🤝El Salvador, Bitcoin & Big Tech,🌴Middle East's Crypto Oasis,📉Crypto Lows in Hong Kong

October 21, 2023

Your 5 minute emerging markets web3 weekly update

In This Issue

Latin America and the Caribbean
🔸El Salvador's VP on Bitcoin, Bonds, and Big Tech Collaborations
🔸Argentina's Likely Unstoppable Journey Towards Implementing a CBDC

Asia
🔸Crypto Oasis: Regulatory Clarity Driving Industry Growth in the Middle East
🔸Trust in Crypto Plummets in Hong Kong Post-JPEX Scandal: Survey

Africa
🔸VALR, Africa's Top Crypto Exchange, Partners with Visa
🔸Nigerian Web3 Fintech, Yuki, Accepted into Blockchain Founders Group's Accelerator Program

Eastern Europe
🔸From Offline Payments to Taxes: How Russia Plans to Implement the Digital Ruble
🔸Russia's Power Brokers Meet To Negotiate Differences on Crypto Mining Regulation

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Latin America and the Caribbean

Image Credit: Midjourney

El Salvador's economic recovery and strong bonds performance, with returns of 70% in 2023, have attracted Wall Street investors, and this success is attributed to the country's financial policies and its adoption of Bitcoin as legal tender. The country's Vice-president, Felix Ulloa, highlighted that the Bitcoin Law played a crucial role in positioning El Salvador as a global leader in the digital economy, attracting investors and over 80 Bitcoin-related companies to operate in the country. Additionally, El Salvador's focus on technology and heavy-handed security measures against gang violence has drawn the attention of major players like Google and Meta, which have plans to collaborate and operate within El Salvador.

The Central Bank of the Argentine Republic (BCRA) is actively working on a law for the proposed Central Bank Digital Currency (CBDC) put forth by the country's Minister of Economy and presidential candidate, Sergio Massa. According to Agustín D’Attellis, the director of BCRA, the development of this law is a crucial step in updating Argentina's monetary policy and he believes that embracing new technologies like blockchain and digital currencies is essential for addressing Argentina's ongoing economic challenges and expanding the tax base. The CBDC project, known as the Argentine Digital Peso, will be implemented in stages, starting with digitalization and the use of digital wallets, then developing the necessary infrastructure, and finally launching the CBDC to replace physical cash gradually.

Asia

Image Credit: Midjourney

The UAE, Dubai, and Bahrain continue their efforts to be crypto industry hotspots for businesses to operate from due to its progressive regulatory stance. Additionally, the Middle East and North Africa (MENA) region is the fastest-growing cryptocurrency market globally, as per research by Chainalysis. According to Alex Chehade, the head of Binance's local operations in Dubai, the region's regulatory certainty and clarity are attracting major cryptocurrency exchanges and startups. Regulators in these jurisdiction provide businesses with the certainty needed for long-term planning, making it easy for global companies to do business in the Middle East.

Attitudes toward cryptocurrencies in Hong Kong have deteriorated in the wake of the JPEX scandal, with 41% of respondents in a recent survey by the Hong Kong University of Science and Technology stating a preference not to hold virtual assets, marking a 12% increase from earlier this year. The survey also revealed that only 20% of respondents said they would consider holding virtual assets in the future, down 5% from earlier in the year. The fallout from the JPEX cryptocurrency platform scandal, which saw thousands of victims and resulted in the arrests of 28 individuals, poses challenges to Hong Kong's ambitions to develop virtual assets and become a global hub for the industry.

Africa

Image Credit: Midjourney

VALR, the largest crypto exchange in South Africa, has entered into a strategic partnership with VISA, the world's largest card network, to issue VISA cards and offer other digital payment solutions. The partnership follows VISA's efforts to promote digital currency adoption globally, with previous collaborations with Coinbase, Crypto[.]com, and Circle. VALR recently received approval to offer crypto services in Europe and is pursuing licenses in Dubai, Mauritius, and South Africa, making it Africa's top crypto exchange by trading volume, and it plans to launch perpetual futures products.

Nigerian Web3 fintech startup Yuki has been accepted into the Blockchain Founders Group Adrenaline Program, a 12-week accelerator designed to help blockchain startups scale rapidly by providing access to mentors and partners. During the program, Yuki will access up to €100,000 in funding, learn from experienced blockchain mentors, connect with investors and partners, and receive support for marketing and product development, with the goal of streamlining blockchain adoption in Africa. Yuki offers APIs that enable African fintechs and neobanks to easily create and offer unique crypto solutions, such as remittance services, stablecoins, and crypto trading.

Eastern Europe

Image Credit: Midjourney

The Bank of Russia is collaborating with the Ministry of Finance and the Treasury to determine the most effective methods for implementing the digital ruble, Russia's CBDC, focusing on enhancing its value-added features such as automatic payments, QR code-based payments, and enabling offline transactions. Discussions also revolve around the potential for government payments and tax transactions via the digital ruble. The mass introduction of the digital ruble is expected to commence around 2025, with active testing currently underway involving about 600 individuals and 30 legal entities in 11 cities in Russia.

Representatives from the Bank of Russia, the Ministry of Finance, the Ministry of Energy, the Ministry of Economic Development, the Federal Tax Service, the State Duma, and the Industrial Mining Association met in in Moscow to discuss the regulation of cryptocurrency mining and its circulation in Russia. The meeting aimed to consolidate the market's opinion and emphasize the importance of adopting legislation and regulation in this area. Two approaches were presented, with the Ministry of Finance proposing a comprehensive approach to regulation while the Bank of Russia focused on legalizing mining as a separate economic activity. Legislation on mining could be presented during the Duma's autumn session if a compromise is reached.

Thanks for reading and have a great week ahead!

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Written by Jon Lira. Connect with him on LinkedIn.

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