Do you know your crypto mining rig from your hash rate? Don't worry, this article will explain some crucial cryptocurrency mining terms you should know. 

It's perhaps an oversimplified definition, but using power-intensive computer systems to create [Bitcoin](/coins/btc) and verify transactions on the blockchain is a concept known as cryptocurrency mining.

As these mining operations become outlawed in certain countries, others are embracing the activity. Either way, cryptocurrency mining is a concept that every digital investor should at least understand to an extent. This article helps you achieve that.

A closer look reveals that cryptocurrency mining is a competition or race of sorts between miners. These miners build "rigs" from computer hardware that perform mathematical calculations for the cryptocurrency network to confirm transactions and increase security. The miners who are successful at solving these math problems first are rewarded with a new amount of cryptocurrency and they can also collect transaction fees for the transactions they confirm.   

The most common terms associated with cryptocurrency mining activities are listed below:

## Crypto Mining Rig

A crypto mining rig is a collection of physical hardware components assembled to perform the computational processes of the mining operations. Core component(s) include:

Central Processing Unit (CPU) – Once a crucial component for solving the complex calculations required in crypto-mining, the evolution of mining has made the CPU essentially a thing of the past.

Graphical Processing Unit (GPU) – In charge of the digital rendering in a mining system and much more useful in mining than the old CPU because of their speed and efficiency.

Field Programmable Gate Array (FPGA) - Unlike other architectures, FPGAs have the versatility of being programmable, giving miners the flexibility to alter their programming to improve their functionality.

Application-Specific Integrated Circuit (ASIC) – A hardware component designed exclusively for cryptocurrency mining, whereas CPUs and GPUs have other purposes in many industries. ASIC is expensive and very complex, but more efficient at mining.

### Hash Rate

Cryptocurrency miners are tasked with producing a 64-digit hexadecimal number called a hash. Hash rate is the term given to the calculating power of a device measured in hashes per second. Each hash rate is a created block that is tested against the network.

The hash rate is of utmost importance to crypto-miners because of the competition with "fellow" miners. Each miner wants their rig to be the first to generate a valid hash. To do so, their rigs need to solve those incredibly complex mathematical puzzles as rapidly as they can.

### Proof-of-Work

Cryptocurrencies evolved out of a desire to exchange currency without a financial “overseer” being involved - Better known as decentralisation. Proof-of-Work (PoW) makes this possible because it is one method of absolutely confirming cryptocurrency transactions. How? Proof-of-work adds a new block of transactions to a cryptocurrency's existing blockchain. Crypto miners compete to add these new blocks to the blockchain successfully, and the winner reaps the rewards of newly minted cryptocurrency and transaction fees.

## Is Cryptocurrency Mining Legal?

Much about the cryptocurrency market, in general, remains unregulated; cryptocurrency mining is no exception. Therefore, its legality is mostly opaque to much of society, including the crypto-miners.

For the most part, crypto miners are considered money transmitters. That means that crypto-miners operate under the jurisdiction of the rules governing those kinds of transactions in whatever country the miner decides to build their rig(s). For example, cryptocurrency mining is considered a business in Israel. It is therefore subject to corporate income tax in that country. Despite cryptocurrency mining being around for over a decade, there is still a great deal of regulatory work to be done in most countries.

For now, geography seems to be the determining factor in the legality of mining. Russia and China have [banned cryptocurrency mining](https://cryptonews.com/guides/countries-in-which-bitcoin-is-banned-or-legal.htm), but the U.S. and Canada appear to be embracing mining efforts in their territories.

## Conclusion

Not all cryptocurrency investors are encouraged to get into mining - it is not an easy way to make money, and it is a huge liability to the environment because of the inordinate amount of energy crypto rigs consume. Politically speaking, mining is expected to become a strategy of many countries which see a future in cryptocurrencies. Countries willingly putting up barriers to the widespread adoption of cryptocurrencies in their territory will be sabotaging their own innovation engine.



Crypto Mining Rig and Hash Rate: Know Your Crypto

Bitcoin holders woke up with a severe case of digital cold turkey less than 24 hours after Thanksgiving. The price of the number one digital asset slipped by 2.85% to $55,493 at time of writing.

While this pull-back is nothing compared to recent drawdowns it has left many Bitcoin holders frustrated with the lack of positive price action in recent weeks. Many altcoins have witnessed astronomical gains while Bitcoin has stuck range bound between $56k and $58k for what seems like an eternity.

Yesterday’s push to $59,500 led many to believe that it was Bitcoin’s time to take centre stage once again with $58,000 looking like it offered solid support. However, as in previous years immediately following Thanksgiving, Bitcoin holders woke up this morning to the grim reality of yet more negative price action.

## Inflation concerns

All this being said, the broader stage continues to be set for Bitcoin to bloom. As more and more international governments begin to realise the value of digital currencies and the benefits they bring, legislation for the integration of cryptocurrency into everyday society is beginning to take shape.

Furthermore, with rising inflation across the globe the need for a stable hedge has never been greater. With gold prices stagnating in recent years the lure of a digital alternative makes Bitcoin a very attractive proposition indeed.

## Bitcoin eclipses [Paypal](https://www.paypal.com/us/home) with sights set on Visa

In yet another cause for crypto celebration the value transferred over the Bitcoin network has exceeded that of Paypal by more than 60%. Recent figures from Blockdata show that the Bitcoin network processed over $489 billion per quarter in 2021 compared with Paypal’s $302 billion. And now many crypto speculators are starting to believe that the next milestones to fall will be those of Mastercard and Visa.

To date, Bitcoin is processing just under 27% of Mastercard’s $1.8 trillion and around 15% of Visa’s mighty £3.2 trillion each quarter. If Bitcoin were to continue along its current trajectory of growth it could outpace the total capital transferred by Mastercard as early as 2026.

## Clinton calls for clarity

Former United States Secretary of State Hillary Clinton stepped into the crypto debate this week with calls for stronger regulation in order to prevent market manipulation by Russia, China and ‘others’.

As part of a larger debate on social media manipulation Clinton warned of ‘technology of all kinds’ which has the potential to destabilise countries and the world reserve currency status of the dollar.

Clinton said: ‘There is one thing on the horizon which people are beginning to pay attention to and that is the need to regulate the cryptocurrency market. Imagine the combination of social media amassing even larger sums of money through the control of certain cryptocurrency chains.’

Her comments come as many countries begin to understand the notion of using digital currencies to circumnavigate financial sanctions put in place by the leading nations and [SWIFT](https://www.swift.com/) (the Society for Worldwide Interbank Financial Telecommunication) - the world’s current leading system of transferring capital worldwide.

Bitcoin Holders Frustration as Price Down

NFL player, Odell Beckham Jr, will be receiving his salary in Bitcoin (BTC) as he has entered into a partnership with [Cash App](https://cash.app/).

Beckham Jr. is a wide receiver for the Los Angeles Rams and reportedly currently earns a $4.25 million salary, which will now be converted into the digital asset.

## 'The Future Has Arrived'

"We're proud to be the first major sports team to embrace Bitcoin –The future has arrived." – Sterling Scott, founder of Cash App.

The partnership has been agreed upon by Cash App's owner, Square which will be paying Beckham Jr. his salary via the service. The app allows users to buy and store Bitcoin amongst other digital currencies.

## Swamped With Deals

Beckham Jr.'s announcement of the deal was made on social media using the Cash App where he also discussed how he was interested in the new technology, but he claimed that he had been swamped with "contracts and endorsement deals" which meant he could not pursue his interest in cryptocurrency until now.

The NFL star and receiver, Odell Beckham jr, said: "It's a NEW ERA & to kick that off I'm hyped to announce that I'm taking my new salary in bitcoin," on Twitter.

The football player also revealed he had invested a small amount of his own money into [Bitcoin](/coins/btc) earlier this year. 



NFL Star Odell Beckham Jr to Receive Salary in Bitcoin

Crypto investors need to be aware of how a new US law impacts on the sector.

The $1.2 trillion infrastructure bill, recently signed by President Joe Biden, captured a lot of headlines, but not everyone noticed the measures aimed at crypto investors and exchanges.

Under the legislation ‘brokers’ (aka cryptocurrency exchanges) will have to issue a 1099-B. That means crypto exchanges will have to tell the IRS directly about crypto transactions.

Experts believe this will create tax reporting challenges for many crypto investors. For example, traders who use their own crypto wallet may find the information handed to the IRS contains inaccuracies. This is because the exchange’s reporting on trading activity will only have a limited view of what investors paid for crypto in the first place.

## What should crypto investors do?

If you want to stay on the right side of the law, and you should, then there are two major factors to consider.

Firstly, keep track of what you originally paid for your crypto, and keep it as accurate as possible, so you can reconcile your records with what the exchanges report to the IRS.

Secondly, consider finding a tax professional with crypto knowledge. This could help ensure even greater accuracy and assist you in being as transparent as possible about what cryptocurrency you hold and what you paid for it.

The IRS already considered cryptocurrency taxable property, this new reporting requirement makes it even more important for crypto investors to ensure they report activity accurately and completely.

The massive drop in value of Bitcoin and Ethereum in the hours after Biden signed the bill into law recovered slightly by mid-week.

It is thought the fall in value is more likely to relate to the general volatility of crypto rather than the new US law.

More [Business news](/news/category/crypto-business-news).

US Infrastructure Bill: Impact on Crypto

The crypto bull market seems to have stumbled this week? Why?

Earlier this week, the CEO of AMC Theatres, the largest movie theatre chain on the planet, said his company would begin accepting shiba inu coins as payment through Bitpay wallets. This could happen in 60 days.

While a positive news story, it did nothing to prevent the crypto bull market from cratering out over the past 24 hours after a seemingly parabolic rise.

Two of the market’s titans, [Bitcoin](/coins/btc) and[ Ethereum](/coins/eth), led the decline, exhibiting sharp drop-offs in value after setting new all-time highs last week.

## Bitcoin Value Falls

Bitcoin’s value fell below $58,000 on Thursday - a sharp contrast to the digital asset’s achievement the week prior when the price shot up to over $68,000 for the first time.

Some are quick to associate the recent decline in cryptocurrencies with President Biden’s signature on a new $1.2 trillion infrastructure bill, which includes specific language on the tax reporting requirements for cryptocurrency exchanges.

The news that some of the proposed legislation may treat _stablecoin issuers_ like banks didn’t sit well with investors. Still, there are investors that have developed a bit of an appreciation for these ‘corrections’ considering how it aligns with their investment strategy of ‘buying the dip’.

But not all of us are willing to adopt this strategy, and a harsh dip can chase off new investors. Sometimes, permanently.

## Is the Crypto Market Immature?

Consider for a moment that market volatility like we’ve seen in the last day or two can be directly linked to the crypto market’s immaturity. Cryptocurrencies, by and large, have yet to achieve a state of ‘mainstream adoption’, meaning many, _many_ traditional investors are still watching from the sidelines.

Volatility, from a crypto bull market to a bear market, has come to be expected. When a celebrity tweet can send a particular coin upwards of 10% or more, it’s a sign of a market still evolving.

Another bit of news that may have triggered the _flight_ mechanism among some investors had to do with Chinese regulators intensifying their efforts to ferret out those in the country still involved in Bitcoin mining activities, something the Chinese government outlawed earlier this year.

America’s infrastructure bill and China’s clamp down on mining activities both had an obvious impact on Bitcoin. As the key digital asset used in assessing the health of the entire cryptocurrency sector, both announcements had a negative impact that rippled across the entire market.

## Mainstream Adoption of Crypto

Still, there were signs this week that cryptocurrencies will continue making their push towards mainstream adoption.

The Los Angeles sports arena, home of the NBA’s Lakers and Clippers, will be renamed from the “Staples Center,” the formal name of the 20,000- seat arena since 1999, and become the “Crypto.com Arena” in a $700 million deal for the naming rights.

As a result, Crypto.com’s digital coin, CRO, was buoyed to an all-time high of $0.593 on Thursday after the company won the naming rights.

Lastly, the crypto ‘brain trust’ anticipates that more digital coins will become an accepted form of payment for many more vendors in 2022. AMC has jumped on the bandwagon, McDonald’s and Burger King are in the conversation, even charities are embracing cryptocurrencies as more and more investors take their positions in the market.

As this trend evolves, the value of cryptos will likely increase and the market will continue to evolve, not retract.

Infrastructure Bill ~ Crypto Bull Market Stumbles

Blockchain and cryptocurrency market technology should be taught in schools, according to the incoming New York mayor.

The comments come just days after New York Mayor-elect Eric Adams said he wanted to receive his first three wage packets in Bitcoin (BTC).

His latest comments, during an interview with [CNN](https://edition.cnn.com/), reinforced his stance on cryptocurrency technology, with Adams suggesting schools should be teaching crypto.

## 'The New Way of Thinking'

He said: ‘We must open our schools to teach the technology, to teach this new way of thinking.’

Adams described cryptocurrency as ‘a new way of paying for goods and services throughout the entire globe’ as he urged schools to prepare students for the ‘new way of thinking’ created by by blockchain technology and digital assets.

In part, his call for crypto education was prompted by his experience with young New Yorkers. He told CNN: ‘When I talked about blockchain and Bitcoin, young people on the street stopped and asked me “What is that?”.’

## New York Should Remain a Centre of Innovation

The comments by Adams received a mixed reaction on social media, with some saying cryptocurrency technology ‘must’ become part of school curricula and others arguing schools should remain focused on teaching core subjects and the basic concepts of finance first.

During the interview, Adams suggested he will encourage businesses in New York to accept cryptocurrencies as payment. While he insisted such a move would be taken carefully to ‘get it right’, Adams insisted it was necessary to ensure New York remains a ‘center of innovation, no matter what that innovation is’.

If the school plan suggested by Adams was implemented, New York wouldn’t be the first US city to do so.

Earlier this year, a bill was passed by the Georgia House of Representatives which called for state education officials to implement in high schools a financial literacy programme which would include crypto.


Teach Global Blockchain Technology in Schools: NY Mayor

Let’s talk Ripple and XRP.

Earlier this week, the overall market cap of cryptocurrencies hit $3.3 trillion. It’s an amount that merits attention and has further prompted regulators and financial authorities to accelerate the tempo in writing a regulatory rulebook for the market.

However, first they’ll need to cut through their own confusion on how these financial instruments work.

Can _all_ digital assets be categorised as a form of currency or are some them _securities_ masquerading as currencies? It’s one question among many that regulators are asking.

## Ripple Labs

One blockchain company that knows this all too well is San Francisco’s Ripple. A fintech company that popped up a decade ago, Ripple Labs originally promoted a strategy that would offer financial institutions a new low-cost method of performing expedient trans-border money transfers.

To achieve as much, Ripple Labs built the technical infrastructure on which transactions sped across the globe in the form of a cryptocurrency identified as XRP. Ripple created 100 billion units of XRP in 2012 and allotments were sold off while Ripple remained a majority holder.

This is where Ripple found itself in trouble with the Securities and Exchange Commission (SEC). Because of the way in which XRP was distributed, it appeared, to some, that XRP functioned _more like a stock or security_ rather than a currency. By December 2020, SEC chairman, Gary Gensler, had seen enough and initiated a lawsuit against Ripple Labs for how the company distributed XRP, claiming the company was selling an unregistered security, _not_ a currency.

## Lawsuit Causes Anxiety Among XRP Supporters

The pending case initiated a sequence of negative events that cratered the price of XRP and got the asset delisted from many popular crypto exchanges, the most crippling being Coinbase. The lawsuit has continued to drag on causing anxiety among XRP supporters and investor, and many legal experts have said that the lawsuit is unlikely to have an ending this year.

However, Ripple has demonstrated some legal prowess since the lawsuit was filed, accruing small victories in the proceedings while simultaneously attracting troves of new investors who have faith in a favourable outcome. Frankly, at the current rate of mainstream adoption, a settlement deal could be reached at any time and November 2021 is expected to be particularly revealing in terms of what’s next for the lawsuit.

Today will be a crucial as it marks the deadline for the exchange of _Expert Rebuttal Reports,_ an expert analysis of each opposing party’s claims. Once those reports are submitted, the second half of November should be rife with opinions on where the lawsuit is headed and when it might finally get resolved.

Getting down to brass tacks, it seems that Ripple has the momentum and SEC Chair Gary Gensler can’t be pleased with how things have unfolded with his lawsuit. The inability to close a ‘slam dunk’ case against a gritty crypto start-up hardly has any place on a resume for someone who’s vying to be the next Secretary of the Treasury. Will Gensler broker a settlement deal with Ripple? It’s possible.

If so, not only would it be a move that would put XRP right back on the exchanges that delisted it, including Coinbase, it would be a ‘drinks for everyone’ kind of announcement that would send the whole market upward.

More [Coin news](/news/category/crypto-coin-news).

Ripple, XRP Latest News- The SEC Lawsuit

Claims by Craig Wright that he is the true creator of Bitcoin could be settled in court, in what commentators are calling the ‘trial of the century’.

The identity of Bitcoin’s creator Satoshi Nakamoto remains the crypto industry’s biggest secret, there is one person who claims he is the founder of the world’s first digital decentralised currency.

Australian computer scientist Craig Wright has stood by the claim since 2016 and a court in Miami is set to determine, once and for all, if Wright did indeed have some part in the development of Bitcoin.

Of course, access to 1.1 million Bitcoin in a locked wallet has nothing to do with the settling of the case, but is a strong reason to determine the facts.

The case centres around whether Craig Wright acted alone or with a now deceased partner in setting up and developing the Bitcoin source code. A jury of 10 have three weeks to listen to evidence and determine the facts of the case.

Craig Wright’s claim for sole ownership and development of the Bitcoin source code centres around his autism and the lack of a written agreement between himself and the other party, the now deceased David Kleiman.

One of the easiest ways to determine the author of the original source code and resulting locked Bitcoin wallet is to find out who can access the original funds. However, to date no one has been able to conclusively prove they own or can access the keys to open up the wallet.

## The $69 Billion Question

With the current price of Bitcoin floating around $63,500 determining the custody of 1.1 million, Bitcoin has serious ramifications. Should the case settle in anyone’s favour, the locked Bitcoin may become released and immediately placed for sale on the open market.

The impact of $69 billion worth of Bitcoin entering the market would send huge shock waves through the industry and have a serious effect on the price and stability of the world’s number one digital currency. The case continues.

## Bitcoin Price Explosion

A huge price surge saw Bitcoin explode more than $1,500 in a matter of minutes on Tuesday morning surpassing the highest price within a week.

Bitcoin Price Explosion came after days of sideways action and little volatility however many industry experts were expecting the price move.

This positive move adds to the bullish feel that has accompanied Bitcoin throughout October and most of 2021 with many investors seeking to jump on board the cryptocurrency express. Another bullish indicator saw the Relative Strength Index (RSI) move into 70 which typically indicates an asset is in high demand. 

Craig Wright Bitcoin Trial: Trial of the Century?

Burger King has announced a partnership with [Robinhood](https://robinhood.com/us/en/) to offer millions of prizes in crypto through the BK rewards program. The rewards program was initially launched in September.

The Miami-based burger chain announced on Wednesday that it has teamed up with California brokerage Robinhood Markets to give away $100,000 in the hottest new financial product around: Bitcoin.

## The BK Crypto Program

Through its BK Crypto program, which is available for a limited engagement at only eight stores in the greater Palm Beach, Florida area (so don't get too excited Miami-Dade county residents), customers can buy the chain's signature Whopper sandwich with Bitcoin, Ethereum, Litecoin or Bitcoin Cash.

Customers can enter to win 20 BTC, 200 ETH or Sm DOGE when they spend over $5 in store or on the app. Users must have a Robinhood account in order to receive the prizes.

## The Whoppercoin

This is a relatively novel tactic for a major corporation to combine their rewards program with cryptocurrency. However, it isn't the first time that Burger King has offered crypto incentives to customers at its restaurants.

In 2014, Burger King Russia gave away Bitcoin-themed Whoppercoin tokens with their purchase of a Whopper. Each token was worth 10 rubles which formed part of the first wave of Russian ICOs. The promotion ran again for two weeks between July 25th and August 8th, 2017.

Burger King and Robinhood Partner for Crypto Rewards

US lawmakers have urged Facebook boss Mark Zuckerberg to ditch his company’s cryptocurrency plans.

It was announced recently that Novi, a digital wallet, will enter a trial period in Guatemala, allowing cryptocurrency payments. Facebook is also reported to have revived plans to launch a cryptocurrency called Diem.

A letter signed by five Democratic Senators was sent to Zuckerberg outlining concerns about Facebook’s involvement in crypto, and demanding digital currency projects are discontinued.

The letter concludes: ‘Facebook cannot be trusted to manage a payment system or digital currency when its existing ability to manage risks and keep consumers safe has proven wholly insufficient.

## 'Immediately Discontinue Nivot Pilot'

‘We urge you to immediately discontinue your Novi pilot and to commit that you will not bring Diem to market.’

The letter from Brian Schatz (D-Hawai‘i), Senate Banking, Housing, and Urban Affairs Committee Chairman Sherrod Brown (D-Ohio), Richard Blumenthal (D-Conn.), Elizabeth Warren (D-Mass.), and Tina Smith (D-Minn.) reads: ‘We write to voice our strongest opposition to Facebook’s revived effort to launch a cryptocurrency and digital wallet, now branded “Diem” and “Novi,” respectively. In October 2019, Senators Schatz and Brown wrote to members of the Diem Association’s predecessor, the Libra Association, and expressed deep concerns about the risks the project posed to consumers and the financial system. Facebook subsequently shelved Libra amid regulatory scrutiny, but you did not address our concerns before resuming this endeavour.

‘On multiple occasions, Facebook has committed not to launch a digital currency absent federal financial regulators’ approval. In prepared remarks before the House Financial Services Committee in October 2019, you said that Facebook would “not be a part of launching the Libra payments system anywhere in the world unless all US regulators approve it.” More recently, David Marcus, the executive overseeing Facebook’s digital currency efforts, said, “\[w\]e are definitely not going to launch without the proper regulatory framework.”

‘Despite these assurances, Facebook is once again pursuing digital currency plans on an aggressive timeline and has already launched a pilot for a payments infrastructure network, even though these plans are incompatible with the actual financial regulatory landscape - not only for Diem specifically, but also for stablecoins in general. The agencies that oversee the US financial system are studying the risks that stablecoins pose to financial stability. Accordingly, they are considering how to address these inherent risks and clarify regulation and supervision of these products.’

## 'Facebook Cannot be Trusted'

It continues: ‘You have not offered a satisfactory explanation for how Diem will prevent illicit financial flows and other criminal activity. The intergovernmental Financial Action Task Force warned in a report to the G-20 finance ministers that stablecoins’ “propensity for mass-adoption makes them more vulnerable to be used by criminals and terrorists to launder their proceeds of crime and finance their terrorist activities.” The President’s Working Group on Financial Markets said in December 2020 that stablecoins “are likely to attract illicit actors and, without appropriate mitigation measures, allow evasion of key public policy objectives.”

‘Facebook cannot be trusted to manage a payment system or digital currency when its existing ability to manage risks and keep consumers safe has proven wholly insufficient. We urge you to immediately discontinue your Novi pilot and to commit that you will not bring Diem to market.’

[CNBC](https://www.cnbc.com/world/?region=world) carried responses issued on behalf of Facebook and Diem.

The broadcaster said Facebook claims to have already addressed many of the concerns raised by the senators. The social media giant had said that Novi and Facebook accounts are kept separately to ensure privacy and protection and added that the wallet was built to be completely secure.

## Privacy Top of Mind for Customers

The statement is reported to say: ‘We know privacy is top of mind for Novi customers, so it will always be top of mind for us. We prioritise the security and privacy of people’s information by encrypting sensitive financial information'. If we determine a transaction is unauthorised, we provide a full refund back to a person’s Novi balance. People’s Novi accounts and Facebook accounts are separate.’

CNBC added that Diem had highlighted it is not part of Facebook, which is just one of two dozen members of the Diem Association. The association is a network of ‘merchants, payment service providers, social impact partners, and other entities’ that are ‘dedicated to building a blockchain-based payment system that supports financial innovation, inclusion, and integrity’.

A statement carried by CNBC adds: ‘Diem welcomes the opportunity to engage with members of Congress on the robust controls we have spent two years building into our payment system.

‘Unfortunately, today's letter from lawmakers to Facebook misunderstands the relationship between Diem and Facebook. Diem is not Facebook. We are an independent organisation, and Facebook's Novi is just one of more than two dozen members of the Diem Association. Novi's pilot with Paxos is unrelated to Diem.’



Facebook Should 'Discontinue' Crypto Projects

Regulation in the US will not destroy cryptocurrency, but it could slow development. That was the warning given by Tesla boss Elon Musk this week.

Speaking at the Code Conference in California, Musk suggested the US Government should avoid regulating crypto markets.

He said: ‘It is not possible to, I think, destroy crypto, but it is possible for governments to slow down its advancement.’

Directly asked whether the US Government should actively regulate the crypto industry, Musk said: ‘I would say, “Do nothing”.’

Musk has publicly supported some digital coins is positive about the part crypto will play in addressing issues with traditional financial systems. At the Code Conference, however, he accepted the impact of cryptocurrency has limits.

He said: ‘I wouldn’t say that I’m a massive cryptocurrency expert. I think there’s some value in cryptocurrency, but I wouldn’t say it’s the second coming of the Messiah.’

## Power Shortages

During the interview, Musk addresses recent developments in crypto mining and regulation in China.

Tougher measures to crack down on cryptocurrency trading, including stronger systems to monitor crypto transactions, have been outlined by China’s central bank.

Musk believes the move is power-related, but electrical, not political.

He said the crackdown was due to the country’s ‘significant electricity generation issues’.

Musk added: ‘Part of it may actually be due to electricity shortages in many parts of China. A lot of South China right now is having random power outages, because the power demand is higher than expected.

‘Crypto mining might be playing a role in that.’

However, he acknowledges the Chinese Government may have issues with decentralised nature of cryptocurrencies may present a challenge for the Chinese government.

The Tesla CEO said: ‘I suppose cryptocurrency is fundamentally aimed at reducing the power of a centralised government. They don’t like that.’

Elon Musk Tells Regulators to ‘Do Nothing’ on Crypto

Cryptocurrency trading platforms are more likely to succeed if they submit to existing crypto regulation, according to the head of the [US Securities and Exchange Commission.](https://www.sec.gov/)

Talking during the Code Conference in Beverly Hills, SEC Chair Gary Gensler stopped short of confirming cryptocurrencies would come under SEC regulation, but did say observing existing tax compliance, money laundering and insider trading laws could assist exchanges.

## Investors Expect Profit

Gensler said US law has a broad view of what a securities market is, but the common thread is that it involves organisations raising money from investors who expect a profit.

Being interviewed on Monday by the former US attorney for the Southern District of New York, Preet Bharara, he added: ‘I think there is a lot of clarity in the law. This won’t end well if they stay outside the regulatory space.’

There was little doubt Gensler believes cryptocurrency, including creating and trading, does come within the existing definitions of securities trading, and he believes crypto would benefit from clear regulation. Similar work towards ensuring transparency in digital assets and financial services in general are underway in the europpean union (MiCA) and the financial conduct authority (FCA) in the United Kingdom. 

## Request to Improve Transparency

During the Code Conference, Gensler also discussed regulation of special purpose acquisition companies (SPACs), confirming he’s asked the SEC staff to recommend regulatory measures, including improve transparency.

The SEC website notes Gensler was nominated by President, Joe Biden, and sworn in as Chair on April 17, 2021.

Prior to joining the SEC, Gensler was professor of the Practice of Global Economics and Management at the MIT Sloan School of Management, co-director of MIT’s Fintech@CSAIL, and senior advisor to the MIT Media Lab Digital Currency Initiative. He also served as chair of the Maryland Financial Consumer Protection Commission.



'Crypto Regulation Could Lead to Success'

US President, Joe Biden, will nominate the anti-crypto, Saule Omarova, for the top position of OCC. The official White House [website](https://www.whitehouse.gov/) continues its series of nominations since yesterday evening.

There is no text about Omarova's nomination on the president's website, but it does mention that she has worked "in various capacities at the Board of Governors of the Federal Reserve System".

The nomination was announced in a press release that thanks for all past work rather than just announcing a new name.

## Omarova Sceptical of Crypto

It is unknown whether this will have any effect on the current plans to recognize virtual currencies as commodities , but it certainly seems strange timing for Omarova to take office. This may be seen as negative news within the crypto industry as Omarova is known to have previously been sceptical of cryptocurrencies and even argued for their banning.

She had previously spoke at a hearing on virtual currencies where she said that cryptocurrencies should be considered as any other type of financial instrument and therefore require maximum transparency, describing them as "trustless".



Saule Omarova to be Nominated as Head of OCC

An article in the [New York Times ](https://www.nytimes.com/) explaining cryptocurrency is being seen as an indication that crypto regulation is on its way in the United States.

The explainer looked at stable coins and suggested that regulatory control might be “the most important conversation in Washington financial circles this year.”

The stability and use of stablecoins has been questioned, despite the value being linked to government currencies, chiefly the US dollar.

## Regulation Could Add Comfort

While they act as a bridge between cryptocurrency and the traditional financial world, regulation could add comfort to investors and encourage wider use. It could also, of course, be an attempt to restrict the growth of crypto.

Mainstream media has previously reported on the question of regulating stablecoins, but the appearance of this article in the New York Times has caused a stir. Seen as a newspaper of record with serious contacts in Washington DC, the story has prompted commentators to see it as an indication of something on the horizon.

While some see the explainer article as near-confirmation that regulation of stablecoins is coming, there is still the questions of who will regulate, in what form and how much regulation will there be?

Helpfully, the New York Times outlines likely options for regulators.

## A Risk To The System

These includes, designating them as a risk to the system, calling them securities, potentially making them subject to SEC regulation and treating them as money market and mutual funds.

The articles adds that regulators could treat stablecoins like banks, under the regulatory oversight of the Office of the Comptroller of Currency, or even issue a competing Central Bank Digital Currency (CBDC).

The New York Times articles does observe, however, that US regulators cannot go it alone in corralling stablecoins. International cooperation would be needed, and possible international regulation in 2023 is mooted.

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