In this week’s crypto news roundup, Mark Zuckerberg claims Libra will increase Facebook’s ad prices, while Goldman Sachs draws the ire of crypto investors.
- During a shareholder’s meeting, Mark Zuckerberg said that Libra would ultimately drive an increase in Facebook’s advertising prices.
- Gaming startup Enjin has released a new plugin that turns Minecraft Java Edition into a blockchain platform.
- During an investor call, US bank Goldman Sachs angered competitors and crypto investors by claiming that crypto is “not an asset class.”
- South Korea is preparing a new amendment to income tax law that might include new rules for cryptocurrency sales and mining projects.
As Facebook continues to develop the Libra, many experts are wondering precisely how the company will profit by integrating the token with social media. At an annual shareholder meeting, Mark Zuckerberg said that Libra would make commerce more beneficial for businesses, leading to an increase in ad revenue. Considering that 98% of Facebook’s income came from ads in 2019, that’s not an insignificant game.
“When they run an ad, somebody clicks on that ad and is now going to be more likely to buy something because they actually have a form of payment that works that’s on file; then it basically becomes worth it more for the businesses to bid higher in the ads. And what we see are higher prices for the ads overall.”
In Facebook CEO’s view, payments “is an area that the core infrastructure hasn’t been updated in a very long time”, which is why Libra is poised to make it more efficient.
Gaming startup Enjin has released a new plugin that turns Minecraft Java Edition into a blockchain platform. Dubbed EnjinCraft, the addon grants players the ability to spawn blockchain assets into Minecraft without any additional code. This functionality lets Minecraft servers run localized economies where players have ownership of in-game objects and tokens.
“EnjinCraft is the beginning of a new era for sandbox games. Players now have a tangible stake in their gaming worlds, and server owners can create new kinds of addictive experiences by using branded collectibles and items with scarcity and value in the digital universe,” said Enjin’s co-founder and CTO, Witek Radomski.
Enjin has also released an open-source software development kit (SDK) for Java, allowing developers to implement blockchain in Java-based mobile, desktop or web apps.
During an investor call, US bank Goldman Sachs angered the crypto community by claiming that crypto is “not an asset class.” A slide deck presentation elaborated by stating that crypto doesn’t generate cash flow or contribute to global economic growth. The comment even drew attention from the Winklevoss brothers, who imply that Goldman Sachs is purposefully ignoring crypto-related legislative developments of the past five years.
“It’s important to note that Goldman Sachs’ competitors Fidelity and JP Morgan have made significant investments in cryptocurrency,” said Dave Hodgson, chief investment officer and managing director of NEM Ventures, a cryptocurrency-focused venture capital firm. Fidelity last year set up a separate unit devoted to cryptocurrency clearing and custody, while J.P. Morgan developed its own internal digital currency, “JPM Coin,” for payments.
“While volatility is indeed high, the year-on-year, and now decade-long performance is a consistent uptrend based on holding the asset, not trading the volatility. By considering it unviable for its investors, Goldman Sachs has risked causing its investors to miss out on one of the best performing asset classes in the past 100 years, never mind the last 10.”
South Korea is preparing a new amendment to income tax law that might include new rules for cryptocurrency sales and mining projects. What’s particularly surprising is the amendment may include language for ICOs, which are currently banned in the country.
The South Korean government attempted to draft legislation to tax individual crypto profits at the beginning of the year. Since individuals’ profits from virtual currency transactions are not listed as income, these earnings do not fall under income tax taxation.
It is still unclear if the gains in cryptocurrency transactions are similar to profits in other assets like stocks and real estate in the eyes of the government.
According to Decenter, the proposed amendment will be ready by July and will be brought to Parliament in September 2020.
That’s the roundup for May 30, 2020. Check in next week for the latest news of cryptocurrency innovation and regulation around the world!
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