5 Crypto Tales: Partnerships, Tax Proposals, and the Rise of Perpetual Futures [Advance Cash ]

5 Crypto Tales: Partnerships, Tax Proposals, And The Rise Of Perpetual Futures
5 Crypto Tales: Partnerships, Tax Proposals, And The Rise Of Perpetual Futures [Advance Cash ] 2

The news that Venmo is now accepting cryptocurrency transfers has been among the top crypto stories lately. Here are some of the other stories making headlines in crypto.

Paxos partners with Fierce Finance

Blockchain infrastructure platform Paxos has forged a partnership with financial services app, Fierce Finance. Paxos technology will be leveraged to power Fierce Finance's new digital asset experience. This new offering will combine an FDIC-insured checking account, a no-fee debit card, and fractional stocks, ETFs, and cryptocurrency exchanges in one app.

“We are the skilled custodian that handles licensing, trading and technical complexity so our customers can focus on creating a seamless user experience,” said Michael Coscetta, Paxos chief revenue officer. "By integrating with the Paxos platform, Fierce ensures its users get the best prices with the proper consumer protections in place so their assets always remain safe and accessible."

New York-based Paxos was founded in 2012. The company hit a milestone early last month when it surpassed ten million active end-user digital wallets globally. Earlier this year, Paxos launched an engineering R&D center in Israel focused on "excellence in security and cryptography". The center will serve as a hub for crypto researchers and security specialists to develop secure solutions on top of the blockchain.

Paxos has raised over $540 million in funding. The company's investors include Oak HC/FT, Declaration Partners and PayPal Ventures.

Proposed Cryptocurrency Mining Tax

If the Biden administration has its way, the electricity used in cryptocurrency mining could become much more expensive. The White House is proposing a 30% tax to offset the environmental impact of cryptocurrency mining.

A statement from the Council of Economic Advisers (CEA) claims that the “high energy consumption” of cryptocurrency mining “has negative impacts on the environment, quality of life and power grids” wherever they find themselves. A White House report released last fall suggested that cryptocurrency mining devours more electricity than the country of Australia. In the United States, cryptocurrency mining represents between 0.9% and 1.7% of all electricity consumption. The United States is home to around a third of global cryptocurrency mining.

Some critics of the proposal believe less in the administration's climate concerns than in its antipathy towards the cryptocurrency industry in general. Other observers suggest that taxing greenhouse gas emissions from cryptocurrency mining makes more sense than simply taxing the use of electricity – which can come from clean sources.

If passed, the tax could raise $3.5 billion over 10 years.

Coinbase launches international exchange

On the heels of obtaining a license to operate in US-based cryptocurrency exchange Bermuda Coinbase launched its Coinbase International Exchange. The new exchange will give institutional market participants in eligible jurisdictions outside the United States the ability to trade perpetual futures contracts.

Perpetual futures contracts are similar to futures contracts on other assets. But there are important differences. Perpetual futures contracts do not have an expiration period, unlike traditional futures contracts. This allows traders to hold their positions for longer periods of time, even indefinitely. Trading in perpetual futures contracts is not permitted in the United States. But the perpetual futures market is huge. Nearly 75% of cryptocurrency trading globally last year was in perpetual futures.

Coinbase International Exchange listed perpetual futures for Bitcoin (BTC) and Ethereum (ETH) this week. The contracts offer 5x leverage and all trades are settled in USDC.

New digital asset venture capital fund coming from Fineqia

Digital asset and fintech investment firm Fineqia will launch a new venture capital fund to invest in digital asset startups. The new fund, Fineqia Glass Slipper Ventures (FGSV), will focus on investing in early-stage and growth-stage technology companies. Among Fineqia's current investments in the industry are digital asset manager Wave Digital Assets LLDC and blockchain gaming platform company Forte Labs. The fund has identified blockchain infrastructure, decentralized finance and the metaverse as areas of particular focus for investments.

“We have a proven track record of investments that generate extraordinary returns,” said Bundeep Singh Rangar, CEO of Fineqia. "An investment fund will give us more firepower to invest in the most promising companies among the scores we see monthly and take advantage of entry valuations not frothy like they were 18 months ago."

Deloitte leverages Blockchain for KYB, KYC

Will the next big thing in decentralized finance come from the underlying blockchain technology or from products like cryptocurrencies? The latest entry in the "Innovative Blockchain Use Case" competition comes courtesy of Deloitte Consulting. The company announced that it has partnered with BOTLabs GmBh to use its KILT protocol to support KYC and KYB processes.

"By offering reusable digital credentials anchored on the KILT blockchain, Deloitte is transforming verification processes for individuals and entities," said Micha Bitterli, head of managed services at Deloitte. "Digital credentials that are convenient, cost-effective, and secure have the potential to open up new digital markets, from e-commerce and DeFi to gaming."

Reusable credentials are stored on the customer's wallet on their own device. Customers have complete control over who they share their credentials with. They can also control which credential data points they grant access to. Deloitte digitally signs credentials and is able to revoke credentials via blockchain if a client's circumstances change.