Replies to post #15669 on Bitcoin (BTCUSD)

[Investors3]

Iran Ditches the Rial Amid Hyperinflation as LocalBitcoins Seem to Trade Near $35K

Iran’s parliament votes to institute a new currency as coronavirus and sanctions hyperinflate the rial and local Bitcoin prices skyrocket relative to official exchanges.

https://ih.advfn.com/stock-market/COIN/BTCUSD/crypto-news/82370739/iran-ditches-the-rial-amid-hyperinflation-as-local

Iran Ditches the Rial Amid Hyperinflation as LocalBitcoins Seem to Trade Near $35K
KOLLEN POST

https://cointelegraph.com/news/iran-ditches-the-rial-amid-hyperinflation-as-localbitcoins-seem-to-trade-near-35k


Iran’s parliament votes to institute a new currency as coronavirus and sanctions hyperinflate the rial and local Bitcoin prices skyrocket relative to official exchanges.

Per a May 4 report from local outlet Mehr News, Iran’s new ‘Reforming Monetary and Banking Law’ has passed in parliament. The new law dictates the transition from rial to the toman — valued at 10,000 rials — within the next two years.

Hyperinflation and the BTC connection in Iran

Back in 2018, Iranian authorities set an official exchange rate at some 42,000 rial to the dollar. Many currency exchanges still show this as the going rate. At the same time, peer-to-peer Bitcoin exchange LocalBitcoins is seeing prices of 1,445,658,900 rials per BTC — according to the official exchange rate, roughly $34,500.

It is, however, not the time to start selling BTC in Iran. Despite official proclamations, the rial has taken a beating alongside the Iranian economy.

According to Radio Free Europe, black market trading had the U.S. dollar selling for 156,000 rials. The toman would cut four zeroes off of current rates, but may well run into the same problems that have stymied the rial.

Years of hyperinflation in Iran

United States sanctions following President Trump’s 2018 withdrawal from a 2015 nuclear deal initially set in motion years of hyperinflation and economic woes.

More recently, Iran’s struggle to contain the coronavirus and the collapse of the price of oil have compounded existing problems.

Cointelegraph has previously reported on the increasing value of crypto to Iranians. Other countries facing hyperinflation have used crypto to combat slipping values — most recently, Venezuela saw a new BTC-backed synthetic dollar.

[Investors3]

Kazakhstan Sets Eyes on Top-3 Spot for Global Bitcoin Mining
STEPHEN O'NEAL
17 HOURS AGO

The post-Soviet country’s cheap electricity has been attracting Bitcoin miners, but will it manage to elbow out Russia and the United States?

https://cointelegraph.com/news/kazakhstan-sets-eyes-on-top-3-spot-for-global-bitcoin-mining

Kazakhstan is becoming an important destination for Bitcoin (BTC) miners seeking cheap electricity in the post-halving market driven by thinner margins. According to recent reports, the oil-rich Central Asian country expects the total amount of money invested in local crypto mining operations to double by the end of 2020 and attract $738 million over the next three years.

Unlike other countries in Central Asia, the Kazakh government has de facto legalized crypto mining, which makes the market more attractive for both local and foreign players. So, could this vast semidesert land become the new go-to spot for BTC miners?

From blanket crypto ban to legalization

The Kazakh government has adopted an overall friendly approach to crypto recently, although there is still little regulatory clarity on the subject. However, positive developments were preceded by regulatory turbulence, and at some point, its central bank went as far as to suggest a blanket ban on cryptocurrencies.

In early 2018, the chairman of the National Bank of Kazakhstan, Daniyar Akishev, declared that his agency was considering outlawing all cryptocurrencies. Just a few months later, Kazakhstan’s president, Nursultan Nazarbayev, called for global cooperation in crypto regulation but did not mention whether this regulation should encourage the sector’s growth or its containment.

Previously in 2017, Kazakhstan’s government-supported Astana International Finance Center signed a deal with Malta-based firm Exante to develop the Kazakh digital asset market, while the central bank announced it was considering using blockchain to sell short-term debt notes to investors.

Things started to look more concrete and positive for local crypto miners in 2019. In December of last year, local media reported that Kazakhstan’s lawmakers wouldn’t be taxing cryptocurrency mining until the mined assets are exchanged for fiat money, as crypto mining would not be treated as an entrepreneurial activity but rather a “purely technological process.”

A recent bill, which was approved by the Kazakh Senate and signed into law by Nazarbayev earlier in June, essentially legalizes mining, saying that people involved in digital mining are obliged to inform the authorities about their activities. It also stresses that miners are the legal owners of the digital assets they produce.

Didar Bekbauov, founder of crypto mining marketplace Xive — a local company providing hosting services for large-scale international miners — and who previously worked at Hive Mining, told Cointelegraph that the current regulation is not strict, but stressed that the framework hasn’t been finalized yet: “The bill says miners need to report to [the] government about their activities. But nobody still knows how it will be in practice. Other than that no regulations.”

Cheap electricity attracts foreign players

According to Bekbauov, the main mining players in Kazakhstan are foreign companies from China, Japan and “other Asian countries.” There is also Genesis Mining, an international cloud mining company with farms located across several countries, and Bitfury, another non-Chinese mining powerhouse headquartered in Amsterdam.

“They are miners with experience, some private funds, private investors,” Bekbauov said of the companies mining away in Kazakhstan. The Xive founder added that around 90% of their mining activities are performed on the Bitcoin blockchain, and he said that the arrival of foreign companies doesn’t make it harder for local mom-and-pop mining operations, as Kazakhstan “still has excess electricity generation.”

Therefore, the main attraction for miners is not the regulatory framework, which still remains ambiguous despite some positive developments, but rather the abnormally cheap electricity rates. As of December 2019, the price of electricity in Kazakhstan was $0.041 per kilowatt-hour for households and $0.049 for businesses. For comparison, the average electricity price in the United States is $0.14, although some states such as Texas seem to be offering competitive prices under certain conditions.

The price of electricity has always been one of the main factors when it comes to cryptocurrency mining, but it has become even more important after the Bitcoin halving took place back in May. The halved reward prompted miners to either sell their equipment or relocate to regions with cheaper electricity such as Kazakhstan, Russia, the Middle East and South America.

Along with the abundance of cheap electricity, Kazakhstan’s geographical position also makes it “a fast-growing hotbed for Bitcoin mining action,” according to Thomas Heller, global business director of F2Pool, who also told Cointelegraph:

“Kazakhstan is located in an optimal location for mining. The climate is cool, and is in close proximity to China. It’s becoming a popular location for Chinese miners to move old-gen machines from China to Kazakhstan to take advantage of cheaper electricity prices outside of the Sichuan Hydro Season.”

Bekbauov said that most local mining operations are located in regions with high electricity generation — such as Ekibastuz, Karagandy, Pavlodar and Taraz — while the country has an overall good climate for crypto mining throughout most of the year. Dmitrii Ushakov, chief commercial officer of BitRiver — a major co-location services provider for Bitcoin mining in the Commonwealth of Independent States region — confirmed that the cheap electricity prices in Kazakhstan are luring investors in, telling Cointelegraph: “Miners can currently find very attractive electricity prices for mining in Kazakhstan and some other former Soviet countries. This is the main reason for the current interest in mining in Kazakhstan.”

However, Ushakov added that there are “no natural prerequisites for cheap electricity in the country,” as it is mainly produced by coal-fired power plants. He elaborated, expanding on some other drawbacks of Kazakhstan-based mining, namely an overall unstable situation in the region and inadequate safety of local mining farms:

“This is risky because the markets and other factors affecting the price of such electricity within a nation can change quickly. Another aspect that should be considered here is the safety of these mining sites, which are often set up in a very short time by using pre-existing infrastructure that is old and unreliable.”

Will Kazakhstan become a top-three mining destination?

Last month, Kazakhstan’s minister of digital development, innovation and aerospace industry, Askar Zhumagaliyev, announced that the department is planning to attract 300 billion tenge, or $738 million, worth of investments by 2023 for activities related to cryptocurrency mining.

Kazakhstan’s ambitious mining plans might seem staggering at first, but the country has some statistics to back them up. According to Zhumagaliyev, there are currently 14 cryptocurrency mining farms that have already brought in approximately $201.7 million of investments combined.

Further, the Bitcoin Mining Map designed by the Cambridge Center for Alternative Finance at the Judge Business School of the University of Cambridge shows that the countries in the CIS region combined comprise the fourth largest region for crypto mining globally. In the second quarter of 2020, mining in Kazakhstan has reportedly made up about 6.17% of the average monthly Bitcoin hash rate, which is only slightly behind Russia (6.9%) and the United States (7.24%), while China remains the undisputed king (over 65%). Alejandro De La Torre, vice president of mining pool Poolin, agreed that under certain conditions, Kazakhstan could become third in the near future:

“With the abundance of cheap electrical prices, mild temperatures and the governments ’hands-off’ approach to mining, I do indeed foresee Kazakhstan becoming a top-3 crypto mining destination.”

Other experts are more skeptical. BitRiver’s Ushakov argued that although low electricity prices are a solid advantage for Kazakhstan in the mining race, the region itself isn’t stable enough to witness significant growth:

“Although low electricity prices make Kazakhstan a hot destination to mine, we believe that China, Russia and the USA will continue to be the top-3 mining destinations in the world because of increasing investments in mining, predictable energy policies and a more stable political as well as economic environment for mining.”

Kristy-Leigh Minehan, a mining consultant and former chief technology officer of Core Scientific, told Cointelegraph that she does not expect Kazakhstan to become a top-three destination anytime soon due to an apparent lack of interest from institutional players: “Bitcoin mining is becoming the destination of institutional investment that seeks an alternate asset base; many are still very shy with regards to Kazakhstan’s politics.”

[Investors3]

Bitfury's US Bitcoin mining subsidiary to go public via $2B SPAC merger
OSATO AVAN-NOMAYO
4 HOURS AGO

Bitcoin mining firms, even the newly-established ones, seem to be increasingly pursuing public listings.

Cipher Mining Technologies Inc. a subsidiary of blockchain development firm Bitfury has inked a $2 billion merger deal with Nasdaq-listed Good Works Acquisition Corp — a special purpose acquisition company, or SPAC. Both companies have entered into a business combination agreement.

According to a press release issued on Friday the merger will see Bitfury’s U.S. Bitcoin (BTC) mining enterprise become a publicly-listed company under the banner Cipher Mining Inc.

In addition to the combined $2 billion valuation for Cipher, investors like Morgan Stanley-backed Counterpoint Group and Fidelity Management and Research company will also lead a $425 million funding round.

This additional cash influx will proceed via a private investment in public equity, or PIPE, funding round. Bitfury will also provide a $50 million investment-in-kind to add to the $170 million left over from the October 2020 Good Works initial public offering, thus setting the combined company’s gross cash holdings at $595 million.

Commenting on the merger, Cipher Mining CEO Tyler Page remarked that the deal was a significant step in the emergence of properly capitalized Bitcoin mining enterprises, adding:

“With this transaction, we will be able to combine the formidable skill sets and technologies developed by Bitfury Group over the past 10 years with what we believe will be a leadership position on the global cost curve, and thereby create a true leader in the Bitcoin mining industry.”

With the merger expected to close in Q2 2021, Cipher is looking to achieve a 745 megawatts mining capacity by end of 2025. The company says it hopes to cross the 445 MW milestone between the end of 2021 and Q2 2022.

Cipher is the latest Bitcoin mining establishment to pursue a public listing albeit via a merger with a SPAC entity. As previously reported by Cointelegraph, Australian green energy Bitcoin mining outfit Iris Energy is set for a $39 million IPO in the summer.

With designs towards 745 MW in mining capacity, Cipher is also the latest example of the expanding Bitcoin mining outlay in North America. While China still dominates the BTC hash rate distribution, firms in the U.S. and Canada are reportedly increasing their inventory in the quest to dilute China’s control of the Bitcoin mining arena.

Meanwhile, Chinese miners are coming under significant regulatory pressure from municipal authorities. Earlier in March, reports emerged of crypto miners planning to exit Inner Mongolia amid energy consumption concerns.

https://cointelegraph.com/news/bitfury-s-us-bitcoin-mining-subsidiary-to-go-public-via-2b-spac-merger

[Investors3]

LARGEST CANADIAN BITCOIN ETF OPENS TO MUTUAL FUND INVESTORS
Purpose Investments, an institutional firm with more than $12 billion under management, on Wednesday announced the launch of mutual fund units for the world’s first ETF backed and settled by Bitcoin.
ALEX MCSHANE

Purpose Investments, an institutional firm with more than $12 billion under management, on Wednesday announced the launch of mutual fund units for the world’s first ETF backed and settled by Bitcoin.

“We’re happy to provide another easy and secure way for Canadian investors to gain exposure to Bitcoin,” said CEO and founder Som Seif. Mutual funds that allow investors exposure to Bitcoin have risen in demand by investors worldwide this year.

The Purpose Bitcoin ETF invests directly in Bitcoin allowing investors efficient exposure to Bitcoin without the associated risk and burden of self-custody.

The Purpose Bitcoin ETF aims to accurately reflect the price of Bitcoin, meaning its units may be purchased or redeemed at net asset value per unit of the applicable class without premiums or discounts, which might otherwise be associated with listed Bitcoin securities like Grayscale.

The Purpose Bitcoin Fund currently has $1.2 billion in assets under management, consisting of 21,688.950498 Bitcoin. All three of the offerings are backed by at least 0.0001 Bitcoin per share, with a current net asset value of between $10 and $12.

There are currently between 5,000 and 7,000 available shares per Bitcoin in the funds.

In the US, the SEC has yet to approve a Bitcoin or Bitcoin futures backed ETF, despite many filings and a rise in demand this year. An ETF in the US would open the floodgates to new institutional investors that cannot or will not otherwise get any Bitcoin price exposure.

https://bitcoinmagazine.com/culture/largest-canadian-bitcoin-etf-opens-to-mutual-fund-investors