Malta’s Pro-Cryptocurrency Regulation Pay Dividends and Bitmain Summarizes 2018 Key Milestones
Malta, one of Europe’s smallest islands played a leading role in setting the trend for enacting pro-cryptocurrency regulation that benefited the nation’s economy. According to a report, Malta had the largest trading volume in December last year ahead of well-known financial hubs such as New York and London. Bitmain, the largest manufacturer of cryptocurrency mining equipment published a blog post listing the firm’s key milestones in 2018 – and they are not disappointing given the environment that crypto companies had to operate in. Bitcoin got a put-down from a senior adviser to the Bank of England (BoE) governor who claims that the world’s popular cryptocurrency fails fundamental tests of financial services.
Yahoo founder: Blockchain is a natural fit for banks and trading
The beginning of 2018 saw many analysts and self-proclaimed crypto enthusiasts making predictions of when and how the price of Bitcoin would shoot to the moon. By the end of the year, only a few were correct or re-adjusted their predictions.
2019 is proving to be a different year as predictions and forecasts are based on technology, regulation, and impact of cryptocurrencies rather than their price.
Speaking at the Innovation Asia Forum held in Singapore, Jerry Yang, the co-founder of Yahoo said that blockchain is good for banks and trading.
“Blockchain is a natural technology for banks and trading. If you look at US institutions and banks, the kind of infrastructure that is being developed has long-term implications. For the technology to succeed, the question is can there be trust built? That can open huge amounts of doors,” said Yang.
Cryptocurrencies fail fundamental tests, says senior adviser to BoE governor
Cryptocurrencies such as Bitcoin will always have critics and die-supporters – the two extreme groups that will push the growth of the sector.
Van Steenis, a senior adviser to the governor of the Bank of England (BoE) Mark Carney said that cryptocurrencies fail fundamental tests for financial services. He was speaking in an interview on Bloomberg Television in Davos, Switzerland on Jan. 21 ahead of the annual World Economic Forum (WEF) Annual Meeting.
“I’m not so worried about cryptocurrencies. They fail the basic tests of financial services. They’re not a great unit of exchange, they don’t hold value, and they’re slower,” said Steenis.
He added that one of the challenges that England central bank is facing is how it will regulate new entrants to the banking system. He said that fintech firms are mainly obsessed with reaching out to customers and they have to do so before traditional banks innovate.
“What I love when meeting with Fintechs is their obsession with customers. The challenge is will they get customers before the traditional banks can innovate,” he said.
Steenis is a force to reckon with in the financial sector as he has previously worked for two of the world’s leading financial institutions – America’s Morgan Stanley and Britain’s Schroders PLC.
Crypto smart card wallet maker raises $15 million from SBI Crypto Investment Ltd.
Tangem, the maker of smart card wallet for cryptocurrencies has raised $15 million from SBI Crypto Investment Ltd. in an attempt to push for mass adoption of blockchain technology and cryptocurrencies.
The crypto firm is pioneering digital assets by making them as easy to use as Cash and has attracted additional investment to accelerate the deployment of its technology in several other industries where secure storage and circulation of digital assets has great potential.
Andrey Kurennykh, the co-founder of Tangem said, “In 2018, our technology was proven by the markets after we launched the mass production of Tangem cards for cryptocurrencies and tokens. With this additional investment in 2019, we will be able to extend our product offering in other industries and provide better support to companies which embrace the idea of [the] physical distribution of blockchain assets”.
With a special chip, Tangem smart notes are smart banknotes that allow users to carry cryptocurrencies or digital assets.
Yoshitaka Kitao, the president and CEO of SBI Holdings said the Tangem hardware wallet is secure and is an important tool in promoting the adoption of blockchain assets.
Mining giant Bitmain summarizes 2018 key milestones and gives an outlook for the year
In the midst of the raging crypto winter accompanied by storms, Chinese-based mining giant Bitmain experienced some calm and sunshine.
The mining giant published a blog post on Jan. 21 detailing its key milestones for the past year and how it hopes to sail through in 2019.
“As we move into this new year, here at Bitmain we’ve been doing a bit of reflecting on what a year 2018 has been, as well as what we expect this coming year,” said Bitmain in the blog post.
The company pointed out that there were major developments that are too many to list and because of that, the firm only listed memorable milestones.
The firm filed an application to list on the Hong Kong Stock Exchange. The blog post, however, did not go into detail on how the application is coming along (if it is at all).
Bitmain claims to have launched several exciting products to improve mining efficiency. This is exactly what the market needed because of the low Bitcoin prices and concerns of the industry’s footprint on the environment.
Its greatest milestone for 2018 was the next generation 7nm ASIC chip specifically designed for SHA-256 mining. The chip was integrated into new mining equipment and greatly improved power consumption and performance.
Bitmain partnered with Circle Internet Financial and led the firm’s $110 million Series E funding round. The mining giant also rolled out an institutional-grade cryptocurrency index service to be used as a reference point by investors, miners, and users.
The crypto mining giant expanded into the U.S and built facilities in Texas and Washington.
Bitmain anticipates greater adoption for cryptocurrencies and this begins with regulators acknowledging the role cryptos can play in the financial system instead of seeing the new industry as a threat to the stability of the traditional financial system.
Thanks to pro-active crypto regulation, Malta is the world’s crypto trading leader
Malta has edged traditional financial hubs such as New York and London as the world’s leader in cryptocurrency trading, at least according to a December exchange report published by CryptoCompare.
Malta, one of the smallest island in Europe and with a population of less than half a million people processed a little under $40 billion in digital currencies through its exchanges. In second place is Hong Kong which processed $32.5 billion.
The U.S, a country with the greatest economy in the world came fifth. Samoa came third and Seychelles, an African island, came fourth.
About the surprising results, Charles Hayter, co-founder of Crypto Compare said, “It’s home to some of the largest exchanges who have chosen to set up shop as they [Malta] have carved out a crypto-friendly regulatory atmosphere.”
Commonly referred to as the Blockchain Island, Malta enacted three comprehensive blockchain and cryptocurrency laws that attracted several exchanges such as Binance, OKEx, Bittrex, and more to the European island.
This development is an indication of what pro-active cryptocurrency regulation can do to countries
Cryptocurrency exchange LGO Markets partnership with XTRD aimed at institutional investors
The cryptocurrency sector is moving away from being a market driven by hobbyists to one driven forward by institutional clients. It has already been predicted that the inflow of institutional investors will trigger the next bull run. This kind of thinking has taken off with crypto firms who are doing all they can to lure as many institutional clients as possible.
LGO Markets, a non-custodial trading platform has partnered with the technology company XTRD to allow banks, hedge funds, and institutional investors to have easy access to cryptocurrency markets.
LGO Markets’ platform will be integrated into XRTD’s ecosystem allowing institutional clients to access liquidity pool without significantly altering their algorithms.
Serg Gulko, the CTO of XTRD was quoted as saying, “When we just started our dialog, I was pleasantly surprised by the fact, that the entire solution was being built by traditionally good French engineers. Besides technological stack, LGO Markets is taking seriously on regulations what is good for company and industry as a whole. Over the time we discovered that we might have much more to work in common besides FIX API integration.”
Hugo Renaudin, the CEO of LGO Markets expressed his excitement at the partnership and explained that the company’s “ambition is to become the reference institutional platform for trading, clearing, and settlement of digital assets.”
He added that the new partnership makes sense because XTRD will provide institutional grade access to LGO Markets’ platform.
South Korean exchange leaders jailed for manipulating trading volume
Two leaders of Komid, a South Korean-based cryptocurrency exchange have been sentenced to serve time for manipulating trading volumes of their platform and illegally benefiting from their actions, reported local online publication Blockinpress on Jan. 18.
The exchange’s CEO, only identified as Choi was slapped with a three-year sentence and another company leader with an unspecified role was sentenced to two years in prison for various crimes ranging from fraud and embezzlement to misconduct.
The convicted exchange leaders reportedly conjured up an elaborate scheme to fake 5 million transactions with the end goal of inflating the trading volume. It is alleged that the two earned $45 million from their scheme. The firm also used a bot to automatically place large orders and lure new users to the platform.
“Choi has committed fraud for a countless number of victims for a long period of time…. Furthermore [sic], he holds the financial authorities responsible for failing to keep track of the industry better,” the judge who presided over the case was quoted as saying.
In December, The Korea Times reported that local authorities indicted three employees of South Korea’s largest exchange Upbit on suspicion of manipulating its order book. The exchange denied the allegations in a press statement and labeled them as “totally false.”
An official of the country’s financial regulator, the Financial Services Commission (FSC) said, “I’m worried about investors who may lose money in this market because of exchanges like Upbit. We need a way to make the market and the industry fair and transparent.”
Swiss private bank Falcon introduces direct transfers of cryptocurrencies
Switzerland’s first private bank Falcon has introduced a new feature that facilitates direct transfers of cryptocurrencies for private and institutional clients, the bank announced on Jan. 21.
Martin Keller, the CEO of the Swiss investment bank said his institution has taken another step in availing itself as a market leader in the cryptocurrency space.
“Falcon has once more seized the opportunity to demonstrate its expertise as a market leader in the digital assets space by merging traditional private banking services with innovative financial solutions,” he said about the new offering.
The bank, which currently supports Bitcoin, Bitcoin Cash, Ether, and Litecoin for direct transfers claimed that the latest offering makes the selected digital assets “fully bankable.”
The new offering goes into effect immediately allowing both private and institutional clients to directly transfer select digital currencies to and from segregated wallets or directly convert them to fiat currencies. Clients can make use of e-banking or dedicated relationship managers to conveniently place trades.
“Digital assets are included in portfolio statements as well as in tax reporting documents. In addition to ensuring best execution, Falcon provides secure storage thanks to its proprietary custody solution,” said the blog.
Bitcoin must ditch proof-of-work algorithm, says BIS report
The Bank for International Settlements (BIS) released a 31-page report on Jan. 21 entitled “Beyond the doomsday economics of “proof-of-work” in cryptocurrencies” in which it claims that Bitcoin must depart from its proof-of-work consensus mechanism if it entertains any hopes of solving its problems and remain viable in the future.
The research paper further said that when the block reward reduced to zero in the future, transactions fees alone will not be enough to cover mining expenses. The paper argues that the Bitcoin network would become so slow that it will be unusable.
“Simple calculations suggest that once block rewards are zero, it could take months before a Bitcoin payment is final unless new technologies are deployed to speed up payment finality,” said the paper.
The study further added that off-chain solutions such as the Lightning Network could prove useful in the future.
In conclusion, the researchers said, “In the digital age too, good money is likely to remain a social construct rather than a purely technological one.”
The BIS is a Swiss-based financial organization is owned by 60 central banks.