A note of crypto caution
At the end of a week of crypto euphoria, with Coinbase’s successful IPO, Turkey has served a reminder that bitcoin can be put back in its box, with a ban on payments with cryptocurrencies.
On Friday, the central bank barred their use to purchase goods and services saying this posed “significant risks” and citing the lack of regulatory oversight, excessive volatility, the potential for use in illicit activities, theft of digital wallets and the irrevocable nature of transactions required.
The anonymous use of virtual money “may cause non-recoverable losses” and “undermine the confidence in methods and instruments used currently in payments”, a statement from the bank said. Turkey has the largest volume of cryptocurrency transactions in the Middle East.
As Elaine Moore cautions, investors in both bitcoin and Coinbase must reconcile themselves not only to the environmental damage caused by crypto miners, but also to the fact that states may act in this way and the US will never allow a digital currency to challenge the dollar.
There is also the risk of prices falling, but this was not on the minds of investors today as the crypto rally raged on through the “joke” token dogecoin. Alphaville reports it has risen more than 200 per cent in the past 24 hours and is 550 per cent higher than a week ago.
There seems no obvious reason for the surge other than another Elon Musk promotion of it on Twitter, and investors making sure they have the last laugh in a crazy week for crypto.
The Internet of (Five) Things
1. Pakistan blocks social media
Pakistan blocked access to popular social media sites on Friday ahead of an expected crackdown on Islamists. Nayatel, a popular Islamabad-based internet service provider, sent an SMS message to clients informing them that Twitter, Facebook, WhatsApp, YouTube, TikTok and Telegram had been blocked in the country. Other service providers sent out similar messages.
2. TSMC being forced to pick sides
The world’s largest contract chipmaker is under increasing pressure to pick a side in the US-China rivalry for technological supremacy, posing a dilemma for the Taiwanese chip foundry that has become crucial to the global supply chain, reports Eleanor Olcott from Taipei.
3. Mercedes kick-starts Tesla offensive
Mercedes has unveiled a battery-powered version of the brand’s flagship S-Class saloon, designed to lure customers away from the likes of Tesla. The EQS is set to go on sale in late summer and will be followed by an all-electric E-Class saloon and two sport utility vehicles within two years.
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