Crypto Flipsider News – Terra Sells Bitcoin Worth $3.5 Billion as Do Kwon Announces New Recovery Plan; Portugal to Impose Capital Gains Tax; Grayscale Launch ETF for Europe; Nomura Prepares Crypto Subsidiary, and SEBA Enters Crypto with LGT Bank
Read in the Digest:
- Terra sells $3.5 billion in Bitcoin to protect UST peg as Do Kwon announces new recovery plan.
- Portugal to reverse 2016 crypto tax laws and impose capital gains tax.
- Grayscale enters European ETF market with new finance fund.
- Nomura prepares crypto subsidiary – SEBA enters crypto with LGT bank.
Terra Sells $3.5 Billion in Bitcoin to Protect UST Peg as Do Kwon Announces New Recovery Plan
The Luna Foundation Guard has revealed that it emptied its Bitcoin reserves when TerraUSD (UST), the algorithmic stablecoin of the Terra ecosystem, lost its dollar peg last week. The LFG had previously accumulated nearly 80,394 bitcoin worth $3.5 billion USD.
When the UST first lost its peg, the LFG stated that had it transferred 52,189 bitcoin to a counterparty, 5,313 of which was returned. The LFG has subsequently sold 33,206 bitcoin for 1,164,018,521 TerraUSD in an attempt to stabilize the market. The LFG now holds just 313 bitcoin, among other digital assets.
With the initial measures being unable to save the Terra ecosystem from collapse, Do Kwon, the CEO of Terraform, has announced a new rescue plan. Kwon proposes a hard fork and the creation of Terra 2.0.
The current network will be renamed ‘Terra Classic’ and LUNA, ‘LUNC’, While the new chain will assume the names ‘Terra’ and ‘LUNA’ which will instead be focused on the building of decentralized finance (DeFi) applications on Terra.
Flipsider:
- Polygon has already begun helping Terra ecosystem projects to migrate to the Polygon Network.
Why You Should Care
As Terra looks to salvage itself from the wreckage, Changpeng “CZ” Zhao, CEO of Binance, stated that he would support the community, but only with increased transparency surrounding the project.
Portugal to Reverse 2016 Crypto Tax Laws and Impose Capital Gains Tax
Portugal’s Minister of Finance, Fernando Medina, confirmed on Friday that his country will soon start taxing cryptocurrencies. Sapo reported from comments on the nation’s parliament.
Presently, cryptocurrency is seen as a currency and not as an asset. Therefore, only businesses that offer crypto services are taxed, while individual investors are not. The resulting zero percent capital gains tax in place have made the country something of a tax haven for crypto investors.
Susana Duarte, an associate partner at the Abrey Advogados law firm in Lisbon, has also said that the government of Portugal “will progress with crypto taxation.” The new policy will also include a tax on capital gains.
As it stands, the government of Portugal is yet to announce an official date for the commement of taxation, or even a set rate that will be charged. The government also has yet to confirm how staking or yield farming may be affected.
Flipsider:
- Minister Fernando Medina remarked that the policy will look to create and implement an “adequate” system which is “not so expensive as to drive capital out of the region”.
Why You Should Care
The Secretary of State believes that Portugal’s biggest problem in creating an appropriate legal framework lies in properly defining cryptocurrencies.
Grayscale Enters European ETF Market with New Finance Fund
Grayscale, the world’s largest cryptocurrency asset manager, has announced the launch of an exchange-traded fund (ETF) in Europe.
The fund, ‘Grayscale Future of Finance UCITS ETF (GFOF)’, will list on the London Stock Exchange (LSE), Borsa Italiana, and Deutsche Börse Xetra, and will become the second ETF to be launched by Grayscale.
Grayscale’s new ETF looks to provide investors with exposure to companies in finance, technology, and digital assets. The trading of GFOF will begin on Tuesday, May 17th.
Michael Sonnenshein, the CEO of Grayscale, has said that it is a “compelling time” to enter the European ETF market. However, he maintained that his firm would initially have only a minimal physical presence in Europe.
Flipsider:
- Grayscale is still trying to convince the SEC to approve the conversion of its flagship ‘Bitcoin Trust (GBTC)’ into a spot Bitcoin ETF.
Why You Should Care
According to Sonnenshein, the more developed European crypto ETP space offers his firm some extra opportunities.
Nomura Prepares Crypto Subsidiary – SEBA Enters Crypto with LGT Bank
Japan’s largest investment banking broker is set to launch a new crypto subsidiary. The crypto arm of the bank will focus on launching products for Bitcoin, Altcoins, and non-fungible tokens (NFTs).
Last week, Nomura, which has $569 billion in assets under management, started trading crypto derivatives. The subsidiary, which will be hosted abroad, will endeavour to reach a staff strength of close to 100 people by 2023.
The world’s largest family-owned banking institution, LGT Bank, has also made its debut in the crypto industry, after partnering with SEBA.
In conjunction with SEBA, the crypto service launched by LGT bank will offer custody and trading services for Bitcoin (BTC) and Ethereum (ETH) to its clients.
Speaking on the adoption of crypto and its related services, Roland Matt, the CEO of LGT Bank, explained that “the demand for cryptocurrencies has also increased among our clients in recent years.”
Flipsider:
- GBTC, the world’s biggest crypto fund, is currently trading at a major discount following the extended devaluation of Bitcoin.
Why You Should Care
The entrance of banks into crypto has been tipped to add more insurance and security to what is a largely unregulated environment.
Text source: DailyCoin.com
