After the expansion of the US Federal Reserve’s balance sheet by $297 billion to $8.03 trillion, the highest after November 2022, Twitter is abuzz that that the US central bank has restarted the process of ‘quantitative easing’ or QE.
The last QE took place in 2008 to expand the US Fed’s balance sheet by trillions, and stimulated asset prices, including that of cryptocurrencies.
However, the recent balance sheet expansion stemmed mainly from banks borrowing short-term loans from the Federal Reserve to cope with the recent collapse of the three US crypto banks, including the ‘start-ups focused’ Silicon Valley Bank.
“QE is increasing the balance sheet for monetary purposes. This is about financial stability, and all expansion of the balance sheet is not QE,” Marc Chandler, chief market strategist at Bannockburn Global Forex and author of the book Making Sense Of The Dollar told CoinDesk in an email.
Arbitrum To Airdrop New Token
The long-awaited ARB token will grant holders the ability to vote on changes to the leading Ethereum layer 2 network.
The Arbitrum Foundation said on Thursday that ARB is to airdrop its token on March 23, 2023.
According to the Arbitrum Foundation, ARB will mark Arbitrum’s official transition into a decentralised autonomous organisation (DAO), meaning that ARB holders will be able to vote on key decisions governing Arbitrum One and Arbitrum Nova – the networks that allow users to transact on the Ethereum Blockchain with greater speeds and lower fees.
“Arbitrum DAO will have the power to control key decisions at the core protocol level, from how the chain’s technology is upgraded to how the revenue from the chain can be used to support the ecosystem,” Arbitrum Foundation said in a statement.
GST Stalemate To Continue For Cryptocurrencies
The proposed move to levy goods and services tax (GST) on cryptocurrencies will be postponed as consensus on the modalities has eluded officials from the Centre as well as the state governments. As a result, the 50th meeting of the GST Council, which is expected later this year, is unlikely to finalise the move.
Consensus has eluded the officials because of the “complexities” involved in indirect taxation of cryptocurrencies. Officials say they will need “a few more months” to be able to draw clarity on indirect taxation of virtual digital assets.
“I don’t think this subject will be taken up for discussion anytime soon,” an official said.
Last year, the GST Council had tasked the finance ministries of Haryana and Karnataka to study and identify all relevant supplies associated with the crypto-ecosystem that would be counted within the ambit of GST – their nature, whether they are goods or services, and their applicable rates based on appropriate classification.
The two officials are yet to analyse the full effect of the subject due to complications developed.