In the rising world of cryptocurrency and the blockchain, there seems never to be a dull news moment. Every month is filled with big weekly headliners. Sometimes they’re yay, sometimes nay, but there’s no disputing the influence this new technology is having on ever-growing population numbers (and income figures) around the world. Invest in Blockchain looks at September’s eye-popping news headlines and major trends.
Arguably the biggest dinner table (or sub-Reddit, as the case may be) topic of the month. China’s at it again! Banning Google, banning Facebook, and now, ICOs. Invest in Blockchain takes you through a bite-sized overview of September’s most influential headline.
Asia dominated the crypto news developments in September, which comes as no surprise, seeing that two countries, in particular, have been dominating the cryptocurrency charts. We look into Japan’s newfound status as the world’s largest Bitcoin market.
Fintech firm Dunamu, an affiliate of South Korean gaming Kakao Corporation, circulated that it will, in partnership with US digital currency exchange Bittrex, trade over 110 cryptocurrencies on its upcoming platform, Upbit, starting with an October beta launch. With an ICO ban announced recently, existing cryptocurrencies should be smiling all the way to the top of this new exchange.
Indian Reserve Bank (RBI) executive director, Sudarshan Sen, said that the government is looking into cryptocurrencies as a viable alternative to the Indian Rupee, adding that they are not comfortable with non-fiat digital currencies such as Bitcoin.
India has had a long-standing aversion to crypto. In December 2013, the RBI issued a statement cautioning investors against virtual currencies. In March of this year, its deputy governor called blockchain technology out for being nothing more than a pipedream in replacing traditional currency. It might just be, however, that the government ends up having its own plans up its sleeve in the long run.
First, European Central Bank (ECB) president Mario Draghi stated in response to Estonia’s dream of having its own state-owned virtual currency as part of their e-Residency program, that “no member state can introduce its own currency.” Then, he called Bitcoin “not a currency but a mere instrument of speculation”, likening it to Tulipmania in the Netherlands in the 17th century.
Now, the president of the world’s most important bank has responded to a question of the place of technologies like blockchain in future monetary policies by stating:
“We at the ECB are looking into this, and we have now been looking at this for some time. One conclusion is that, at this point in time, the technology is not mature [enough] yet… to be considered in either central bank policy-making, or in the payments system. We have to look at what progress this technology will [make] in the future.”
Following this up with an answer to the Committee on Economic and Monetary Affairs of the European Parliament that it’s not within the ECB’s regulatory jurisdiction to regulate or prohibit Bitcoin, there seems to be a much more hands-off approach to cryptocurrencies within Europe at present. Watch this space.
Transnistria, Moldova’s unrecognised breakaway region with a population of 500,000, is planning the establishment of cryptocurrency mining farms. The operation of these “farmlands,” thanks to cheap electricity, high-speed internet penetration and smiling Russian investors, will make its government plausibly the most eager public administration on earth when it comes to embracing cryptocurrencies.
CEO Jamie Dimon has called Bitcoin out as nothing more than a fraud and declared it an “Untouchable” by his firm, JPMorgan. And yet, JPMorgan has been acting as a go-between for its clients to buy and sell cryptocurrency. Invest in Blockchain looks at this seeming discrepancy.
In contrast to rival firm JP Morgan, Morgan Stanley’s CEO James Gorman said he believes that cryptocurrencies are “certainly something more than just a fad.” He added that his daughter had bought Bitcoin, uttered in sharp contrast to the snigger with which Dimon had referenced his offspring. The markets responded accordingly. There was a 5.71%, or $221.6, rise in Bitcoin on US-based exchange Bitfinex as a result, reported Investing.com.
While the CEOs of JPMorgan and Morgan Stanley are at loggerheads, opinion-wise, Oaktree Capital’s co-chairman is having his mind changed. Invest in Blockchain looks at the difference 2 months and a little research has made to change this billionaire investors’ opinion on Bitcoin from “no” to a possible “go.”
It seems there’s a new market square for investors to hang out during their lunch break (and, oh, probably every other hour). Coinmarketcap, an alt-coin tracking website that reflects the current dollar value for each listed market coin, recently shot up and is now the 379th most visited website… in the world. MTV is 3,397th on the list. Time to make way for the Crypto Generation.
You know there’s a new industry on the block when AngelList, the world’s leading peer-to-peer angel investor, co-founder, and startup job board, publishes a how-to guide on getting a job at a crypto startup. With a reported 2500+ open technical roles and 1000+ non-technical roles on AngelList alone, the world’s newest sector is in bloom.
There can’t be a cryptocurrency without an accompanying cryptocurrency property market. Invest in Blockchain looks at the trailblazers developing this fascinating new real estate trend.
Kicking things off on a high note, September 1 started with US$4,904.90 for the world’s first cryptocurrency. By September 2, this had climbed to the highest-ever price of US$4,969.00. However, by September 15, owing to industry announcements such as those of China and South Korea, Bitcoin had long since descended the throne of its all-time high, dropping to US$2,981.00. By September 30, it had recovered from the blows dealt during the course of the month and closed at US$4,367.00. (Source: Bitfinex exchange)
After the Bitcoin fork that brought us Bitcoin Cash sent the media into overdrive, Bitcoin is set to split again: This time, it’s Bitcoin Gold. Set for an October launch, Bitcoin Gold is aiming for an even more decentralised cryptocurrency that will decrease the power miners have thanks to current hardware needs. They hope to equalise the playing field by introducing mining using graphics cards.
The Next Web asked what $500 worth of Bitcoins invested 5 years ago would’ve gotten you today:
“Five years ago in December of 2012, at $12 per coin, you could have purchased 41 tokens and had enough change left over for a hamburger and fries, or whatever people ate in the past. Today those coins would be worth $182,275.”
Ethereum entered September at US$389.90, climbing to a high of US$394.78 on September 1, and hit the month’s low on September 15 with US$201.26. It ended September on US$303.44. (Source: Investing.com)
Ethereum is set to hard fork in a major update to the system, a third of 4 pre-planned launch stages. An initial date for Byzantium deployment, a phase I testnet launch in the overall Metropolis update, was originally set for September 18, with an October 9 launch date. This has now been postponed to October 17. Phase II’s Constantinople update is set to follow at a later stage.
The former CIA employee, whistleblower Edward Snowden took to Twitter to name ZCash as the best Bitcoin alternative.
It’s not difficult to understand why authorities around the globe are pulling rank regarding ICOs: there’s a lot of money flowing in. In a mere 3 months, token sales amassed $200 million shy of a billion dollars. Coupled with the first quarter, it pushes the total funding amount for the first 2 quarters of 2017 up to $1.3 billion. And with daily crypto transactions totalling to half a million dollars, it’s no wonder: there’s a lot of money flowing to and fro in River Cryptocurrency. Read the complete Coindesk report here.
Ethereum founder Vitalik Buterin, together with developer Jason Teutsch, is working on revolutionising the industry’s biggest headache at the moment: ICOs. By July 2017, more than US$1.3 billion had exchanged hands thanks to initial coin offerings. With governments cracking down on the trend, Vitalik’s efforts at creating an “interactive coin offering” couldn’t have come at a better time. They aim to quell the current ICO mania by cancelling out upfront market caps, and enabling purchase cancellations.
Vitalik jokes that if Putin knows what Bitcoin is and Paris Hilton is endorsing ICOs, then cryptocurrencies have already gone mainstream. And with celebrities endorsing ICOs left, right and centre, we’re bound to agree: cryptocurrency is steadily rising above its niche origins. Mike Tyson started the trend with Bitcoin ATMs back in 2015.
Now, boxer Floyd Mayweather, Uruguayan football star Luis Suarez, American rapper The Game, Ms Hilton herself, actor Jamie Foxx, and the latest, DJ Khaled, are all prompting their followers to back whichever ICO it is they back – with benefits, of course. Whether this will end up doing the ICOs in question any actual favours, is anyone’s guess. Regulators and investors alike aren’t pleased. And Paris herself has already started having second thoughts about her whirlwind romance with LydianCoin in the face of the possibility of being held legally accountable for any misdealings.
Financial regulators in Hong Kong, a global financial hotbed and cryptocurrency ICO hub, has been prompted into action by China’s ban on ICOs. The Securities and Futures Commission (SFC) followed other countries’ leads and released a statement warning that ICOs might likely be considered securities and therefore subject to the country’s laws. Zcash is one of the alt-coins operating out of Hong Kong. Meanwhile, a Macau gaming company is aiming to raise $500 million through an ICO and will issue coins based out of Hong Kong, a move that has alarmed authorities due to ties to a Macau gang boss.
South Korea has been busy. The country is fighting off North Korean hackers, banning ICOs, probing cryptocurrencies, and surpassing China in trading volume. Not bad for a month’s work! Invest in Blockchain takes a bite-sized view of what South Korea is placing its cryptocurrency focus on.
Taizo, brother to Masayoshi Son – Japan’s richest man – and a billionaire in own right, has predicted that ICOs will come to dominate funding.
Australia follows on the heels of its Australasian counterparts. The Australian Securities and Investments Commission (ASIC) has offered guidance on ICOs in an attempt to “ensure innovative firms understand the regulatory framework they may be operating under and ensure they meet any obligations they may have when raising funds in Australia.” ASIC also issued an investment warning to investors wanting to invest in ICOs.
Croatian fintech startup Digital Assets Power Play has raised $2.6 million during their ICO and made local crowdfunding history.
Switzerland is home to three of the largest ICOs, according to a report by PricewaterhouseCoopers (PwC). And as “the most competitive country in the world and the leader in numerous economic sectors, due in no small part to its strong position as a driver of innovation,” according to Deloitte, so it should be. Unfortunately, the country’s also suffered at the hands of a fake coin ICO scandal.
Now, the Swiss Financial Market Supervisory Authority (FINMA) is taking action. In mid-September, the regulator closed down a consortium of 3 companies linked to the fake E-Coin and declared that it was investigating 11 more. FINMA also warned that ICOs may come under existing regulatory legislation. However, blockchain technologies are still supported, with the agency stating:
“FINMA recognises the innovative potential of such technology and has been supporting efforts in developing and implementing blockchain solutions in the Swiss finance industry for several years.”
And they put their money where their mouth is: The government-operated telecommunications company Swisscom is in the process of establishing a new blockchain unit.
The US Securities and Exchange Commission (SEC) isn’t letting up on cryptocurrencies anytime soon. After ruling tokens issued during hacked Ethereum-based The DAO to have be securities, they released a statement warning investors against ICOs, which would subsequently be under the agency’s regulation.
Now, charges have been brought against a US businessman and the two companies under his control for selling cryptocurrencies back by nonexistent assets during two token sales. DRC (Diamond Reserve Club) and REcoin have landed Maksim Zaslavskiy in hot soup, and the SEC is bound to make an example out of the unscrupulous business practices employed by Zaslavskiy in taking his ICOs to market.
Filecoin, a blockchain data storage network, netted $257 million during its ICO (of which Day 1 saw $200 in 60 minutes – that while experiencing tech issues).
Popular Canada-based messaging app Kik, founded by a group of University of Waterloo students in 2009, has raised nearly $100 million during its Kin Token Distribution Event. Of course, Canada’s ruling on ICOs was of no help. Additionally, Israeli entrepreneur and investor Moshe Hogeg invested US$50 million during the ICO’s presale, despite the fact that the company hasn’t been performing due to fierce competition from other social messaging apps.
With an active user base of 15 million (albeit dwindling in the face of its 300 million registered users), Kik is the largest consumer company in the crypto space.
Although it will “take a couple of years,” Vitalik is confident that Ethereum and the blockchain can scale to a Visa-esque mainstream capacity. During a Q&A with AngelList founder Naval Ravikant at TechCrunch Disrupt, he added that the technical barriers preventing this type of scale is exactly what his team is working on.
If you’re going to live in a blockchain apartment, then you had better have a blockchain smartphone to go with it. Luckily, Solarin has got you covered, provided they can get it to market.
Leading Indian Bitcoin exchange Unocoin has partnered with Bitcoin wallet Blockchain.info. Blockchain’s entry into the market will be eased through fiat processing handled by Unocoin, while for Indian investors, the process for investing in cryptocurrency aims to be more hassle-free.
Ukraine’s Ministry of Justice is the latest department to integrate blockchain technologies into its processes. The trial forms part of broader efforts by the Ukrainian government to create more transparency in its dealings and eliminate state corruption. They’re working with BitFury to create a blockchain eGovernance program. There are plans to allow foreign investors to buy real estate online through the blockchain. And in October, they launch a trial using a blockchain-based land registry system.
The bank developed a distributed hyper ledger using open-source software consortium Hyperledger to shadow their primary ledger. The aim is to monitor transfers between their Canadian and US accounts in real-time. Although Canada recently forewarned that ICOs are likely to be securities, innovation is clearly not dead.
Insurance is an industry that doesn’t see a lot of innovation. Consulting firm Ernst and Young (EY) aims to change this. Shipping giant Maersk teamed up with Microsoft in a groundbreaking trial to test blockchain functionality for shipping insurance. EY was in charge of overseeing the process and is aiming for the automotive industry next.
According to a recent study by research firm Juniper, IBM tops Microsoft as the world’s blockchain market leader. Companies surveyed included Accenture, Deloitte, FCA (Financial Conduct Authority), IBM, KPMG, Microsoft, and PwC.
In terms of Blockchain technology, 67% of respondents stated they’d already invested more than $100,000 by the end of 2016. 91% indicated that they’d be spending at least that amount in 2017.
Barbados-based startup Bit, which aims to stabilize economies in the Caribbean through the introduction of a blockchain-based payment network, has appointed Rawdon Adams, son of the country’s second prime minister, as CEO.
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