Hello, and welcome to this week's edition of Overbit News.
Our first piece of the week focuses on the current Bitcoin and ongoing cryptocurrency market slide.
As we saw earlier this year, Chinese regulators tightened their grip on cryptocurrency miners and related operations. Now, on Monday night, Bitcoin, Ether, and virtually all other cryptocurrencies suffered a big dip, which again appears to be connected to developments in China, although of a different sort this time.
Monday's price fluctuation is said to be connected to China's real estate sector, namely the Chinese firm Evergrande Group. With over $300 billion in liabilities, Evergrande is the world's most indebted real-estate company, and markets around the globe have plummeted as investors fear China would allow Evergrande to fail on its commitments.
If Evergrande fails, it may considerably influence the Chinese and global economy, affecting countries worldwide. Evergrande's downfall has been likened to Lehman Brothers' bankruptcy, which triggered the Global Financial Crisis back in 2008.
Because the crypto sector is so correlated to traditional markets, what occurs in China may significantly impact our readers, so it's definitely an issue worth monitoring in the near future.
Closing out this week's edition, we move over to the United States, where potential crypto regulations are once again in the headlines.
According to the Proof of Stake Alliance, a proposed amendment to the much-discussed Infrastructure Bill passed by the US Senate last month may subject a broad spectrum of crypto users to up to five years in prison for acquiring digital assets that are not accurately disclosed (POSA).
The clause, which would apply to all US residents who receive any type of digital asset, has so far avoided public or congressional examination, according to a report by the non-profit group that strives to bring legal and regulatory clarity to the proof of stake sector.
They believe that a law that makes digital asset users felony criminals should be debated openly rather than discreetly inserted in a forthcoming bill.
According to the modification above to Section 6050I, "any person" who gets more than USD 10,000 in digital assets must check the sender's personal information, including Social Security number, and sign and submit a report to the government within 15 days.
Failure to comply leads to obligatory fines and can be considered a crime (up to five years in jail)," according to the study. The idea is based on 1984 legislation designed to discourage in-person cash transfers and encourage the use of financial institutions for large transactions.
However, the comparatively simple requirements that were in place 37 years ago are difficult to apply to digital assets, making compliance overly onerous. As a result, crypto miners, stakers, lenders, decentralised application and marketplace users, traders, businesses, and individuals with any exposure to digital assets are all at risk of being subject to the contentious requirement, "even though in most situations, the person or entity in the receipt is not in the position to report the required information," according to the report's authors.
As you can see, global markets and regulators are constantly shifting the heads winds of crypto, and we will continue to monitor at Overbit.com.
Thanks for reading, and we'll see you next week.