Headlines
▌Revenue of Bitcoin Miners in July Was US$555 Million, a 16.7% Drop From the Previous Month
According to the data available on The Block, Bitcoin miners generated total revenue of US$555 million in July, down from US$667 million in June. The data also shows that Bitcoin network difficulty decreased over July. On the 31st of July, the number stood at 27.693t, whereas it stood at 29.57t at the beginning of the month.
Policies
▌ Central Bank of Honduras Warns About the Risks of Using Cryptocurrency
The Central Bank of Honduras has issued a press release that seeks to clarify the stance the institution takes about the use of cryptocurrencies in the country. The organization states that even with the popularity such instruments have attained in other countries, cryptocurrencies have no backing of any sort, and are also affected by high levels of volatility. The bank explained that “Any transaction carried out with them will be under the responsibility and risk of the person who performs it.” In addition, the organization informed that according to national laws, the only institution authorized to issue money and to guarantee the existence of an efficient payment system is the Central Bank of Honduras. In earlier news, Honduras established a Bitcoin center to promote the use of Bitcoin.
Cryptocurrency
▌Two California Men Sentenced to Prison for Conning Investors Out of $1.9 Million Through Cryptocurrency Offering
Two men from Orange County in California were sentenced to prison for operating a cryptocurrency scam that defrauded more than 2,000 investors out of a collective $1.9 million, according to the U.S. Department of Justice. Jeremy McAlpine, 26, and Zachary Matar, 29, founded an investment management service and trading company named Dropil Inc. in 2017. During the company’s ICO in 2018, the duo encouraged investors to purchase Dropil’s native token, DROP, and claims that by purchasing it, investors can access to an automated trading bot called “Dex” that would generate annual returns of up to 63% in DROP and distribute them every 15 days. McAlpine and Matar pleaded guilty to securities fraud charges in August 2021 and were sentenced to federal prison for three-year and two-and-a-half-year respectively.
▌Bank of America Says Ethereum Needs Scalability Improvements to Hold Its Market Position
The transition of the Ethereum blockchain from a proof-of-work (PoW) consensus mechanism to a proof-of-stake (PoS) appears imminent, as it needs scalability improvements to keep its market alive, Bank of America (BofA) said in a research report last week. Without the scalability improvements, Ethereum is unlikely to remain as the dominant blockchain operating system, the bank said. “PoS decreases Ethereum’s energy consumption by over 99%, lowers barriers to entry for investors to generate yield as network validators and alters ETH’s supply/demand dynamics,” the bank said, referring to the system’s ether token. BofA also noted that newer blockchains such as Binance Smart Chain (BSC), Tron, Avalanche and Solana have taken market share from Ethereum due to their PoS consensus mechanisms, greater scalability, and lower transaction fees. The bank added that these features will “likely be key as the Web 3 ecosystem of decentralized applications emerges.”
Key Economic Events
▌Moody's: Fed to lift policy rate to 3.5-3.75% by year-end
The famous bond rating company Moody's said that it expects the U.S. Federal Reserve (Fed) to continue to take the policy rate to the range of 3.5-3.75% by the end of the year and above 4% by March 2023, in advance at several upcoming FOMC meetings.
▌U.S. 30-year Treasury Yield Fell Below 2.92% for the First Time Since April
The U.S. 30-year treasury bond yield fell below 2.92% for the first time since April 2022. On the other hand, the U.S. 20-year treasury bond yield fell 10 basis points to 3.11%.