Blockchain Bites: China’s Miners, Africa’s Venmo and Cuba’s New Exchange

China’s rainy season reduces the costs of bitcoin mining but investors aren’t biting, Starbucks and McDonald’s will pilot the “digital yuan” and Openfinance is threatening to delist tokens on its platform.

Top Shelf

Miner Hardships

Spring usually draws in a crowd of miners and investors into the Bitcoin network, as China’s rainy season drives down the costs of hydropower making mining more profitable. However, bitcoin’s recent price drop, the cost of buying the latest mining rigs and the upcoming halving have collided and now, this season, miners aren’t investing.

Leaseback Rig

Private investment firm Arctos Capital has acquired $1 million in assets from Blockware Mining LLC, but will lease them back to the company so it can continue operating as usual. In what’s known as a leaseback transaction, Arctos will lease Bitmain Antminer hardware to the firm allowing the company to continue its mining and hosting operations.

China’s Pilot Chains

Starbucks and McDonald’s are reportedly among 19 restaurants and retail shops that will be involved in testing China’s central bank digital currency in the country’s Xiong’An district. The move signals China’s wider efforts to test out the digital currency project, with state-owned commercial banks already developing wallet applications for the digital yuan, also known as DC/EP.

Token Threat

Openfinance, a security token trading platform, is threatening to delist all tokens and suspend trading next month unless issuers cough up more funds to cover its costs. The company has not seen transaction activity on its platform grow quickly enough to cover operating costs, and is now raising fees to close its budget shortfall. 

Roadmap to Recovery

E. Glen Weyl, founder of the RadicalxChange Foundation and a researcher for Microsoft, collaborated with Harvard professor Danielle Allen and other experts to write a roadmap for reopening the economy. The “Roadmap to Pandemic Resilience” charts a course for scaling up testing, tracing and supported isolation in a way that protects health while preventing permanent injury to regular people’s livelihoods.

Loan Origination

Driven by coronavirus-led market speculation dYdX, a decentralized margin trading exchange, has lent $700 million worth of ether, dai, and USDC in February and March, bringing its 12 month originations past the $1 billion mark. “People like to trade (and especially trade with leverage) when there is volatility,” founder Antonio Juliano said.

Newspaper Provenance 

Italy’s largest news wire service is using an Ethereum-based registration system called “ANSAcheck” to combat fake news and copycats. The Agenzia Nazionale Stampa Associata (ANSA) newswire distributes 3,000 articles a day to 24 shareholder publishers and 87 news partners every day. 

Reversing Circulation

Digital dollars can reduce unemployment, Marcelo M. Prates, a lawyer at the Central Bank of Brazil, argues in a CoinDesk op-ed. He proposes a new form of monetary circulation, enabled by a central bank digital currency, that is issued by employers when paying wages and would reach the central bank only after circulating among persons and businesses. “The [MoneytothePeople] model directly tackles unemployment by granting the power to issue the new currency to public and private institutions responsible for paying wages,” he said.  

Refuting Research 

Researchers with the University of California Berkeley’s Haas Blockchain Initiative have found stablecoin issuances do not pump crypto markets, but instead serve as tools for investors to hedge their positions during periods of risk or price depreciation.This refutes claims of research published in 2018 that concluded stablecoin issuances, specifically lead by Tether and sister company Bitfinex, “are timed following market downturns and result in sizable increases in bitcoin prices.”

Crypto Culture

Prediction Provider

Data provider Nomics has launched a free price prediction service for cryptocurrencies. The 7-Day Asset Price Prediction feed will give an outlook on future crypto prices based on purpose-built algorithms, machine learning and data scraping from major exchanges. 

Venmo of Africa

Binance’s newly unveiled social payments app Bundle targeted towards the African market allows users to transfer cash, and buy, sell and store cryptocurrencies. (Forbes)

Crypto for Cuba

The Qbita Exchange, a decentralized Bitcoin exchange, has launched in Cuba, reports Decrypt. The app is mobile-friendly, features a built-in wallet and requires little bandwidth, meaning it might succeed where other exchanges have failed on the island nation beset by sanctions and poor internet service. (Decrypt)

Libra’s Timeline

The Libra Association’s recent decision to scale back its hopes of a fully decentralized global currency to meet the demands of hostile regulators and governments is just the latest turn in a two-year saga. CoinDesk has been tracking the project every step of the way and now provides the comprehensive timeline. “Bookmark this article, because we’ll keep updating it as the story continues to unfold,” writes CoinDesk’s dogged reporter and editor Nikhilesh De.

Paywall Provider, Popper

You can now get paid to use Zoom, thanks to a new Ethereum-based protocol called SmartSessions. Developed by 2key New Economics, the system generates a personalized Zoom link, sets up a paywall and allows people to enter the chat after an ETH payment. 

New Feature 

Securitize will now allow retail investors to buy and sell security tokens by clicking a web link. The “Instant Access” peer-to-peer trading feature runs on the Ethereum mainnet.

Market Intel

After swinging wildly for most of this year, the price of bitcoin is now back to roughly where it started 2020 – around $7,100. The flat year-to-date indicates the cryptocurrency is keeping pace with the U.S. currency, and even outperforming national currencies like the euro, British pound and Canadian dollar. This insight is from First Mover, CoinDesk’s daily markets newsletter. You can sign up here. 

Podcasts

History of Money

Luke Gromen, founder of Forest From The Trees, joins NLW on the latest episode of The Breakdown to discuss the history of money – from Bretton Woods to the rise of quantitative easing – and how it came to pass that the Federal Reserve is the only sugar daddy left.

Bitcoin in Africa

In the final episode Bitcoin in Africa series, we join Anita Posch as she travels to Botswana and speaks with Alakanani Itireleng on bitcoin’s present and potential future in the “original home of the honey badger.”

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