U.S. Congressman Jim Himes says that Congress is not ready to pass cryptocurrency legislation anytime soon, citing a lack of deep understanding of cryptocurrencies among lawmakers. “There’s going to be a lot of discussion in the coming years about ways to regulate” cryptocurrencies, said the congressman.
U.S. Representative Jim Himes has revealed some discussions Congress is having regarding cryptocurrency legislation in an interview with Yahoo Finance Friday. The Connecticut representative serves as the chair of the National Security, International Development and Monetary Policy Subcommittee of the House Financial Services Committee. He previously worked at the investment bank Goldman Sachs for 12 years.
His crypto comments came as the U.S. Treasury published a proposal to require businesses to report crypto transactions above $10K to the Internal Revenue Service (IRS).
Himes said that Congress is not ready to act on crypto legislation anytime soon. “Most of my colleagues don’t have a deep understanding of cryptocurrencies, what they can do, what the dangers are,” he described, emphasizing that “Congress has not spent a lot of time on it.” The lawmaker elaborated:
So, for better or for worse, there’s not going to be legislation passed out of the United States Congress anytime soon.
“That said, more and more of my colleagues are becoming aware,” he continued. Congress also has a pro-bitcoin senator, Cynthia Lummis, who has vowed to show her colleagues in Congress that bitcoin is a great store of value. She also plans to convince Treasury Secretary Janet Yellen of the same.
Congressman Himes proceeded to describe the atmosphere in Congress surrounding crypto discussions, referencing Nobel laureate Paul Krugman’s recent opinion piece, published in The New York Times, which he said was “relatively well characterized.”
Himes described, “Innovative ideas, that’s interesting, what does it actually do, what problem does it solve.” Pointing out that the benefits to “drug dealers, human traffickers, [and] potential terrorists” are pretty clear to him, he reiterated, “Tell me what the other benefits are.” The congressman noted, “That is sort of general atmosphere in Congress where people are saying ‘tell me again what’s good about cryptocurrencies, what problem does it solve.’”
Nonetheless, Himes emphasized:
Don’t get me wrong, that doesn’t mean there is going to be an attempt to ban it.
He expects that “There’s going to be a lot of discussion in the coming years about ways to regulate, how to tax, etc. etc. — all this stuff that causes the government to intersect with something like cryptocurrency.”
“In a bigger frame of reference, the piling into cryptocurrencies, the Gamestop bubble, Robinhood, SPACs, I could list for you 12 things that feel to me like they are largely a function not of deep fundamental investment research but largely a function of immense amounts of liquidity,” he added, noting:
I don’t know that those things necessarily need to be regulated. I’m not saying that.
“But it is very clear to me that there’s a lot of people out there who believe that trees grow to the sky and will get a very expensive education in what the downside of volatility looks like when we do see some kind of bear market or some kind of depression in asset prices. A lot of people are going to get very expensive education when that happens,” the congressman warned.
Bitcoin Reaches Highest Level Since May as Chartists Eye $50,000
After a volatile weekend, Bitcoin has once again surpassed $40,000, reaching its highest level in more than two weeks.
The world’s largest crypto gained as much as 4.5% Monday to $41,020, extending its rally to a second day. The coin has rallied roughly 9% since Friday. The wider Bloomberg Galaxy Crypto Index, which tracks some of the major cryptocurrencies, also advanced, adding as much as 7.7% at one point.
With Bitcoin crossing the $40,000 threshold, many chartists are looking at $42,500 as its next important level to breach. That number roughly represents its 200-day moving average and topping it could mean the coin rallies toward $50,000.
“Bitcoin is always going to be volatile and the manic run-up we had was never sustainable. The question is where do we settle? What is the new floor in Bitcoin?,” said Tom Essaye, a former Merrill Lynch trader who founded “The Sevens Report” newsletter. “In order for Bitcoin to resume that rally, I think you’re going to need to see more widespread legitimate adoption.”
Cryptocurrencies have been under pressure in recent weeks, with Bitcoin losing about 30% since mid-April, when it hit a record of almost $65,000. The recent selloff has been exacerbated by a public rebuke from Tesla Inc.’s Elon Musk, who criticized the amount of energy used by the servers underpinning the token and reneged a previous offer to allow customers to buy his cars using the cryptocurrency. Increased Chinese regulatory oversight has also soured the mood.
But prices got a boost at the start of the week after veteran hedge fund manager Paul Tudor Jones — who said last year Bitcoin could be a good hedge against inflation — re-endorsed the coin in a television interview.
“I like Bitcoin as a portfolio diversifier,” Tudor Jones of Tudor Investment Corp. said in an interview with CNBC. “Everybody asks me what should I do with my Bitcoin? The only thing I know for certain, I want 5% in gold, 5% in Bitcoin, 5% in cash, 5% in commodities.”
Meanwhile, over the weekend, Musk once again roiled the market, saying via tweet that Tesla would allow transactions in Bitcoin once it is mined with more clean energy. The mogul said he wants miners, who have come under the spotlight in recent months, to use about 50% clean energy. The Cambridge Center for Alternative Finance has estimated that 39% of crypto mining is powered by renewable sources, mainly hydroelectric.
Bitcoin’s peers, including Bitcoin Cash, Dash, and Ether also gained on Monday.
Bitcoin Mining Difficulty Drops 5% After Xinjiang’s Miner Shutdown
Bitcoin’s mining difficulty fell by 5.3 percent on Sunday night UTC on the back of a recent drop-off in hash rate. On-chain data shows the network’s mining difficulty dropped to 19.8 trillion, a level not seen since early January.
The mining difficulty is how the network aims to keep blocks being produced at an even rate, despite a wildly fluctuating hash rate. Every two weeks it makes the mining process easier or harder, in order to accommodate the varying hash rate.
After the previous difficulty adjustment on May 30, the network’s hash rate remained steady. But on June 9, miners in Xinjiang’s Zhundong Economic and Technology Development Zone received orders to close operations — a result of the China State Council’s high-level comment about cracking down on bitcoin trading and mining activities. Following this news, major Chinese bitcoin mining pools saw a notable plunge in hash rate by over 20 percent on average.
From the last adjustment to June 9, Bitcoin’s average block production interval was around 9.9 minutes, close to the intended 10-minute-per-block interval, data shows. But due to the hash rate plunge, the average block production interval between June 9 and 14 was extended to more than 12 minutes.
The difficulty drop may be welcome news for miners who are still online as their share of the total block subsidies over the next two weeks will increase. Meanwhile, bitcoin’s price has jumped above $39,000 again, nearing the $40,000 level.
Bitcoin’s price started to see a notable breakout also around Sunday night UTC time following Tesla founder and CEO Elon Musk’s tweet denying that he manipulated the cryptocurrency’s market movements.
“This is inaccurate,” he replied to CoinTelegraph’s tweet about an article with comments that accused him of market manipulation.
“Tesla only sold ~10% of holdings to confirm BTC could be liquidated easily without moving market. When there’s confirmation of reasonable (~50%) clean energy usage by miners with positive future trend, Tesla will resume allowing Bitcoin transactions,” Musk said on social media.
Bitcoin’s price increased by over $1,500 within hours after Musk’s reply, which came just a month after Musk said Tesla suspended the bitcoin payment option out of environmental concerns.
Whale Alert: 176 Million XRP Coins Transferred
Amid the current market volatility in the cryptocurrency market, there has been a significant whale movement of the 7th crypto coin by Market capitalization, Ripple (XRP).
According to the latest data published by blockchain tracking and analytics firm, Whale Alert, a leading XRP wallet transferred 176 million coins worth approximately $146 million on Saturday 12 May.
The mentioned transaction was executed at around 15:44 UTC, and it was recorded on Bithomp.com. The recent transfer of the XRP whale from an unknown wallet is one of the largest moves since the start of this month.
In the last week of May 2021, a transaction of 139 million XRP was traced to an anonymous whale address. The transaction was done from an unknown wallet after the coin surged above $1. It was also noticed that there has been a substantial increase in the activities of the network in the past few weeks.
According to Coinshares report, Ripple (XRP) has recorded an additional investment worth $7 million in the first week of June, this was the highest level of new investment since April 2021.
In May 2021, Ripple, San Francisco-based blockchain firm, announced that the company is planning to support NFTs on XRP Ledger (XRPL). In addition, the company highlighted the significant advantages of XRPL over other platforms in the growing market of NFTs.
The world’s 7th largest cryptocurrency has seen immense volatility since the start of 2021. XRP started this year at a price level of approximately $0.22 after a crash of nearly 60 percent in December 2020 due to the SEC’s lawsuit against Ripple.
In April 2021, the digital currency saw significant interest from retail and institutional investors as its price touched an all-time high of approximately $1.92. After registering the record price level, XRP price experienced a dip in May 2021 as the digital asset reached a low of $0.69 on 23 May.
As of press time XRP is trading at $0.88 with a 7.10% gain in the last 24 hours.
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