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Lira Woes Makes Crypto The Great Mitigator

Published

2 years ago

September 6, 2022

Notwithstanding the Ukraine war, 2022 will most likely go down in history as the year of inflation. Following decades of sub-5% inflation in the United States and the European Union, prices have risen by around 9% in both areas, driven predominantly by supply shocks to energy and food (not to mention quantitative easing).

But as bad as 9% is for economies that have enjoyed 2% inflation or lower for many years, it’s still not as bad as the inflation wreaking havoc on the Turkish economy.

Newly published official figures put year-on-year inflation in Turkey at 80%, while unofficial measures suggest real inflation topped 140% as far back as April.

Such eye-watering figures have hit Turkish residents hard, yet many have found one fairly novel means of lessening the impact of inflation: cryptocurrency.

Yes, while Turkey’s reputation as an undemocratic nation might imply that crypto isn’t welcome in the Eurasian nation, it boasts one of the highest cryptocurrency ownership rates in the world, showing that bitcoin is used for more than just risky speculation.

Double-Digit Inflation = Cryptocurrency Adoption?

Turkey’s official consumer prices index rose by 80.2% year-on-year in August, up from an already high 79.6% in July. This represents the first time official inflation has passed 80% since 1998, and it also represents the highest rate recorded during President Recep Tayyip Erdoğan’s nearly 20-year rulership.

In Turkey’s case, loose monetary policy is generally blamed for rampant inflation, with Erdoğan refusing to raise interest rates to a level where they would potentially suppress price rises.

That said, the government is claiming that inflation will begin falling towards the end of the year.

“In the months ahead, we will witness inflation losing speed even more,” Nureddin Nebati, the country’s finance minister, wrote on Twitter. “We will drive high inflation out of these lands, never to return again.”

Regardless of what will happen in the future, inflation is already biting ordinary Turks now, and has been doing so for several years.

This is evident in its data for cryptocurrency ownership, with figures presented by Statista showing that 20% of the population owned or had owned crypto in 2019, rising to 25% in 2021.

What’s interesting about global cryptocurrency ownership data is that it highlights how such ownership is generally highest in nations facing similar stresses as Turkey.

That is, inflation drives people towards bitcoin and other cryptocurrencies as a means of preserving (or increasing) whatever modest wealth they have.

Accordingly, Turkey has one of the most thriving cryptocurrency markets in the world, even though the government has sought to restrict it in various ways in recent months (so far unsuccessfully).

Possibly one of the clearest signs of how busy the Turkish crypto market is came in December 2021, when data from Chainalysis and Kaiko revealed that the nation’s borders were clocking around one million cryptocurrency transactions per day.

Where Turkey and Cryptocurrency Will Go From Here

Meanwhile, people on the ground confirm that they’ve invested in bitcoin and other cryptocurrencies precisely because of the Turkish lira’s woes.

“If my savings are in lira, they are losing value,” said Izzet Emre Ari, a twenty-something computer engineer who spoke to Reuters in 2021.

Such is the momentum behind cryptocurrency trading in Turkey that some observers within the country have talked of a process of ‘cryptolization,’ as the local population shifts to crypto as a means of preserving wealth.

“In the past it was dollarization, meaning in order to avoid fluctuations in their currency people kept their assets in dollars,” said Turan Sert, an adviser to the Paribu exchange in Turkey, who spoke to Al Jazeera in January. “Now the recent trend is being called cryptolization.”

Even more recently, industry figures in Turkey suggest that 2022’s bear market hasn’t done too much to dampen the enthusiasm of Turks for crypto.

This is because, even though BTC has fallen by 71% since an all-time high of USD 69,000 in November, the Turkish lira has fallen even harder.

“The trading volume [in the cryptocurrency market] is high in Turkey, the demand is high, because we are looking to protect our money from high inflation and high interest rates.

There are 5.5-6 million Turks who hold a cryptocurrency account in the country and if you include family members, this is something that interests around 10-12 million people” said consultant and author Vedat Guven, who was interviewed by German state-owned news broadcaster DW in May.

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SNP treasurer didn’t know about motorhome

Published

2 years ago

April 25, 2023

The SNP’s former treasurer has said he did not know that the party had bought a luxury motorhome.

Colin Beattie, who was in the role for a total of nearly 20 years, was asked by journalists whether he knew about and had signed off the purchase.

He replied: “No, I didn’t know about that”.

Mr Beattie quit as treasurer the day after he was arrested by police as part of an ongoing investigation into the party’s finances.

He was subsequently released without charge pending further investigation.

The Niesmann and Bischoff vehicle, which can retail for more than £100,000, was seized by police from outside the home of former SNP chief executive Peter Murrell’s mother in Dunfermline.

The motorhome was removed on 5 April – the same morning that Mr Murrell became the first senior party figure to be arrested in the probe.

Mr Murrell, who is married to Nicola Sturgeon, was also released without charge pending further inquiry, with officers spending two days searching the couple’s home in Glasgow. The SNP’s headquarters in Edinburgh were also searched.

Newspaper reports quoted neighbours as saying the motorhome had sat on the driveway of the house since January 2021.

Mr Beattie was not SNP treasurer at the time, having lost an internal vote to Douglas Chapman the previous November after 16 years in the role.

He was reappointed when Mr Chapman quit in May 2021 after saying he had “not received the support or financial information” that was needed to carry out his duties as treasurer.

The Daily Record said it had been told by party sources that the motorhome was bought as a potential “battle bus” ahead of the last Scottish Parliament election in May of that year but was never used.

The party had generally hired vehicles to use during previous election campaigns.

Humza Yousaf, who succeeded Ms Sturgeon as SNP leader and first minister last month, has previously said he only learned about the motorhome after he won the leadership contest and saw a police warrant that gave details of items officers wanted to confiscate.

Mr Beattie served as the SNP’s treasurer for 16 years before being defeated in an internal election by Douglas Chapman in 2020, but returned to the role when Mr Chapman resigned a year later.

Speaking to journalists as he returned to the Scottish Parliament for the first time since his arrest, Mr Beattie said the SNP was not in danger of going bust.

The MSP for Midlothian North and Musselburgh said: “The SNP is in the black. We’re a going concern, definitely.”

The leader of the SNP’s Westminster group, Stephen Flynn, said on Monday that it could miss out on £1.2m in public funds if it fails to file its accounts by the 31 May deadline.

The party is having problems finding new auditors after the previous company resigned in September – although Mr Yousaf has said he did not find out the firm had quit until after he became party leader.

Senior figures in the Westminster group are said to be at loggerheads after former leader Ian Blackford accused his successor Mr Flynn of giving him false assurances about the group’s auditors.

Mr Blackford told the BBC he had been told by Mr Flynn in a phone call on 7 April that the group had an auditor in place, but a senior SNP source disputed his version of events.

‘No assurances’

The source said a discussion had taken place “but no assurances were provided that this would be certain and would meet deadlines”.

The BBC is unable to verify which account is accurate.

The party has still not found an auditor and senior figures have admitted that meeting the 31 May deadline will be “challenging”.

Mr Yousaf is due to speak with SNP MPs on Tuesday afternoon as part of a visit to London that saw the new first minister meet Prime Minister Rishi Sunak the previous evening.

Police Scotland launched its Operation Branchform investigation in July 2021 after receiving complaints about how more than £600,000 of donations raised by activists for a future independence referendum campaign were spent.

Questions were raised after accounts showed the SNP had just under £97,000 in the bank at the end of 2019, and total net assets of about £272,000.

Last year it emerged that Peter Murrell gave a loan of more than £100,000 to the SNP to help it out with a “cash flow” issue after the last election.

The party had repaid about half of the loan by November of that year, but Mr Yousaf admitted last week that the party still owed money to Mr Murrell.

Reports /TrainViral/

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Andre Cronje Outlines 2023 Plans For Fantom

Published

2 years ago

December 27, 2022

Andre Cronje outlined the plans of Fantom going in 2023.

Andre Cronje took to Medium to outline plans for Fantom’s development in the next quarters.

As the next step in a successful career at Yearn.finance and other ecosystems, Andre Cronje has stepped up as a board member of both Fantom Operations Ltd and Fantom Foundation Ltd.

Bear Markets Are Not An Issue

The move was announced on Cronje’s personal medium blog, along with an update on what’s in store for the Fantom network.

For starters, the newly instated board member stressed that Fantom is unaffected by the issues that have been plaguing the crypto market for the past year. In fact, fantom was founded during similar circumstances and, according to Cronje, knows how to weather the storm.

“Bull markets are when we are rewarded for the work we put in during the bear market. Those that hunker down keep building, keep growing, keep improving – they are the ones that reap the rewards of the bull. We were born in a bear market. This is a time we are used to, and a time we are well suited for.”

Cronje also states that the team at Fantom focuses on creating tools for developers and do not plan to get distracted by gamefi, collapsing exchanges, NFTs, and the like. Instead, the Fantom team will continue doing its best to provide crypto devs with all the tools they need to see their own visions to completion.

Gas, Virtual Machines, And More

Over the course of the next few quarters, Fantom will focus on quality-of-life updates targeting gas fees.

Among the planned updates is gas monetization, which will allow revenue share for dapps based on gas used. This feature aims to mirror the way content creators are paid on platforms like Twitch while rewarding sustainable blockchain development. Fantom is also working on gas subsidies, which would allow dapps to interact with wallets without the wallet needing to pay for gas fees, if the developer chooses to allow this.

Fantom has also proposed a new funding scheme for dapp developers, which will target dapp devs that are already self-sufficient but could use a boost nonetheless.

Work on the Fantom Virtual Machine will also continue chugging along. At the moment, EVMs are considered one of the primary bottlenecks for the Fantom ecosystem – a problem the team wants to remedy as soon as possible.

The blog post ends with a promise of further updates around the end of Q1, primarily targeting updates to Fantoms’ marketing and business development departments.

Reports /TrainViral/

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Crypto Solutions and Tradable Wrapped Assets

Published

2 years ago

September 23, 2022

A new recording has emerged of Celsius Network Co-founder Nuke Goldstein discussing the plan to use “crypto-based solutions” to repay its Earn customers and revive the company’s fortunes.

Crypto Lender to Create CEL-Wrapped Tokens That Could Be Traded on Uniswap

In the recording, sent anonymously to crypto YouTuber Tiffany Fong, Goldstein outlines Celsius Network’s proposed recovery plan in greater depth. The plan was hinted at in another leaked recording of a Celsius All Hands Meeting, where company CEO Alex Mashinsky and Chief Compliance Officer Oren Blonstein spoke about “unprecedented and really innovative solutions” to honour creditor claims.

According to Goldstein, Celsius intends to first simplify its coin holdings by consolidating its remaining funds consisting of more than 50 different cryptocurrencies into Bitcoin (BTC), Ether (ETH), and USD Coin (USDC). After the consolidation, Celsius will create a “wrapped claims token” to be known as Celsius X (Cx). The wrapped token will represent the ratio between the amount Celsius owes its creditors and the amount the company actually has on hand.

Celsius customers will then be able to redeem the wrapped tokens for a specific ratio. Conversely, they can keep their Cx tokens on the Celsius platform and wait for a larger payout when revenue starts streaming in from the company’s bitcoin-mining operations and other potentially lucrative opportunities in the broader crypto market.

Additionally, Goldstein claimed that Celsius customers would also be able to trade the wrapped tokens on decentralized exchanges such as Uniswap, where market forces would determine their value.

Plan Could Allow Customers to Speculate on Celsius’s Future

Tiffany Fong indicated that she received the Goldstein recording before the All Hands Meeting on September 8. According to her estimation, the price of the proposed Cx tokens will probably not be pegged 1:1 to the value of the original cryptocurrency in the same way assets like Wrapped BTC (wBTC) are pegged 1:1 to Bitcoin.

She explained this would be primarily because of the deficit in the Celsius balance sheet, which, according to the crypto lender’s latest Coin Report, stands at $2.5 billion.

While there is a risk of Cx prices tumbling in the event of mass sell-offs, the recovery plan allows customers to speculate on the crypto company’s long-term future.

Is Celsius Copying the Bitfinex Playbook?

Many Celsius customers have likened the proposed recovery plan to what Bitfinex did after losing 12,000 BTC in a 2016 hack. In the Bitfinex recovery solution, the crypto exchange opted to issue BFX tokens representing the value of the lost BTC. The idea was to buy back the BFX tokens from Bitfinex customers at $1.00 per token. Conversely, customers could receive a percentage of shares in Bitfinex, allowing them to speculate on the exchange’s eventual recovery.

It is said that within half a year, the recovery plan enabled Bitfinex customers to make back 75 to 100% of their funds. However, Bitfinex’s repayments were greatly aided by the recovery of about $3.6 billion in BTC from hackers responsible for the attack.

Celsius has no such luxury to fall back on. Instead, it will rely on revenue from BTC mining and transaction fees from its proposed rebranding as a crypto custodian to cover the deficit in its books.

Celsius’s Unsecured Creditors Committee (UCC) has acknowledged meeting with CEO Alex Mashinsky, who presented a proposal to them. However, the Committee has yet to publicly give its opinion on the proposal, instead urging the crypto lender to file the whole plan with the bankruptcy court.