Gemini, the crypto exchange founded by the Winklevoss twins, plans to shut down all customer accounts in Canada by the end of 2024. In an email sent to Canadian users on September 30th, Gemini announced that all accounts would be closed by December 31st, urging users to withdraw their assets within 90 days.

New Regulations

Effective December 31st, 2024, Gemini will close all customer accounts in Canada with limited exceptions. This decision comes shortly after Canadian financial regulators implemented new regulations for crypto exchanges and trading platforms operating within the country.

On February 22nd, the Canadian Securities Administrators (CSA) released a notice mandating that all crypto asset trading platforms submit a legally binding pre-registration undertaking to continue their operations. Responses to these new regulations varied among major international crypto exchanges.

A Domino Effect

Gemini quickly complied with the aforementioned regulations, filing its pre-registration on April 13th. A spokesperson highlighted Canada as one of the most important and developed markets in North America, noting its significant role.

Many publications tried to reach out to Gemini for comments regarding the closure of Canadian accounts but did not receive a response. Other leading exchanges, including OKX, dYdX, Paxos, Bybit, and Binance, have also announced that they will be leaving the Canadian market. Stringent regulations are also nothing new, as was the case last year with the G-7 Summit.

As of September 27th, 2024, Shigeru Ishiba, a member of the Liberal Democratic Party, has been elected as the next Japanese Prime Minister. However, his previous role as defense minister and his preference for higher taxes and increased money supply may pose challenges for cryptocurrency supporters in the nation.

Infact, his stance on Bitcoin remains vague, and unlike his predecessor, Ishiba has not publicly engaged with crypto at major tech events, focusing instead on economic and defense issues. His past statements include harsh penalties for military draft evaders and strong advocacy for an Asian counterpart to NATO, along with a desire to amend the Japanese pacifist constitution due to perceived threats by North Korea.

Boosting The Military

Described as a Christian, military advocate, and banker, Ishiba is not what one might typically associate with a leader in a predominantly Shinto and Buddhist country that prides itself on pacifism. He will officially take over on October 1, following the recent vote, and his objectives are clear, namely to increase taxes on investments and income while boosting military capabilities.

The Japanese cryptocurrency landscape presents a mixed picture. While the foundational idea of Peer-to-Peer (P2P) electronic cash continues to thrive in various trading communities and local businesses, the government has faced significant criticism. This includes high taxes on crypto assets and a ban on privacy coins on exchanges. Nonetheless, trading on centralized platforms reportedly surged in 2024.

Amidst a changing economic environment, the Bank of Japan (BoJ) previously adjusted its longstanding monetary policy, indicating a possible departure compared to the prolonged era of an extremely accommodative monetary approach.

Growing Centralization

Ishiba has expressed intentions to enhance income and investment taxes but has assured that those investing through approved programs like NISA (Nippon Individual Savings Account) will be exempt. This program currently does not include cryptocurrencies, with the only exception being a select few ETF investments.

Despite his emphasis on tax reforms, Ishiba aligns with U.S. style economic policies, advocating for increased defense spending, higher minimum wages, and measures to combat deflation, which translates into aggressive monetary policies. While traditional fiat currency issues once led many to see crypto as a safe haven, the growing centralization of markets raises concerns among mainstream holders.

While militaristic policies might not seem directly connected to cryptocurrency, closer ties with U.S. military efforts and increased focus on global conflicts could have substantial implications for the crypto market in Japan.

Changpeng Zhao (CZ), the founder and former CEO of Binance, the largest cryptocurrency exchange in the world, recently shared his thoughts and future plans after completing a four-month prison sentence. Zhao expressed deep gratitude to his supporters who stood by him during difficult times before saying that there are always more opportunities ahead than there were in the past, conveying a hopeful outlook for the future.

Investing Long Term

CZ reaffirmed his commitment to blockchain technology and decentralization, describing himself as a long term investor focused on impact rather than just returns. He also indicated that Giggle Academy, a nonprofit online education platform, would be a key focus for him in the coming years, as he plans to devote more time to charitable initiatives and education.

In a recent tweet, he provided an update on his upcoming book, stating that he is about two-thirds done before jokingly remarking that writing a book is a lot more work than he initially expected. He also reflected on Binance and its performance, noting with satisfaction that the exchange has been thriving without him.

A Notable Development

The aforementioned remarks by CZ followed his release after serving time for anti-money laundering violations, stemming via a Department of Justice investigation into him and Binance. He paid a $50 million fine and resigned as CEO in November 2023, bringing the lengthy investigation to a close. The exchange faced $4.3 billion in penalties during this period.

His imprisonment made headlines, especially since he was one of the wealthiest individuals to serve time in a U.S. federal prison, ranked as the 34th richest person globally with a net worth over $40 billion at the time. As for the market, BNB, the native token of the Binance ecosystem, was trading at around $575, down nearly 4% in the last 24 hours, according to CoinGecko.

RD Technologies raised $7.80M in Pre-Series A funding with help by Solana Foundation. RD Technologies is a fintech company focused on facilitating payments and commerce with trust, stability, and efficiency.

Nodepay obtained an undisclosed amount with assistance by Animoca Brands. Nodepay is the network infrastructure that provides decentralized bandwidth for AI training. By connecting to the Nodepay Network, users can sell their unused internet to AI companies, enabling the efficient transfer of public training data, labelling, model sharing and remote distributed training.

MeshMap acquired secured $4M in Undisclosed funding with support by Andreessen Horowitz. MeshMap is a decentralized platform for creating and sharing 3D maps collaboratively. It leverages decentralized infrastructure to enable users to contribute, validate, and access highly detailed 3D maps without relying on centralized mapping services.

AminoChain secured $5M in Seed funding with help by Andreessen Horowitz. AminoChain is developing a Layer 2 blockchain protocol that connects enterprise medical institutions, enabling the creation of user-owned decentralized healthcare applications.

Mawari raised $10.80M in Strategic funding with assistance by 1kx. Mawari is a Solana-based DePIN (Decentralized Physical Infrastructure Network) project focused on scaling spatial computing.

EarthFast obtained $1.40M in Seed funding with support by Nascent. EarthFast is an infrastructure protocol that began as a community project in 2022 called Armada Network. It enables projects to build and host decentralized apps easily, providing a scalable, secure, and efficient alternative to traditional cloud platforms.

Infinex raised a whopping $65.29M in Undisclosed funding with help by Framework Ventures. Infinex is a decentralized perpetuals exchange created by the founder of Synthetix, Kain Warwick, aimed at providing a user experience similar to centralized exchanges.

Berkeley Compute Inc secured $5M in Pre-Seed funding with assistance by Chia Network. Berkeley Compute is developing a pooling protocol to scale GPU capacity for AI workloads through decentralized data center operators.

Helix Labs obtained $2M in Pre-Seed funding with support by Tribe Capital. Helix Labs is a protocol that enhances yield opportunities for non-ETH Layer 1 asset holders through restaking. It also supports an OmniVM rollup future via liquidity abstraction.

Zulu Network raised an undisclosed amount in Seed funding with help by Draper Dragon. Zulu Network is the first Bitcoin Layer 2 to achieve Bitcoin-level security using BitVM2, enabling developers to seamlessly deploy dApps on both EVM & UTXO layers. Zulu is also a recognized key contributor to BitVM, poised to launch the first trust-minimized Bitcoin bridge.

Bitcoin (BTC) responded positively to the recent US inflation report, rising above $66,500 for the first time in nearly two months before experiencing a slight pullback. In addition, several altcoins have seen significant gains recently, particularly within the meme coin sector.

Shiba Inu has stood out, gaining another 6% in the last 24 hours and nearing $0.000022 earlier today for the first time in over three months, marking a 42% rise for the week. PEPE has also made notable gains, climbing 6.5% since yesterday and 36% since last Saturday. Other meme coins like WIF, BONK, and FLOKI have also recorded significant increases.

BTC Hits $66.5K

The week began strongly for Bitcoin, which had already gained momentum following the US Federal Reserve deciding to finally cut interest rates on September 18th. The cryptocurrency was valued at $63,000 over the weekend and surpassed $64,500 on Monday.

However, it struggled to hold its ground initially, dipping again as bears took charge on Thursday, driving the price down to $62,700 (on Bitstamp). Despite this, the bullish trend resumed, culminating in a surge last night that pushed the asset to $66,500, a level not seen since August 1st, fueled by favorable inflation news.

While Bitcoin has since lost some momentum and is now just below $66,000, its market capitalization remains above $1.3 trillion on CoinGecko, with its dominance over altcoins slightly increasing to 53.8%. On the larger-cap altcoin front, Ripple and Toncoin are both showing positive daily movements, alongside BNB, ETH, DOGE, and TRX, albeit to a lesser extent.

Other Markets

In a bold move, Israel seized an opportunity to eliminate Hezbollah leader Hassan Nasrallah, escalating tensions in the region. This assassination has garnered support by the United States, with President Biden openly backing Israel. Meanwhile, the Australian Foreign Minister, Penny Wong, has called for an immediate cease-fire in Lebanon, highlighting growing international concern.

As both Israel and Hezbollah edge closer to an all-out conflict, economic factors also come into play. Federal Reserve Chair Jerome Powell recently held a press conference following a key rate decision, indicating that upcoming employment data will shed light on what kind of monetary policy the central bank decides upon. The September jobs report is expected to reflect a strong, yet moderating, labor market.

On another front, high-risk real estate bonds are outpacing returns from tech giants like Nvidia, while China has made a substantial pledge to address its ongoing property crisis. The global landscape remains volatile as these interconnected issues unfold.

The Kazakhstan Astana Financial Service Authority (AFSA) has issued a full license to crypto exchange Bybit, allowing it to operate within the country. This decision came shortly after AFSA provided the exchange with consent to full authorization on September 6th, positioning it as the first regulated Digital Asset Trading Facility (DATF) in the country.

Full Authorization In Kazakhstan
A press release dated September 27th indicated that the aforementioned full license establishes Bybit as a regulated market entity in Kazakhstan, representing a major step for the exchange and its global expansion strategy.

Bybit announced that the license enables its local entity to offer a wide array of crypto services, including a trading platform via the domain bybit.kz and investment management services as both an agent and a principal.

Set to launch in mid-October, this domain will also facilitate spot and derivatives trading, margin trading, and digital asset loan services for users in Kazakhstan and the wider Commonwealth of Independent States (CIS) region.

Renewed Enthusiasm

Bybit founder and CEO, Ben Zhou, expressed enthusiasm about this achievement, highlighting the exciting opportunity to tap into the vibrant Kazakhstani crypto market. With this full license, we are dedicated to delivering our advanced technology, security, and transparency to crypto traders in Kazakhstan, ensuring they have access to top-notch tools and services to excel in this rapidly evolving industry, Zhou commented.
The announcement also marks a significant milestone for Bybit, reinforcing its commitment to promoting growth and innovation in the global crypto landscape. Other exchanges, including Binance, are also planning to expand into Kazakhstan, having secured their own consent for full authorization on September 6th.

Robinhood and Revolut are reportedly exploring the possibility of entering the stablecoin market, aiming to challenge significant dominance held by Tether. Thus far, neither company has made any formal announcements, and no representatives have commented publicly.

The timing seems advantageous, as Robinhood and Revolut are not the only notable firms investigating stablecoins. On Thursday, Ethena Labs introduced a new stablecoin backed by the BlackRock USD Institutional Digital Liquidity Fund (BUIDL). This stablecoin aims to mirror the stability of traditional options by linking its value to BUIDL, which consists of US dollars, short-term US Treasury bills, and repurchase agreements.

Competition Heating Up

The interest in stablecoins is largely driven by the upcoming MiCA regulations in the EU, which will impose strict rules on this market. While Circle has the necessary licensing to operate in the EU, it has not posed a serious challenge to Tether in over two years. Should Tether fail to comply, the EU market would present a prime opportunity for new entrants, particularly for major players like Robinhood and Revolut.

Thomas Eichenberger, Chief Product Officer at Sygnum, remarked on the appeal of the business models seen with companies like Circle and Tether, suggesting many may seek to replicate their success. Bloomberg highlighted that Tether employed about 100 people while generating $5.2 billion in profit this year, making it a significant player in terms of assets under management.

Global Expansion

The stablecoin market is expanding globally, especially in emerging economies, where an increasing number of users are utilizing them for savings or everyday transactions. Their role in helping users navigate US sanctions has also drawn considerable interest.

Even before the specific opportunities presented by MiCA, investors have been keen to disrupt the duopoly held by Tether and Circle. PayPal introduced its own stablecoin last year with this aim and is nearing a valuation of $1 billion, though the total assets of Tether stand at nearly $120 billion. If the EU market becomes available for competition, numerous challengers are expected to emerge.

As of September 26th, Solana leads in positive net flows, surpassing all other chains with a total of $1.0 billion over the past three months. It recorded the third-highest inflow at $1.5 billion and the seventh-highest outflow at $458.5 million, resulting in an overall positive net flow.

Data aggregator Artemis.xyz indicates that while Solana excels in net flows, Ethereum has the worst performance, showing a negative net flow of $871 million. 

Peak Net Flow

While Solana has topped the net flows list on at least seven occasions in the last three months, the peak net flow of $655.1 million occurred on September 12th. The altcoin led the list three times in July, twice in August, and matched its August performance in September, breaking the billion-dollar threshold.

The data further reveals that despite leading in both inflows and outflows, Ethereum underperformed overall. Arbitrum, which also reached the top a few times in the past three months, ranked second worst with a net flow of -$492.7 million, placing second in inflows ($3 billion) and outflows ($3.5 billion).

Still Struggling

Charts by Artemis illustrate that Bitcoin (BTC) and Binance (BNB) also struggled in various metrics. Bitcoin ranked tenth in inflows with $96.7 million, while Binance followed closely at eleventh with $96 million. In terms of outflows, Bitcoin held the eleventh position at $208.5 million, with Binance at fourteenth with $77.2 million.

Despite this, Binance slightly outperformed Bitcoin in net flows, achieving a positive net flow of $18.7 million in ninth place compared to Bitcoin's negative net flow of -$111.8 million in tenth. Further analysis of Artemis data indicates that Bitcoin managed to reach the top position only once in the last three months, recording a second-highest positive net flow of $6.6 million on August 24th.

Authorities in Dagestan, a republic of Russia, are stepping up efforts to eliminate illegal underground cryptocurrency mining operations, attributing regional power outages and electricity theft to these activities. Amid ongoing electricity shortages, local officials are urging law enforcement to increase actions against these covert setups.

A Tricky Operation

Recent reports revealed the discovery of multiple hidden crypto mining facilities. The Dagestan Prime Minister, Abdulmuslim Abdulmuslimov, has called for stricter measures, highlighting that miners are constantly innovating ways to conceal their operations. During a recent meeting, he mentioned that several unregistered mining farms have been located in underground caverns, making them more challenging to identify.

Footage was shown of a clandestine operation in the Sergokalinsky district, where a small opening at ground level led to a cavern containing over 15 mining machines cooled by fans. Abdulmuslimov pointed out that this was just one of many similar sites, noting that miners are increasingly using mobile installations to facilitate relocation.

The Legal Way

To regulate the sector, Russia has recently legalized cryptocurrency mining. In August 2024, President Vladimir Putin enacted a law granting legal status to the industry, which will take effect on November 1st, 2024. This legislation allows registered companies and individuals to mine legally, granting exclusive rights to registered miners, while those below government-set energy consumption limits can mine without registration.

However, Dagestan remains a hotspot for illegal crypto mining, with ongoing crackdowns on electricity theft. Reports indicate a rise in police raids in the region since late 2023, and Dagestan is believed to have the highest incidence of electricity theft related to mining in the country. Authorities suspect that these operations are responsible for significant electrical issues, including a recent fire at a substation that left parts of the area without power for several days.

Visa has officially launched a new platform designed to help financial institutions issue fiat-backed tokens and explore their applications. This initiative aims to establish global standards that enhance collaboration among financial entities in the blockchain space.

Cuy Sheffield, the Head of Crypto for the company, noted the growing trend of tokenizing real assets, such as real estate and debt securities, which is driving the need to integrate money into blockchain platforms for trading.

Previously, the global payment giant joined forces with Transak, a Web3 infrastructure provider, to unveil a solution for cryptocurrency withdrawals and payments through Visa Direct.

Renewed Interest

Visa has been monitoring renewed interest by central banks in tokenization and its capacity to modernize financial systems. The company has already piloted projects with HSBC and Hang Seng Bank as part of the Digital Hong Kong Dollar initiative, and is involved in a pilot for the digital real with the Central Bank of Brazil.

Banco Bilbao Vizcaya Argentaria (BBVA) in Spain is actively engaged with the new Visa Tokenized Asset Platform (VTAP). The bank is testing the issuance, transfer, and redemption of a bank token on a trial blockchain, aiming to launch an initial pilot project with select customers in 2025 using the Ethereum blockchain.

Facilitating Real-Time Transfers

Among the various applications for banks is the ability to facilitate real-time money transfers between their clients. Catherine Gu, who leads CBDC and tokenized assets at Visa, pointed out that cross-border transactions are particularly significant for banks, especially for multinational corporations that require around-the-clock money movement.

Sheffield anticipates that engagement with tokenized real-world assets could significantly influence market demand. For instance, a bank might enable its customers to use a fiat-backed token to buy tokenized commodities or Treasury securities with immediate settlement.

In any case, through the Visa Tokenized Asset Platform, the payments giant aims to foster the development of standards that ensure interoperability among financial institutions.

U.S. Congressman Tom Emmer has directly criticized SEC Chair Gary Gensler, calling him the most destructive and lawless chair in the history of the regulatory agency. As the upcoming Presidential Election looms, Kamala Harris insists on keeping Gensler where he is whereas Donald Trump has explicitly stated he plans to fire Gensler immediately if he wins.

A Shaky Foundation

Emmer accused Gensler of inventing the term crypto asset security without providing any regulatory clarity, which has fueled enforcement efforts by the SEC against the crypto industry for three years. Last week, the SEC retracted the term in a court footnote.

Emmer also challenged Gensler on the mishandling of the Debt Box case, where the SEC sued a crypto startup for an alleged $50 million fraud, resulting in a dismissal and a $1.8 million fee against the SEC. Gensler admitted the case was poorly handled. Mark Cuban outright called Gensler a blight and that his departure will greatly contribute to local GDP growth.

Fighting Back

SEC Commissioner Hester Peirce also criticized the agency for taking too long to retract the aforementioned term, suggesting that it should have acknowledged earlier that crypto tokens are not securities. She indicated that while congressional input on definitions would be helpful, the SEC could have provided guidance itself.

Despite calls by 42 lawmakers to revoke the SEC Staff Accounting Bulletin No. 121, which requires companies holding crypto to list it as a liability, Gensler confirmed it would stay in place, arguing it helps companies understand risks. Rep. Wiley Nickel countered that this rule could hinder banks and their ability to custody crypto products, creating greater risk by shifting control to non-bank entities.

Riot Platforms has ended its attempt to acquire Bitfarms, settling instead for a 19.9% ownership stake as both companies redirect their focus to their own strategies following the agreement. This settlement, announced on September 23rd, 2024, means Riot will not pursue an immediate acquisition.

The Calm Before The Storm

As part of the deal, Riot has retracted its request for a special meeting of Bitfarms shareholders. In exchange, Bitfarms has implemented several board-level changes to support its ongoing strategic review. Notably, Amy Freedman has been appointed to the Board, taking over for Andrés Finkielsztain, who has resigned. Freedman, recognized for her expertise in corporate governance, will actively participate in the Bitfarms Governance and Nominating Committee and Compensation Committee, and may also join special committees of independent directors as needed.

The interest by Riot Platforms in Bitfarms has been closely watched since its unsolicited $950 million acquisition proposal in May, followed by increased share purchases. In response, Bitfarms adopted a shareholder rights plan, often referred to as a poison pill, on June 20th, preventing any entity, including Riot, when it came to acquiring over 15% of company shares before a specified deadline. This strategy was aimed at safeguarding shareholder interests while considering other potential strategic options like mergers or sales.

Wait And See

Concerns arose within Bitfarms regarding Riot, particularly among its Special Committee of Independent Directors. They contended that the ongoing share acquisitions could jeopardize the integrity of the strategic review process which Bitfarms had meticulously crafted, arguing that Riot was undervaluing the company. This led the committee to adopt defensive measures to protect shareholder value.

Although the settlement has taken place, Riot continues to hold a significant stake in Bitfarms and may reevaluate its position in the future. According to its early warning report, Riot could present new proposals based on how Bitfarms performs as well as broader market conditions. For the time being, both companies are concentrating on their respective strategies and have seemingly established a temporary truce.