The statistics indicate a growing interest in cryptocurrencies among investors and users worldwide. Let's take a look at several intriguing coin projects that are capturing attention.
Which coins are worth paying attention to right now?
One of such projects is Ethereum 2.0, which aims to transition to the Proof of Stake (PoS) consensus. This promises higher efficiency and reduced energy consumption, marking a significant step towards the sustainability of the cryptocurrency industry. Additionally, Cardano (ADA) continues to evolve as a smart contract platform with a focus on security and stability. Its developers are actively working on improving the blockchain and expanding the application ecosystem. Solana (SOL) is also of interest, known for its high throughput and low transaction fees. Projects built on this platform benefit from its speed and scalability.
Also of interest are Polkadot (DOT) and Cosmos (ATOM): Polka Dot provides infrastructure for creating custom blockchains and bridges between them. This project can enhance blockchain interoperability. Cosmos also focuses on solving blockchain interoperability issues, allowing them to interact with each other. Polygon (MATIC) provides scalability and enhanced development capabilities on the Ethereum network.
Despite the economic crisis and the lack of significant inflows into the crypto market, it's worth noting NFT projects: The non-fungible token (NFT) market continues to grow. Projects like Flow (FLOW), Enjin (ENJ), and Decentraland (MANA) offer innovative solutions in this space.
Certainly, the most promising cryptocurrency for investments in 2023 remains Bitcoin. Since we've mentioned the most prominent coin in the crypto market, let's talk about Bitcoin.
What's happening with Bitcoin right now?
Bitcoin's mining difficulty has once again reached a historic high. Following the latest adjustment, the mining difficulty of the leading cryptocurrency increased by 5.48%, reaching a new all-time high at 57.12 T. The average hash rate for the period since the last adjustment was 423.22 EH/s. The block time interval stood at 9.5 minutes. According to Glassnode, on September 17, the smoothed 7-day moving average reached its peak at 423.4 EH/s but then corrected to 422.2 EH/s.
On Monday, September 18, Bitcoin's market dominance returned to levels above 50%. For over two years, this metric fluctuated within the range of 39–49%. At the end of June, dominance surged to a 26-month high of 52% after asset management giant BlackRock applied to the SEC to launch a spot ETF based on digital gold. Following BlackRock, similar requests were made by Valkyrie, Fidelity Investments, WisdomTree, and Invesco.
The potential approval of Bitcoin exchange-traded funds (ETFs) has raised hopes among market participants for a substantial influx of capital into the leading cryptocurrency. Another favorable factor for Bitcoin is the proposed listing rules for crypto exchanges by the New York Department of Financial Services. The changes introduce stricter standards for asset listings, with no regulatory obstacles envisaged for digital gold. On September 18th, the price of Bitcoin surpassed the $27,000 mark.
Robert Kiyosaki, the bestselling author of "Rich Dad, Poor Dad" and an entrepreneur, recommended investing in gold, silver, and Bitcoin before the collapse of the U.S. economy. In August, the investor suggested that if a global economic collapse were to occur, the price of the leading cryptocurrency would reach $1 million. In February, he mentioned a lower figure of $500,000. This is not the first time the entrepreneur has advocated for alternative investments. In September 2022, he predicted the "greatest crash in history" and considered cryptocurrencies a hedge against it. In October, he recommended buying Bitcoin amid the rising Federal Reserve interest rates. In March 2023, Kiyosaki advised buying digital gold and precious metals ahead of an "emergency landing" amid issues with American banks. He reiterated his recommendations in April and May. In the fall of 2021, he predicted a "giant stock market crash in October" and a decline in Bitcoin. Due to its volatility, the cryptocurrency market constantly generates a lot of debate and criticism.
SEC Chairman warns of cryptocurrency's harm to the economy
Gensler also criticized celebrity endorsements and efforts to establish regulatory frameworks in certain U.S. states. The official added that separate rules for cryptocurrencies in the country are unnecessary since they already exist. "They're called Congress-passed laws, whether it's in the anti-money laundering and sanctions space or in the securities and commodity exchange space," Gensler said.
The head of the commission also confirmed that most cryptocurrencies are considered securities and fall under the agency's jurisdiction. In his view, the vast majority of digital assets meet the definition of investment contracts and should be regulated accordingly. In July of this year, Gensler requested additional funding of $109 million to strengthen investor protection in the cryptocurrency market.
In August, U.S. House Representative Warren Davidson once again called for Gary Gensler's removal from the position of SEC chairman due to the unsuccessful proceedings against Grayscale. What happened? During protracted debates, Grayscale's lawyers pointed out the SEC's inconsistent approach to crypto investment products and asked the regulator to "expeditiously" approve a spot Bitcoin ETF. Grayscale Investments also applied for the launch of a future ETF on Ethereum. Grayscale Investments submitted a proposal to the SEC for the launch of an exchange-traded fund based on futures contracts on Ethereum traded on the CME. The submission falls under the Securities Act of 1933, which regulates commodity and spot Bitcoin ETFs.
Ripple, the SEC, and the United States
Brad Garlinghouse, the CEO of Ripple, considers the United States to be one of the "worst places" to launch cryptocurrency projects. He made this statement during the Token 2049 conference in Singapore.
He believes that Singapore, the United Kingdom, the UAE, and Switzerland are jurisdictions with "smart" policies for regulating digital assets. He recommended that the United States adopt this trend, which simultaneously encourages innovation and protects consumers. Ripple's CEO placed the blame for the current situation on the United States Securities and Exchange Commission (SEC). He stated that the agency has been waging a "political war" with the industry through numerous lawsuits.
"You can see the dynamics. In the past, many judges said that the SEC was always right and did not fight against it. But now the picture is changing," stated Garlinghouse.
The SEC and Ripple have been engaged in a legal battle since 2020. The agency accused the company of conducting an unregistered sale of securities in the form of XRP totaling $1.3 billion. Brad Garlinghouse and Chris Larsen, the co-founders of the firm, were also named as defendants in the lawsuit. In July 2023, the Southern District of New York concluded that the token's software sales and other distributions did not constitute offers and sales of investment contracts. Following this, the SEC filed an appeal.
Ripple's CEO added that the partial victory of his company and the decision regarding Grayscale's Bitcoin ETF provide more regulatory clarity to crypto exchanges and custodial providers in the United States. In September, the SEC appealed the blocking of Ripple's partial non-recognition of XRP as a security by a judge's decision.
XRP (Ripple) also appears to be an interesting investment project.
Is cryptocurrency regulation a problem or necessity?
Regulating the cryptocurrency industry will continue to be a pivotal issue in the near future. Different countries may implement their own rules and policies, which can influence the use of cryptocurrencies and investments. Regulators will seek to strike a balance between protecting investors and fostering innovation.
When considering cryptocurrency regulation in a specific context, attention should be paid to the following aspects:
- Licensing and registration: some countries require cryptocurrency companies to obtain licenses or register with regulatory authorities.
- Taxes: developing a tax policy regarding cryptocurrencies can be a complex issue. Taxes may be imposed on cryptocurrency transactions, investment profits, or mining.
- Investor protection: regulators aim to provide investor protection against fraud and adverse situations in the cryptocurrency market.
- KYC and AML: many countries are implementing Know Your Customer (KYC) rules and anti-money laundering (AML) measures for cryptocurrency companies to prevent illegal activities.
- Bans or restrictions: some countries may impose bans on cryptocurrencies or restrictions on their use.
- Digital national currencies: some countries are considering the issuance of digital national currencies (CBDCs), which can also impact cryptocurrency regulation.
Nevertheless, cryptocurrency regulation is essentially on pause and continues to be a subject of disagreement. Cryptocurrency regulation can vary significantly from one country to another, and it is important to monitor changes in legislation and policies in your region to understand how they may affect your financial transactions and cryptocurrency investments. Ukraine is one of the largest countries in terms of cryptocurrency investments.
A pre-trial investigation has been initiated against participants in the cryptocurrency market in Ukraine
The Bureau of Economic Security of Ukraine (BEB) will inspect Bitcoin exchanges whose owners and founders are residents of Ukraine, as reported by the new head of the agency, Andriy Pashchuk. In August, BEB estimated that Ukraine's budget had lost at least 3 billion hryvnias (approximately $81 million) in taxes from the activities of local cryptocurrency exchanges over the past ten years.
Earlier, the National Bank of Ukraine (NBU) requested financial reports from banks in Ukraine regarding their interactions with several cryptocurrency companies and non-banking payment services. It is worth noting that the law "On Virtual Assets," adopted in September 2021, will not come into effect until changes are made to Ukraine's tax code. Due to the lack of a regulatory framework, cryptocurrency exchanges do not currently pay taxes in Ukraine. In early June, the National Commission on Securities and the Stock Market (NKTSBFR) presented a relevant legislative proposal, suggesting a tax rate of 18%.
As you may have noticed, cryptocurrency market regulation varies from one country to another, and in some places, it is non-existent. The regulation of the crypto industry remains an open question. Despite periodic volatility, the cryptocurrency market will continue to be an interesting and promising field for research and investment in 2024. With increasing awareness and regulation, one can expect a more stable and mature cryptocurrency industry.