Crypto News: A Canadian Billionaire Loves Ethereum, Another Crypto Company Wants to Become a Bank and the US Government Is Stepping Its Game Up…
Another week and another couple of milestones reached for the crypto industry.
In this week’s edition of the Netcoins news roundup, we detail why Kevin O’Leary is excited about the Ethereum upgrade and reminisce about a certain publicly-traded company making a landmark large purchase of Bitcoin a year ago this week.
The biggest news by far surrounds President Joe Biden’s infrastructure bill, which sets out crypto regulations that are striking a bit of fear into every facet of the industry, but the long-term outcome of the bill may not be so bad.
All of that and more in this week’s edition of the news!
Canadian Entrepreneur Kevin O’Leary Loves the Ethereum Upgrade
Kevin O’Leary isn’t just a billionaire. He’s a reality TV personality and he invests in cryptocurrency. In a tweet published over the weekend, O’Leary talks about how much he loves the new Ethereum Improvement Proposals reshaping its blockchain.
He refers to EIP-1559 and EIP-3675, explaining how the first proposal will turn Ethereum into a deflationary asset because it burns transaction fees rather than rewarding them to miners. This will lower Ethereum’s supply. The latter proposal, as O’Leary explains in the tweet, will officially move Ethereum to a proof-of-stake consensus mechanism.
One of the most popular personalities on Canada’s Dragon’s Den, and America’s Shark Tank investing shows, O’Leary says that these changes will allow investors to view Ethereum through the same lens as evaluating a business and that Ethereum’s price-to-earnings ratio will work out to around 15 to 1, which although high is much better than the price-to-earnings ratios of most technology stocks.
Consider that Elon Musk’s most valuable company Tesla Motors has a price-to-earnings ratio of 370 to 1.
The Company Behind USDC Stablecoin Wants to Become a Bank
Circle is the private fintech company behind the U.S. Dollar Coin (USDC), a stablecoin pegged to the value of the American dollar. The company wants to become a chartered bank in a move that would align it with Paxos, a competitor with its own stablecoin that already has conditional approval from government regulators to go in the same direction.
Circle plans to go public and hit the stock market via a special purpose acquisition company later this year. Becoming a chartered bank on top of that would position it to become a huge crypto conglomerate alongside some of the biggest names in the industry.
This is definitely news worth tracking throughout the rest of the year.
Crypto Tax Regulations Stand Pat in U.S. Senate
On Tuesday, a landmark infrastructure bill presented by the Biden Administration gave a solid glimpse into cryptocurrency regulation in the United States. Bill H.R. 3684 states “any business effectuating transfers of digital assets on behalf of another person” will be considered a broker for the sake of IRS reporting.
What should concern those running businesses in the crypto industry is that the above languages are fairly broad meaning you could target more than just cryptocurrency exchanges. Miners, stakers, node operators, software developers, and broader money services businesses could all technically be at the mercy of said tax regulations.
The bill still has to pass through the House of Representatives, but it looks like it’s on its way there.
MicroStrategy Purchased Bitcoin One Year Ago This Week
Since buying Bitcoin one year ago, becoming the first American company to make a big institutional crypto purchase, publicly-traded technology consulting firm MicroStrategy has made 14 separate purchases of Bitcoin.
A year later the company owns 0.56% of the total circulating supply. More importantly, CEO Michael Saylor became one of the biggest evangelists for bitcoin. He’s also helping educate other companies on how to make large purchases of Bitcoin to store and company cash reserves.
That’s it for this week’s edition of Netcoins news. Sign up for a free account today and make purchases without paying any fees on the most trusted cryptocurrency exchange in Canada.
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Written by: Jack Choros
Writer, content marketing at Netcoins.