse Ambitions

Meta Platforms, Inc. has faced difficulties in adopting AI-friendly hardware and software systems despite significant investments in AI research. A September 2022 memo by the head of infrastructure, Santosh Janardhan, highlighted a "significant gap" in the company's tooling, workflows, and processes for AI development.

Challenges include capacity crunches, leadership changes, and a scrapped AI chip project. These issues doubled Meta's capital expenditures to around $4 billion per quarter, leading to layoffs and the cancellation of planned data center builds in four locations.

Meta's late adoption of graphics processing units (GPUs) for AI work and its metaverse pivot further hampered its ability to deploy AI in response to threats like TikTok's rise and Apple's ad privacy changes. After abandoning a large-scale rollout of its custom inference chip, Meta ordered billions of dollars worth of Nvidia GPUs in 2022. This, combined with several executive departures, left Meta lagging behind competitors like Google.

Meta is now retooling its data centers to accommodate the incoming GPUs and plans to develop a more ambitious in-house chip, likely to be completed around 2025. Chief Technology Officer Andrew Bosworth predicts Meta will release a generative AI product this year.

Source: YahooFinance

Apple's Ban on Outside Payments Ruled Unlawful, Potentially Benefiting Crypto and NFT Apps

A California court has ruled that Apple's ban on app developers using alternative in-app payment methods, which includes a 30% commission, violates state competition laws.

This decision could pave the way for cryptocurrency and non-fungible token (NFT) projects to add more functionality to their iOS apps. The ruling came in the case of Apple vs Epic Games, the creator of Fortnite, and upheld a lower court's 2021 decision.

Epic Games' founder and CEO, Tim Sweeney, celebrated the ruling, stating that it "frees iOS developers" by allowing them to direct consumers to alternative payment solutions.

If Apple does not appeal the ruling, it could set a case law precedent that benefits creators of crypto and NFT apps by exempting them from Apple's 30% commission.

Source: Cointelegraph

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