Happened in Crypto: Regulations, AI, and much more
There’s hardly any field that would be as dynamic as crypto and it can get hard to stay in the loop of what's going on. To help you out, we’ve compiled a list of a few news and events shaping the industry. Here’s our little roundup.
Web3 dominated this year's Paris Blockchain Week
The Paris Blockchain Week 2023 discussed the evolution of Web3 in the mainstream and the crypto industry's past, present, and future. The three-day event was a net positive for the crypto industry, with Ethereum co-founder Joseph Lubin discussing the growing demand for a Web3-based payment infrastructure.
Industry experts also discussed the potential impact of the European Union's Markets in Crypto-Assets (MiCA) regulation. Tim Draper addressed the ongoing banking crisis and promoted Bitcoin as the true capital hedge.
Despite nationwide protests, the PBW 2023 had no shortage of enthusiasm, with Animoca Brands CEO Robby Yung commending the local government's "warm embrace" for crypto and blockchain enthusiasts.
Paris Blockchain Week is an annual event that brings together blockchain enthusiasts, entrepreneurs, developers, investors, and policymakers from around the world. It aims to promote the adoption of blockchain technology by showcasing its potential use cases and discussing the challenges and opportunities associated with its implementation.
G-7 Plans to Tighten Global Crypto Regulations
The Group of Seven (G-7) countries are reportedly planning to introduce tougher global regulations for cryptocurrencies. Discussions on the matter will speed up ahead of a mid-May meeting of finance ministers and central bankers from the G-7 countries.
The leaders of the G-7 nations are expected to make a joint declaration for stricter crypto policies during this year's summit in Hiroshima, Japan.
The G-7's goal is to establish a global framework for regulating cryptocurrencies with a focus on transparency and consumer protection. The Financial Stability Board recommended global crypto rules last October, and regulators across the world are working toward a consensus on regulating crypto. Recent failures of banks and cryptocurrency exchanges have put cryptocurrencies under more scrutiny from regulators.
Nvidia Shifts Focus to AI, Dismisses Cryptocurrency as Useless for Society
Nvidia's CTO, Michael Kagan, recently made comments to The Guardian stating that cryptocurrency "doesn't bring anything useful for society" and that AI does. This is a significant shift for Nvidia, as it has both benefited and suffered from the cryptocurrency market in the past.
Nvidia previously created entire product lines for cryptocurrency mining but was also burdened with excess inventory when the market crashed. Kagan's comments touch on the debate over whether cryptocurrency is a worthy alternative to fiat money or simply a tool for generating profit. Nvidia is now focusing on AI and attracting customers for AI applications, with major companies like Oracle, Meta, Amazon, and Microsoft investing in Nvidia's H100 GPUs for generative AI training and inference.
Do you share Kagan’s opinion or are you with us on the journey to the moon?
Partial Bank Bailouts and the Crypto Community: Why It's Different This Time
Article summary: The recent partial bailouts of failed banks have not caused concern in the crypto community, despite its opposition to bailouts. While the US Federal Reserve System helped Circle withdraw its $3.3 billion deposit from Signature Bank and Silicon Valley Bank, economists emphasize the difference between the current solution and the 2008 financial crisis.
In the previous crisis, investors and owners of large banks were bailed out, whereas now only specific parts of the banks are being bailed out. The overlap between the crypto and startup communities has led to some support for bank bailouts, as valuable institutions on the border of crypto and fiat need to be saved. Ultimately, the debate on bank bailouts in the crypto community remains divided, but the current approach is viewed as a different solution to a different problem.
NFTs are about to be taxed in the US
The US Internal Revenue Service (IRS) is reportedly considering changes to the tax treatment of non-fungible tokens (NFTs). If implemented, NFTs may be taxed at a higher collectible tax rate rather than the lower capital gains rate.
This development highlights the complexity of crypto taxes, with areas such as staking, wrapped tokens, and decentralized finance transactions still open to debate. As the IRS continues to take a more serious approach to crypto, tax practitioners and investors in the US should remain updated on any changes to the tax treatment of cryptocurrencies, including NFTs.