Bitcoin (BTC) jumped into October, overcoming a US government shutdown that has stalled altcoin exchange-traded fund (ETF) applications.
While markets embraced “Uptober,” other headlines were filled with regulatory struggles and policy trials.
Two defendants admitted guilt in what UK police called the largest cryptocurrency seizure globally, a case that has left courts deliberating whether victims should be compensated at current Bitcoin prices or based on their historical losses.
Brazilian energy firms are courting miners to utilize excess power as New York lawmakers propose new taxes that could push the industry out of the state.
In Europe, stablecoins are facing renewed warnings from regulators just as banks and the ECB promote their own euro-based alternatives.
Here’s this week’s edition of Global Express:
US government shutdown puts altcoin ETFs in limbo as Bitcoin enters “Uptober”
Bitcoin rose above $120,000 on Friday as the US government shutdown entered its third day, fueling optimism that the world’s largest cryptocurrency by market capitalization could maintain its October pattern, often referred to as “Uptober.”
US lawmakers failed to achieve a funding agreement on Wednesday, resulting in the government shutdown. So far, traditional markets haven’t been disrupted, with major indexes rising, although gains have not been as pronounced as Bitcoin’s increase.
This government standoff is particularly significant for both traditional and digital assets as it postpones the release of US jobs data initially scheduled for Friday. The nonfarm payroll report is a crucial economic indicator that investors closely follow for insights into the Federal Reserve’s policy direction ahead of the next Federal Open Market Committee (FOMC) meeting starting on Oct. 28.
Related: Strategy stacks 7K Bitcoin, stablecoins cross $295B: September in charts
Bitcoin’s last October drop occurred just before the 35-day shutdown that began in December 2018, when the cryptocurrency decreased from $3,900 to $3,550. Analysts cited the Financial Action Task Force’s decision in October 2018 to extend its guidelines to include virtual assets as a factor that negatively influenced sentiment. Since then, Bitcoin has recorded six consecutive years of positive performances in October.
The government shutdown is anticipated to delay the Securities and Exchange Commission’s evaluation of routine applications, including crypto exchange-traded funds (ETFs). Proposals related to Litecoin (LTC), Solana (SOL), and XRP (XRP) are facing decision deadlines throughout the month but are likely to be postponed until the agency resumes normal operations.
Brazil wants Bitcoin miners
Crypto miners are unexpectedly welcomed in Brazil, where energy companies regard them as a solution to persistent overproduction.
As reported by Reuters, at least half a dozen projects are under negotiation as some local plants report up to 70% of excess output. Laos has adopted a similar strategy, attracting miners with hydropower to service the debt from dams that left the country with surplus electricity.
Interestingly, Brazil and Laos are leveraging crypto mining to absorb surplus power, unlike other countries that have ejected miners. China’s comprehensive ban in 2021 shuttered entire operations, relocating hash power overseas. In Thailand, miners faced raids for allegedly disrupting the grid and raising electricity costs. In contrast, Brazil is viewing the industry as an outlet for its energy system rather than a liability.
The situation in New York is quite different. On Wednesday, State Senator Liz Krueger proposed a bill to implement a tiered excise tax on crypto mining power usage. The proposal ranges from $0.02 per kilowatt-hour for mid-sized operators to $0.05 for the largest, exempting only those miners who use fully renewable energy.
Related: France goes rogue, Bitcoin pumps on Fed rate cut: Global Express
This follows a two-year moratorium on fossil-fuel-powered mining that ended in 2024. Given that the median cost of mining 1 BTC is already above $70,000 this year, an additional tax could force grid-reliant miners out of the state.
Two plead guilty following the world’s largest Bitcoin seizure
Zhimin Qian, who operated a multibillion-dollar Ponzi-style scheme in China, pleaded guilty in a London court on Monday to laundering criminal proceeds that included 61,000 BTC. Qian’s associate, Hok Seng Ling, also admitted guilt on Tuesday.
From 2014 to 2017, Qian deceived over 128,000 investors through her company, Tianjin Lantian Gerui Electronic Technology, in one of China’s most infamous fundraising frauds before escaping to the UK using false documents.
Police seized her assets in 2018 after tracking Ling. The seized items included Bitcoin, encrypted devices, cash, and gold, which the UK Metropolitan Police described as the largest cryptocurrency seizure in history.
The Bitcoin haul is currently valued at over $7.24 billion and is at the heart of a debate on whether victims will receive compensation at current market values or only what they initially lost.
The Financial Times reported that the High Court may limit restitution to the original investment value for victims, approximately 640 million British pounds ($862 million). This would leave the remaining $6.4 billion under government oversight. Treasury officials have discussed whether the surplus could alleviate a budget deficit, but others caution that this could trigger a protracted legal dispute.
Europe cools on private stablecoins while backing digital euro
European authorities are indicating pressure on private digital currencies while laying the groundwork for their own.
The European Systemic Risk Board (ESRB) has reportedly suggested a ban on stablecoins issued jointly by firms within and outside the bloc. While this recommendation is not legally binding, it strengthens warnings from European Central Bank (ECB) President Christine Lagarde and officials from the Italian central bank that non-EU stablecoins might threaten financial stability.
The world’s largest stablecoin, Tether’s USDt (USDT), has already been delisted by multiple EU trading platforms after Tether opted not to comply with the bloc’s Markets in Crypto-Assets framework. This shift has benefited Circle’s USDC (USDC), but the ESRB proposal could also apply pressure to Tether’s US-based competitor.
Emerging local initiatives are taking shape as well. On Sept. 25, nine major European banks, including ING and UniCredit, announced plans to collaboratively launch a euro-pegged stablecoin.
In the meantime, the European Central Bank is progressing with its digital euro project. On Thursday, it announced framework agreements with seven technology providers, including Feedzai and Giesecke+Devrient, to create systems for fraud detection, risk management, and offline payments. ECB executive board member Piero Cipollone recently mentioned that a mid-2029 launch “could be a fair assessment.”
Magazine: Japan tours on XRP Ledger, USDC and USDT payments via Grab: Asia Express
