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News summary 11/9: Coinbase, Vattenfall, Taproot, China, and New York

Cryptocurrency exchange Coinbase is testing new services and enabling users to take out loans up to million dollars. Swedish energy company Vattenfall comments on Bitcoin mining. Bitcoin’s Taproot update will take place soon. Digital currency e-CNY is growing in China and New York has a new Bitcoin-positive mayor.

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Coinbase is planning to offer new services and free trading

Coinbase is one of the world’s largest cryptocurrency exchanges. The company is also listed on the NASDAQ stock exchange these days with a ticker COIN.

The Block reported last week about Coinbase’s new services. Coinbase One would be based on a monthly fee. It would provide users with completely free trading. In addition, there is priority telephone support available also on weekends and holidays.

Such services could be even free of charge. For example, the famous Robinhood trading app is completely free. The app makes money by reselling investor trading data to institutions.

Coinbase is also entering the lending market.

It will be possible to borrow money against crypto holdings up to one million dollars. According to available information, the maximum loan amount would be 40% of your collateral. For example, if you owned one Bitcoin worth $60,000, it would be possible to get a loan of $24,000.

The borrowed money is paid directly into the user’s bank account or PayPal account.

Coinbase tried to offer a fixed 4% interest rate on USDC deposits earlier. However, this was abandoned when the SEC threatened to sue Coinbase.

Coinbase’s popularity is growing rapidly. Last week, Coinbase’s mobile app was number one on the App Store in the U.S. in all categories.

Vattenfall and Bitcoin mining

Sweden’s state-owned Vattenfall is one of Europe’s biggest electricity producers. Vattenfall made the headlines this week thanks to Bitcoin comments from Henrik Julin, the company’s Head of Physical Power Management.

You can see the Twitter thread below.

The Swedish Environment Agency (Naturvårdsverket) and the Financial Supervisory Authority (Finansinpektionen) had recently issued a statement about Bitcoin. These entities want to ban Bitcoin mining altogether and prevent new mining farms from being built. There is a fear that renewable energy capacity would not be enough to cover mining demands.

However, according to Vattenfall, Bitcoin mining is a great resource as it can be turned on and off quickly. Energy can be sold to mining farms when energy consumption is generally low. This way, it is possible to ensure that no energy is wasted at all.

Bitcoin’s Taproot update is coming soon

Bitcoin is known for its slow development pace. The previous major update was seen in 2017. It was SegWit, which was required to enable Bitcoin’s lightning network.

The soon-to-be-released Taproot is the first major update since 2017. Unlike SegWit, Taproot has received unanimous support from the community. This time there is no “civil war” in Bitcoin.

Taproot includes three important updates: BIP 340, BIP 341, and BIP 342. BIP is short for Bitcoin Improvement Proposal. These BIPs improve Bitcoin’s privacy, security, and scalability. See the video below for more information.

Taproot is a significant update, but it doesn’t make any difference to regular users. It doesn’t make transactions instantly cheaper or faster. A regular user doesn’t even know the Taproot upgrade has been done.

Taproot received official approval in the signaling phase in June. The upgrade will be activated in the Bitcoin network in about a week. Taproot is not expected to have a significant impact on the price of Bitcoin.

China’s digital currency e-CNY on the rise

Central bank digital currencies (CBDC) have often made the headlines in recent years. This is largely due to the development in China. We have now some fresh news from the eastern giant and its e-CNY currency.

According to My Changchun, a spokesman of the central bank of China, 140 million e-CNY wallets have been downloaded by now. The digital currency has been used in transactions worth about $9.7 billion. As recently as June, only 34 million wallets were activated. The pace of adoption is fast right now.

The e-CNY is still in the pilot phase. China has not given an official launch date for its digital currency.

CBDC basically means digital fiat. It allows total control over each transaction. Analysts have speculated that many western countries will introduce the universal basic income (UBI) paid with a CBDC.

A central bank digital currency allows incentives to be paid on an individual basis. On the other hand, the downside is the control of assets and transactions by central banks.

The EU and the US have not launched their own digital currencies. However, this will certainly change in the coming years. It will be seen whether any of the CBDCs will pose a threat to Bitcoin.

New York’s new Bitcoin mayor

Miami’s Francis Suarez has been known as the most Bitcoin-positive mayor in the United States. Suarez even announced his intention to accept the next paycheck in Bitcoin.

Now Suarez has a challenger. The new mayor of New York, Eric Adams, tweeted last week that he will take his first three paychecks in Bitcoin. Adams has other plans as well. He wants to make New York the Bitcoin center of the United States.

Adams believes Bitcoin and blockchain technology should be part of the city’s education program. You can see more information in the video below.

The city of Miami has also joined a project called CityCoins two months ago. This project is built on a Stacks, which is a smart contract platform running on Bitcoin’s blockchain.

In a similar project in New York, residents can support the city by purchasing or mining an NYCoin token. When new tokens are created, they are shared with the token owners and the city with a 70-30 ratio. The city can collect funds to infrastructure spending or other expenses.

You can read more about the project citycoin.co/nyccoin. Time will tell whether this idea will receive wider support among people.

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