Our weekly crypto newsletter is here! Learn more about the Binance blockchain hack, India’s plans on a CBDC, and the EU’s new wave of crypto sanctions against Russia!
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‘Moran’ Hard Fork Success After Binance Hack
Last week another big name in crypto fell victim to a hack as the Binance network was exploited for an estimated $100million. The blockchain was temporarily paused to limit damage after the cross-chain bridge between the BNB Beacon Chain (BEP2) and BNB Chain (BEP20) was attacked.
Binance later announced that both the test net and main net would undergo an upgrade in the form of a hard fork. The security patch dubbed the ‘Moran’ hard fork a “temporary urgent patch to mitigate the cross-chain infrastructure.” To allow the hard fork, deposits and withdrawals were briefly suspended in the early hours of Wednesday when the upgrade was successfully deployed.
Despite its success, work is still being done to improve the network’s security. Developers are now heavily focused on upgrading the networks underlying cross-chain proof verification. We can also expect to see the introduction of more security measures to its cross-chain system in the coming weeks.
The E-Rupee Envisioned to Crush Crypto Use in India
The Reserve Bank of India (RBI) is still firm in its position to ban cryptocurrencies. In January 2022, though, the RBI established the Fintech Department, tasked with drafting crypto regulations and researching the potential launch of a Central Bank Digital Currency (CBDC). Finally, the RBI published last week a comprehensive roadmap for introducing a blockchain-based e-rupee. The document outlines the test phases of the pilot project, which is expected to launch later this year.
According to the concept note, India’s Central Bank decided to start the process of issuing a digital currency prompted by the examples of China and the 16 other countries that are currently pioneering CBDCs. The authors list the benefits that a future e-rupee will bring to the economy, including lower operational costs, cross-border payments innovation, and increased financial inclusion, while “reducing the risk associated with private cryptocurrencies.” The RBI has maintained that banning cryptocurrency is the most suitable choice for India, despite the government introducing crypto taxes. The pilot project announcement follows RBI governor Ravi Shankar’s June statement that a CBDC could help “kill” the reasons for private cryptocurrencies to exist.
EU’s Blanket Ban Covers All Russian Crypto Users
As part of the eighth round of sanctions against Russia, the European Union placed a blanket ban on all crypto services to Russian entities. The existing ban on all crypto transactions exceeding EUR 10,000 was expanded to prohibit all crypto-asset wallets, accounts, or custody services, regardless of the amount. The ban took effect on October 6th, and while some crypto exchanges were quick to comply, others have failed to do so. Some of the most renowned crypto exchanges lagging with compliance are Binance, Coinbase, Kraken, and FTX.
Binance and Coinbase did impose the EUR 10,000 crypto ban, which was a part of the EU’s spring sanctions package against Russia, but have not issued a statement if they intend to extend this to all transactions. Kraken and FTX have not yet issued any bans on crypto trades for Russian users.
Especially after Russia’s Central Bank decision last month to legalize cryptocurrencies for international payments, the EU has considered crypto a tool for Russians to circumvent its financial sanctions. However, the situation on the ground is not so black and white, as an increasing number of Russian dissidents are using crypto to escape the country.
