On Wednesday, during the U.S. House of Representatives Financial Services Committee, crypto industry leaders formally talked with U.S. lawmakers for the first time, explaining their business and making regulatory recommendations.
Representatives from six leading cryptocurrency companies, such as Circle and Coinbase, urged the U.S. Congress to establish more transparent rules for the booming $3 trillion industry.
They warned that too strict restrictions would push them overseas.
Cryptocurrency managers have repeatedly called for careful rules rather than forcing the industry to comply with existing regulations.
According to Analysts, they don’t expect Congress to formulate new cryptocurrency regulations in the short term. Legislators mainly regarded hearings as fact-finding activities.
Republicans praised executives for taking the lead in areas that could become key technologies.
The rapid growth of cryptocurrency has particularly attracted the attention of regulators, who worry that the financial system may be at risk if proper monitoring is not carried out.
In November, a working group led by the U.S. Department of the Treasury recommended that Congress pass a law stating that stablecoins can only be issued by companies with insurance deposits such as banks.
Executives said they welcome the clarity of regulation, which may help the industry’s expansion, but too strict rules may backfire.
They said that the industry’s rapid growth highlights investors’ strong interest in digital assets, supported by precise rules, not stifled.
Bitfury’s Brooks was the former CEO of Binance’s U.S. business, and before that was the banking regulator. He told lawmakers that cryptocurrencies are similar to traditional assets.
Puerto Rico hopes to fight corruption through blockchain technology
According to reports, after another corruption scandal, the Puerto Rican government seeks to improve its anti-corruption efforts by adopting blockchain technology.
Puerto Rico’s House of Representatives Speaker Rafael “Tatito” Hernandez announced that lawmakers would hold a meeting with local blockchain enthusiasts this month to discuss the use of blockchain technology to reduce the possibility of corruption.
At the Puerto Rico Blockchain Trade Association meeting, the official stated that implementing blockchain and smart contracts can bring more transparency and accountability to the public sector.
The spokesperson’s remarks come as the corruption problem in Puerto Rico is getting worse. According to reports, the local mayor accepted more than $100,000 in cash bribes last week.
Puerto Rico is not alone in exploring the potential anti-corruption capabilities of blockchain and digital currencies technologies. In 2020, the Danish Ministry of Foreign Affairs reported on the potential of blockchain in combating administrative and political corruption.
The United Nations Drug and Crime Agency also recommended that Kenya use blockchain in November 2020 to combat government corruption.
Although many jurisdictions are considering the basic technology of cryptocurrency as a tool to reduce corruption, some governments such as Russia prohibit their representatives and officials from holding cryptocurrencies on the grounds of corruption.
As one of the most corrupt countries globally, Russia can actually use encryption to reduce corruption.
Bitcoin hashrate recovers fully after the Chinese crackdown
The Bitcoin hashrate, a measure of network computing power, almost fully recovered to the level of May, when the Chinese authorities began to crack down on the industry.
According to the Bitcoin Mining Power Index compiled by the University of Cambridge Alternative Finance Center, China was the world’s largest Bitcoin miner at the time. It accounted for 71% of the global computing power.
Data from the mining pool BTC.com shows that from May to June, the global hashrate was roughly halved because Chinese miners were collectively blacked out to comply with government orders. Since then, this number has been steadily increasing as they develop operations overseas and North American miners deploy massive processes.
The hashrate averaged 182.83 exahash per second in the past three days, close to the May peak of 190.55 EH/s.
As the computing power increases, the difficulty of mining Bitcoin blocks will also increase to keep the time required for mining blocks reasonably stable.
OKLink senior researcher Eddie Wang said that after nine consecutive increases, the difficulty dropped by 1.49% on November 28. Wang noted that this decline coincided with a widespread domain name service attack on Chinese mining pools.
Wang expects the difficulty to increase by 4% this weekend. Jaran Mellerud of Arcane Research expects an increase of 7%.
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