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The U.S. puts politics ahead of policy, Brad Garlinghouse has said at the 2023 Dubai Fintech Summit.

Crypto exchange Coinbase is bolstering its relationship with regulatory authorities in the United Arab Emirates as it faces mounting challenges back home in the U.S.

“There is no doubt that UAE has the potential to be a strategic hub for Coinbase, amplifying our efforts across the world,” Coinbase said in a blog post on Sunday. “It further serves as a particularly strategic bridge between Asia and Europe — two of our existing focus international regions to date.”

Coinbase’s executive team, including CEO and co-founder Brian Armstrong, is in the UAE this week for meetings with policymakers, regulators, crypto founders and clients. Armstrong will also provide a keynote address at the inaugural Dubai Fintech Summit. Armstrong admired the UAE for its proactive and progressive regulatory approach to crypto in a tweet, saying the region “deserves a lot of credit for being forward thinking on crypto.”

“First dedicated crypto regulator in the world, a clear rule book published (!), business friendly plus strong customer protections. Really enjoying my visit so far,” he added.

Coinbase’s tensions with US regulators grow

Coinbase’s first visit to the UAE, in Dubai and Abu Dhabi, comes amid souring relations with American regulators and a nascent effort to move beyond the U.S. In March, the U.S. Securities and Exchange Commission sent Coinbase a Wells notice alerting the exchange to “possible violations of securities laws.” In April, Coinbase sued the SEC in order to force the agency to respond to a petition that the company filed demanding the SEC publish specific rules for digital assets. Last week, the SEC was ordered by a U.S. court to respond to Coinbase’s complaint within ten days.

Also last week, Coinbase launched an international derivatives exchange from Bermuda, allowing users to trade perpetual futures with currently 5x leverage.

“It is no secret that Coinbase is also working with Abu Dhabi Global Market (ADGM) regulators to further expand the licensing and availability for Coinbase International Exchange,” Coinbase said in the Sunday blog post. “We have also been engaging with Dubai’s Virtual Assets Regulatory Authority (VARA), a dedicated regulator for virtual assets, as they put forward a comprehensive retail framework built on the principles of economic sustainability and cross-border financial security. This expands our global footprint, helping get us closer to bringing 1 billion users to crypto.”

UAE’s growing crypto ecosystem

The UAE has witnessed significant growth in its crypto ecosystem over the past few years, attracting attention from giants such as Binance.

Dubai’s Virtual Assets Regulatory Authority was set up last year, and earlier this year, it issued its crypto regulatory framework, laying out a concrete licensing regime for crypto service providers. Last month, the registration authority of ADGM issued a consultation paper to explain the proposed Distributed Ledger Technology Foundations Regulations 2023 and sought public feedback on the proposed new legislative framework for foundations that facilitate DLT and token issuance.

“In short, the region is standing-out as a leader in the development of a web3 ecosystem, making it an attractive location to consider investing in,” Coinbase said. “The vacuum created by other notable jurisdictions means that international counterparts, such as the UAE, are racing to fill the regulatory gap.”

Despite regulatory uncertainty in the U.S., Coinbase is “100% committed” to the home country over the long term, Armstrong said last week during the company’s earnings call.

“Let me be clear, we’re 100% committed to the U.S. I founded this company in the United States because I saw that rule of law prevails here,” Armstrong said. “That’s really important, and I’m actually really optimistic on the U.S. getting this right.”

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Over 11,000 tokens have been issued and traded on the Bitcoin network, data shows.

Under the plans, any crypto received will immediately be exchanged for Swiss francs, Prime Minister Daniel Risch told German news publication Handelsblatt.

Speculative mania in meme coins has historically presaged bearish reversals in bitcoin.

Democratic Party lawmaker Kim Nam-kuk had reportedly co-sponsored a bill seeking to defer taxation on crypto profits.

Binance CEO Changpeng Zhao this morning dismissed concerns after the exchange paused and restarted bitcoin withdrawals twice in less than 12 hours.

Zhao said in response to comments about the exchange’s bitcoin withdrawal issues ,”4″ — his personal code for “Ignore FUD, fake news, attacks, etc.”

“4. There are some FUD about BTC withdrawal issues,” Zhao, known by his initials “CZ,” tweeted Monday. He pointed to Bitcoin network’s high transaction fees as the main reason for the temporary withdrawal halts.

Some users had expressed concerns that Binance in fact halted withdrawals because of billions of dollars of withdrawals from the exchange and worried that the network congestion explanation could be cover for the company needing to replenish its hot wallets. Binance quickly addressed those concerns, saying: “We’re aware that some data are showing a large volume of outflows from Binance. This ‘outflow’ are actually movements between Binance hot and cold wallets due to the BTC address adjustments.”

Binance indeed moved 157,000 bitcoin (worth around $4.4 billion) between its hot and cold wallets on Sunday, according to CryptoQuant’s head of research Julio Moreno. Binance’s net withdrawals were likely only around 10,100 bitcoin (over $282 million), Moreno added.

Binance’s bitcoin withdrawal pauses and resumptions

Binance first paused bitcoin withdrawals for around two hours on Sunday afternoon U.S. time, citing network congestion. Its second pause occurred Sunday evening U.S. time and normal service resumed after about two hours.

Binance said a large volume of pending transactions on the Bitcoin network caused the withdrawal issues. Transactions were pending because the bitcoin transaction fees that had been set by Binance did not anticipate the transaction surge. Binance reacted by increasing the fees for pending transactions to be picked up by miners, and then resumed withdrawals.

In addition to the block rewards, bitcoin miners also get transaction fees. When users send Bitcoin transactions, they have the option to attach a fee to incentivize miners to prioritize their transactions. Higher fee transactions generally get processed faster.

“To prevent a similar recurrence in the future, our fees have been adjusted. We will continue to monitor on-chain activity and adjust accordingly if needed,” Binance said. “Our team has also been working on enabling BTC Lightning Network withdrawals, which will help in such situations.”

Bitcoin Lightning Network is a Layer 2 scaling solution built on top of the Bitcoin blockchain. Lightning Network fees are generally lower compared to on-chain Bitcoin transaction fees because the Lightning Network operates off-chain, reducing the burden on the main blockchain.

Bitcoin network congestion

Pending transactions on the Bitcoin network hit a record high of over 400,000 on Sunday, higher than anything seen during the bull runs of 2018 and 2021, according to on-chain data. The number is still higher than 400,000.

The recent launch of the Ordinals protocol appears to be the main cause of Bitcoin network congestion and high fees. Ordinals, created by Bitcoin developer Casey Rodarmor, facilitates the creation of NFTs on the Bitcoin blockchain. Ordinals Inscriptions continue to climb, as The Block reported recently. Inscriptions, similar to NFTs, are metadata inscribed on a satoshi, the lowest denomination of a bitcoin. Using Ordinal Inscriptions, people can directly inscribe text, images and even videos on the Bitcoin blockchain.

The price of bitcoin continues to trend lower and is now at $28,170, down 2.8% in the last 24 hours, according to CoinGecko data.

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Deribit’s forward-looking ether volatility index (ETH DVOL) hit lifetime lows over the weekend. Expectations for price turbulence appear underpriced considering the lingering macroeconomic uncertainties.

The move could bolster market liquidity for the burgeoning Metis ecosystem, community members say.

Some holders have turned pocket change into fortunes after getting into the very early stages of pepe.