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Impeachment Inquiry: Major New Phase Starts in 7 Days

November 6, 2019 |

Mark your calendars: House Intelligence Committee Chairman Adam Schiff on Wednesday announced what the AP calls a “major new phase” of the impeachment inquiry. Public impeachment hearings will begin next Wednesday, Schiff said. Politico reports first up will be William Taylor , the top US diplomat in Ukraine, and Deputy Assistant…
Newser

More Than 20K Feet Deep, a Major Find

November 5, 2019 |

It’s the deepest shipwreck ever found—one caked in US history. Experts aboard the Research Vessel Petrel believe they’ve found the wreck of the USS Johnston some 20,400 feet, or nearly 4 miles, below the waves of the Philippine Sea, where it came to rest in the largest naval…
Newser

3 Major Signs That Precede the Fall of World Reserve Currencies

October 24, 2019 |

3 Major Signs that Precede the Fall of World Reserve Currencies

The story of reserve currencies is long and stretches far back into ancient times. As modern history shows, however, the average lifespan of fiat reserve assets is just around 100 years. This means that even the U.S. dollar’s period of dominance is probably nearing its end very soon, statistically speaking. But it’s not mere guesswork, as there are distinct patterns that emerge prior to the fall of any world reserve currency. In this exploration, three of the most common will be highlighted.

Also Read: Germany’s Financial Crisis Invokes 5-Year Rent Freeze

Bad Omens

To understand the end of any currency’s reserve status, it’s important to be familiar with beginnings, as the former is informed by the latter. A good example of this is the case of the British pound, which prior to becoming a reserve currency was turned from silver to paper with the creation of the Bank of England. The bank was created in the wake of crushing military defeat at the hands of France, and England wished to finance the creation of a more powerful navy. The central bank was thus given sole ability to issue paper currency. War and empire building would similarly play a leading role in the British pound’s consequent fall from grace. Two other common factors emerging prior to the death of reserve currencies are increased spending and easy credit, and sanctions on free trade.

3 Major Signs That Precede the Fall of World Reserve Currencies
Source: JPM / Hong Kong Monetary Authority, 2011

War and Empire Building

In each case where a reserve currency has gained and lost status as such, war and conquest have played an extremely centralized role. The Portuguese succession crisis of 1580 caused by the battle of Alcácer Quibir, meant the end of the country’s already struggling empire. Increased reliance on finance from conquered lands, excessive taxation and a shriveling domestic economy resulted in the fall of Portugal’s various currencies from world reserve grace. Spanish money would then swoop in, assuming prominence in the context of a dynastic merger with Portugal known as the Iberian Union (1580-1640). As one struggling spice empire builder thus joined a stronger one, money such as Spain’s escudo gained worldwide reserve status and, as with Portugal, colonialism’s bloody legacy of expansion and monopolistic dominance of trade routes made this possible.

The Dutch-Portuguese War (1601-1663) would step up next, seeing the Netherlands challenge Iberian Union power, leveraging their government-created megacorporation Dutch East India Company and Dutch West India Company. The Iberian Union would fall apart, and the Dutch florin would take over as the world’s money.

3 Major Signs That Precede the Fall of World Reserve Currencies

The pattern is relatively clear but in case there’s any doubt, it remains unbroken to this day. The journey from florin to USD is similar. Dutch interests were overtaken by French in a series of wars and battles including the Franco-Dutch War (1672-1678), French monetary dominance was successively challenged by the iron fist of the British East India Company and its massive ‘private’ army and then, post World War I, Britain would find itself bankrupted after attempting to hold to the gold standard throughout the conflict, unable to pay with the limited asset for the excesses of modern militarism. The newly created Federal Reserve Bank in the U.S. would show up, appearing as the fiat hero, thanks to the issuance of dollar-denominated credit to foreign countries. The National Bureau of Economic Research summarizes one report, noting:

When the war began, the United States was a net debtor in international capital markets, but following the war the United States began investing large amounts internationally, particularly Latin America, thus ‘taking on the role traditionally played by Britain and other European capital exporters.’

3 Major Signs That Precede the Fall of World Reserve Currencies
www.usdebtclock.org

Reckless Spending and Easy Credit

Going hand in hand with waging war and massive empire building is, of course, spending money. The irony of the British pound’s failure as reserve currency after WWI was that it faltered because it was too economically sound. The Bank Charter Act of 1844 saw the pound adopt an official gold standard. As gold is limited, and one can’t build a massive military super power with limited assets, the pound’s economic strength in the context of easy credit warfare killed it.

Like Portugal before the fall of its own world reserve currency, U.S. economic policies are now similarly debt-based and reckless, relying on loans from other nations, progressively desperate taxation, trade sanctions and a printing press to survive. China currently holds the largest portion of U.S. debt amongst foreign interests, with a $ 1.1 trillion bag to call. The U.S. continues to spend close to $ 1 trillion on war annually, in spite of this, with president Donald Trump even calling for major foreign powers like Saudi Arabia to pay for U.S. troops basically as mercenaries.

3 Major Signs That Precede the Fall of World Reserve CurrenciesWhere the historic paper British pound was concerned, spending for a massive navy was needed after defeat at the Battle of Beachy Head (1690), and in 1694 William III cleverly found his way around this obstacle, creating a non-government central bank that was given sole rights to issue paper currency. If this sounds eerily familiar, that might be thanks to the current U.S. government-sponsored private bank set up in strikingly similar fashion in 1913. None of this is anything new or isolated. Regarding the historic reserve status of the Dutch florin, the Federal Reserve Bank of Atlanta reports:

As a supplier of fiat money, the Bank of Amsterdam engaged in many of the same activities as central banks today. The Bank operated a large-value payment system; it provided liquidity to the Amsterdam money market through repo-like arrangements; it engaged in open market operations to stabilize market conditions; it lent to selected counterparties; and it returned seigniorage to its sponsoring government, the City of Amsterdam.

Repo like arrangements are the norm today, centuries later. The report goes on to detail that “The end of currency’s reserve status is a rare event, and the florin’s downfall teaches that preeminence of a central bank does not necessarily guard against fiscal overexploitation or a sudden loss of market confidence.”

3 Major Signs That Precede the Fall of World Reserve Currencies

Trade Wars and Sanctions

As recently reported, “China has reduced its holdings of U.S. debt since November 2013, when it held $ 1.3 trillion. It wants to allow its currency, the yuan, to rise. To do that, China had to loosen its peg to the dollar. That made the yuan more attractive to forex traders in global markets. China’s economy is also slowing down due to President Donald Trump’s trade war.”

With the lifespan of USD reserve hegemony approaching a statistically expected death rattle, many economists view the Chinese yuan as the next big contender for world reserve currency status. After all, the historical formula is all there: perpetual U.S. warfare, reckless lending, and hubristic sanctions on free trade both domestically and abroad, shriveling the U.S. economy and starving others of much needed resources. The battle for dominance of oil echoes history’s battle for sugarcane and spice. Even food is quite literally being hoarded and withheld from starving individuals just as it was in times past.

Sanctions cutting off Iraq, Iran and Venezuela from free trade, and tariff battles between the current world superpowers rage on, unabated. No different, in essence, from the seafaring mayhem of history. However, borders are now disappearing. Money can now be digitized. The next world reserve currency could be China’s anticipated and already announced digital yuan. Should that be the case, a completely surveilled world reserve monetary currency would not be hard to imagine. That is, unless individuals demand sounder options not as readily subject to the the whims of kings and queens, politicians or central banks and their borders, and not the tools of modern day colonialists wishing only to establish tax farms on planet Earth.

What do you think will be the next world reserve currency? Let us know in the comments section below.


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Major German Coop Bank Passes Negative Interest Rates to Customers

October 9, 2019 |

Major German Coop Bank Passes Negative Interest Rates to Customers

One of Germany’s largest cooperative banks has begun charging its retail customers a negative interest rate. Other major banks could follow suit since the European Central Bank cut the deposit rate to a record low. Deutsche Bank recently said that it needs to be “much more robust about passing on negative rates.”

Also read: Massive Layoffs: Banks Cutting Nearly 60,000 Jobs Worldwide

Berliner Volksbank

Berliner Volksbank is one of the largest German cooperative banks, with total assets of approximately 14 billion euros (~$ 15.4 billion). Describing itself as “the largest regional cooperative bank in Germany,” the bank has approximately 75 branches and more than 370 cashpoints in the German states of Berlin and Brandenburg.

The bank started applying a minus 0.5% rate on deposits exceeding 100,000 euros (~$ 110,000) last week, effectively charging customers half a percent to hold their savings. According to local media, the bank explained that its new policy is due to the move by the European Central Bank (ECB) last month to cut the deposit rate to a record low, from -0.4% to -0.5%.

Major German Coop Bank Passes Negative Interest Rates to Customers

At the rate of -0.4%, the ECB’s negative interest-rate policy was already costing German banks 2.4 billion euros a year, the Financial Times reported in August, emphasizing that German banks are hit the hardest in Europe because they hold about a third of the total excess deposits on which the ECB levies negative rates. The ECB introduced negative interest rates in June 2014 in an effort to stimulate the economy.

So far, most German banks have not passed on the negative interest rate burden to retail customers, opting to absorb the costs themselves to uphold their reputation and prevent mass withdrawals. A study by management consultant Investors Marketing shows that one in two Germans could leave their banks if they started charging negative interest rates.

Deutsche Bank and Commerzbank

Germany’s largest bank, Deutsche Bank, is also contemplating the prospect of applying negative interest rates on customer accounts. CFO James von Moltke said at the September Bank of America Merrill Lynch Annual Financials Conference 2019 in London that “We need to be much more robust about passing on negative rates.” He added: “We are very cautious about whether in a mass retail setting we would be able to pass on negative rates for legal reasons, including documentation requirements and other reasons, including politics.”

Major German Coop Bank Passes Negative Interest Rates to Customers

Another major bank in the country, Commerzbank, is currently not considering passing on the negative interest rate costs to retail clients, Bloomberg reported the bank’s CFO, Stephan Engels, confirming in September.

Deutsche Bank and Commerzbank attempted a merger early this year, but the plan was abandoned as the pair decided that the benefits generated by the deal would not offset the costs of the merger. The two banks subsequently announced massive layoffs, with Deutsche Bank planning to lay off 18,000 workers and Commerzbank planning to let go of 4,300 employees.

Other Banks Could Follow

The National Association of German Cooperative Banks, the association for the cooperative banking sector in Germany, believes that other banks may follow the move by Berliner Volksbank. “It can not be ruled out that additional customers or products will be affected,” spokeswoman Cornelia Schulz was quoted by Bloomberg as saying. Oliver Maier, Managing Director of market research firm Verivox Finanzvergleich, elaborated: “Things are changing in the industry and we expect further negative interest rates, especially since one of the major cooperative lenders has now taken that step.”

Major German Coop Bank Passes Negative Interest Rates to Customers

Oswald Gruebel, a former Credit Suisse CEO and an ex-executive of UBS Group AG, commented on the issue in an interview with Swiss newspaper NZZ am Sonntag:

Negative interest rates are crazy. That means money is not worth anything any more … As long as we have negative interest rates, the financial industry will continue to shrink.

According to data provider Biallo.de, a number of smaller banks have already opted to share the negative rate burden with their corporate and wealthy clients, but the threshold is usually much higher than the 100,000 euros set by Berliner Volksbank. Germany’s largest savings bank, Hamburger Sparkasse, told the Financial Times in August that it had already levied “custody fees” on private customers with deposits above €500,000 and corporate customers with over €250,000 in their account.

Major German Coop Bank Passes Negative Interest Rates to Customers
German Finance Minister Olaf Scholz

Meanwhile, German Finance Minister Olaf Scholz said last month that he had told banks not to pass on the ECB’s negative interest rates to savers. He was quoted by Reuters as saying:

I told [the] bank chief very clearly that it would be a fairly bad idea to react by slapping negative rates on millions of savers.

What do you think of German banks slapping negative rates on customers? Let us know in the comments section below.

Disclaimer: This article is for informational purposes only. It is not an offer or solicitation of an offer to buy or sell, or as a recommendation, endorsement, or sponsorship of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.


Images courtesy of Shutterstock.


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The post Major German Coop Bank Passes Negative Interest Rates to Customers appeared first on Bitcoin News.

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Why Bitcoin Is Better Than Banks: Major Credit Card Breach Exposes 60M Accounts

October 8, 2019 |

Why Bitcoin Is Better Than Banks: Major Credit Card Breach Exposes 60M Accounts

Sberbank, the largest bank in Russia with a regional and global presence, has suffered a major data breach. Personal information belonging to millions of clients is now being sold on the black market. Initial analyses suggest the trove of data for sale is real, highlighting the risks associated with traditional banking.

Also read: Turkish Government Freezes Over 3 Million Bank Accounts

Personal Information Put Up for Sale

The leak at Sberbank, a leading financial services provider with offices in 21 countries including other CIS members, the U.S., U.K., Central and Eastern Europe, may be the largest to date in the history of the Russian banking sector. The blow against its reputation comes after the industry experienced a similar attack earlier this year in which three other Russian banks were targeted.

The unknown new owners of the database, containing details for 60 million credit cards, are now selling the information online. An ad appeared this past weekend on a forum banned by the federal telecom watchdog, Roskomnadzor. Kommersant, the leading Russian business daily which broke the news, quotes digital security experts who believe the information is real, although not all of it may be current.

Why Bitcoin Is Better Than Banks: Major Credit Card Breach Exposes 60M Accounts

Potential buyers of the data lot have been offered a sample of entries. According to the publication, whose authors have examined the set, it contains the data of 200 clients from different Russian cities, served by Sberbank’s Ural branch. The tables provide the details of the account holders, their bank cards and associated transactions.

The date stated on the document is Aug. 4, 2019, possibly the day the leak took place. It also features the phrase “way4” and the abbreviation “w4.” The savings bank has been using a data processing platform called Way4 for around a decade. Sberbank confirmed the leak in a press release and revealed an internal investigation has been launched. The bank has not been able to identify any external cyberattacks and the main assumption at the moment points to “deliberate criminal actions of an employee.”

The Russian lender is currently checking the authenticity of the leaked information to confirm whether it is genuine. Sberbank representatives assured the public the funds stored in the leaked bank card accounts are not in danger of being misappropriated by parties unauthorized by its customers. The stolen information does not contain the CVV numbers of the cards and there’s also two-factor authentication via SMS for each transaction.

Leaked Data Is Real, Independent Checks Confirm

Ashot Oganesyan, founder of data leak prevention software provider Devicelock, claims his company has analyzed the released sample and been able to confirm it contains the personal data of real people. Trying to establish the truth for themselves, Kommersant journalists have attempted to find their own info in the database and the sellers provided them with the details of their own credit cards, including information about former employers.

According to their website, Sberbank now provides services to over 150 million clients worldwide. In Russia alone, the bank has around 92 million active retail customers and over 2.4 million corporate clients. The number of Sberbank’s active credit cards in the country is currently around 18 million. The database that’s on sale has been divided into 11 sets which corresponds to the number of the bank’s territorial branches.

Why Bitcoin Is Better Than Banks: Major Credit Card Breach Exposes 60M Accounts

Sberbank’s clients are only the latest victims of bank information theft in the Russian Federation. This past summer, 900,000 customers of OTP Bank, Alpha Bank, and HCF Bank had their names, phone numbers, passport details and employment information exposed. Among them were the personal details of 500 police officers and even 40 agents of the Federal Security Service (FSB).

Cases such as these, which are not an isolated Eastern European phenomenon, demonstrate the risks associated with the widely adopted banking sector practice of collecting detailed personal information, also known as know-your-customer (KYC) procedures. The data is usually stored in a centralized manner that increases its vulnerability to attacks targeting a bank’s systems.

With cryptocurrencies you are free to transact in a decentralized and private manner. The model introduced by Bitcoin does not require a trusted third party providing intermediary services. If you need to buy or sell coins such as bitcoin cash (BCH) and other major digital currencies you can do so on a peer-to-peer platform like local.Bitcoin.com.

What are your thoughts about the latest major credit card breach? Share your opinion on the subject in the comments section below.


Images courtesy of Shutterstock.


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The post Why Bitcoin Is Better Than Banks: Major Credit Card Breach Exposes 60M Accounts appeared first on Bitcoin News.

Bitcoin News

Major Ukraine Story Broken by a Pretty Unlikely Person

September 28, 2019 |

Just another day on the job? Not so for Andrew Howard, the college journalist who broke one of the biggest stories of the week. The 20-year-old Arizona State University junior was first to report that Kurt Volker, the State Department’s special envoy for Ukraine, was stepping down amid tensions over…
Newser

‘Major’ Montana storm promises several feet of snow and possible ‘life threatening’ situations, officials warn

September 28, 2019 |

Weather officials are warning of potentially “life threatening” situations in Montana as certain parts of the state could see up 3 feet of snow as a “major fall storm” is expected to move into the region over the weekend. 
FOX News

A major winter storm is bringing heavy snow, strong winds and possible blizzard conditions to the Northern Rockies

September 27, 2019 |

Very dangerous if not impossible travel conditions will impact several states especially Montana and Idaho.  
FOX News

CNN

Rugby World Cup delivers first major shock

September 25, 2019 |

The 2019 Rugby World Cup delivered its first major shock as minnows Uruguay held on for a historic 30-27 victory over Fiji.
CNN.com – RSS Channel – World

Major German Stock Exchange Group Launches Crypto Trading

September 24, 2019 |

Major German Stock Exchange Group Launches Crypto Trading

Boerse Stuttgart Group, which operates Germany’s second-largest stock exchange, has launched a regulated crypto trading platform, in partnership with Solarisbank. Customers can connect directly to the new exchange and trade bitcoin against the euro without a broker.

Also read: Indian Parliament Member Helping Crypto Community Influence Regulation

German Regulated Crypto Trading Platform

The group which owns Germany’s second-largest stock exchange has launched a digital asset trading platform called Boerse Stuttgart Digital Exchange (BSDEX). Trading is now live on the platform, Boerse Stuttgart Group announced Monday.

Major German Stock Exchange Group Launches Crypto Trading
The Boerse Stuttgart stock exchange

BSDEX “is Germany’s first regulated trading venue for digital assets where investors’ orders are executed directly against each other according to fixed rules,” explained Boerse Stuttgart Digital Exchange GmbH, the company responsible for the technical operation of the new exchange. Initially, the new platform is only available to a number of invited users. According to the announcement:

As of now, selected users in Germany can connect directly to the trading venue, where they can trade the bitcoin-euro pair initially. BSDEX will be opened up gradually to other retail and also institutional investors, who can register for it now.

Major German Stock Exchange Group Launches Crypto Trading
Boerse Stuttgart Digital Exchange’s user interface

Investors can connect directly to the new crypto exchange and trade without a broker. Currently, only market and limit orders are available, but the company said it will add more trading options in the near future. Transaction fees are levied based on the order type, but the exchange affirmed that there are presently no other costs for users.

Peter Grosskopf, CTO at Boerse Stuttgart Digital Exchange GmbH, explained that “BSDEX will give retail and institutional investors direct access to digital assets and provide flexible and relatively low-cost trading.” He joined the company in April from Solarisbank, which supports the development of the new platform.

Boerse Stuttgart Sees Potential in Crypto

Dirk Sturz, the CEO of Boerse Stuttgart Digital Exchange GmbH, believes that “The market in cryptocurrencies is worth billions, and more digital assets will emerge on the basis of blockchain.” He has worked at Boerse Stuttgart since 2007. “Our goal is to build up the leading European trading venue for those assets,” he remarked.

The company claims that its newly launched digital asset platform complies with the regulatory requirements of the German Banking Act (Kreditwesengesetz). The platform aims to offers “a transparent environment and an appropriate legal framework for digital asset trading,” the announcement details, adding:

BSDEX is the next step of Boerse Stuttgart Group in creating an end-to-end ecosystem for digital assets, thus driving the digital transformation of financial markets.

Major German Stock Exchange Group Launches Crypto Trading
Bison app

Prior to launching the digital asset exchange, Boerse Stuttgart launched a cryptocurrency app called Bison early this year. It was developed by Sowa Labs, a fintech subsidiary of Boerse Stuttgart Digital Ventures. The app’s trading partner is Euwax, a subsidiary of Boerse Stuttgart. Users can download the app to buy and sell four cryptocurrencies free of charge: BTC, ETH, LTC, and XRP. “You don’t need a crypto wallet, only a German bank account,” Bison’s website clarifies. The app also offers “Cryptoradar,” which analyses real-time data and provides a sentiment overview of the most discussed cryptocurrencies.

Operations, Partners and Other Crypto Projects

BSDEX is operated as a trading facility by Baden-Wuerttembergische Wertpapierboerse, which also operates the company’s public stock exchange in Stuttgart. Boerse Stuttgart Digital Exchange GmbH, which is responsible for the technical operation of BSDEX, is a joint venture of Boerse Stuttgart GmbH, digital publishing house Axel Springer, and finance portal Finanzen.net.

Blocknox, a subsidiary Boerse Stuttgart Digital Ventures, is responsible for the custody of acquired cryptocurrencies on an escrow basis. Meanwhile, Euwax manages the financial services required for trading.

Major German Stock Exchange Group Launches Crypto Trading
Germany’s Federal Financial Supervisory Authority

A Berlin-based fintech company with a full German banking license, Solarisbank is BSDEX’s technology and banking partner responsible for payment processing and the custody of customers’ cash deposits in euro. The bank is authorized and regulated by the Federal Financial Supervisory Authority (Bafin) and the European Central Bank (ECB).

Bitwala partnered with Solarisbank last year to offer crypto-friendly bank accounts to its users. Bitbond partnered with the bank in March to process bank transfers during its security token offering. Further, Solarisbank’s Blockchain Factory, which enables users to offer their own crypto service, has partnered with Bison to help bring the app to the mass market.

What do you think of Boerse Stuttgart Group launching a crypto trading platform? Let us know in the comments section below.

Disclaimer: This article is for informational purposes only. It is not an offer or solicitation of an offer to buy or sell, or as a recommendation, endorsement, or sponsorship of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.


Images courtesy of Shutterstock, Bison, and Boerse Stuttgart Group.


Did you know you can buy and sell BCH privately using our noncustodial, peer-to-peer Local Bitcoin Cash trading platform? The Local.Bitcoin.com marketplace has thousands of participants from all around the world trading BCH right now. And if you need a bitcoin wallet to securely store your coins, you can download one from us here.

The post Major German Stock Exchange Group Launches Crypto Trading appeared first on Bitcoin News.

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