Zimbabwe’s Golix Exchange Enters Kenya, Uganda, South Africa

Zimbabwe’s Golix Exchange Enters Kenya, Uganda, South Africa

Crypto exchange Golix is entering three other African markets in an effort to survive the ban imposed by the central bank in its home country – Zimbabwe. Moreover, the troubled trading platform claims the move is part of a strategy to offer its services across the whole continent. Golix says the shortage of infrastructure has slowed down the adoption of cryptocurrencies in Africa.

 Also read: Johannesburg Gets a New Crypto ATM, Ban Threatened Harare May Lose One

Golix Moves On After Ban, Expands in Africa

Trying to stay afloat after the crackdown by the Reserve Bank of Zimbabwe (RBZ), Golix has turned its attention to Kenya, Uganda, and South Africa. Zimbabwe’s leading cryptocurrency exchange hopes to continue trading in these African countries, despite the ban imposed by financial authorities in Harare.

In a statement quoted by News Day, Golix head of growth, Panashe Tapera, noted that moving outside the country was part of a new strategy – the trading platform plans to expand operations across the entire continent. Tapera said:

As part of our strategy, starting from Friday, June 1, people in Kenya, South Africa and Uganda will be able to start trading from Golix. This is one of our plans to be the leading exchange in Africa, which is inspired by the vision to provide financial autonomy in the continent.

Golix has been offering exchange services in Zimbabwe for the past three years and was the only crypto trading platform there for quite some time, processing transactions worth $20 million and having 50,000 local users. Now it’s planning to continue to do the same in more and larger markets, saying that shortage of crypto infrastructure has slowed down the adoption of digital currencies in Africa.

Zimbabwe’s Golix Exchange Enters Kenya, Uganda, South Africa

The Republic of South Africa, the region’s economic powerhouse, has the highest number of cryptocurrency exchanges on the continent. Its central bank has set up a special unit tasked to review its position on cryptocurrencies and a “self-regulatory” approach has been proposed by legal experts working in the crypto sector. Uganda has been mentioned recently as a crypto-friendly destination, where the leading crypto exchange Binance wants to open a new office.

Challenging the Central Bank in Court

The announcement comes after last month the central bank in Harare issued a circular to banking institutions instructing them to stop providing bank accounts to cryptocurrency companies. The new guidelines effectively banned all crypto-related activities in the country. The RBZ gave local banks and cryptocurrency operators 60 days to comply.

Zimbabwe’s Golix Exchange Enters Kenya, Uganda, South AfricaGolix has since sent several letters to its clients informing them that they would not be able to trade digital coins or deposit fiat currency, and also helping them withdraw their funds.

According to local media, the operator of the exchange, Bitfinance Limited, has filed a lawsuit against the central bank. Later, it was reported that the country’s High Court has ruled in favor of the company’s argument that the RBZ has no authority to ban digital currencies.

Last week, Golix said it had been granted “an interim relief.” In further communication with its customers, the exchange shared that its accounts had not been restored and the legal proceedings were still ongoing. “Nevertheless, please note that we are in the middle of promising engagements with a financial institution which is willing to process our fiat withdrawals through a prepaid debit card,” the platform told its clients.

Golix Takes Its Token Sale to the New Markets

The Zimbabwean exchange intends to enter and operate in Kenya, Uganda and South Africa by also conducting its $32 million token sale there. The aim of the coin offering is to enable instant remittances and international payments through cryptocurrencies.

According to Golix lead of special projects, William Chui, “Since the onset, our main agenda is to provide financial autonomy in Africa. The GLX token is going to be used to facilitate and realize this agenda.”

Zimbabwe’s Golix Exchange Enters Kenya, Uganda, South Africa

Clients from different countries will be able to buy the GLX token from the exchange with fiat currencies, he explained. Then, the coin issued by Golix will be used to purchase other cryptos on its trading platform at zero transaction fees.

Zimbabwe’s first crypto exchange also promises lower fees, in comparison with traditional banking methods, for remittances and international transfers facilitated by the GLX token. The Golix representative believes that will contribute to the GDP growth in African countries.

Do you think the expansion to new markets will help Golix survive the ban in Zimbabwe? Tell us in the comments section below.


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Bitcoin in Brief Saturday: Spanish Parties Back Crypto Draft, Slovenia Adopts Crypto Action Plan

Bitcoin in Brief Saturday: Spanish Parties Back Crypto Draft, Slovenia Adopts Crypto Action Plan

All parties represented in the Spanish Congress have voiced support for a new draft legislation introducing favorable crypto regulations in the country. We’ve covered the details in today’s edition of Bitcoin in Brief. Also, Slovenia adopts a crypto action plan, Estonia drops plans to issue a national cryptocurrency, and Hungary claims it’s ready to join the global blockchain market.  

Also read: Bitcoin in Brief Friday: Expanding Horizons in a Bearish Month

Spanish Parties Call for Favorable Crypto Regulations

Lawmakers in Spain, who have earlier this year reviewed proposals to introduce incentives for crypto companies, have now issued a unanimous call for adopting regulations that favor the implementation of crypto and blockchain technologies. These should be introduced to the market “through controlled testing environments.” A draft legislation aimed at achieving the goal, proposed again by the ruling People’s Party, has just won support from all parliamentary groups in the Finance and Public Function Committee of the Spanish Congress.

The legislative initiative calls for promoting the advantages of the technology that underpins cryptocurrencies like bitcoin, including cost savings through the elimination of intermediaries in payments and transfers and the benefits it offers when it comes to raising capital, especially for startups. Its sponsors urge support for projects to build authorized blockchain technology networks, Europa Press reported.

Bitcoin in Brief Saturday: Spanish Parties Back Crypto Draft, Slovenia Adopts Crypto Action Plan

The draft approved by Spain’s leading parties also turns attention to the perils associated with crypto-related operations, calling for “adequate dissemination of information about the risks” assumed by investors, as well as their rights and the guarantees they can rely on. According to Spanish deputies, the approach will help to avoid “economic damages that are impossible to repair”, such as those linked to high-risk financial products.

Lawmakers call on the government in Madrid to support the initiative and join the efforts of the National Securities Market Commission and the Bank of Spain in that direction. They also insist on reaching a common position in regards to the use and the regulation of cryptocurrencies on European level and ask the executive branch of power to work with other EU countries and institutions to achieve that.

Slovenia Adopts Crypto and Blockchain Action Plan

Bitcoin in Brief Saturday: Spanish Parties Back Crypto Draft, Slovenia Adopts Crypto Action PlanThe government in Ljubljana has adopted an action plan to underpin the implementation of blockchain technology in Slovenia and create a regulatory framework for cryptocurrencies. According to the Economy Ministry, the plan entails a series of measures designed to also regulate Initial Coin Offerings (ICOs). Slovenian authorities hope to establish a safe and stable legal environment to help the creation, growth and development of blockchain technology-based projects and startups.

Another goal is to transpose in the national legislation the legal provisions adopted by European and other relevant institutions, STA reported. Local officials believe that the application of blockchain technologies can improve the competitiveness of the Slovenian economy. The government also backed the creation of a European Blockchain Hub as a link between public and private stakeholders in the field, both in Slovenia and within the EU. On Thursday, the Slovenian Ministry of Economy was tasked to get actively involved in the hub.

Estonia Backpedals on Plans for National Crypto

Estonian officials have scaled down plans to issue a national cryptocurrency, which were criticized some time ago by both the European Central Bank and local banking authorities. According to Siim Sikkut, who is in charge of the country’s IT strategy, Estonia has dropped its intentions to peg the Estcoin to the common European currency and offer it to all citizens. The digital tokens will instead be distributed as an incentive to e-residents of the Baltic country, Sikkut said in an interview, Bloomberg reported. These are foreign nationals who use Estonia’s electronic identification system to remotely sign documents and set up companies.

Bitcoin in Brief Saturday: Spanish Parties Back Crypto Draft, Slovenia Adopts Crypto Action Plan

The tech-savvy former Soviet republic was one of the first European nations to come up with plans for a national cryptocurrency. Similar initiatives have been discussed in Sweden, Switzerland, Poland, the UK, and other countries. The idea, however, was not appreciated by the ECB management. In September, the bank’s president, Mario Draghi, criticized the proposal declaring that “No member state can introduce its own currency. The currency of the Eurozone is the euro.”

“We agreed in discussions with politicians that Estcoin will proceed as a means for transactions inside the e-resident community. Other options aren’t on the table. We’re not building a new currency,” Siim Sikkut said. This was confirmed by the author of the Estcoin plan, Kaspar Korjus, who also noted that the details are still being analyzed for potential benefits. Estcoin “would definitely not be a national ‘cryptocurrency’,” he emphasized. Estonia’s e-residency program has so far issued ID cards to more than 35,000 foreigners. The majority of the participants are from Finland, the Russian Federation and Ukraine.

Hungary Prepared to Join the Global Blockchain Market

Blockchaineum 2.0, arguably the largest blockchain summit in Central and Eastern Europe, recently gathered major stakeholders in Budapest to discuss blockchain-based solutions and other hot topics related to the implementation of the technology around the world. While many in Europe are just starting to take blockchain seriously, Hungary has been preparing for some time and now claims it’s ready to join the global blockchain market.

Bitcoin in Brief Saturday: Spanish Parties Back Crypto Draft, Slovenia Adopts Crypto Action Plan“Many regulatory rules have been laid down recently on European level, and it is in Hungary’s best interest to make use of them in order to become a regional center. Although, this won’t happen because of regulation, but rather on purely market basis,” said Tamás Czeglédi, quoted by the Budapest Business Journal. He is one of the organizers of the event and is working to put his country on the European blockchain map.

Hungarian business wants to jump on the blockchain bandwagon ahead of regional competitors and it has created a Blockchain Competence Center (BCC) earlier this year to prove its intentions. “Whereas the EU had been focusing on regulation until around a year ago, the past few months saw a shift towards a more practical approach,” said Péter Benedek, the CEO of BCC. “The newly established Ministry for Innovation and Technology, along with the enhanced national digital wellbeing strategy, can help local blockchain players embrace innovative solutions and improve their fundraising potential,” he added.

What are your thoughts on today’s Bitcoin in Brief topics? Let us know in the comments section below.


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Russian Duma Adopts Three Crypto Bills on First Reading

Russian Duma Adopts Three Crypto Bills on First Reading

Russian State Duma has approved its first reading of the long-awaited legislation package regulating crypto-related matters and activities. The legal texts, voted almost unanimously, will open the way for legalization of cryptocurrencies in the Russian Federation, including their exchange and circulation under certain conditions. Deputies now have about two weeks to propose amendments before they proceed to final adoption of the three bills.

Also read: Cryptocurrency is Property in Russia, Justice Minister Confirms

The Bills Regulate Crypto Assets, Crowdfunding and Digital Rights

The lower house of Russia’s parliament, the Duma, has accepted and approved on first reading three pieces of legislation tailored to regulate different aspects of the crypto ecosphere in the country. This week, the bills – “On Digital Financial Assets,” “On Attracting Investments Using Investment Platforms,” and “On Digital Rights” – hit the house floor. All of them were voted almost unanimously, the Russian Association of Cryptocurrencies and Blockchain announced on social media.  Some interesting ideas, like tax breaks, have been pitched already during parliamentary discussions.

Russian Duma Adopts Three Crypto Bills on First ReadingThe first two drafts were introduced on March 20 by a group of deputies led by the chairman of the Financial Market Committee, Anatoly Aksakov, while the third one, which amends the country’s Civil Code, was filed on March 26 by the speaker of the Duma, Vyacheslav Volodin, and the head of the parliamentary Legislation Committee, Pavel Krasheninnikov.

The new legislation incorporates legal concepts like “digital right” and “smart contract” and defines cryptocurrencies and tokens as property, not as legal tender. It establish the sequence of actions in a token sale and the rules governing ICO projects. The texts form the basis for legalizing crypto mining but the legal definition of this economic activity will be expanded and refined between the two readings. Other amendments may be introduced in the next couple of weeks. Some proposals, including a moratorium on the taxation of miners, have been discussed in parliament already.

Cryptocurrency Is Electronic Property, Not Legal Tender

The bill “On Digital Financial Assets”, № 419059-7, prepared by the Finance Ministry, was voted by Russian legislators with only one “nay”. It regulates the relations arising from the creation, issuance, storage, and circulation of digital financial assets. The draft also establishes the exact procedures for conducting crypto transactions and concluding smart contracts, including the exercise of rights and the performance of obligations.

Last week, Russian prime minister Dmitry Medvedev said that common words like “cryptocurrencies” and “tokens” will be replaced with the legal terms “digital money” and “digital rights” in the new legislation. The text of this particular draft, however, contains definitions of the original, colloquial terms. It reads: “Digital financial asset – property in electronic form, created using cryptographic tools.” It also says that property rights in this case are certified by making digital records in a register of digital transactions.

Russian Duma Adopts Three Crypto Bills on First Reading

“Digital financial assets include cryptocurrency, token,” the document states, emphasizing that these assets are not legal tender in the Russian Federation. According to the authors, tokens can have a single issuer, while cryptocurrencies can have multiple issuers, like the miners. Both can be exchanged with rubles and foreign currencies under rules determined by the Central Bank of Russia (CBR). They will not be considered a mandatory means of payment, account and transfer like the ruble, but individuals and businesses will be able to use them for payments within the frame of the law.

According to Russian media reports, the draft states that crypto purchases and sales should be performed only through providers of exchange services for digital financial assets – brokers, dealers, and corporate entities – acting as custodians. That includes cryptocurrency exchanges which will offer individual accounts and wallets to their customers. The rules governing these activities shall be developed by the Central Bank in consultation with the Council of Ministers.

Crowdfunding and Crowdinvesting Regulated

The bill also describes the sequence of actions involved in issuing digital tokens, stating that their release should be carried out through public offering. Entities behind initial coin offerings (ICOs) will be required to disclose detailed information about their projects. The organizers of token sales need to prove they control at least 5 million rubles (~$81,000) of capital. Banks and non-credit financial institutions won’t be allowed to conducts ICOs. The law also regulates crypto mining and implies that miners should register with the Federal Tax Service, as either individual entrepreneurs or legal entities, and pay taxes.

Russian Duma Adopts Three Crypto Bills on First Reading

The Law “On Attracting Investments Using Investment Platforms”, № 419090-7, regulates specifically crowdfunding and crowdinvesting in Russia. The draft reads that both legal entities and individual entrepreneurs can be involved in such activities and prescribes the norms that the organizers of digital fundraising should abide by.

According to its provisions, private citizens can participate in crowdfunding without any registration but the investment platform operators should be registered with the CBR. The bank will also determine the maximum amount an “unqualified investor” can spend on a single project as well as and the limit of their yearly investments in digital tokens.

Only Tokens with Economic Value to Be Recognized as ‘Digital rights’

Russian Duma Adopts Three Crypto Bills on First ReadingThe third draft passed on first reading, the bill “On Digital Rights” – № 424632-7, amends the Russian civil law. It introduces basic provisions allowing legislators to regulate the market of tokens and cryptocurrencies and creating conditions for digital transactions. The text develops the legal concept of “digital right” to define tokens.

According to the authors, only tokens with significant economic meaning will be recognized as digital rights, unlike loyalty points or virtual coins used in online gaming, for example. A holder of a “digital right” is described as a person with unique access to the coin’s digital code.

Besides regulating the circulation of tokens and the execution of token transactions, the law is also expected to ensure judicial protection for their owners. The introduction of digital rights creates a legal basis for taxation of economic activities related to token sales, as well.

Do you think the new legislation will open the way for mass adoption of cryptocurrencies in Russia? Tell us in the comments section below.


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HomeMine ICO – Passive Mining on Household Electrical Appliances for Everyone

HomeMine ICO

HomeMine ICO – Passive mining on household electrical appliances for everyone.

The days are long gone when you could earn money at home by simply using the capacity of your personal computer. Hashing is becoming more and more complex, and today the mining entry threshold for an average person has become critically high – both in terms of equipment costs and necessary competencies.

HomeMineCoin OÜ responded to this challenge with its HomeMine project to be launched for ICO on May 21st. This project reveals new opportunities for passive mining with the use of conventional household electrical ...

Get latest cryptocurrency news on bitcoin, ethereum, initial coin offerings, ICOs, ethereum and all other cryptocurrencies. Learn How to trade on cryptocurrency exchanges.

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Pump and a Ponzi? Bithumb Criticized For Prematurely Listing a Cryptocurrency Created by its Developers

Earlier this week, Bithumb, South Korea’s second-biggest cryptocurrency exchange – behind UPbit – that is known for its rigorous verification process for new cryptocurrencies, announced the airdrop of Popchain, a cryptocurrency which the global community has not heard about previously. Two Weeks Into Development Hankyung, one of the leading mainstream media outlets in South Korea,

The post Pump and a Ponzi? Bithumb Criticized For Prematurely Listing a Cryptocurrency Created by its Developers appeared first on CCN

Bitcoin in Brief Saturday: “Social” Coins, Crypto Vending, Blockchain Mileage

Bitcoin in Brief Saturday: “Social” Coins, Crypto Vending, Blockchain Mileage

Reports suggest that Facebook may develop its own crypto. The plan is worth a mention, especially on the backdrop of the crypto ban imposed by the social media network. In Saturday’s Bitcoin in Brief, we also cover Telegram’s advance towards implementing its payment system using the Gram token. Some blockchain stories with beers and beamers complete today’s round-up.

Also read: Bitcoin in Brief Friday: China Mulls Blockchain Standard, Zcash Fights Chinese ASICs

Facebook Mulls Own Token, Reports Say

Bitcoin in Brief Saturday: “Social” Coins, Crypto Vending, Blockchain MileageFacebook is reportedly considering creating its own cryptocurrency. Sources familiar with the matter told the financial news outlet Cheddar that the social media giant is serious about the project to introduce global crypto payments on its platform. A digital token would allow its two billion users around the world to take advantage of crypto transactions and skip state-issued fiat currencies.

Facebook announced recently that it had formed a team whose main task will be to explore the uses for blockchain technologies that the company can utilize to improve its business. The group is headed by David Marcus, former head of Facebook Messenger and ex-president of Paypal, who currently sits on the board of Coinbase.

The development of the payments system, however, is likely to take some time, possibly years. Marcus, who is a crypto enthusiast and an early investor, has been quoted as saying that crypto payments are still very slow and expensive. Facebook is not planning to hold an initial coin offering (ICO) to fund the project. In January, the social network banned crypto-related ads, including advertisements of token sales.

Telegram Moving Forward with Crypto Payments

Bitcoin in Brief Saturday: “Social” Coins, Crypto Vending, Blockchain MileageTelegram, on the other hand, has already raised enough money to fund its own blockchain project and payment system. The messaging service, which is popular with the crypto community, has already attracted $1.7 billion dollars to finance its Telegram Open Network (TON). The company, founded by Russian entrepreneur Pavel Durov, has decided to call off a planned public ICO.

According to Russian media reports, Telegram is now conducting closed tests of a new service designed to store users’ information and documents for verification purposes. Telegram Passport will be used to keep personal details and copies of IDs, banking statements, and utility bills which will be used to identify users on Telegram’s blockchain TON.

The identity verification feature is needed to facilitate payments using Telegram’s own crypto token called Gram. Once uploaded, the personal information can be potentially shared with partners within the platform, but also on their systems. Telegram Passport, which should be launched by the summer, is expected to prevent anonymous crypto payments.

Crypto Beer Vending Machine to Check Age

Bitcoin in Brief Saturday: “Social” Coins, Crypto Vending, Blockchain MileageCivic, a San-Francisco-based startup, has recently announced plans to introduce a “crypto beer vending machine.” The project, which will be realized in partnership with a leading US beer producer, aims to also prove that blockchain can be used to verify if a thirsty guy or girl have 21 years of age to legally consume the alcoholic beverage. To get a cold can, one has to install Civic’s app on their smartphone, verify their ID, and then walk up to the machine, Futurism reports. The project’s success depends on the readiness of government authorities to accept identity verification performed on a blockchain. Civic’s beer vending machine is still a prototype.

BMW Tracking Mileage on a Blockchain

Another blockchain partnership aims to track the mileage of cars. A team at BMW, the German automobile manufacturer, has been tasked with finding a way to better preserve the resale value of vehicles leased by the company. Collecting reliable data for the mileage, amortization and maintenance of these cars is crucial for achieving the best price on the second-hand market.

Bitcoin in Brief Saturday: “Social” Coins, Crypto Vending, Blockchain MileageThe blockchain startup DOVU has been invited by BMW to establish a partnership with Alphabet, the auto giant’s leasing and fleet vehicle branch, and BMW’s Innovation Lab in order to develop a system to collect and keep record of the important information. The companies behind the project hope to also evaluate how effective tokenization can be in encouraging customers’ cooperation.

In a pilot program implemented by the partners, BMW drivers are prompted by a custom wallet app to take a picture of their dashboards once a week. All submissions are added to DOVU’s blockchain which is used by Alphabet to compile consistent and unalterable data reflecting the exploitation of the vehicles. The information is then used to assess the mileage and the depreciation of the used cars and ultimately determine their resale value.

What do you think of today’s Bitcoin in Brief stories? Let us know in the comments section below.


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What’s In a Name? The Identity Crisis for Initial Coin Offerings

What's In a Name? The Identity Crisis for Initial Coin Offerings

Aaron Kaplan, securities attorney and COO of Prometheum, is guest author for this Opinion/Editorial. 

Initial Coin Offerings (ICOs) have become the investment du jour while the understanding of what ICOs are has become desperately convoluted. Every huckster, scammer and opportunist has tried to hop on the bandwagon. (I’m talking to you, Casey Ryback) Many of these ICOs were a means for scammers to raise money over the internet from unsophisticated investors whose “FOMO” outweighed the obvious red flags associated with such offerings.

Also read: Ver’s Sci-Fi Novel Life, Voorhees Buys Tucker’s Tie for $27k

Identity Crisis for Initial Coin Offerings

The rapid growth of the ICO industry ($6+ billion) and the inherent scams and related investor losses forced the SEC to consider ICOs in the context of the Federal Securities Laws (FSLs).  The SEC’s recent broad subpoena sweep marked the SEC’s official declaration that ICOs are securities. Now that ICOs must comply with the FSLs, it should come as no surprise that a new type of trickster is trying to hijack the innovation through either a) selling illiquid tokens to wealthy investors or b) selling traditional securities that are registered on a blockchain.

To set the record straight, and provide much needed clarity, here is a condensed description of ICOs and their intended benefit. ICOs are an innovative means of capital formation. Issuers offer a securitization of user interest in an ecosystem as an investment to the general public. Assuming the issuer has reasonable token economics, then the greater the user interest in the ecosystem, and the utility of the underlying token, the more the value of such token should increase. It’s supply and demand, but the price is not reflected in the common stock; rather, it is reflected in the cryptographic token representing the user interest. 

What's In a Name? The Identity Crisis for Initial Coin Offerings
Aaron Kaplan

Furthermore, an ICO should have two key features:

1. It should be available to the general public, and

2. It should be able to freely trade on the secondary market when the token is issued.

The securities of ICOs to date have not and cannot achieve both those goals. Such securities are illiquid and only available to accredited investors/institutions.

As the industry matures through compliance with all relevant rules and regulations, I fear we are losing the spirit of ICOs, which some argue may not be sustainable under the FSLs.

Issue 1: Reg D/SAFT ICOs

The Filecoin Reg D token offering in mid-2017 was an important point for honoring the Federal Securities Laws. Reg D ICOs raise capital with proper offering documents (a requirement under the FSLs) by selling tokens that have proposed utility in an ecosystem. While such ICOs are legal by nature, companies conducting ICOs in a Reg D (or a SAFT) offering forgot how an ICO was supposed to function.

These Reg D and SAFT ICOs inherently contradict the spirit of an ICO- a token sale that should be open to all investors (both accredited and non-accredited), and freely trading in the secondary market. Reg D and SAFT issuers’ token sales are only open to accredited investors (i.e. wealthy individuals and institutions) and are restricted securities (meaning they can’t trade freely on the secondary market until the issuer files current public information and essentially registers such securities with the SEC).

What's In a Name? The Identity Crisis for Initial Coin Offerings

These issuers, while understanding that ICOs are securitizations of user interest, missed the mark. Their ICOs are illiquid and limit participation to the wealthy. Investors won’t have the ability to trade those tokens, and are stuck with illiquid (untradeable) securities that have the same issues as those associated with traditional venture funding – waiting for a buyout event or going public (which is extremely rare) before investors can realize a return on their investment.

Issue 2: ICOs vs. Traditional Securities Issued Over a Blockchain

Opportunistic companies are also trying to use the concept of an ICO, turning an innovative method of monetizing an ecosystem into a cheap marketing ploy. The most frustrating example of this practice are companies who say they are raising capital for an ICO, but in reality they are just issuing traditional equity or debt securities that are represented by a cryptographic token. These aren’t ICOs, but rather traditional securities registered (like a transfer agent’s log) over a blockchain. While many (including me) believe blockchain securities are the future of securities ownership, a preferred equity token is not an ICO. It is a traditional security that is issued over a blockchain.

What's In a Name? The Identity Crisis for Initial Coin OfferingsSecurities issued over a blockchain MUST be distinguished from ICOs. An appropriate definition of an ICO in 2018 is the following: an ICO is a securitization of user interest. It is not a debt or equity security, but rather a new type of security – an investment whose value is related to the user’s interest in an ecosystem and the utility of the actual token in that ecosystem. It is essential that the industry understands the difference.

In late March, a company tried to issue a blockchain security for a building. Such cryptographic tokens represent ownership in the building and trade over blockchain. That is a traditional Reg D security, and not an ICO. The company received news coverage for being the first company to sell interests in a building using a blockchain. However, many companies have sold interests in real property online. This company is doing the same thing – basically putting lipstick on a pig.

So how do we define an ICO?

ICOs are innovative ways to unleash/monetize potential value from the user interest in an ecosystem. ICO tokens represent a new type of security whose value is related to the user appetite in that ecosystem (daily average use, recurring use, etc.). Ideally, an ICO should be available to all types of investors (accredited and non-accredited) and be freely tradable when the underlying network goes live.

With ICOs officially coming under the FSLs regime, the industry should take a moment to reflect on what an ICO is and will be under the FSLs before it morphs from a genuine innovation into a marketing ploy.

This is an Op-ed article. The opinions expressed in this article are the author’s own. Bitcoin.com does not endorse nor support views, opinions or conclusions drawn in this post. Bitcoin.com is not responsible for or liable for any content, accuracy or quality within the Op-ed article. Readers should do their own due diligence before taking any actions related to the content. Bitcoin.com is not responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any information in this Op-ed article.


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Telegram Reportedly Testing Service to Store Data for Identity Verification

Telegram Reportedly Testing Service to Store Data for Identity Verification

Telegram has been testing a new service that will store users’ information and documents for verification purposes, according to Russian media reports. Telegram Passport will be used to keep personal details and copies of IDs, banking statements, and utility bills to identify users on Telegram’s blockchain platform TON. 

Also read: After Telegram, Viber May Be Blocked, Russian Minister Says

Telegram Passport to Prevent Anonymous Crypto Payments

Developers at Telegram are conducting closed tests of a new service designed to store personal data, according to sources quoted by Russian media. Telegram Passport will be used to verify identities of users on the messenger’s Telegram Open Network. They will be able to buy goods and pay for services on the TON blockchain platform with Telegram’s crypto token called Gram.

Customers will provide their personal details and documents, such as copies of IDs, passports, drivers’ licenses, utility bills, bank statements, and possibly photographs. Once uploaded, the information can be potentially shared with Telegram’s partners within the platform, but also on their systems, Vedomosti reported, quoting two sources close to the company.

Telegram Passport, which may be launched by the summer, is expected to effectively prevent anonymity associated with crypto payments, which is a worrisome aspect for regulators around the world, explained Alexander Filatov, partner at SP Capital. His consulting company has invested in TON and facilitated investments of other interested parties.

Telegram Reportedly Testing Service to Store Data for Identity Verification

A number of partner businesses will be able to take advantage of the service. The Russian payments services provider Qiwi has already been granted access to the system, according to the report. The company is said to be cooperating with the messenger on the launch of Telegram Passport.

Initially, only the users, not even Telegram, will have access to their details and documents. They will be able to secure the data with a password and two factor authentication. The company will use the information only with the account holder‘s consent, according to information shared on the closed pages of telegram.org cited by the Russian outlet. Once Telegram’s partners receive the data, they can verify it according to their own standards.

Others are Working on Similar Concepts

Telegram’s main competitors in that field are mature systems that use authorization services provided by third-party platforms via Google, Facebook, or Windows Live, said Dmitry Ufaev, head of the Russian operations of Bitfury, a leading manufacturer of software and hardware blockchain solutions. In his words, Telegram Passport will allow the messenger to circumvent these established services, providing greater privacy and data security to its users. This will be a reputational advantage, Ufaev noted.

Other major companies are working in the same direction as well, and Telegram is likely to face hefty competition. The Chinese messenger Wechat has already implemented money transfers for users and service providers on its platform. The company is currently testing a digital identity verification system with face detection functionality which should be more efficient than verification based on copies of documents. The tech giant Apple is also working on its Face ID system.

According to Alexei Prokofiev, partner at two venture capital funds, states will eventually switch to identity verification based on biometrics. “It’s a matter of digital sovereignty,” he believes. In his opinion, if Telegram does not establish relations with government authorities, it may fail to acquire licenses for providing services in jurisdictions where biometric verification is required by law.

Telegram Reportedly Testing Service to Store Data for Identity Verification

News that Telegram is working on its blockchain platform TON came out in January. The company founded by entrepreneur Pavel Durov was able to attract investments worth a total of $1.7 billion dollars to finance the project. Goods, services and other content on TON will be paid with Gram, Telegram’s own crypto. Recently, the messenger called off a planned public initial coin offering.

Durov’s company has been involved in a bitter conflict with authorities in Moscow following its refusal to hand over its encryptions keys to FSB, the Federal Security Service. Despite some interruptions, attempts by Russian regulators to block the service in the country have been unsuccessful so far. Russia’s telecom regulator Roskomnadzor has been trying to restrict access to the messenger since April 16 after a decision by a district court in Moscow from April 13.

What do you think of Telegram’s plan to introduce identity verification for users of services offered on its blockchain platform? Tell us in the comments section below.  


Images courtesy of Shutterstock, Yarcube, Wikipedia.


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Major Cryptocurrencies Record Strong Gains, Ethereum Price up 7%, Bitcoin at $9,300

The cryptocurrency market has recorded strong gains once again over the past 24 hours, as the valuation of the market broke the $440 billion, moving one step closer to the $0.5 trillion region. Bitcoin, Ethereum, Cardano, Bitcoin Cash, and other major cryptocurrencies demonstrated large short-term gains. Ethereum Leads Market The price of Ether, the native … Continued

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Bitcoin in Brief Friday: World Satoshi Summit Canceled, Pump and Dump Scheme Exposed

Bitcoin in Brief Friday: World Satoshi Summit Canceled, Pump and Dump Scheme Exposed

In today’s Bitcoin in Brief we’re covering disappointing news for the crypto community: the World Satoshi Summit in Delhi has been canceled because of “regulatory issues” according to its organizers. Also, an alleged crypto pump and dump scheme has been exposed. There is more than one opinion on the case, as you’ll see below.

Also read: Bitcoin in Brief Thursday: Big Money Wears Big Horns, Claws Are In the Closet

World Satoshi Summit Canceled

A major crypto conference, scheduled to be held in Delhi in May, has been canceled. “Due to certain regulatory issues in India, World Satoshi Summit currently stands cancelled,” reads a message on the event’s website. All refunds will be processed over the next few weeks, the organizers promise. They encourage participants to reach out on hello@worldsatoshisummit.com in case of any further queries.

“I feel very sad to inform you that due to certain regulatory issues in India like crypto ban, our most anticipated event, World Satoshi Summit, stands postponed/cancelled. I deeply regret that we have to make such a harsh decision at the eleventh hour, when we were all set for the conference,” Sanjay Goswami, head of marketing for the summit told the Indian outlet Crypto News.

Bitcoin in Brief Friday: World Satoshi Summit Canceled, Pump and Dump Scheme Exposed

Indian crypto media have asked the organizers to provide more details and clarity on the reasons for the cancelation. In recent months, the cryptocurrency and blockchain community in the country has been targeted by both regulators and banks. While authorities are working on a new bill to regulate the crypto sector, the Reserve Bank of India has prohibited commercial banks from servicing businesses dealing in cryptocurrencies. Bitcoin trade on local exchanges has dropped as much as 90% in a couple of months.

Pump and Dump Scheme – Exposed?

An alleged crypto pump and dump scheme has been reportedly exposed in a Steemit post. The accusations have been made against the Discord chat group Bitcoin Bravado by a supposed member. The publication contains screenshots of Telegram messages between members of the group. The author claims they indicate a plan for a pump and dump operation on a token called Haven Coin through price manipulation.

The whistleblower says he was invited to join the group’s Telegram channel where he saw the messages. According to the screenshots, members of the group discussed how much cryptocurrency would be needed to control 25% of the trading volume, how long it should be held, and when it should be dumped. The blogger, named “cryptomedication”, has contacted the U.S. Securities and Exchange Commission (SEC) and the Federal Bureau of Investigation (FBI) regarding the suspicious conversations. “I’m not here to hide at all”, he says providing his twitter account, as well – @CryptoMedicated.

Bitcoin in Brief Friday: World Satoshi Summit Canceled, Pump and Dump Scheme Exposed

In an open letter, Bitcoin Bravado called the publication a “slender article”. It also said that none of the people involved in the conversations from the screenshots write for or have equity in the company. “It’s important for everyone to understand our company’s structure.​ Though a few of the members shown in those telegram chats have been friends​ and supporters​ to Bitcoin Bravado, they write none of the content ​and have no ownership or equity ​in the company. They have their own business, we have ours. They’re almost completely inactive in the day to day operations and have been removed from our Discord channel,” the statement reads.

First Ad in the Blockchain

TD Ameritrade claims to have become the first company to embed an advertisement in the blockchain. The ad of the brokerage firm is made up of ASCII art. It can be viewed on a landing page, which also links to information about each bitcoin transaction and how the ad was built. The advertising agency Havas New York also participated in the project.

Bitcoin in Brief Friday: World Satoshi Summit Canceled, Pump and Dump Scheme ExposedThe two companies placed the ad in a function of the blockchain called OP_Return, which works like the memo space on a check, Digital News Daily reports. Simple messages and characters can be placed within transactions on the blockchain and the authors decided to create the image by linking 68 individual transactions with 80 characters each.

According to Denise Karkos, Chief Marketing Officer at TD Ameritrade, there is “no expectation beyond creating a little buzz for the brand” and enjoying the process. “Wouldn’t it be fun to be the first to advertise in the blockchain,” she said, noting that her company was also the first brokerage to provide access to bitcoin futures.

Parity Has No Intention to Split the Ethereum Chain

Parity Technologies has reaffirmed its “commitment to ethereum and a decentralized future”. In a blog post, the company said: “We are deeply sorry to those users who remain unable to access their ether as a result of a bug in our code.” The startup has been in constant conversation with affected projects. It also believes that those who have stuck ether through the wallet freeze have a case for attempting to recover the property.

Bitcoin in Brief Friday: World Satoshi Summit Canceled, Pump and Dump Scheme ExposedIn December, the team behind Parity asked for a hard fork of ethereum to overcome the consequences of the bug, which allowed an ethereum hobbyist to break their multi-signature wallet. As a result, an amount of more than half a million ether was permanently locked and the multi-sig functionality was temporarily disabled.

The company acknowledges that the debate around the recovery has “clearly shown the importance of a transparent governance process” that can respond to the community’s position on contentious issues such as ASIC resistance, supply caps, and contract restorations. “Let us make clear: we have no intention to split the Ethereum chain […] We have all dedicated a great deal of time and effort to developing the ethereum ecosystem, and have no intention of harming what we have helped build,” its team stated. Its members insist they remain committed to making the etherium platform “open, scalable, and safe”.

What are your thoughts on the subjects we’ve covered in today’s Bitcoin in Brief? Share them in the comments section below.


Images courtesy of Shutterstock, World Satoshi Summit, TD Ameritrade, Parity Technologies.


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Nasdaq-Listed Company Xunlei Faces Class-Action for Disguising ICO

Nasdaq-listed technology firm Xunlei has become the subject of multiple class-action lawsuits from investors who purchased the company’s digital token, Linktoken. Xunlei is accused of misleading investors to disguise an initial coin offering (ICO) through which Linktoken was distributed.

Also Read: Survey: 89% of Visa, Mastercard, Unionpay Users Know Crypto – 53% Have Purchased

Xunlei CEO Rejects ICO Allegations

Nasdaq-Listed Company Xunlei Faces Class-Action for Disguising ICOThe chief executive officer of Xunlei, Chen Lei, has rejected accusations that the company misled investors in order to illegally conduct an ICO in China.

Xunlei’s Linktoken was distributed to users in exchange for a contribution of idle internet bandwidth, according to South China Morning Post. Chen Lei has claimed that the Linktoken distribution did not comprise an ICO due to the company not raising any funds through the issuance of the tokens, and due to Linktoken comprising a utility token that is not allowed to be traded. “By making a public offering, really you need to use it to raise money. We have never used a coin to raise any money at all, that’s never our intention,” Mr. Lei stated.

In October 2017, Linktoken was launched in conjunction with other efforts by Xunlei to enter the booming blockchain industry. Whilst the distribution of the Linktoken appears to have been the catalyst for many weeks of sharp bullish action, the value of Xunlei’s stock has more than halved since posting 500% gains and setting record highs of $25 USD in November 2017.

Xunlei’s Stock Plummets

Nasdaq-Listed Company Xunlei Faces Class-Action for Disguising ICOSince then, the price of Xunlei’s shares had plummeted to approximately $10 by early April, prompting some U.S.-based investors to seek action against the company for allegations of giving false and/or misleading statements regarding the legitimacy of the company’s cryptocurrency-related activities between October 2017 and January 2018. Among other allegations, investors have pointed to the requirement that they purchase hardware from Xunlei in order to share bandwidth and claim the digital tokens in return.

Chen Lei has refuted the allegations, stating “We are a small capital company, so our stock price does fluctuate, but I don’t think there’s any basis for the lawsuit because we’re operating in China and it is the Chinese law and regulations that we need to observe,” adding that “the definition of [an] ICO has to be interpreted in the Chinese market.” Mr. Lei also indicated that Xunlei is currently in the process of hiring legal counsel to refute the allegations.

Chen Lei Claims to Support Regulatory Action Against ICOs

Nasdaq-Listed Company Xunlei Faces Class-Action for Disguising ICOChen Lei also criticized initial coin offerings and advocated for greater regulatory action to be taken against such, stating “ICOs are terrible, and give a bad name to blockchain technology. Governments should clamp down on these practices – a crackdown is the only way blockchain can rebuild its reputation.” Mr. Lei added: “We have been very straight on our business practices – we do not sell tokens.”

China’s National Internet Finance Association (NIFA), a self-regulatory body established by the People’s Bank of China and authorized by China’s State Council, conducted an investigation into Xunlei’s token distribution, concluding in January the company had evaded regulations through conducting an “initial miner offering.”

NIFA stated “In the case of Lianke issued by Xunlei, for example, the issuing company in effect substitutes Lianke for the duty to pay back project contributors with legal tender, making it essentially a financing activity and a form of disguised ICO. In addition, with frequent promotional activities and publishing of trading tutorials, Xunlei has lured many citizens without sound discernment into IMO activities.”

Xunlei Shares Bounce After Blockchain Launch

Nasdaq-Listed Company Xunlei Faces Class-Action for Disguising ICODespite the controversy and ongoing class-action lawsuits, Xunlie’s stock has bounced in recent days following the company’s announcement that its “Thunderchain” blockchain platform designed to facilitate the development of decentralized applications has been launched.

Xunlei’s shares (XNET) are currently trading at $13.46, after retracing from highs of $14 on the 20th of April.

Do you think that Xunlei will be successful in evading ICO status regarding its Linktoken issuance? Share your thoughts in the comments section below


Images courtesy of Shutterstock, Wikipedia


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SpyCO? Facebook-Linked Cambridge Analytica Planned Its Own Coin Offering

SpyCO? Facebook-Linked Cambridge Analytica Planned its Own Coin Offering

Cambridge Analytica, the London-headquartered data mining firm responsible for the latest Facebook privacy scandal, has reportedly been working on launching its own initial coin offering (ICO) in recent months. The company has also been linked to helping other shady players market their tokens.  

Also Read: SPI Solar to Host 5,000 Bitcoin Miners for Chinese VC Fund 500 IPO

Privacy Dystopia

SpyCO? Facebook-Linked Cambridge Analytica Planned its Own Coin OfferingCambridge Analytica was planning an ICO in order to fund a system for storing and selling personal data to advertisers. Ironically, the system was presented as an online privacy solution that could help prevent exactly what the company specializes in doing. The effort seems to have been put on hold now that the global spotlight has been put on Cambridge Analytica and its tactics.

“Who knows more about the usage of personal data than Cambridge Analytica?” Brittany Kaiser, a former employee of the company told the New York Times. “So why not build a platform that reconstructs the way that works?”

Jill Carlson, a consultant who attended meetings where Cambridge Analytica pitched its services, noticed that the company was in sharp contrast with the ideals of openness and transparency which attracted her to bitcoin. “The way that Cambridge Analytica was talking about it, they were viewing it as a means of being able to basically inflict government control and private corporate control over individuals, which just takes the whole initial premise of this technology and turns it on its head in this very dystopian way,” she explained.

Helping ‘Broken Tooth’ Gangster?

SpyCO? Facebook-Linked Cambridge Analytica Planned its Own Coin OfferingBesides planning its own ICO, Cambridge Analytica was also reportedly trying to get  promoters of other tokens to sign up to its personal data mining services. The company was marketing itself based on how it was able to influence political campaigns around the world with its “psychographic profiles” of voters and offered to employ the same tactic to create more persuasive targeted advertising for ICOs. In its marketing material the company claimed that Kaiser was “helping blockchain companies in using predictive modeling to target investors for token sales.”

One specific token that the newspaper says it obtained documents showing Cambridge Analytica tried to help promote is Dragon Coin. According to the report, the casino gamblers’ token is associated with Wan Kuok-koi “a famous gangster in Macau who has gone by the nickname Broken Tooth.” The NYT also notes that the company has denied this connection despite evidence to the contrary.

Would you have gambled on a Cambridge Analytica ICO token? Share your thoughts in the comments section below. 


Images courtesy of Shutterstock.


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PR: Dynatiq Announces ICO for Their Blockchain Based Domains & Websites Marketplace

Dynatiq Announces ICO for Their Blockchain Based Domains & Websites Marketplace

This is a paid press release, which contains forward looking statements, and should be treated as advertising or promotional material. Bitcoin.com does not endorse nor support this product/service. Bitcoin.com is not responsible for or liable for any content, accuracy or quality within the press release.

Dynatiq, a decentralized domain and website marketplace, announces token event starting 25th April 2018. Dynatiq is set to be the backbone of the domain industry.

Dubai, UAE: As of January 1, 2018, a total of global internet users was approximated to be 3,812,564,450 as compared to 3.42 billion that was recorded in 2016. Asia has always been the continent with the highest number of internet users in the world however their recent percentage dropped from 50.1% to 49.7%. Europe has 17.0%. Latin America has 10.4% and Africa has 10%. North American only has 8.2%.

In Asia, China has 738,539,792 users while the United States has 286,942,362 users. Russia has 109,55,842 users while Latin America has 18,526,199 users. Research also shows that North America has the highest penetration rate with a total of 88.1% of its people using the internet. In addition to this, Google now has over 6,586,013,574 searches per day worldwide.

Research also shows that digital marketing will generate 44% or approximately $237 billion globally in 2018. Search advertisements are the most popular digital advertisement that is available now as the expenditure of marketers in 2018 reaches 12% with a total of $113 billion spent.

In the first quarter of 2017, there were 1.3 million new domain names that were registered which is a 3.7% increase from the previous year. The .net and .com had a total of 143.6 million domain name registration by the end of 2017.

The Dynatiq Advantage

Dynatiq will never store a users data on a centralized marketplace, with an aim to protect data with the transparent and secure technology that is blockchain. Dynatiq technology uses escrow on a blockchain based marketplace. This escrow will provide various advantages to people who transact with it. Regardless if it is a website or domain sale, the use of escrow on the blockchain based marketplace will ensure that all buyers and sellers are equally protected thereby giving them an opportunity to settle their disputes with utmost concern.

Users are familiar with buying things online you must have come across a typical online review. An aggregate star rating for your website or domain marketplace will help the upli!ment of a business. Even though customer reviews range in thoroughness and comprehensibility, they can have an adverse effect on audience attraction

The staking process will enable the general public to acquire tokens, especially during the crowdfunding stage. A certain percentage of the generated funds will be channeled to operations pool in order to provide merchants with the amounts of tokens that will be paid out as rewards to customers. The idea of selling these tokens to merchants will be solely dependent on the situation. Whenever customers make purchases at participating merchants, the tokens will end up in the hands of customers. The customers will make the decisions on whether to trade it or redeem it. The token can be properly used after the successful launching of the platform.

Contact Email Address
info@dynatiq.com
Supporting Link
https://dynatiq.com

This is a paid press release. Readers should do their own due diligence before taking any actions related to the promoted company or any of its affiliates or services. Bitcoin.com is not responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in the press release.

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Is Ripple About to Become Another Ethereum?

Is Ripple About to Become Another Ethereum?

For only the second time in its history, an attempt at tokenizing Ripple’s XRP ledger through an initial coin offering (ICO) is being seriously offered by a group not formally associated with the company. It’s an interesting juxtaposition for a project widely believed to be actively separating itself from the messiness of the cryptocurrency world. ICOs are an unintended use case, it turns out, for the legacy banking establishment’s favorite new settlement tech, and, if it proves successful, could push the XRP ledger into Ethereum territory.  

Also read: India Searches for Ethereum Over Bitcoin

Ripple’s XRP Ledger Might Be an Accidental Ethereum

“XRP Ledger is open-source and a decentralized platform,” a Ripple spokesperson is reported to have commented, “so people can build whatever they want, but Ripple isn’t interested in promoting or supporting ICOs on the ledger.” The dismissive statement comes from the news that a Brazilian group of earnest XRP fans have launched Allvor, an ambitious ICO built on top of the tech, much in the way similar proposals happen on purpose with Ethereum.

Is Ripple About to Become Another Ethereum?
Ripple is often lambasted as being too close to power.

ERC20 endeavours, however, come with considerable baggage, as less than honorable projects are associated with it. And in an increasingly competitive crowdfunding environment, entrepreneurs in this space are searching for inventive ways to present the idea. Ripple has long been associated with traditional banking concerns, and boasts about that fact. It’s safe to assume an ICO touting even a loose association with the third largest crypto by market cap, and darling of the status quo, might be able to attract a pretty penny.

Is Ripple About to Become Another Ethereum?
Cleyton Domingues

Allvor bills itself as “the first cryptocurrency issued in the XRP Ledger with a focus on e-commerce,” writes Cleyton Domingues, co-founder and Public Policy and Management Officer in Brazil’s Ministry of Economy, Planning and Development. Mr. Domingues, along with associates Syval Peres and Leandro Gonçalves, insists “integrating the XRP Ledger’s superior technology with systems and protocols used in e-commerce as a way to boost the cryptocurrency use on a global scale,” breathlessly describing XRP as “the best and most efficient distributed database technology ever made.”  

Complicating matters for Allvor are many-fold: for an ecommerce solution to work, it must have infrastructure, not just a claim to transaction speed, and that takes money; ALV, then, will be the token to help that process along. Furthermore, the project is bootstrapped which inevitably means an airdrop, which by the nature of the XRP Ledger means users must essentially agree to the project in order to receive and use ALV. And that bit is actually a selling point for Mr. Domingues, who believes such a feature allows for a kind of user control unheard of using Ethereum, for example.

Is Ripple About to Become Another Ethereum?

Been There, Done That  

At least one XRP enthusiast is voicing intense skepticism at the prospect of Allvor. “The total amount of ALV to be created equals to the total amount of XRP in existence,” a commenter wrote, “However Allvor has allocated only 5% for the initial release. Theoretically all XRP holders could apply for the Airdrop, so what happens in this case, 95% of them will be left out?”

Is Ripple About to Become Another Ethereum?

There is also the issue of “telling a third anonymous party how much XRP you hold and what is/are your account(s). If you don’t use a proxy, you will reveal to Allvor your IP address too, because you will have to use their app to register, see their whitepaper. Maybe you will reveal even more, so far we don’t know what will the registration exactly look like,” the commenter worried.

To that end, XRP is having a heck of a time trying to get listed on exchanges. Notoriously, reports have it Ripple attempted to sweeten a potential exchange addition by offering gobs of money. No takers. This creates an interesting problem for those who might wish to alter their ALV position, attempting to cash out.

Is Ripple About to Become Another Ethereum?
Jon Holmquist’s tongue-in-cheek message to Allvor

And this isn’t the first time a Ripple ICO has been tried. Summer of last year, Jon Holmquist launched an ill-fated project, only to be squashed two days later by way of US Securities and Exchange concerns. In answer, he stepped back completely, writing “I will not be participating in the auction at all. I will not put in a bid for any of the PRX tokens. I think I am legally barred from doing so in the U.S. under auctioneering laws.” 

Do you think ICOs are XRP Ledger’s future? Let us know what you think in the comments below.


Images via Shutterstock, Jon Holmquist, Allvor. 


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YouToken Disrupts FinTech and Crowdfunding at 2018 Global Blockchain Forum

YouToken

April 4, 2018

YouToken (YTN) presented their innovative blockchain-based crowdfunding platform to over 1,400 attendees at the 2018 Global Blockchain Forum in Santa Clara, California.

Dozens of promising startups attended the event with YouToken leading the way in the FinTech and crowdfunding disruption sector. Based on blockchain technology, the platform aims to connect investors with entrepreneurs via crypto tokens and ultimately capitalize on a project in its early stages of success.

Everyone from blockchain enthusiasts to VCs and Stanford, Princeton and Johns Hopkins professors gathered around YouToken’s booth to take part in ...

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Telegram’s ICO Has Raised $1.7 Billion – But Not Everyone Is Impressed

Telegram’s ICO Has Raised $1.7 Billion – But Not Everyone Is Impressed

ICOs that can raise over $1 billion are the unicorns of the crowdfunding space. To date, only EOS and Telegram have achieved that feat. Any project of that magnitude is bound to cause controversy, and while the headlines have focused on the $1.7 billion Telegram has raised, some investors have steered well clear of the mammoth crowdsale.

Also read: Trezor to Implement Bitcoin Cash Addresses

A Billion Reasons Not to Buy In

Telegram’s ICO Has Raised $1.7 Billion – But Not Everyone Is ImpressedMoney talks, and thus it’s no surprise that most of the talk surrounding Telegram’s proposed blockchain concerns the obscene amount it’s raising. Not content with securing $850 million in its initial private sale, the Russian messaging app has doubled up, taking its total proceeds to $1.7 billion. It’s hard to envisage what couldn’t be built for that sort of money: a literal moonshot would not be out of the question.

On Thursday, Telegram filed a Form D with the U.S. Securities and Exchange Commission, confirming its second round of “purchase agreements for cryptocurrency”, and Pavel Durov’s company might not be done. It’s been reported that Telegram might keep on fundraising until it’s hit $2.25 billion. Aside from the pleasing problem of dreaming up ways to spend this money, Telegram has its investors to placate, who are worried that all this capital may be diluting the token value. Some investors have expressed disquiet, while others have stayed away altogether.

Chris Burniske Bows Out

Telegram’s ICO Has Raised $1.7 Billion – But Not Everyone Is Impressed
Chris Burniske

Chris Burniske, one of the best known figures in the cryptocurrency space, and head of venture capital (VC) firm Placeholder, has steered clear. He believes that Telegram has “raised an unnecessarily large amount of money, which may ultimately hurt more than it helps”. Placeholder gets first dibs on major crypto projects, and if Burniske had wanted to buy into Telegram’s ICO, he’d have had no trouble securing an allocation.

“Considering the Telegram ICO? Proceed with Caution” wrote Justine and Olivia Moore in a scathing critique published last week. As VC investors at CRV, the pair are accustomed to evaluating projects such as Telegram, and their decision to warn investors off is telling. After outlining the project’s pros (of which there are many), they explore the cons, which are just as numerous. The Moores touch upon the huge amount being raised, claiming that it could ultimately top $2.6 billion. Remarkably, this money may not even be enough to support Telegram for long, as the leaked whitepaper has $620 million budgeted for the next four years. The Moores write:

If Telegram isn’t able to start generating revenue and spend continues to increase, the company could eventually risk bankruptcy or be forced to raise additional capital at unfavorable terms.

They conclude: “We aren’t convinced that Telegram will deliver significant upside beyond the ICO valuation.” There are reasons to admire Telegram, not least its CEO’s refusal to hand over encrypted user data to the Russian authorities – though the courts may eventually force his hand. Pavel Durov is certainly pro crypto and pro privacy, but that has little bearing on how Telegram’s own cryptocurrency project will play out. Despite being on course to exceed $2 billion when the dust settles, Telegram’s problems may have only just begun.

Do you think VC investors are right to avoid the Telegram ICO? Let us know in the comments section below.


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