Bitcoin Rebounds to $40K After Announcement of $6T Budget by Biden
The price BTC (bitcoin) brushed the $40K mark today after Biden’s announcement of the proposed $6T budget for next year.
On Thursday, the New York Times reported that this could be the biggest budget since World War 2. Biden also plans to push to increase the budget to $8.2T by 2031.
With the announcement, BTC (bitcoin) was up to $40, 854 in data by Crypto.co. But as of writing, it’s now down by 3.09% with its price at $ 36,833.86 in a 24-hr chart.
Also, stock prices slightly rose with Dow Jones up by 0.4%, S&P 500 by 0.3%, and Nasdaq increased by 0.2%.
Biden’s proposed budget of $6T will be spent on infrastructure, education, and healthcare as further stated by the NYT report. It also added:
“The proposal shows the sweep of Mr. Biden’s ambitions to wield government power to help more Americans attain the comforts of a middle-class life and to lift US industry to better compete globally in an economy the administration believes will be dominated by a race to reduce energy emissions and combat climate change.”
The market is now on a “wait-and-see phase” as the BTC (bitcoin) price trades below $40K. The most dominant cryptocurrency has tremendously dropped by 70% from its peak price of $64K in mid-April. This month, BTC (bitcoin) underwent two consecutive corrections. On May 19, its price even dropped to as low as $30K following a massive sell-off. This has resulted in a flash crash that brought down the whole crypto market.
Poloniex Under Fire by Regulators for Breaking Laws
Crypto exchange Poloniex is currently under fire by the Ontario regulators for allegedly violating securities laws.
According to reports, the crypto exchange failed to comply with the April 19 deadline set by the regulatory body. In a statement by the Ontario Securities Commission, Poloniex has never registered with the agency but has allowed its Ontario residents users to trade crypto derivatives and securities.
In a published document by the OSC on March 29 further states:
“If a platform currently trading in derivatives or securities in Ontario does not do so by this date, steps will be taken to enforce applicable requirements under securities law.”
The regulation applies to all trading platforms that operate in Ontario even those located outside of the Canadian province.
The recent move by the OSC was mainly due to investment risk. According to a report by the Toronto Star, Matt Burgoyne, a partner at Calgary-based McLeod Law commented on the matter:
“It’s a potential disaster for investors who frankly might not be sophisticated enough to understand the risks. This won’t be the last time regulators do something like this, either.”
According to OSC, Poloniex ignored the warning of the regulatory body and has not contacted the agency even after the April 19 deadline lapsed. OSC further stated:
“Entities such as Poloniex, which flout this compliance process, expose Ontario investors to unacceptable risks and create an uneven playing field.”
The Seychelles-based crypto exchange now faces a possible $1 million in fines and trading bans.
Iran Temporarily Halts Crypto Mining
On Wednesday, Iranian President Hassan Rouhani has temporarily halted crypto mining following a massive power outage in major key cities in the country.
The ban will be effective immediately that will last for four months and will end on Sept. 22.
The power shortage was catalyzed by the surging demand which includes crypto mining. But Rouhani stated that 85% of the country’s mining is illegal.
The Iranian government’s program on power subsidy has encouraged even households to jump in crypto mining which is illegal in the country.
In October 2020, the country revised its laws to adopt BTC (bitcoin) to get around with US sanctions on using dollars for international trade. The new law legalized bitcoin mining and will be sold to the country’s central bank. But the new regulation has aggravated the country’s power shortage issue due to surging numbers of illegal miners. To combat this, The Ministry of Intelligence has deployed spies to hunt down illegal miners.
Hundreds of computers used for cryptocurrency mining were confiscated as a result of the government’s crackdown on these illegal miners.
Musk, Saylor, and the Bitcoin Mining Council
Shortly after turning his back on BTC (bitcoin), Elon Musk is now back, and this time to aid for the renewable sources for the mining of the cryptocurrency.
On Tuesday, the Technoking and Microstrategy CEO Michael Saylor had a meeting with major bitcoin miners in North America which include Argo Blockchain, Galaxy Digital, and Marathon Digital Holdings. With the meeting, the Bitcoin Mining Council was created which will “promote energy usage transparency and accelerate sustainability initiatives worldwide.”
The group is responsible for producing just less than 10% of the global computing power on the bitcoin network but due to recent issues on bitcoin’s energy consumption, the news immediately raised criticisms.
But during the meeting, Saylor stated:
“The only reason we had the meeting is because we wanted to ensure the success of a decentralized cryptocurrency and the source of decentralization is energy usage.”
Commenting on Musk’s participation, Saylor stated that he reach out to him first. He further added:
“We wanted to understand how we could be the good guys in the entire ESG debate”, because “we [bitcoiners] are the good people” who are “actually driving sustainability.”
Seems like the two are now good bitcoin (?) buddies after an exchange of words in their respective Twitter accounts after Musk removed bitcoin as payment for Tesla cars. Musk has raised an issue over the cryptocurrency’s carbon footprint caused by dirty energies from coal for its mining.