Invesco Blockchain ETF to Debut on London Stock Exchange, Facebook’s Cryptocurrency a Potentially Cash Cow
Apart from the falling digital asset prices, the crypto industry is going through a good spell as positive developments have been announced in the past days. American based asset manager Invesco has launched a blockchain-based ETF that will trade on the London Stock Exchange. Any analyst at Barclays noted that Facebook’s secretive cryptocurrency has the potential to rack in billions in revenue for the social media company. Germany, the largest economy in Europe, is poised to adopt a positive stance on security tokens. Ripple CEO Brad Garlinghouse has questioned the usefulness of JP Morgan Chase’s stablecoin and argues that it has no real use case.
Barclays says Facebook’s cryptocurrency opens up an opportunity for $19-billion in revenue
Social media giant Facebook is believed to be secretly working on cryptocurrency project. A Barclays analyst now believes that the cryptocurrency – believed to be a stablecoin – could open up a multi-billion-dollar revenue stream for the tech company in addition to its advertising business model.
Ross Sandler forecasts that Facebook Coin could potentially generate as much as $19 billion in additional revenue in two years’ time, reported CNBC on March 11.
“Merely establishing this revenue stream starts to change the story for Facebook shares in our view,” said the analyst.
Facebook’s cryptocurrency will be used for global payments via messaging app WhatsApp, according to reports from mainstream publications such as Bloomberg and the New York Times.
Sandler said the cryptocurrency project would help the social media platform to discover a new income stream, something that the firm needs at the moment.
“Any attempt to build out revenue streams outside of advertising, especially those that don’t abuse user privacy are likely to be well-received by Facebook’s shareholders,” said Sandler.
The analyst believes that if Facebook stablecoin proves to be a success, the tech giant could eventually expand its services and get into consumer lending, physical payments, and remittance.
U.S. asset manager Invesco launches blockchain ETF on London Stock Exchange
U.S private asset manager Invesco Ltd. is launching a blockchain-based exchange-traded fund (ETF), reported the Financial Times on March 9. The new ETF targets companies that generate revenue from blockchain technology and also gives a clear indication that asset managers still have an appetite for the technology that underpins digital assets.
The Invesco Elwood Global Blockchain ETF will debut on the London Stock Exchange on March 11 and will initially invest in 48 companies.
The ETF, which carries a 65-basis points management fee, will invest in companies invest such as Taiwan Semiconductor Manufacturing, a firm that supplies mining chips to cryptocurrency manufacturers, and CME Group (Chicago Mercantile Exchange & Chicago Board of Trade), a financial market company that has played a crucial role in Bitcoin futures trading.
The ETF will also invest in tech companies such as Advanced Micro Systems (AMD), Apple, and Intel. The ETF will invest in the companies based on a scoring system developed by Elwood Asset Management, an investment firm backed the British hedge fund manager, Alan Howard, who is also the co-founder of the Brevan Howard hedge fund.
Elwood chief executive Bin Ren believes that blockchain technology has far more use cases that extend beyond digital currencies.
“We are beginning to see the technology being used by financial services companies in particular, but we expect greater application of blockchain technology across a wide range of industries,” said Ren.
Binance may possibly launch a fiat-to-crypto exchange in Argentina
Changpeng Zhao (CZ), the CEO of Binance, one of the largest cryptocurrency exchanges in the world, has hinted at the development of a new crypto-to-fiat exchange in Argentina in a tweet posted on March 9.
The tweet came after the announcement that Argentina’s government has pledged to co-invest in crypto projects backed by the cryptocurrency exchange.
CZ’s comment suggested that Binance may be opening a trading platform in the Latin American country.
In the tweet, CZ asked, “Guess where we will have a new fiat-to-crypto exchange?”
It was reported in January that Binance was planning to launch fiat-to-crypto exchanges in eight more countries. However, the exchange did not specify the location of the six exchanges except for Singapore and Malta.
The exchange recently partnered with payment processor Simplex to allow users to purchase cryptocurrencies using credit cards.
More recently, social trading and investing platform eToro launched its cryptocurrency trading services in the U.S and will allow users in 32 U.S states and territories to trade 13 unspecified cryptocurrencies.
Cryptocurrency exchange Bitfinex launches USDT markets for two top digital assets
Bitfinex, a cryptocurrency exchange owned and operated by iFinex announced on March 11 that it is launching USDT markets for two of the world largest digital assets – Bitcoin and Ethereum. The exchange claims that this is an “effort to optimize cross-pair market making capabilities.”
The ticker symbols for the newly launched pairs are “BTCUST” and “ETHUST”.
“At Bitfinex we strive to provide our user base with a diverse array of tools for running high-quality market differentiating trading strategies,” said the exchange via a blog post announcing the new pairs.
Bitcoin and Ethereum are two of the world’s largest cryptocurrency and they have a combined valuation of $83 billion and contribute just over 62 percent of the entire market cap.
Binance users gear for an 8-hour downtime on March 12 due to scheduled maintenance
Leading cryptocurrency exchange is preparing to perform system-wide upgrade maintenance scheduled for March 12 starting at 2:00 AM (UTC).
During the upgrade, the exchange will suspend all services that include deposits, withdrawals, and trading. Deposits pending before the upgrade will only be completed after the upgrade process is complete.
The exchange has promised to keep its users updated about the process. Binance has never been hacked, making it one of the safest crypto exchanges worldwide.
South Korea’s messaging app operator Kakao raises $90 million in a private coin offering
The crypto division of South Korea’s messaging app Kakao has secured $90 million in funding through a private coin offering. The platform is preparing another similar round of funding starting March 12 and hopes to raise the same amount of money before launching its blockchain platform in June this year.
The previous round of funding ran in the last quarter of last year despite the price plunge that dominated the market in 2018. This is according to Jason Han, the CEO of Ground X Corp, the crypto division of Kakao.
Han further added that the firm raised funds from venture capital and private equity funds that include Cresendo Equity Partners, IDG Capital, and Translink Capital.
In an interview with Bloomberg, Han said that they are planning to fill their platform (known as Klaytn) with services such as games, travel apps, etc., all acquired from third parties.
Han further added that the platform is collaborating with 26 partners so that they can run their apps on the Klaytn platform. The partners include Wemade Entertainment Co., Watcha Inc., and Zanadu.
“There’s going to be a wide spectrum of services. We’re continuing to have conversations with Kakao,” said Han.
The platform’s launch was slotted for last year but was delayed. The firm has 65 employees and is expecting to go on an aggressive hiring spree.
Some fund managers are unfazed by the bear market
The crypto market has lost more than 70 percent of its value since it reached its peak of around $828 billion in January last year.
However, some fund managers are unsettled by the volatility of the industry and the scandals that have painted a bad picture of the industry. These fund managers believe that the price of Bitcoin is irrelevant at the moment but what matters most is what distributed ledger technology (DLT) will do to trigger the technological innovations and create big opportunities for early-stage investors.
They believe that crypto startups will build applications on the decentralized protocols and have the same impact as those built on the protocols of the internet.
Managing partner at venture capital firm Andreessen Horowitz Scott Kupor said that his firm is interested in investing in projects whose leaders have a clear view of what they are trying to build.
“A lot of the times what we invest in is the promise that they will do that. And that’s how we think about the business more generally. We are buyers, we have not sold any assets, we think of those as traditional venture investments that have 7 to 10-year horizons,” said Kupor.
Crypto forensics and intelligence firm CipherTrace partners with Malta Financial Service Authority
Malta’s financial watchdog the Malta Financial Services Authority (MFSA) has partnered with crypto detective firm CipherTrace. The regulatory agency will utilize CipherTrace Compliance Monitoring to manage and monitor risks related to cryptocurrencies and virtual asset businesses.
CipherTrace Compliance Monitoring solution can be used to protect consumers and investors in the virtual asset business.
MFSA chief executive officer Joseph Cuschieri said they came to a decision to partner with CipherTrace after being aware of risks such as money laundering and financing terrorism that are associated with businesses operating in the crypto space.
“CipherTrace Compliance Monitoring will provide the MFSA with powerful oversight tools to automate regulatory processes and audit the risk management of virtual asset businesses that are licensed in Malta,” said Cuschieri.
CipherTrace Compliance Monitoring utilizes machine learning technology to den-anonymize transactions. This helps regulators evaluate the truthfulness of virtual asset businesses.
CipherTrace CEO Dave Jevans said that cryptocurrency firms are struggling to establish relationships with banks due to perceived risk. He added that CipherTrace bridges the gap and can bring the two worlds to work together.
“Banks and other financial institutions use the CipherTrace Compliance Monitoring solution to help decide which virtual asset businesses to trust as corporate customers. These insights help banks avoid de-risking by turning away valuable customers in this lucrative and fast-growing sector,” said Jevans.
Ripple CEO Brad Garlinghouse questions JP Morgan Chase’s stablecoin
Ripple CEO Brad Garlinghouse expressed skepticism over JPM Coin, the stablecoin announced in February by JP Morgan Chase, one of the leading financial institutions in the world.
Speaking at the DC Blockchain Summit on March 6, Garlinghouse said that it is a good thing that financial institutions such as JP Morgan were getting into the crypto industry. However, his praises ended as soon as they had come in.
Garlinghouse says the bank’s stablecoin does not solve any real issue and there is actually no purpose for having such a coin in the first place.
“If you give them a dollar for deposits, they’ll give you a JPM Coin that you can then move within the JPM ledger. Wait a minute, just use the dollar! […] I don’t understand. If you’re just moving within the JPM ledger, and it has to be dollar-to-dollar, one-to-one backing, I don’t understand what problem that solves,” said Garlinghouse.
JP Morgan’s cryptocurrency was initially received well by Bitcoin enthusiasts who will praise anything that brings credibility and trustworthiness to the nascent industry. However, the stablecoin has met criticism from leading figures in the crypto industry.
Bill Barhydt, the CEO of Aba took a swipe at enterprise blockchains and their tokens, labeling them as nonsense.
“It’s exactly what’s happening with this enterprise blockchain nonsense; where people have this fallacy that they’re going to make blockchain work inside the firewall. It’s all going to fail miserably,” said Barhydt.
JP Morgan says that its cryptocurrency has endless applications.
German’s position on security tokens is exactly what the doctors ordered
Germany’s Ministry of Finance made a surprise but welcome decision when it called for blockchain-based securities to be recognized as legal financial instruments.
The announcement made on March 8 suggests that the country’s law needs to be amended so that it can accommodate security tokens.
The government of German, the biggest economy in Europe, wants to initially focus on electronic bonds before it addresses digital shares.
“As a rule, utility tokens do not constitute securities, investments or other financial instruments under the German Securities Trading Act and in most cases will not be electronic bonds in the future,” although “it could be determined by law that a public offer of utility tokens may only take place if the provider has previously published an information sheet,” said a draft outline on utility tokens.
Thomas Heilmann, a German lawmaker believes that distributed ledger technology (DLT) is an interesting technology but many people still do not have a clue of what the technology is all about.
This new legislation could position German as a leader in tokenized finance and possibly push other European countries to adopt a similar stance.
Owner of the world’s tallest building is planning an initial coin offering (ICO)
A real estate firm behind Burj Khalifa, the world’s tallest building, is planning to develop its own cryptocurrency with the aim of launching an initial coin offering (ICO).
Emaar Group is a United Arab Emirates-based development firm that counts Burj Khalifa, The Dubai Mall, The Dubai Foundation, and more in its portfolio.
“Emaar Group is marking an industry-first by leveraging the significant potential of blockchain technology with plans to offer the Emaar community token for customers and partners by the end of this year,” announced the firm in a press release.
The firm has partnered with Switzerland’s Lykke AG to develop an Ethereum-based token compatible with ERC-20 standards. The token will be used by the real estate firm’s customers and shareholders for a referral and loyalty system.
According to the press release, the firm plans follow up the token launch with an ICO within a year.