Coinz.com

LONDON (Reuters) – Britain’s finance ministry said on Monday it intended to legislate to regulate some stablecoins when they are used as a means of payment.

The ministry said it intended to consult later this year on creating regulations for a wider set of crypo-asset activities.

Stablecoins are cryptocurrencies designed to have a stable value relative to traditional currencies, or to a commodity such as gold, to avoid the volatility that makes bitcoin and other digital tokens impractical for most commerce.

“We see enormous potential in crypto, UK financial services minister John Glen said, adding that regulatory standards won’t be compromised.

“We have a detailed plan… this is a new world for the newly regulated and the regulators,” Glen told UK Fintech Week.

Regulation will help consumers use stablecoins for payments with confidence, he said.

Britain will consult on a “world leading” regime for the rest of the crypto market as well, Glen said.

(Reporting by William James and Huw Jones; Editing by William Schomberg)

By Hannah Lang

(Reuters) – Almost half of all cryptocurrency owners in the United States, Latin America and Asia Pacific purchased the digital assets for the first time in 2021, according to a new survey from U.S. cryptocurrency exchange Gemini.

The survey of nearly 30,000 people across 20 countries, which was conducted between November 2021 and February 2022, shows 2021 was a blockbuster year for crypto, with inflation in particular driving adoption in countries that have experienced currency devaluation, the report found.

Brazil and Indonesia lead the world in crypto adoption, Gemini found, with 41% of people surveyed in those countries reporting crypto ownership, compared with 20% in the United States and 18% in the United Kingdom.

Gemini found that 79% of people who reported owning crypto last year said they chose to purchase the digital assets for their long-term investment potential.

People who do not currently own crypto and live in countries that have experienced currency devaluation against the U.S. dollar were more than five times as likely to say they planned to purchase crypto as a hedge against inflation.

Only 16% of respondents in the United States and 15% in Europe agreed that cryptocurrencies hedge against inflation, compared with 64% in Indonesia and India, for example.

The Indian rupee has declined 17.5% against the dollar in the last five years, while the Indonesian rupiah depreciated 50% against the dollar between 2011 and 2020.

Only 17% of Europeans reported that they owned digital assets in 2021, and only 7% of those who do not currently own crypto said they intended to buy digital assets at some point.

It remains to be seen if the adoption momentum can keep pace this year.

While the most popular cryptocurrency, bitcoin, hit an all-time high of more than $68,000 in November, helping to push the value of the cryptocurrency market to $3 trillion, according to CoinGecko, it has traded in the narrow range of $34,000-$44,000 for most of 2022 so far.

(Reporting by Hannah Lang in Washington; Editing by Leslie Adler)

SHANGHAI (Reuters) – China’s central bank said on Saturday it will further expand a pilot scheme of its digital currency to more areas, including cities in the eastern Zhejiang province which is set to host the Asian Games later this year.

The People’s Bank of China (PBOC) said it will promote the research and development of the digital currency, dubbed e-CNY, and expand the scope of the pilot scheme, according to an online statement.

Tianjin, Chongqing, Guangzhou, Fuzhou, Xiamen and six cities in the coastal Zhejiang province will be added to the existing 10 major “pilot” cities to test the use e-CNY, it said.

The six cities in Zhejiang, which included the provincial capital of Hangzhou, will host the Asian Games in September.

The PBOC has ramped up testing of the digital currency in recent years and hoped to take advantage of the Beijing Winter Olympics as an opportunity to promote the yuan globalisation.

However, Beijing’s aim to make an Olympic splash with its digital currency was thwarted by a COVID 19-induced exclusion of foreign spectators. Instead, it has been taken up by a captive audience of locals unable to use their usual digital payment apps.

The PBOC statement also said Beijing and Zhangjiakou, which co-hosted the Winter Games in February, will also become e-CNY’s pilot cities.

(Reporting by Winni Zhou and Ryan Woo; Editing by Mike Harrison)

By Jonathan Stempel

NEW YORK (Reuters) – A federal judge on Thursday dismissed a lawsuit accusing Binance, the world’s largest cryptocurrency exchange by trading volume, of violating U.S. securities laws by selling unregistered tokens and failing to register as an exchange or broker-dealer.

The lawsuit had been brought in Manhattan by digital token investors who had bought nine tokens – EOS, QSP, KNC, TRX, FUN, ICX, OMG, LEND and ELF – through Binance’s online exchange starting in 2017, and which soon lost much of their value.

In a 327-page complaint, the investors claimed that Binance “wrongfully engaged in millions of transactions” and failed to warn them about the “significant risks” of buying the tokens, and sought to recoup what they paid.

U.S. District Judge Andrew Carter, however, said the investors sued too late, having waited more than one year after their purchases.

He also said domestic securities laws did not apply because Binance was not a domestic exchange, even if it used Amazon computer servers and Ethereum blockchain computers in the United States.

“Plaintiffs must allege more than stating that plaintiffs bought tokens while located in the U.S. and that title passed in whole or in part over servers located in California that host Binance’s website,” Carter wrote.

Kyle Roche, a lawyer for the investors at Roche Freedman, declined to comment. Binance and its lawyers did not immediately respond to requests for comment.

The investors claimed the statute of limitations began running exactly one year before their April 2020 lawsuit, when the U.S. Securities and Exchange Commission released a “framework” characterizing their tokens as securities.

Binance has an opaque corporate structure, with a holding company registered in the Cayman Islands. Founder and Chief Executive Changpeng Zhao said in October that Binance planned to establish “a few headquarters” around the world.

The case is Anderson et al v Binance et al, U.S. District Court, Southern District of New York, No. 20-02803.

(Reporting by Jonathan Stempel in New York; Editing by Nick Zieminski)

By Michelle Price

WASHINGTON (Reuters) – U.S. listed companies that hold cryptocurrencies on behalf of users and customers should account for those assets as a liability on their balance sheet and disclose the related risks to investors, the securities regulator said on Thursday.

The U.S. Securities and Exchange Commission (SEC) guidance would apply to a range of listed entities, including crypto exchanges and traditional firms such as retail brokers and banks that are increasingly providing cryptocurrency services and holding digital assets on behalf of a range of clients.

While there is a well-established standard under accounting rules for safeguarding traditional assets on behalf of clients, there is no explicit standard for safeguarding crypto assets and companies diverge in their treatment of these arrangements.

In its guidance, the SEC said there are “significant” technological, legal and regulatory risks associated with safeguarding crypto-assets and as a result they should be reflected as a liability on companies’ balance sheets.

“The technological mechanisms supporting how crypto-assets are issued, held, or transferred, as well as legal uncertainties regarding holding crypto-assets for others, create significant increased risks…including an increased risk of financial loss,” the SEC wrote.

Companies should also disclose “the nature and amount” of crypto assets they are responsible for holding, with separate disclosures for each significant crypto-asset, and any vulnerabilities resulting from concentration in such activities.

The underlying crypto assets should be accounted for at fair value, the SEC said.

Cryptocurrency platforms and wallets continue suffer major breaches, with hackers just this week stealing $615 million worth of cryptocurrency from blockchain project Ronin.

In addition, U.S. regulators remain undecided on how to treat cryptocurrencies, with regulators still discussing new rules for how banks should handle digital assets.

(Reporting by Michelle Price; Editing by David Gregorio)

By Hannah Lang

(Reuters) – Circle Internet Financial has selected Bank of New York Mellon Corp as primary custodian for its reserves of USD Coin, a stablecoin cryptocurrency whose value is directly pegged to the U.S. dollar, the crypto operator said on Thursday.

The new partnership will help link the traditional capital market with the market for digital assets, Circle said in a news release.

As cryptocurrencies rise in popularity — surpassing $3 trillion in value in November, according to crypto data provider CoinGecko — the banking system is slowly warming to the idea of working more closely with digital currency companies.

“We are at a point in the evolution of our industry where the digitization of assets is presenting new and exciting opportunities to a broad range of market participants,” Roman Regelman, BNY Mellon’s chief executive officer of asset servicing and head of digital, said in the release.

Circle is the principal operator of USD Coin (USDC), which has a nearly $52.4 billion market capitalization, according to CoinGecko.

The Boston-based company in February said it was valued at $9 billion under new deal terms with Concord Acquisition Corp, a blank-check firm. Blank-check firms, or special purpose acquisition companies (SPACs), are shell companies that raise funds through a listing to acquire a private company and take it public.

Last summer, Grayscale, the world’s largest digital currency manager, chose BNY Mellon to run accounting and administration of its Grayscale Bitcoin Trust.

BNY Mellon also announced last year that it would hold, transfer and issue bitcoin for its asset management clients, in one of the first announcements of its kind by a major Wall Street bank.

In January, BNY Mellon Chief Financial Officer Emily Portney said in an interview that U.S. regulators should provide more clarity on the rules of the road for cryptocurrencies and other digital assets amid confusion over what activities are allowed.

(Reporting by Hannah Lang in Washington; editing by Jonathan Oatis)

By Huw Jones and Carolyn Cohn

LONDON (Reuters) – Britain’s finance ministry flagged several reforms on Thursday and defended regulators from criticism they are too slow to license firms, saying flawed applicants must not get through.

The ministry and regulators face pressure to make financial rules more flexible to keep London globally competitive after Britain’s departure from the European Union.

The Financial Conduct Authority has been criticised for being slow in authorising crypto firms as it grapples with an internal revamp and pay structure that has disillusioned some staff.

Financial services minister John Glen said he has a “very high regard” for the leadership at the FCA and its counterpart at the Bank of England, and that some people criticised regulators just because they don’t get what they want.

Glen said he was aware of frustration over licensing waiting times and has told FCA CEO Nikhil Rathi that the complexity of new types of financial firms like crypto means that some thought needs to be given to being more responsive.

Some applicants, however, had no experience of dealing with regulators and needed to recognise they must adhere to high standards, he said.

“Just not responding quickly to a request isn’t necessarily a bad thing if there are underlying flaws in the business model of an applicant,” Glen told a House of Lords committee.

“We should not be looking to be nimble at all costs.”

He faces pressure to use “freedoms” from Brexit and has been been considering rules for sectors like cryptoassets.

Glen said he may comment further next week on crypto, and a consultation paper is due after Easter on reform of the so-called matching adjustment in insurance solvency rules.

Legislation on a new framework for writing financial rules could be brought to parliament imminently, Glen said, which would help regulators respond faster to market changes.

But having a primary, rather than secondary objective for regulators to consider any impact of a proposed rule on the competitiveness of the industry was a “non-starter”, he added.

A change in rules could allow for the growth in Britain of “captives” or licensed in-house insurers set up by corporates looking to cut costs through self-insurance, he said.

“It’s ripe for further work to be done. I hope that we would see that evolution in the way insurance and reinsurance is offered to big corporates,” Glen said.

(Reporting by Huw Jones;Editing by Elaine Hardcastle)

By Huw Jones and Tom Wilson

LONDON (Reuters) – European Union lawmakers were set on Thursday to back tougher safeguards for transfers of bitcoin and other cryptocurrencies, in the latest sign that regulators are tightening up on the freewheeling sector.

Two committees in the European Parliament have thrashed out cross-party compromises to be voted on. Crypto exchange Coinbase Global Inc has warned the rules would usher in a surveillance regime that stifles innovation.

The $2.1 trillion crypto sector is still subject to patchy regulation across the world. Concerns that bitcoin and its peers could upset financial stability and be used for crime have accelerated work by policymakers to bring the sector to heel.

Under the proposal first put forward last year by the EU’s executive European Commission, crypto firms such as exchanges would have to obtain, hold, and submit information on those involved in transfers.

That would make is easier to identify and report suspicious transactions, freeze digital assets, and discourage high-risk transactions, said Ernest Urtasun, a Spanish Green Party lawmaker helping to steer the measure through the parliament.

The Commission had proposed applying the rule to transfers worth 1,000 euros ($1,116) or more, but under the cross-party agreement this ‘de minimis’ rule has been scrapped – meaning all transfers would be in scope.

Urtasun said removing the threshold brings the draft law into line with rules from the global Financial Action Task Force that sets standards for combating money laundering. Those rules mean crypto firms must collect and share data on transactions.

An exemption for low value transfers is not appropriate, as crypto users could dodge the rules by creating an almost unlimited number of transfers, Urtasun said, also citing the small amounts involved in transfers linked to some crime.

The lawmakers’ committees have also agreed on new provisions on crypto wallets held by individuals, not exchanges, and on the creation of an EU list of high-risk or non-compliant cryptoasset service providers.

Coinbase Chief Legal Officer Paul Grewal said in a blog on Monday that traditional cash, not crypto, was by far the most popular way to hide financial crime.

EU states have joint say with parliament on the final version of the law and countries have already agreed among themselves there should be no de minimis.

($1 = 0.8961 euros)

(Reporting by Huw Jones and Tom Wilson; Editing by Catherine Evans)

(Reuters) – Financial sanctions imposed on Russia threaten to gradually dilute the dominance of the U.S. dollar and could result in a more fragmented international monetary system, Gita Gopinath, IMF’s First Deputy Managing Director, told The Financial Times.

Russia has been hit with a plethora of sanctions from the United States and its allies for its late-February invasion of Ukraine. Russia has called the invasion a ‘special operation’ to disarm its neighbour.

“The dollar would remain the major global currency even in that landscape but fragmentation at a smaller level is certainly quite possible,” Gopinath told the newspaper in an interview, adding that some countries are already renegotiating the currency in which they get paid for trade.

She said that the war will also spur the adoption of digital finance, from cryptocurrencies to stablecoins and central bank digital currencies.

The IMF did not immediately respond to a Reuters request for comment.

Gopinath told the FT that the greater use of other currencies in global trade would lead to further diversification of the reserve assets held by national central banks.

She had earlier said the sanctions against Russia do not foreshadow the demise of the dollar as the reserve currency and that the war in Ukraine will slow global economic growth but will not cause a global recession.

(Reporting by Juby Babu in Bengaluru; Editing by Muralikumar Anantharaman)

By Leika Kihara and Takahiko Wada

TOKYO (Reuters) – G7 policymakers must speed up creation of a common framework to regulate digital currencies, as the Ukraine war heightens the need to avoid them being used as a loophole against sanctions, a senior Bank of Japan official said.

Cryptoassets and stablecoins have come under the regulatory spotlight amid concerns they could be used to evade financial sanctions imposed on Russia since its invasion of Ukraine.

Such digital currencies could upend the global settlement system as they make it easier to circumvent conventional payment means using the U.S. dollar, euro and yen, said Kazushige Kamiyama, the head of the BOJ’s payment and settlement systems department.

“By using stablecoins, it’s not very difficult to create an individual global settlement system,” Kamiyama told Reuters in an interview.

Policymakers of the Group of Seven advanced economies must act quickly in laying out a common understanding on how to update current rules, which do not sufficiently take into account the growing presence of digital currencies, he said.

“G7 nations are now working together on this front, while sharing information on current developments,” said Kamiyama, who is involved in G7 discussions on digital currencies.

U.S. allies including Japan imposed sanctions against Russia for invading Ukraine on Feb. 24, including the removal of many Russian banks from the global payments system SWIFT.

But regulating cryptoassets and stablecoins isn’t easy, as holders can transfer funds across borders far more easily than through legal tender.

The need to balance privacy and money-laundering concerns will also affect debate on the design of a digital yen, said Kamiyama, whose department is charged with the BOJ’s experiments on issuing a central bank digital currency (CBDC).

The BOJ will begin the second phase of experiments from April, which will last about a year and check features such as whether to set a limit on the sum each entity can hold, he said.

While BOJ Governor Haruhiko Kuroda has said a decision on whether to issue CBDC may come by 2026, Kamiyama said the timing will depend partly on how quickly other central banks move.

“Given how so many advanced nation central banks are moving collectively, dramatically and simultaneously on CBDC, it could cause big changes in the settlement system in the future,” he said. “Japan needs to make sure it’s not left behind.”

(Reporting by Leika Kihara and Takahiko Wada; Editing by Lincoln Feast.)

WASHINGTON (Reuters) – The U.S. Securities and Exchange Commission (SEC) on Wednesday flagged crypto-assets, information security, the private fund sector and environmental, social and governance issues among its examination priorities in 2022.

The SEC’s examinations division, tasked with monitoring risks and ensuring investor protection, will also review whether funds’ proxy votes align with their ESG-related disclosures and mandates, and whether there are misrepresentations of ESG factors being considered, the agency said.

(Reporting by Chris Prentice; Editing by Chris Reese)

LONDON (Reuters) – Britain’s financial watchdog said on Wednesday it has extended temporary licences for only a “small number” of cryptocurrency firms ahead of an April 1 cut-off date to prove sufficient money laundering controls.

Crypto firms must have a licence showing they have sufficient checks and controls to stop money laundering or terrorist financing.

“We have concluded our assessments, and the temporary registration regime will close on 1 April, for all but for a small number of firms where it is strictly necessary to continue to have temporary registration,” the Financial Conduct Authority said on its website.

“This is necessary where a firm may be pursuing an appeal or may have particular winding-down circumstances.”

Placing the firms on its list with temporary registrations does not mean they have been assessed as fit and proper, the watchdog said.

Firms still operating under a temporary licence https://register.fca.org.uk/servlet/servlet.FileDownload?file=0154G0000062BtF on Wednesday include relatively large players such as Copper Technologies and Revolut.

David Raw, an FCA policy official, said this month that 90% of crypto firms seeking approval for their anti-money laundering controls have either withdrawn their applications or been refused because they could not meet the standards.

“It won’t be the case that you suddenly have to cease trading,” Raw had said regarding firms whose licence applications could not be fully processed by the April 1 deadline.

(Reporting by Huw Jones, editing by Ed Osmond)

By Francesco Guarascio and Jan Strupczewski

BRUSSELS (Reuters) – The European Commission is readying new sanctions against the Kremlin over Russia’s invasion of Ukraine, EU sources told Reuters on Wednesday, with the magnitude of the new measures depending on Moscow’s stance on gas payments in roubles.

Russia’s President Vladimir Putin has said he wants “unfriendly” countries, including EU states, to pay their gas bills in roubles, a request rejected by Western nations.

The new package of EU sanctions could be ready as early as next week, two of the sources said.

The executive Commission is consulting with EU governments on a “compliance package,” they said. This would apply what European leaders agreed at a summit last week about ensuring that existing sanctions are not by-passed, especially those against blacklisted individuals.

Officials have repeatedly said sanctions against oligarchs could be circumvented using family members, cryptocurrencies, trusts and shell companies in offshore jurisdictions.

Other sanctions imposed by the EU are harder, if not impossible, to evade. These include the freezing of assets held by the Russian central bank in the EU, the exclusion of Russian banks from the SWIFT banking system, and a ban on EU companies exporting high-tech products to Russia.

SELF-IMPOSED BAN ON GAS EXPORT?

What will be eventually proposed is still under discussion, but sources said that far stricter sanctions could be added to the new package if Putin insisted on rouble payments for gas supplies. EU countries now import 40% of their gas from Russia.

The Kremlin said on Wednesday that payments in roubles would be required gradually and not immediately after the deadline set by Putin for March 31.

One of the EU sources said the possible EU reaction would hinge on the timing and details set by Moscow for gas payments.

A euro zone official told Reuters that euro zone finance ministers were expected to discuss on Monday how to retaliate if Putin goes ahead with his threat on rouble payments.

A fifth EU source said that if Putin were true to his words on rouble payments, that could result in Russia effectively imposing a ban on its own natural gas exports.

The EU has so far refrained from banning any fossil fuel imports fuels from Russia because of member states’ heavy reliance on them.

Only a ban on coal was provisionally included in a list of possible sanctions earlier this year, but it never made it into sanctions because Germany struck it down, EU sources told Reuters last week.

(Reporting by Francesco Guarascio @fraguarascio; Editing by Gareth Jones)

By Tom Wilson and Elizabeth Howcroft

LONDON (Reuters) – Hackers have stolen cryptocurrency worth almost $615 million from a blockchain project linked to popular online game Axie Infinity, the latest cyberheist to hit the digital asset sector.

Ronin, a blockchain network that lets users transfer crypto in and out of the game, said on Tuesday the theft happened on March 23 but was not detected until almost a week later.

Here’s what you need to know about the Ronin heist.

CRYPTO’S A BIG DEAL NOW, RIGHT?

Indeed.

Bitcoin and other digital currencies have exploded into public view in recent years, with mainstream investors embracing the sector in droves during the COVID-19 pandemic.

The sector’s now worth over $2.1 trillion. As money has poured in, the hacks and heists that have long plagued crypto have also grown also size.

AND HOW DOES RONIN FIT IN?

Ronin is used in Axie Infinity, one of the world’s most popular online games involving cryptocurrencies.

Its products include a digital wallet for storing crypto, and a “bridge” that allows users to move funds in and out of the game. This is where the crypto were stolen from.

Ronin takes its name from the samurai warriors of feudal Japan who did not serve any particular lord. The name “represents our desire to take the destiny of our product into our own hands,” Axie Infinity said in a blog post.

Vietnam-based Sky Mavis, which launched Axie Infinity in 2018, did not respond to multiple requests for comment. Ronin also did not return Reuters’ messages.

Jeffrey Zirlin, one of Axie Infinity’s founders, said at a conference on Tuesday: “It is one of the bigger hacks in history and we’re fully committed to continue building.”

HOW DID THE HEIST HAPPEN?

The Ronin hacker used stolen private keys – the passwords needed to access crypto funds – Ronin said in a blog post, after targeting computers connected to its network that help confirm transactions.

Ronin said it discovered the hack on Tuesday and that it was working with “various government agencies to ensure the criminals get brought to justice”.

The identity of the hackers is still unclear.

AND AXIE INFINITY?

Axie Infinity says it has 2.8 million daily active players, with some $3.6 billion previously traded on its marketplace, making it one of the most popular blockchain-based online games.

Set in a fictional universe, players can collect, trade and play with virtual creatures called Axies, which are traded in the form of non-fungible tokens (NFTs) and sell for hundreds of thousands of dollars.

It is the largest NFT brand by all-time sales volume, according to market tracker CryptoSlam.

The game has attracted venture capital funding, raising $152 million in October from investors including Andreessen Horowitz.

Axie and other “play-to-earn” games allow players to spend crypto and earn financial rewards. They have surged in popularity in the past year, as a frenzy in the NFT world prompted investors to speculate in the hope of large returns.

WHERE’S THE LOOT NOW? AND ARE USERS AFFECTED?

Most of the stolen funds are still in a digital wallet, which is available to view.

Blockchain Intelligence Group, a Vancouver-based crypto tracker, said that the hackers had moved a small amount of the funds to major exchanges FTX, Crypto.com and Huobi.

Huobi said it was investigating the hack and communicating closely with Axie Infinity. FTX and Crypto.com did not immediately responded to requests for comment.

Ronin said in a blogpost that Sky Mavis was “committed to ensuring that all of the drained funds are recovered or reimbursed,” without giving details. Making sure there is no loss of funds “is our top priority”, it added.

It said it was working with major blockchain tracker Chainalysis to trace the stolen funds. Chainalysis declined to comment.

(Reporting by Tom Wilson; Editing by Kirsten Donovan)

LONDON (Reuters) – Hackers have stolen cryptocurrency worth almost $615 million from a blockchain project linked to the popular online game Axie Infinity, in the latest cyberheist to hit the digital asset sector.

Ronin, a network that allows the transfer of crypto coins across different blockchains, said on Tuesday that hackers stole on March 23 some 173,600 ether tokens and 25.5 million USD Coin tokens.

At the time of the announcement, the loot was worth around $615 million – and, due to a change in the value of the tokens, some $540 million at the time of the hack – making the theft one of the largest on record.

Here are some of the other major thefts to have plagued the crypto sector since bitcoin was born in 2008.

POLY NETWORK

Hackers stole around $610 million in August 2021 from Poly Network, a platform that facilitates peer-to-peer token transactions. The hackers behind the heist later returned nearly all of the stolen funds.

The hack underscored vulnerabilities in the burgeoning decentralised finance – DeFi – sector, where users lend, borrow and save in digital tokens, bypassing the traditional gatekeepers of finance such as banks and exchanges.

COINCHECK

In Jan. 2018, hackers stole cryptocurrency then worth around $530 million from Tokyo-based exchange Coincheck. The thieves attacked one of Coincheck’s “hot wallet” – a digital folder stored online – to drain the funds, drawing attention to security at exchanges.

The hack raised questions in Japan https://www.reuters.com/article/us-japan-cryptocurrency-regulation-idUSKBN1FW04F about regulation of the digital asset market. South Korea’s intelligence agency said at the time that a North Korean hacking group may have been behind the heist.

MT. GOX

In one of the earliest and most-high profile crypto hacks, bitcoin worth close to $500 million dollars was stolen from the Mt.Gox exchange in Tokyo – then the world’s biggest – between 2011 and 2014.

Mt.Gox, which once handled 80% of the world’s bitcoin trade, filed for bankruptcy in early 2014 after the hack was revealed, with some 24,000 customers losing access to their funds.

WORMHOLE

DeFi site Wormhole was hit by a $320 million heist last month, with the hackers making off with 120,000 digital tokens connected to the second-largest cryptocurrency, ether.

The crypto arm of Chicago-based Jump Trading, which had the year before acquired the developer behind Wormhole, later replaced the funds “to make community members whole and support Wormhole now as it continues to develop.”

(Reporting by Tom Wilson and Elizabeth Howcroft; Editing by Chizu Nomiyama)

By Pete Schroeder

WASHINGTON (Reuters) – Four women will take seats on the Commodity Futures Trading Commission, returning the derivatives regulator to full strength, after a unanimous U.S. Senate vote hailed as historic by the chair of the Senate Agriculture Committee.

“This confirmation makes history because all four nominees are women, three of whom are women of color,” Senator Debbie Stabenow, the chair, said in a statement.

Senators on Monday confirmed President Joe Biden’s nominations of Kristin Johnson and Christy Goldsmith Romero to Democratic seats on the bipartisan commission and Summer Kristine Mersinger and Caroline Pham to Republican seats.

The five-member commission was being run only by Chairman Rostin Behnam and Commissioner Dawn Stump, who has said she intends to step down from the agency when her term expires in April. Behnam remains as chairman.

The agency polices commodities markets that have become increasingly tumultuous amid a slew of Western sanctions applied to Russia over Ukraine.

The agency is looking also to carve out a central role in monitoring burgeoning cryptocurrency markets, where the agency already monitors some crypto-related products.

(Reporting by Pete Schroeder; Editing by Howard Goller)

By Tom Wilson and Elizabeth Howcroft

LONDON (Reuters) – Bitcoin on Tuesday held ground just below its highest this year, touched a day earlier, with gains for the original cryptocurrency topping 27% since Russia’s invasion of Ukraine.

Bitcoin hit $48,234 on Monday evening, its highest since Dec. 31. It was last trading up 0.9% at $47,553.

Its gains lifted smaller cryptocurrencies that tend to move in tandem with bitcoin. Ether, the second biggest token, hit $3,436 on Monday, its highest since early January.

Market players cited emerging signs of a new wave of adoption of crypto by institutional investors and financial firms, whose interest over the past two years has fuelled crypto’s journey to mainstream asset from niche technology.

Bitcoin has risen over 12% in the last week alone.

Among supportive comments cited were those by BlackRock Inc’s chief executive, who said last week that the Russia-Ukraine war could end up accelerating digital currencies as a tool to settle international transactions.

Such moves signal “growing conviction that the crypto markets are worth dedicating more resources to,” said Noelle Acheson, head of market insights at U.S. crypto firm Genesis.

Though bitcoin and other cryptocurrencies are now spoken of in the same breath as traditional assets from stocks and foreign exchange to bonds, its remains as volatile as ever.

Bitcoin hit an all-time high of $69,000 in November, before tumbling almost 30% in just 24 days.

(Reporting by Tom Wilson and Elizabeth Howcroft; Editing by Frank Jack Daniel)

By Medha Singh and Lisa Pauline Mattackal

(Reuters) – As a bleak first quarter draws to a close, crypto seems to have the wind in its sails. It has pushed through the $2 trillion barrier and is proving surprisingly resilient amid global chaos.

At Monday’s high of $47,765, market leader bitcoin broke above the narrow $34,000-$44,000 range it’s traded in for most of 2022. Through a steady grind higher from a low just above $40,000 on March 21, it has gained 18%.

Its comparative steadiness, versus previous performance at least, contrasts with stock markets, traditional currencies and even safe-haven gold, which have been shaken by the Russian invasion of Ukraine as well as the Federal Reserve’s tightening.

Bitcoin’s jumpiness has waned of late.

Its 30-day volatility is around 4%, about two-thirds the level it was in June 2021, according to futures trading platform Coinglass. The highest this year was 4.56% on March 16.

This measures its deviation from its own standard levels, and bitcoin has still had wild swings, such as a 17% jump on March 1. But it’s distinctly tamer than in 2021 when it could move as much as 40% in a day.

By comparison, the tech-heavy Nasdaq has whipsawed 5-6% on numerous days in 2022, and was down 20% for the year as of March 14, before it rallied to cut half that loss.

“The largest conflict we’ve seen in Europe since World War Two has really rocked global markets,” said Pierce Crosby, General Manager at charting platform TradingView in New York.

“What we have seen across other major assets is a huge fallout – from both the U.S. equity markets as well as global markets,” he added. “Bitcoin has more or less stayed in a pretty tight range … but actually, in terms of the relative strength, it’s very bullish.”

$2 TRILLION CRYPTO

The total value of the cryptocurrency market rose above $2 trillion on Friday, according to analytics platform CoinMarketCap. To put that in context, the market briefly hit $3 trillion on Nov. 10, when bitcoin reached $69,000.

The meandering climb back above $2 trillion has been slow and has also been helped by a mushrooming in coins and tokens – the number CoinMarketCap counts has risen by almost 5,000 since November to stand at 18,511 cryptocurrencies.

Bitcoin’s market capitalisation has reached $902 billion, but it still has a ways to go to reclaim the $1 trillion it commanded in November. While still the dominant crypto, its market share has also fallen gradually from as much as 70% of the total capitalisation in early 2021 to 42% now.

Graphic: Bitcoin dominance – https://fingfx.thomsonreuters.com/gfx/mkt/zjvqkaejkvx/Pasted%20image%201643630277294.png

WHAT LIES AHEAD?

Many a crypto investor has thought they could divine bitcoin’s direction before the fickle cryptocurrency left them sprawled in the financial dust.

“Although bitcoin is remaining strong in the short term, rising oil prices increase the likelihood of a recession over the coming year or so,” said Marcus Sotiriou, analyst at UK-based digital asset broker GlobalBlock.

“Oil has increased by around 25% in the past six days alone, and bitcoin bulls will want to see this tail off for continued strength.”

That said, certain other technical factors are pointing to bitcoin bullishness.

Funding rates, which measure the cost of holding bitcoin via futures, have turned marginally positive after being negative for most of this year, indicating investors are prepared to pay to be long. It stands at 0.003% on analytics platform CryptoQuant, though still below a peak of 0.06% hit in October.

Coinglass’s longs-to-shorts ratio has also climbed from 0.95 on March 20 to 1.1, the highest level in at least four weeks.

Blockchain data provider Chainalysis said an increasing proportion of bitcoin – nearly 60% of total supply – was being held for longer than 52 weeks, up from 54.72% in the last 25 weeks.

Yet Ashwath Balakrishnan, vice president of research at Delphi Digital in Bengaluru, cautioned that it was difficult to identify a lasting market direction.

“Everyone’s a little cautious,” he said. “If (bitcoin) rejects off of $46k and goes back down then it probably means we’re stuck with range-bound conditions for at least another month or so.”

(Reporting by Lisa Mattackal and Medha Singh in Bengaluru; Editing by Vidya Ranganathan and Pravin Char)

By Ceyda Caglayan, Saeed Azhar and Riham Alkousaa

ISTANBUL/DUBAI (Reuters) – Wealthy Russians are pouring money into real estate in Turkey and the United Arab Emirates, seeking a financial haven in the wake of Moscow’s invasion of Ukraine and Western sanctions, according to many property companies.

“We sell seven to eight units to Russians every day,” said Gul Gul, co-founder of the Golden Sign real estate company in Istanbul. “They buy in cash, they open bank accounts in Turkey or they bring gold.”

In Dubai, Thiago Caldas, CEO of the Modern Living property firm, has hired three Russian-speaking agents to meet Russian interest, which he says has leapt tenfold.

Sanctions imposed since the Feb. 24 invasion include Russia’s exclusion from the SWIFT banking system, and the targeting of individual such as oligarchs deemed to be close to President Vladimir Putin.

While Turkey and the UAE have criticised the Russian offensive, Ankara opposes non-U.N. sanctions on Russia and both countries have relatively good ties with Moscow and still operate direct flights, potentially offering routes out for Russians and their cash.

“They are wealthy Russians but not oligarchs,” said Gul of Golden Sign, one of a dozen real estate companies interviewed by Reuters. “They are finding ways to bring their money to Turkey.”

“There are customers buying three to five flats,” Gul added.

Russians have been big buyers of Turkish property for years, behind Iranians and Iraqis, yet the real estate players said there had been a spike in demand in recent weeks.

Though it’s still early days, industry figures bolster their accounts; In February, as troops massed on Ukraine’s border before advancing, Russians bought 509 houses in Turkey, nearly double the number they snapped up last year, according to the country’s statistics office.

That data was still before Western sanctions took hold, and real estate agents said they expected the numbers to grow further, driving up demand already primed by the world’s emergence from the COVID-19 pandemic.

Ibrahim Babacan, whose company in Istanbul builds and sells real estate mainly for foreign buyers in Turkey, said in the past many Russians had wanted to live in resorts such as the Mediterranean Antalya region. Now they were buying apartments in Istanbul to invest their money.

Reuters contacted some Russian homebuyers but they declined to give interviews due to the sensitivity of the situation.

THOUSANDS AND MILLIONS

Both Turkey and the United Arab Emirates offer residency incentives for property buyers. In Turkey foreigners who pay $250,000 for a property and keep it for three years can get a Turkish passport. For a slightly smaller sum Dubai, a major Middle East business hub, offers a three-year residency visa.

Apartments worth 750,000 dirhams ($205,000) – the threshold for visa entitlement – have seen the bulk of the demand but more expensive property on artificial islands such as Dubai’s glitzy Palm Jumeirah have been bought for up to 6 million dirhams, according to the real estate professionals.

“Investors are looking for both capital protection and the opportunity to receive a residential visa in the UAE for temporary relocation,” said Elena Milishenkova of real estate brokerage Tranio, based in Moscow and Berlin, which has a focus on Russian clients buying property overseas.

Her company received almost three times more requests for apartments in Dubai in the first three months of 2022 compared to the same period last year, she said.

Some companies say demand is even higher.

“Right at the beginning of the invasion of Ukraine, we launched a campaign in the region and the number of people who contacted us was … at least 10 times higher than usual,” said Caldas of Dubai’s Modern Living.

The CEO, who hired the Russian-speaking agents last week, said the really wealthy buyers appeared to have been making their preparations and shifted funds out of Russia even before the war broke out a month ago.

CASH AND CRYPTOCURRENCY

For Russians who have bank accounts in Dubai, the process is relatively simple, said Elena Timchenko of broker Royal Home Real Estate, which is based in the emirate.

Others have turned to friends or contacts for help, but for some, the challenge of getting the money together for a purchase has so far been too much, she added.

“The wish to buy in Dubai is one thing, the ability to do so is another,” she said, referring to the difficulties of bringing funds to the Gulf state.

Some newly arrived Russians in Turkey have struggled to make deposits and transfers at banks that are wary of contravening sanctions. Extra layers of compliance and exclusion from Visa and Mastercard add to the difficulty.

The UAE issued guidelines to banks last year to tighten procedures identifying suspicious transactions in an attempt to stem illicit financial flows. That did not stop the country, like Turkey, being added to a list of countries monitored by the FATF global financial crime watchdog.

A senior executive at an Emirati bank said the bank was making the same checks on customers as before, and had received no new guidance from the central bank.

In Istanbul, meanwhile, real estate builder and seller Babacan said that so far those Russian customers he dealt with were paying via banks without problems.

Caldas and Alex Cihanoglu, a realtor also based in Turkey’s largest city, said some Russians were using cash converted from cryptocurrency, now that sanctions had made financial transfers more complex.

“I would say most of the transactions that we’re seeing are in crypto,” Caldas added. “Crypto, especially for this market now, in the difficulties they’re facing, is the channel that is being used.”

(Additional reporting by Ceyda Caglayan and Jonathan Spicer in Istanbul, and Saeed Azhar, Riham Alkousaa, Lisa Barrington and Alexander Cornwell in Dubai; Writing by Ezgi Erkoyun and Dominic Evans; Editing by Pravin Char)