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The LATAM region records a high interest in unbacked crypto assets and stablecoins and its authorities’ policy responses have varied substantially, ranging from the introduction of Bitcoin as legal tender in El Salvador to their prohibition in many other countries worried about their impact on financial stability, currency/asset substitution, tax evasion, corruption, and money laundering. This paper also describes briefly the results of a survey on CBDCs’ introduction plans and crypto assets regulation. Finally, this paper presents some general lessons and policy recommendations for the region on the regulation of crypto assets, digital currencies and cross-border payments, and on the potential introduction of CBDCs.

On the same day that the Federal Reserve denied Custodia's membership application, the Federal Reserve Bank of Kansas City (the "FRBKC") also denied Custodia's "master account" application. We summarize below the recent actions by the Federal Reserve, FRBKC, and other regulators and discuss their implications for banking institutions looking to commence or expand their crypto-asset banking services and activities.

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One of the biggest challenges of the Bitcoin network is having a low latency, highly secure and private way of exchanging messages between peers. The censorship resistance requirement of the system is determined by the ability to propagate messages without risk of interception by third parties like ISPs. Implementing solutions that enhance privacy among network participants is one way of ensuring that the censorship resistance requirement is satisfied. In this post, we dive into the need for bitcoin’s transport protocol to encrypt messages exchanged between peers. Since all data relayed in the Bitcoin P2P network is inherently public, and the protocol lacks a notion of cryptographic identities, peers talk to each other over unencrypted and unauthenticated connections. This is a risk to the Bitcoin network’s security in the presence of attackers.

The U.S. state of Wyoming has passed a bill that protects its citizens from having to disclose their private keys, with a singular exception. Having now been approved by the state Senate and House of Representatives, it now simply needs to be signed by the Governor in order to take effect.

Custodia Bank filed an amended complaint against the Federal Reserve Friday, weeks after the Fed rejected the bank's effort to secure a "master account" and become a member of the Federal Reserve System. The Wyoming Special Purpose Depository Institution claimed the denial of its application was unlawful, alleged the Federal Reserve Board and Biden administration coordinated a series of public statements to accompany the rejection of Custodia's application and said the Federal Reserve Board – not the Kansas City Fed – was "pulling the strings." The Federal Reserve denied Custodia's application to be a member of the Federal Reserve System at the end of January, and Custodia's master account application was rejected "immediately after," the suit said. "Defendants had a non-discretionary duty to grant Custodia’s master account application and not to discriminate against Custodia in its ability to access all bank services using that account. Any other outcome eviscerates the dual-banking system that has served our nation since its founding," the filing said.

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Bitcoin enthusiasts often make the mistake of concluding that Bitcoin’s potential valuation is infinite. This is true in dollar terms, since there is no limit to the amount of dollar debasement that can occur into the future (see Weimar Germany or recent Zimbabwe). But it is unrealistic in real terms, relative to other assets. The truth is that Bitcoin stands in relative competition with other store-of-value assets, all of which have unique value propositions. A wealthy individual is not very likely to sell their mansion or their prized Rembrandt to buy Bitcoin, but is instead more likely to sell some of their bond portfolio, because they believe Bitcoin better fulfills the intended purpose of holding bonds (propagating value into the future and earning a modest nominal return to offset inflation).

In Bitcoin, a UTXO is considered dust when the fee required to spend it is greater than the amount on the UTXO. Bitcoin Core considers a UTXO as dust if it's value is lower than the cost of spending it at the dustrelayfee. In Bitcoin Core, this dustrelayfee can be set by a commandline argument -dustrelayfee. Additionally, Bitcoin Core default dustrelayfee is 3000 sat/kB. In this article, we explore the bug while trying to open a channel from an LDK node to an LND node. This bug made us explore an important concept in Bitcoin and Lightning called dust limit. We also see how payments under the dust limit don't create HTLC output as transaction with outputs under the dust limit are not viable on-chain as they will not be relayed by nodes.

Just five days after reaching 50,000 inscriptions, Bitcoiners using the Ordinals protocol have now inscribed more than 100,000 pieces of data onto the Bitcoin blockchain. Since the project’s launch in January 2023, a seemingly endless stream of pictures, audio files and PDFs have been uploaded. Prominent projects on Ordinals include Bitcoin Shrooms, Astral Babes and Bitcoin Punks, which are Bitcoin-based uploads of the original Ethereum CryptoPunks. One of these has now sold for as much as 9.5 BTC, or approximately $215,000 at the time of writing.

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Frustration has been building for weeks after a shortage of the newly designed naira notes led to a lack of cash. Some customers in southern Nigeria's Warri and Benin City reportedly set fire to two commercial banks. Nigerians have faced long queues at cash machines with some sleeping outside banks to try and be first in line to get some money. People say they have been forced to skip meals and work without cash to pay for food or transport to their jobs. Some banks were broken into while protesters looted their cash machines. In Benin City, customers attempted to invade the Central Bank of Nigeria's (CBN) local offices but security officers fired tear gas at them.

While CBDCs may seem like a modern and convenient solution, they come with a host of threats to individual freedom. The potential for government surveillance, financial exclusion, and cyber attacks, as well as negative interest rates, pose serious risks to your financial and personal freedom. As such, it's important to understand the dangers of CBDCs and weigh the risks against the potential benefits before embracing them.

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Dozens of American University in Cairo (AUC) students have staged several protests against the rise in tuition fees, echoing outcries by other Egyptians against the toll the deterioration of the Egyptian pound is taking on their lives. They have called on other students to join in, complaining that the rise in education fees is far more than their families could handle. AUC's administration says it encourages students to express themselves freely, having approved the protests that are taking place on campus.

To steel man the case a little: The pro Ordinals and inscriptions case could broadly be understood as: “Come for the fun, rich art, stay for the decentralized digital money.” You could also agree with some of the critiques of shitcoin NFTs, and see this as a way of arguing that “Bitcoin does it better” e.g., Bitcoin inscriptions are immutable, always on chain, simpler and more secure than shitcoin NFTs. But even if they (ordinals) are not a short-lived fad, what’s the most likely outcome here? Low-value inscriptions will likely be priced out by financial transactions over time as Bitcoin gets adopted by more people. Over the medium to long terms, financial transactions will come to dominate in Bitcoin. Other uses of Bitcoin will be subordinate to its use as decentralized money for the internet.

Ordinals, the project that allows users to inscribe data into a satoshi, making them like NFTs, continues to be highly topical within the Bitcoin community. The project is still in its infancy, having officially gone live on the mainnet on January 20th, but its impact is already being felt and debated. The first effect of Ordinals has been a growth in Bitcoin’s “mempool.” The second impact of the launch of Ordinals is the growth in the average size of blocks. If the popularity of Ordinals continues to grow, these types of market and technical dynamics may become more pressing discussion items.

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Bitcoin is becoming especially popular in countries like Nigeria and Kenya while African refugees are also turning to bitcoin when other cross-border tools fall short. Operations like Bitcoin DADA in Kenya and Bitcoin Mountain in Cameroon both of which started and ramped up their operations in 2022, show that the rampant growth of bitcoin adoption in Africa will be driven by grassroots initiatives, regardless of global bear market blues.

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A filing added recently reveals additional details on DCG’s plan to sell Genesis as a part of the latter’s bankruptcy proceedings. The plan entails the Digital Currency Group turning over its Genesis Global Trading equity to the bankrupt Genesis Global Holdco in an effort to sell both companies. The company entered into restructuring in late November, after reportedly failing to secure $1 billion in rescue funds. Rumors of an imminent bankruptcy resurfaced at the beginning of 2023, and a chapter 11 filing was revealed on January 20th, days after the firm reduced its headcount by 30%.

The SEC’s enforcement staff issued a letter to Paxos known as a Wells notice, which the agency uses to inform companies and individuals of a possible enforcement action, according to the people. The notice alleges that Binance USD, a digital asset that Paxos issues and lists, is an unregistered security, according to the people. It couldn’t be determined if the SEC notice is specifically related to Paxos’ issuing of the coin, the listing of the coin or both. Firms that receive Wells notices are allowed to respond in writing and tell the SEC why it shouldn’t proceed with a lawsuit. Wells notices aren’t a final indication that the SEC will take enforcement action. The agency’s five commissioners must vote to authorize any enforcement settlement or litigation.

Kraken, the San Francisco based exchange, inked a ground-shaking settlement with the SEC on Thursday, with Kraken agreeing to shutter its U.S. staking services and pay a $30 million fine amid agency accusations that the services amounted to a sale of securities. That enforcement action likely marks a beginning of similar cases putting big exchanges in the spotlight. Insiders, experts and the rhetoric of officials suggest a reckoning with the government is inevitable for the big exchanges, and this week’s action against Kraken could be just the beginning.

Even though PayPal was allegedly planning to launch its stablecoin in mere weeks, a report from Friday revealed the firm decided to temporarily suspend the project. The decision is largely based on Thursday’s news that PayPal’s main partner in the effort, Paxos, is under investigation by the New York State Department of Financial Services.