Russia develops a SWIFT alternative🌍, tokenizing minerals💎 in the Central African Republic

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EmergingCrypto.io Weekly Update May 22 – May 28

Eastern Europe

Russian state-owned manufacturing and technology conglomerate developed blockchain-based alternative to SWIFT

Rostec, the Russian state-owned manufacturing and technology conglomerate, has built a blockchain-based messaging system to facilitate international settlements between Russia and its trading partners, and digital currency storage, called “CELLS”. Russian banks have been removed from the SWIFT network as part of western sanctions due to Russia’s invasion of Ukraine. Since the removal, the Russian government has been trying to transition payments to Rubles in its trade deals. Cryptocurrencies such as Bitcoin have also been considered for international settlement. (Read more on EmergingCrypto.io; Read more on Bitcoin.com)

Crypto miners consume over 2% of the total electricity in Russia

Russia Deputy Head of the Ministry of Industry and Trade, Vasily Shpak, said last week that Russian crypto miners consume more than 2% of the total volume of electricity consumed in Russia. “This is more than the cost of electricity for agriculture” Deputy Shpak said. “We cannot but recognize mining in this sense as an industrial activity or industry.” Crypto mining in Russia operates in a “grey area”, it’s neither banned nor regulated. “Here our position is completely unambiguous: mining must be recognized, regulated and built into industrial activity,” the deputy head of the Ministry of Industry and Trade said. (Read more on EmergingCrypto.io; Read more on Cointelegraph)

Africa

The Central African Republic wants to raise funds by tokenizing mineral resources

The President of the Central African Republic (CAR), Faustin-Archange Touadéra, announced via Twitter last week that the CAR plans to raise funds by using blockchain and tokenizing its mineral resources. With blockchain, in theory, the proceeds from tokenizing mineral resources could remain on a blockchain and mineral usage could be tracked. The CAR has abundant mineral resources such as gold, cobalt, uranium, and oil. However, an ongoing civil war since 2012 and ESG issues of conflict minerals are two reasons as to why global mining firms have avoided the CAR. In April, the CAR became the second country to adopt Bitcoin as legal tender and details of the country’s mineral resources were referenced in the Sango project presentation. (Read more on EmergingCrypto.io; Read more on Ledger Insights)

Nigerian merchant adoption of e-Naira CBDC very low

Despite the hype of Nigeria’s CBDC, the e-Naira, central bank figures cited by the Nigerian publication, BusinessDay, reported that only 80 merchants have signed up for the e-Naira app and funded their e-Naira wallets. One reason for low merchant adoption is that customers aren’t requesting to use the app. Since its launch in October 2021, there have been 764,000 app downloads and nearly half of those downloads never opened the app. 168,300 accounts have been onboarded and are active. However, only 18,460 wallets have been funded including the 80 merchants. (Read more on EmergingCrypto.io; Read more on Ledger Insights)

Asia

India’s CBDC phased introduction scheduled for 2022

The Reserve Bank of India (RBI, India’s Central Bank) published its annual report last Friday and reported that that India’s central bank digital currency (CDBC) is scheduled for a phased introduction in 2022 through March 2023. The launch is subject to the results of a risk-based model for Know Your Customer (KYC) compliance and anti-money laundering (AML) supervision. In February India’s finance minister announced that India’s CBDC will use blockchain. (Read more on EmergingCrypto.io; Read more on Ledger Insights)

Japan passes new stablecoin provisions

Last week Japan’s parliament passed new provisions to regulate stablecoins that will come into force in 2023. However, it appears to only apply to permissioned networks and excludes algorithmic stablecoins. The new regulations limits issuers of stablecoins in Japan to banks, trust companies, and licensed money transfer companies that have asset custody capabilities, and may make it more challenging for foreign organizations to issue stablecoins there. In addition, intermediaries (e.g., brokers) must be registered as part of a new licensing regime. Lastly, a new system to monitor transactions and enhanced anti-money laundering provisions are part of the new rules. (Read more on EmergingCrypto.io; Read more on Ledger Insights)

Latin America

Spotlighting UISA’s use of blockchain in its sugar production line

Blockchain continues to be integrated with supply chains across industries. This week we’re spotlighting UISA, the Brazilian sugar and ethanol company, and its use of blockchain in its demerara (raw) sugar product. Consumers of their product will be able to access information about the sugar harvest and the company will be able to improve quality control through the cultivation process, providing transparency, efficiency, and security to the company’s production supply chain. UISA plans to eventually implement blockchain in all its production lines. (Read more on EmergingCrypto.io; Read more on Blocknews)

Paraguay is moving closer to regulating its crypto economy

Rounding off this week’s newsletter, crypto adoption across Latin America is high with four of the top 20 countries being from Latin America according to Chainalysis’ 2021 Crypto Adoption Index. Although Paraguay did not make the top 20 list, it is considered an emerging location for crypto adoption due to low electricity costs and soft taxation. At the end of May the Paraguayan congress passed a bill to regulate cryptocurrency trading, mining, and custody. The bill was sent to the Paraguayan senate for approval before it reaches the President to be signed into law. If implemented, the law would apply to both consumers and businesses, provide them financial and legal guarantees, and impose restrictions on electricity spending and taxation. Despite the enthusiasm in Paraguay’s lower house, the reception has been frostier by its central bank and budget commission who have both expressed disapproval of digital currencies. (Read more on EmergingCrypto.io; Read more on Cointelegraph)

Thanks for reading! Have a great week ahead!

Written by Jon Lira. Connect with him on LinkedIn and Twitter.

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