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SBI Financial Acquires Institutional Crypto Desk B2C2

5 years 10 months ago

SBI Financial Services has acquired cryptocurrency trading platform B2C2, Reuters reported Monday.

  • The Japanese firm said it will leverage B2C2’s crypto rails for mainstream financial institutions.
  • Reuters reports that SBI Holdings is now the first major financial firm to own a crypto desk.
  • SBI acquired a $30 million minority stake in B2C2 this summer. It has been offering clients access to B2C2’s trading portal ever since.
  • SBI subsidiaries have shown a penchant for crypto projects including security token offerings and digital asset exchange partnerships. The group offers shareholder payouts in XRP.

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New York’s Quontic Becomes First US Bank to Offer a Bitcoin Rewards Debit Card

5 years 10 months ago

New York-based Quontic Bank has become the first FDIC-insured financial institution to launch a bitcoin rewards checking program.

Announced Tuesday, the program includes a bitcoin rewards debit card (1.5% back), mobile app, access to ATMs, and mobile payments options like Google Pay and Apple Pay. 

The bank had to receive approval from the U.S. Office of the Comptroller of the Currency (OCC). In July, the OCC issued a letter enabling nationally chartered banks in the U.S. to provide custody services for cryptocurrencies. Acting Comptroller Brian Brooks has hinted at more “good” actions on crypto by the end of Trump’s term. 

Related: New Federal Reserve ‘Qualitative’ Approach Could Push Further Into Experimental Realm

At Quontic, customers’ bitcoin will be custodied by crypto asset manager NYDIG, which just scooped Quontic’s former chief innovation officer to serve as its head of bank solutions. Major banking software and payments technology provider FIS will build a mobile app with Quontic to track bitcoin rewards in the second quarter of 2021. 

“This is the first time any bank or any core [banking system] has done anything with bitcoin that is consumer facing,” Quontic CEO Steve Schnall said in an interview.

Read more: MassMutual Buys $100M in Bitcoin, Bets on Institutional Adoption With $5M NYDIG Stake

Customers will be able to hold their bitcoin with NYDIG or redeem it in cash, Schnall said. At the moment, customers are not permitted to transfer the bitcoin to another wallet address. 

Related: DeFi on Bitcoin Gets a Boost as Sovryn Launches on RSK Sidechain

Quontic is a tiny bank with only $1.4 billion in assets, about 0.044% the size of JPMorgan. In 2019, it banked a couple crypto firms. Since then, the bank has pivoted from offering bank accounts to crypto firms to trying to bring bitcoin to the masses. 

“Right now we’re not banking crypto companies,” Schnall said. “For the foreseeable future, we’re just going to focus on the consumer.” 

The bitcoin rewards program is initially available to residents of Alabama, Arkansas, California, Maryland, Massachusetts, Missouri, Montana, New York, Pennsylvania, Utah, Wisconsin and Wyoming. Quontic does business in all 50 states, but these are the states that NYDIG currently operates in.

Update (Dec. 15, 17:18 UTC): Adds comments from Quontic CEO Steve Schnall.

Correction (Dec. 15, 17:30 UTC): Quontic is headquartered in Manhattan, not Queens. The bank moved across the East River in July 2019.

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Estonia Has Withdrawn Licenses From Over 1,000 Crypto Companies This Year

5 years 10 months ago

Estonia has withdrawn more than 1,000 licenses from cryptocurrency companies in 2020, apparently due to the burden of monitoring compliance.

  • Veiko Tali, secretary-general of the Ministry of Finance, said in a post on Friday that many of the companies had “minimal” connections to Estonia and clientele in “remote countries.”
  • The mass license revocation by the Financial Intelligence Unit still leaves around 400 virtual currency service providers (VASPs) licensed in Estonia, he added.
  • The secretary-general explained that monitoring and regulation of virtual currency service providers (VASPs) are in “continuous need of heightened attention,” and that “important regulatory changes” are on the way for the industry.
  • However, Estonia’s resources for monitoring compliance by VASPS are limited, Tali said.
  • Estonia joined the European Union in May 2004, which means the country aligns with EU regulations concerning anti-money laundering and other measures.

See also: Inside the Estonian CBDC Experiment That Could Shape the Digital Euro

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DeFi on Bitcoin Gets a Boost as Sovryn Launches on RSK Sidechain

5 years 10 months ago

A new project built on the Bitcoin sidechain RSK is gunning to advance decentralized finance (DeFi) on Bitcoin’s ecosystem.

Sovryn, a self-billed “decentralized platform for trading and lending Bitcoin,” launched today with $2.1 million at its back – a symbolic number representing Bitcoin’s total supply. Crypto venture capital firm Greenfield One led the funding round, which also saw contributions from Collider Ventures and Monday Capital.

A 2-in-1 decentralized exchange and derivatives market, Sovryn will offer traders borrowing and lending service in bitcoin, USDT and RSK’s dollar on chain (DOC) stablecoin; they can also long or short bitcoin on the platform with up to 5x leverage.

Related: Secret Network Launches Bridge to Bring Transactional Privacy to Ethereum

“RSK was a natural fit for Sovryn,” said Edan Yago, Sovryn project lead. “The team behind it share our vision for a borderless and censorship resistant digital currency. This runs right to the core of the system where transactions are secured by bitcoin miners. Now, with the addition of a smart contract layer, deploying on RSK has meant we can provide the same or better functionality than centralized services, but in a decentralized way.”

The market is the second DeFi platform to come to RSK, a year behind the DAO-like stablecoin market Money on Chain. Cloning yet another DeFi product, Sovryn plans to launch a governance token which mimics Compound Finance’s model in Q1 of 2020 with its SOV token sale.

What is a Bitcoin sidechain?

A Bitcoin sidechain is a scaling solution for Bitcoin that offloads transactions onto a network that operates independently from the primary Bitcoin network, using a 1-for-1 tokenized version of bitcoin as a native currency. These systems are sometimes called “federated networks” because they sacrifice decentralization in favor of efficiency increases like transaction speed.

Read more: RSK Is Changing How It ‘Pegs’ Bitcoin to Its Sidechain

Related: First Mover: Reminiscing on Pre-Pandemic Bitcoin as Rally Stalls

For RSK, a group of signatories oversee the peg-in and peg-out process to convert BTC into RBTC, RSK’s tokenized version, though RSK is in the process of revamping this design. RSK processes transactions through a “merge mined” process, wherein Bitcoin miners also contribute hashrate to RSK in return for RBTC transaction fees.

DeFi on Bitcoin

Sovryn’s launch comes shortly after RSK’s MakerDAO-esque stablecoin market Money on Chain introduced liquidity mining last week. 

These software rollouts have RSK sinking its teeth further into the market designs that made DeFi so hot in the summer and early fall of 2020. These financial products, a mishmash of derivatives markets, lending markets and everything in between, have found a home on Ethereum, whose programming language can accommodate more flexible smart contracts than Bitcoin’s own. 

“Sovryn, Money on Chain and RIF Dollar only represent the beginning of the Bitcoin DeFi ecosystem,” said Diego Gutierrez Zaldivar, IOVlabs CEO and RSK co-founder.

“Other than the RSK-Ethereum bridge being utilized more often, by MakerDAO and Aave for example, 2020 showed the Bitcoin ecosystem is the strongest one and where users want to be. That has led to many developers and entrepreneurs to understand they should, at the very least, create interoperable solutions to Bitcoin’s open finance protocols like RSK. Bitcoin is the future of the Internet of Value, and we’re excited to participate and lead it.”

Read more: Forget Ethereum, DeFi Is Being Built on Bitcoin

Sidechains like RSK have often been billed as a way to bring Ethereum-like smart contract capabilities to Bitcoin. Greenfield One partner Jascha Samadi told CoinDesk that Sovryn is definitely a “short- to mid-term play” to capture some of the lending and derivative markets volume that occurs on Ethereum-native DeFi and even centralized exchanges.

But the long play is about more than active crypto users; it’s about the crop that doesn’t have skin in the game yet.

“The long term play for DeFi on Bitcoin could be significantly larger with users (both retail and institutional) that are not in crypto yet,” Samadi wrote over email.

“At some point obviously, all these users will want to interact with DeFi applications as well, and with products like Sovryn, this will be possible right where they entered the ecosystem,” meaning in Bitcoin, rather than “having to educate them [on how to move] their BTC to Ethereum or some other ecosystem.”

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Las criptomonedas crecen en la problemática economía de Argentina

5 years 10 months ago

Al inicio del 2020, Ripio, una de las casas de cambios más grandes de Argentina, tenía alrededor de 400.000 usuarios. Está terminando este 2020 con más de 1 millón. 

El director de marca de Ripio, Juan Mendez, dijo a CoinDesk que cerca del 70% de los usuarios de Ripio son de Argentina y el resto se concentra en Brasil. De acuerdo a Mendez, la plataforma ha presentado un aumento de hasta 10 veces en su volumen de intercambio, en comparación con el año pasado. 

Read this article in English.

Related: New Federal Reserve ‘Qualitative’ Approach Could Push Further Into Experimental Realm

“He estado con la casa de cambio desde sus inicios y nunca he visto este nivel de crecimiento. Este es mucho mayor que el pico del 2017, tanto en operaciones como de la demanda,” dijo Mendez. 

Los problemas económicos de Argentina van desde enormes obligaciones de deuda hasta una alta inflación, agravada por la pandemia del COVID-19. Estos han obligado a su población a buscar nuevas alternativas para resguardar sus riquezas este año. Pero, como el gobierno ha limitado la compra de dólares norteamericanos a sus ciudadanos, las criptomonedas, rápidamente, han demostrado ser la mejor alternativa. 

Además de Ripio, las casas de cambio de criptomonedas operando en Argentina han presentado récords de crecimiento en este 2020. Con algunas experimentando máximos históricos en volúmenes de intercambios en la última mitad del año.

La casa de cambio mexicana Bitso, que expandió sus operaciones a Argentina en febrero de este año, ha obtenido un 68% de incremento en sus volúmenes de comercio en el tercer trimestre, en comparación con el segundo de este 2020. La instalación de Bitso en Argentina también ayudó a que la plataforma alcanzara el millón de usuarios, al inicio de este año.    

Related: First Mover: Reminiscing on Pre-Pandemic Bitcoin as Rally Stalls

La plataforma de intercambios entre pares (P2P, por sus siglas en inglés) LocalBitcoins también presentó un incremento del 547% en sus volúmenes de intercambio entre agosto del 2019 y del 2020, con un máximo histórico de más de un millón de dólares en bitcoin intercambiados en la segunda semana de agosto de este año. Otra plataforma P2P, Paxful, mostraba casi cero volumen de intercambio en los últimos cinco años, pero el comercio empezó a crecer este año, registrando un aumento del 60.641% al compararse desde septiembre del 2019 hasta el 2020.

El crecimiento sin precedentes del comercio de criptomonedas en Argentina se refleja como una tendencia regional más amplia, ya que LocalBitcoins y Paxful también registraron máximos históricos en varios países de América del Sur, incluidos Chile, Colombia y Bolivia. Los negocios en la región son tan prósperos, que este miércoles CoinDesk reportó que Bitso recaudó la asombrosa cifra de $62 millones para financiar su expansión en Brasil. 

El aumento en el uso de las criptomonedas se está generando a pesar de un contexto de devastadoras consecuencias económicas producidas por la pandemia del COVID-19. Incluso, el Banco Mundial ha declarado a América Latina y el Caribe como la región más golpeada en el mundo. 

La combinación del aumento del precio de bitcoin, las economías inflacionarias (creadas desesperadamente por los países para intentar mitigar los efectos de la pandemia) y la necesidad de medios de pagos digitales más rápidos (particularmente para remesas transfronterizas) han impulsado la adopción de las criptomonedas en América del Sur este año. 

Dentro de este panorama, Argentina destaca. 

Comparado con economías hiperinflacionarias como Venezuela – se proyecta que para este 2020 su economía se va reducir un 6,8% – Argentina parece que enfrentará un peor desgaste, gracias en parte a una larga y complicada historia económica. En mayo, el gobierno falló el pago de $503 millones en intereses, de un bono en dólares emitidos bajo la ley de New York, colocando al país en su noveno default de deuda soberana en su historia.    

El producto interno bruto (PIB) se estima que se contraerá un 12% este año, con cerca de más de la mitad de la población viviendo en pobreza. 

“Las criptomonedas son, en cierta manera, aliados para los individuos, principalmente en países con un alto grado de incertidumbre política o económica,” comentó Andrés Ondarra, Gerente de Bitso Argentina, para Coindesk por correo electrónico. 

Catch-22

Los argentinos, nerviosos ante el deterioro de la economía de sus país, comenzaron a aumentar sus compras de dólares norteamericanos para resguardar su riqueza. Entonces, las reservas del país se redujeron, forzando al gobierno a devaluar su moneda y establecer restricciones en la cantidad de divisas que los ciudadanos pueden resguardar.

En septiembre, en un intento de resguardar las reducidas reservas nacionales, el banco central de Argentina limitó la cantidad de dólares norteamericanos que sus ciudadanos pueden comprar a $200 mensuales, con un impuesto del 35%.    

Esto generó más problemas: después de unas difíciles negociaciones con los acreedores, el gobierno logró manejar exitosamente la restructuración de $65 mil millones de deuda externa este agosto pasado, pero debido a las preocupaciones de los inversionistas sobre las restricciones en el mercado de divisas, los nuevos bonos internacionales recién emitidos cayeron abruptamente durante septiembre y las personas siguieron comprando dólares a pesar del impuesto. 

Cada vez que el peso es devaluado, las personas luchan para conseguir una manera de proteger el valor de sus salarios, agrega Mendez. Además de esto, a inicios de diciembre, el senado de Argentina aprobó un impuesto único sobre el patrimonio a los millonarios del país, para ayudar a financiar los esfuerzos de ayudas económicas ante la pandemia.

Ondarra declaró que Argentina es un mercado de criptomonedas peculiar, ya que sus usuarios siempre están la búsqueda de acceder a reservas de valor y diversas soluciones financieras. 

“Los argentinos siempre están tratando de encontrar una moneda más fuerte,” dijo Mendez. 

Entrando a las criptomonedas

De acuerdo a Mendez, existe una diferencia fundamental entre los usuarios de criptomonedas en Argentina y los de Brasil, donde también opera Ripio. Las dos naciones están separadas por las fallas económicas sistémicas de Argentina a lo largo de los años, explicó.

“Argentina ha tenido que superar muchos desastres económicos a lo largo de los años. Estamos bastante acostumbrados a que fracasen los gobiernos y la planificación económica estratégica, y estamos más dispuestos a probar cosas diferentes para mantener el país a flote” afirmó Mendez.

Por ejemplo, el gobierno usualmente anuncia nuevas restricciones financieras a horas de la tarde del fin de semana (con la intención de que sean implementadas el lunes siguiente), dice Mendez.

“Entonces, durante el fin de semana y el resto de esa semana, nosotros siempre esperamos una gran demanda de criptomonedas,” de acuerdo a Mendez. 

Los argentinos ven las criptomonedas como una gran alternativa para el resguardo de valor, aunque su plataforma alerta a sus usuarios que las monedas como bitcoin son activos digitales volátiles, según Mendez. 

Tanto Ondarra como Mendez están de acuerdo que la fuerte curiosidad de los argentinos sobre alternativas de reservas de valor y el aumento del conocimiento sobre criptomonedas han ayudado al crecimiento del espacio crypto local. 

Pero Ondarra también atribuye el rápido crecimiento, en este año, al reciente aumento del precio. 

“Un factor importante que explica el incremento en el volumen durante los últimos meses ha sido la tendencia alcista en el precio de bitcoin. Lo que indudablemente ha mantenido la atención de las personas en los movimientos del precio y ha promovido un mayor volumen de comercio,” declaró Ondarra. 

Él explica que los inversionistas de Argentina están mirando de cerca los movimientos de grandes inversionistas como MicroStrategy, quienes pasaron cerca de $500 millones de inversiones en efectivo a BTC. 

Este año, Argentina se posicionó en el puesto 28 entre 154 países en el índice de adopción de criptomonedas de Chainalysis, con otros países de América Latina donde Venezuela, Colombia, Brasil y Perú se posicionan delante de Argentina.

“Está prosperando. La atención de todos se encuentra en América Latina. Y está creciendo rápido,” dijo Méndez.

Traducido por José Rafael Peña Gholam.

Este artículo ha sido actualizado por claridad.

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Las criptomonedas surgen en la desafiante economía de Argentina

5 years 10 months ago

Al inicio del 2020, Ripio, una de las casas de cambios más grandes de Argentina, tenía alrededor de 400.000 usuarios. Está terminando este 2020 con más de 1 millón. 

El director de marca de Ripio, Juan Mendez, dijo a CoinDesk que cerca del 70% de los usuarios de Ripio son de Argentina y el resto se concentra en Brasil. De acuerdo a Mendez, la plataforma ha presentado un aumento de hasta 10 veces en su volumen de intercambio, en comparación con el año pasado. 

Read this article in English.

Related: New Federal Reserve ‘Qualitative’ Approach Could Push Further Into Experimental Realm

“He estado con la casa de cambio desde sus inicios y nunca he visto este nivel de crecimiento. Este es mucho mayor que el pico del 2017, tanto en operaciones como de la demanda,” dijo Mendez. 

Los problemas económicos de Argentina van desde enormes obligaciones de deuda hasta una alta inflación, agravada por la pandemia del COVID-19. Estos han obligado a su población a buscar nuevas alternativas para resguardar sus riquezas este año. Pero, como el gobierno ha limitado la compra de dólares norteamericanos a sus ciudadanos, las criptomonedas, rápidamente, han demostrado ser la mejor alternativa. 

Además de Ripio, las casas de cambio de criptomonedas operando en Argentina han presentado récords de crecimiento en este 2020. Con algunas experimentando máximos históricos en volúmenes de intercambios en la última mitad del año.

La casa de cambio mexicana Bitso, quienes expandieron sus operaciones a Argentina en febrero de este año, han obtenido un 68% de incremento en sus volúmenes de comercio en el tercer trimestre, en comparación con el segundo de este 2020. La instalación de Bitso en Argentina también ayudó a que la plataforma alcanzara el millón de usuarios, al inicio de este año.    

Related: First Mover: Reminiscing on Pre-Pandemic Bitcoin as Rally Stalls

La plataforma de intercambios entre pares (P2P, por sus siglas en inglés) LocalBitcoins también presentó un incremento del 547% en sus volúmenes de intercambio entre agosto del 2019 y del 2020, con un máximo histórico de más de un millón de dólares en bitcoin intercambiados en la segunda semana de agosto de este año. Otra plataforma P2P, Paxful, mostraba casi cero volumen de intercambio en los últimos cinco años, pero el comercio empezó a crecer este año, registrando un aumento del 60.641% al compararse desde septiembre del 2019 hasta el 2020.

El crecimiento sin precedentes del comercio de criptomonedas en Argentina se refleja como una tendencia regional más amplia, ya que LocalBitcoins y Paxful también registraron máximos históricos en varios países de América del Sur, incluidos Chile, Colombia y Bolivia. Los negocios en la región están con gran impulso. Una muestra, es que este miércoles CoinDesk reportó que Bitso recaudó la asombrosa cifra de $62 millones para financiar su expansión en Brasil. 

El aumento en el uso de las criptomonedas se está generando a pesar de un contexto de devastadoras consecuencias económicas producidas por la pandemia del COVID-19. Incluso, el Banco Mundial ha declarado a América Latina y el Caribe como la región más golpeada en el mundo. 

En cambio que el uso de criptomonedas se inhibiera, la combinación del aumento del precio de bitcoin, las economías inflacionarias creadas desesperadamente por los países para intentar mitigar los efectos de la pandemia y la necesidad de medios de pagos digitales más rápidos (particularmente para remesas transfronterizas) han impulsado la adopción en América del Sur este año. 

Dentro de este panorama, Argentina destaca. 

Comparado con economías hiperinflacionarias como Venezuela – se proyecta que para este 2020 su economía se va reducir un 6,8% – Argentina parece que enfrentará un peor desgaste, gracias en parte a una larga y complicada historia económica. En mayo, el gobierno falló el pago de $503 millones en intereses, de un bono en dólares emitidos bajo la ley de New York, colocando al país en su noveno default de deuda soberana en su historia.    

El producto interno bruto (PIB) se estima que se contraerá un 12% este año, con cerca de más de la mitad de la población viviendo en pobreza. 

“Las criptomonedas son, en cierta manera, aliados para los individuos, principalmente en países con un alto grado de incertidumbre política o económica,” comentó Andrés Ondarra, Gerente de Bitso Argentina, para Coindesk por correo electrónico. 

Catch-22

Como los argentinos, nerviosos ante el deterioro de la economía de sus país, comenzaron a aumentar sus compras de dólares norteamericanos para resguardar su riqueza, las reservas del país se reducían, forzando al gobierno a devaluar su moneda y agregar restricciones de cuanto en divisas los ciudadanos tienen permitido resguardar.

En un intento para resguardar las reducidas reservas, en septiembre el banco central de Argentina limitó la cantidad de dólares norteamericanos que sus ciudadanos pueden comprar a $200 mensuales, con un impuesto del 35%.    

Esto generó más problemas: después de unas difíciles negociaciones con los acreedores, el gobierno logró manejar exitosamente la restructuración de $65 mil millones de deuda externa este agosto pasado, pero debido a las preocupaciones de los inversionistas sobre las restricciones en el mercado de divisas, los nuevos bonos internacionales recién emitidos cayeron abruptamente durante septiembre y las personas siguieron comprando dólares a pesar del impuesto. 

Cada vez que el peso es devaluado, las personas luchan para conseguir una manera de proteger el valor de sus salarios, agrega Mendez. Además de esto, a inicios de diciembre, el senado de Argentina aprobó un impuesto único sobre el patrimonio a los millonarios del país, para ayudar a financiar los esfuerzos de ayudas económicas ante la pandemia.

Ondarra declaró que Argentina es un mercado de criptomonedas peculiar, ya que sus usuarios siempre están la búsqueda de acceder a reservas de valor y diversas soluciones financieras. 

“Los argentinos siempre están tratando de encontrar una moneda más fuerte,” dijo Mendez. 

Entrando a las criptomonedas

De acuerdo a Mendez, existe una diferencia fundamental entre los usuarios de criptomonedas en Argentina y los de Brasil, donde también opera Ripio. Las dos naciones están separadas por las fallas económicas sistémicas de Argentina a lo largo de los años, explicó.

“Argentina ha tenido que superar muchos desastres económicos a lo largo de los años. Estamos bastante acostumbrados a que fracasen los gobiernos y la planificación económica estratégica, y estamos más dispuestos a probar cosas diferentes para mantener el país a flote” afirmó Mendez.

Por ejemplo, el gobierno usualmente anuncia nuevas restricciones financieras a horas de la tarde del fin de semana (con la intención de que sean implementadas el lunes siguiente), dice Mendez.

“Entonces, durante el fin de semana y el resto de esa semana, nosotros siempre esperamos una gran demanda de criptomonedas,” de acuerdo a Mendez. 

Los argentinos ven las criptomonedas como una gran alternativa para el resguardo de valor, aunque su plataforma alerta a sus usuarios que las monedas como bitcoin son activos digitales volátiles, según Mendez. 

Tanto Ondarra como Mendez están de acuerdo que la fuerte curiosidad de los argentinos sobre alternativas de reservas de valor y el aumento del conocimiento sobre criptomonedas han ayudado al crecimiento del espacio crypto local. 

Pero Ondarra también atribuye el rápido crecimiento, en este año, al reciente aumento del precio. 

“Un factor importante que explica el incremento en el volumen durante los últimos meses ha sido la tendencia alcista en el precio de bitcoin. Lo que indudablemente ha mantenido la atención de las personas en los movimientos del precio y ha promovido un mayor volumen de comercio,” declaró Ondarra. 

Él explica que los inversionistas de Argentina están mirando de cerca los movimientos de grandes inversionistas como MicroStrategy, quienes pasaron cerca de $500 millones de inversiones en efectivo a BTC. 

Este año, Argentina se posicionó en el puesto 28 entre 154 países en el índice de adopción de criptomonedas de Chainalysis, con otros países de América Latina como Venezuela, Colombia, Brasil y Perú que se posicionan delante de Argentina, como muestra del continuo crecimiento de la adopción a un paso veloz en la región.   

“Está prosperando. La atención de todos se encuentra en América Latina. Y está creciendo rápido,” dijo Méndez.

Traducido por José Rafael Peña Gholam.

Related Stories
CoinDesk

Las Criptomonedas Surgen en la Desafiante Economía de Argentina

5 years 10 months ago

Al inicio del 2020, Ripio, una de las casas de cambios más grandes de Argentina, tenía alrededor de 400.000 usuarios. Está terminando este 2020 con más de 1 millón. 

El director de marca de Ripio, Juan Mendez, dijo a CoinDesk que cerca del 70% de los usuarios de Ripio son de Argentina y el resto se concentra en Brasil. De acuerdo a Mendez, la plataforma ha presentado un aumento de hasta 10 veces en su volumen de intercambio, en comparación con el año pasado. 

Read this article in English.

Related: First Mover: Reminiscing on Pre-Pandemic Bitcoin as Rally Stalls

“He estado con la casa de cambio desde sus inicios y nunca he visto este nivel de crecimiento. Este es mucho mayor que el pico del 2017, tanto en operaciones como de la demanda,” dijo Mendez. 

Los problemas económicos de Argentina van desde enormes obligaciones de deuda hasta una alta inflación, agravada por la pandemia del COVID-19. Estos han obligado a su población a buscar nuevas alternativas para resguardar sus riquezas este año. Pero, como el gobierno ha limitado la compra de dólares norteamericanos a sus ciudadanos, las criptomonedas, rápidamente, han demostrado ser la mejor alternativa. 

Además de Ripio, las casas de cambio de criptomonedas operando en Argentina han presentado récords de crecimiento en este 2020. Con algunas experimentando máximos históricos en volúmenes de intercambios en la última mitad del año.

La casa de cambio mexicana Bitso, quienes expandieron sus operaciones a Argentina en febrero de este año, han obtenido un 68% de incremento en sus volúmenes de comercio en el tercer trimestre, en comparación con el segundo de este 2020. La instalación de Bitso en Argentina también ayudó a que la plataforma alcanzara el millón de usuarios, al inicio de este año.    

Related: First Mover: Horrible 2020 Economy Proved Best Thing for Bitcoin

La plataforma de intercambios entre pares (P2P, por sus siglas en inglés) LocalBitcoins también presentó un incremento del 547% en sus volúmenes de intercambio entre agosto del 2019 y del 2020, con un máximo histórico de más de un millón de dólares en bitcoin intercambiados en la segunda semana de agosto de este año. Otra plataforma P2P, Paxful, mostraba casi cero volumen de intercambio en los últimos cinco años, pero el comercio empezó a crecer este año, registrando un aumento del 60.641% al compararse desde septiembre del 2019 hasta el 2020.

El crecimiento sin precedentes del comercio de criptomonedas en Argentina se refleja como una tendencia regional más amplia, ya que LocalBitcoins y Paxful también registraron máximos históricos en varios países de América del Sur, incluidos Chile, Colombia y Bolivia. Los negocios en la región están con gran impulso. Una muestra, es que este miércoles CoinDesk reportó que Bitso recaudó la asombrosa cifra de $62 millones para financiar su expansión en Brasil. 

El aumento en el uso de las criptomonedas se está generando a pesar de un contexto de devastadoras consecuencias económicas producidas por la pandemia del COVID-19. Incluso, el Banco Mundial ha declarado a América Latina y el Caribe como la región más golpeada en el mundo. 

En cambio que el uso de criptomonedas se inhibiera, la combinación del aumento del precio de bitcoin, las economías inflacionarias creadas desesperadamente por los países para intentar mitigar los efectos de la pandemia y la necesidad de medios de pagos digitales más rápidos (particularmente para remesas transfronterizas) han impulsado la adopción en América del Sur este año. 

Dentro de este panorama, Argentina destaca. 

Comparado con economías hiperinflacionarias como Venezuela – se proyecta que para este 2020 su economía se va reducir un 6,8% – Argentina parece que enfrentará un peor desgaste, gracias en parte a una larga y complicada historia económica. En mayo, el gobierno falló el pago de $503 millones en intereses, de un bono en dólares emitidos bajo la ley de New York, colocando al país en su noveno default de deuda soberana en su historia.    

El producto interno bruto (PIB) se estima que se contraerá un 12% este año, con cerca de más de la mitad de la población viviendo en pobreza. 

“Las criptomonedas son, en cierta manera, aliados para los individuos, principalmente en países con un alto grado de incertidumbre política o económica,” comentó Andrés Ondarra, Gerente de Bitso Argentina, para Coindesk por correo electrónico. 

Catch-22

Como los argentinos, nerviosos ante el deterioro de la economía de sus país, comenzaron a aumentar sus compras de dólares norteamericanos para resguardar su riqueza, las reservas del país se reducían, forzando al gobierno a devaluar su moneda y agregar restricciones de cuanto en divisas los ciudadanos tienen permitido resguardar.

En un intento para resguardar las reducidas reservas, en septiembre el banco central de Argentina limitó la cantidad de dólares norteamericanos que sus ciudadanos pueden comprar a $200 mensuales, con un impuesto del 35%.    

Esto generó más problemas: después de unas difíciles negociaciones con los acreedores, el gobierno logró manejar exitosamente la restructuración de $65 mil millones de deuda externa este agosto pasado, pero debido a las preocupaciones de los inversionistas sobre las restricciones en el mercado de divisas, los nuevos bonos internacionales recién emitidos cayeron abruptamente durante septiembre y las personas siguieron comprando dólares a pesar del impuesto. 

Cada vez que el peso es devaluado, las personas luchan para conseguir una manera de proteger el valor de sus salarios, agrega Mendez. Además de esto, a inicios de diciembre, el senado de Argentina aprobó un impuesto único sobre el patrimonio a los millonarios del país, para ayudar a financiar los esfuerzos de ayudas económicas ante la pandemia.

Ondarra declaró que Argentina es un mercado de criptomonedas peculiar, ya que sus usuarios siempre están la búsqueda de acceder a reservas de valor y diversas soluciones financieras. 

“Los argentinos siempre están tratando de encontrar una moneda más fuerte,” dijo Mendez. 

Entrando a las criptomonedas

De acuerdo a Mendez, existe una diferencia fundamental entre los usuarios de criptomonedas en Argentina y los de Brasil, donde también opera Ripio. Las dos naciones están separadas por las fallas económicas sistémicas de Argentina a lo largo de los años, explicó.

“Argentina ha tenido que superar muchos desastres económicos a lo largo de los años. Estamos bastante acostumbrados a que fracasen los gobiernos y la planificación económica estratégica, y estamos más dispuestos a probar cosas diferentes para mantener el país a flote” afirmó Mendez.

Por ejemplo, el gobierno usualmente anuncia nuevas restricciones financieras a horas de la tarde del fin de semana (con la intención de que sean implementadas el lunes siguiente), dice Mendez.

“Entonces, durante el fin de semana y el resto de esa semana, nosotros siempre esperamos una gran demanda de criptomonedas,” de acuerdo a Mendez. 

Los argentinos ven las criptomonedas como una gran alternativa para el resguardo de valor, aunque su plataforma alerta a sus usuarios que las monedas como bitcoin son activos digitales volátiles, según Mendez. 

Tanto Ondarra como Mendez están de acuerdo que la fuerte curiosidad de los argentinos sobre alternativas de reservas de valor y el aumento del conocimiento sobre criptomonedas han ayudado al crecimiento del espacio crypto local. 

Pero Ondarra también atribuye el rápido crecimiento, en este año, al reciente aumento del precio. 

“Un factor importante que explica el incremento en el volumen durante los últimos meses ha sido la tendencia alcista en el precio de bitcoin. Lo que indudablemente ha mantenido la atención de las personas en los movimientos del precio y ha promovido un mayor volumen de comercio,” declaró Ondarra. 

Él explica que los inversionistas de Argentina están mirando de cerca los movimientos de grandes inversionistas como MicroStrategy, quienes pasaron cerca de $500 millones de inversiones en efectivo a BTC. 

Este año, Argentina se posicionó en el puesto 28 entre 154 países en el índice de adopción de criptomonedas de Chainalysis, con otros países de América Latina como Venezuela, Colombia, Brasil y Perú que se posicionan delante de Argentina, como muestra del continuo crecimiento de la adopción a un paso veloz en la región.   

“Está prosperando. La atención de todos se encuentra en América Latina. Y está creciendo rápido,” dijo Méndez.

Traducido por José Rafael Peña Gholam.

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CoinDesk

Amid DeFi Hacks, Nervos and Cardano Join Forces to Improve Smart Contract Security

5 years 10 months ago

Public chain projects Nervos and Cardano have jointly launched a research initiative to enhance the security of smart contracts by improving Unspent Transaction Outputs (UTXOs), one of the most common accounting methods first adopted by the Bitcoin network. 

Nervos and IOHK, the development team behind Cardano, will co-author research papers on how to improve UTXO models, open source future developments, and explore the creation of a universal standard for the accounting method. They will form an alliance with other UTXO-based blockchains to help collaboration across research, development and education in the industry. 

UTXO, which keeps track of a user’s unspent transactions across all their accounts and monitors every single transaction, is a more secure alternative to the account-based accounting method used by smart contract-based blockchains such as Ethereum, Nervos said in a statement shared with CoinDesk. 

Related: Market Wrap: Bitcoin Pushes Past $19.2K; Ether at 3% of BTC Price

The account-based accounting method is more vulnerable to hacks, particularly for decentralized finance (DeFi) protocols, as it simply keeps track of the overall balance of a user’s account but doesn’t monitor the individual transactions within it. 

Nervos and IOHK have adopted modified versions for their respective blockchains. The two projects will share proprietary information to improve the accounting method. 

“UTXOs are superior to account models in many ways and provide improved security, privacy, and scalability, all of which are critical for DeFi,” said Kevin Wang, co-founder at Nervos.

Many DeFi projects rely on unaudited smart contracts with vulnerabilities that bad actors can exploit, according to a report by crypto intelligence company CipherTrace. 

Related: Huobi’s HUSD Stablecoin to Run on Nervos Blockchain

Cardano launched a hard fork last week as part of the transition to its third major development phase, which will be focused on the blockchain’s smart contract functions, while Nervos unveiled its new token standard sUDT to compete with Ethereum’s ERC-20 standard. 

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Secret Network Launches Bridge to Bring Transactional Privacy to Ethereum

5 years 10 months ago

The Secret Network, a privacy-focused blockchain, has launched its Ethereum bridge, which lets assets be transferred between Ethereum and the Secret Network privately. A bridge essentially offers interoperability between the protocols. 

The Secret bridge, initially announced in December, will make privacy cheaper and more practical for Ethereum and Ethereum-based assets.

According to the blog post announcement, “it allows users to create synthetic (wrapped) ETH and ERC-20 tokens on Secret Network that can be used with full privacy, at lower cost.”  

Related: DeFi on Bitcoin Gets a Boost as Sovryn Launches on RSK Sidechain

Users will need Metamask or a Keplr Wallet to interact with the bridge. 

Read more: Community Behind Privacy-Focused Smart Contract Forges Ahead After Settlement

Tor Bair, the Secret Foundation’s executive director and chairman, said the biggest immediate benefit for users when it comes to this recent move is that they can gain transaction privacy. Users can turn Ethereum-based assets into Secret Tokens, which are “programmable like ERC-20s but privacy preserving like zcash or monero,” according to Bair.

Bair said the cost for ETH or ERC-20 holders using the Secret Network would be lower than using other privacy-preserving alternatives like TornadoCash, a tool for obfuscating the history of ether (ETH) transactions.

Related: How Israeli VCs Are Doubling Down on DeFi Startups

Tornado Cash uses zero-knowledge proofs (ZKP), a cryptographic tool that proves a transaction occurred without revealing the information within the payment itself.

Secret smart contracts

The Secret Network’s key offering is the secret contract, a type of smart contract that allows private data to be used in decentralized applications without revealing the raw data. The inputs, outputs and network state are encrypted in a secret contract, which means the data is hidden even on a public blockchain. It is also invisible to the nodes executing the contract.

Read more: Secret Network’s Privacy-Focused Smart Contracts Move a Step Closer to Going Live

“In addition, you’ll be able to access upcoming decentralized finance [DeFi]applications on Secret Network, such as a front-running resistant AMM [automated market maker],” said Bair. “After launch we also plan to introduce ‘bridge mining’ rewards, where users of the Secret Ethereum Bridge can earn Secret Tokens for providing bridge liquidity. These rewards are available for both ETH and ERC-20s.”

The bridge will also give users access to Secret DeFi, privacy-preserving decentralized finance apps built on the Secret Network. For example, OCEAN and Secret have partnered to provide “trustless and convenient access control for Ocean datatokens as well as decentralized private compute via Secret Network.”

The full list of ERC-20 assets that are currently supported are BAND, AAVE, SNX, MKR, LINK, OCEAN, TUSD, YFI, UNI, KNC, COMP and DAI.

“Our community will be continuing to launch Secret DeFi applications that utilize Secret Tokens, especially our upcoming Secret AMM,” said Bair. 

“We will also be exploring bridges and support for additional assets and ecosystems, including other Tendermint chains such as Cosmos. As a result, our AMM will feature cross-chain functionality and front-running resistance, and it will also allow you to trade Secret Tokens that are native to Secret Network.”

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First Mover: Reminiscing on Pre-Pandemic Bitcoin as Rally Stalls

5 years 10 months ago

Bitcoin (BTC) was rising for a fourth straight day, though in a repeat of last week’s action the cryptocurrency struggled to push above $20,000 after its months-long rally from a low around $5,000 in March. 

“The level of $20,000, which is commonly equated with bitcoin’s all-time high, represents a massive psychological barrier and could likely require a lot of force to break through,” Mati Greenspan, founder of the foreign-exchange and cryptocurrency research firm Quantum Economics, wrote in his newsletter. 

In traditional markets, Asian stocks fell the most in two weeks but European equities were steady. U.S. stocks pointed to a higher open after a four-day slump. According to Bloomberg News, investors were pricing in optimism about a vaccine rollout while harboring doubts on the latest efforts by U.S. lawmakers to negotiate a new stimulus bill. The so-called third wave of the coronavirus is leading to new lockdown measures. Gold strengthened 1% to $1,846 an ounce. 

Market moves

Related: DeFi on Bitcoin Gets a Boost as Sovryn Launches on RSK Sidechain

(Editor’s note: This is the second installment of First Mover’s recap of how the bitcoin market evolved over the course of 2020 and what it means for the future. Today we cover January and February, just before the fast-spreading coronavirus began to take its toll on the global economy, sending markets into a tailspin and leading to an unprecedented financial response from governments and central banks around the world.) 


Trillions of dollars of money-printing this year by the Federal Reserve and other central banks have galvanized bitcoin’s use as a hedge against currency debasement by investors from both cryptocurrency markets and traditional finance. 

But even before the pandemic-related economic stimulus hit global markets, economists were already openly speculating whether the U.S. dollar could survive another decade as the world’s dominant currency for international payments and foreign reserves. 

Historically, after all, a catalyst always led to one currency supplanting another as the world’s most important medium of transaction, unit of accounting and store of value. The U.S. dollar had emerged as the world’s leading currency during the early 20th century when it took over from debt-strapped Britain’s pound; a century before that, Holland’s guilder was undone by the French Emperor Napoleon’s invasion.

Related: Las Criptomonedas Surgen en la Desafiante Economía de Argentina

In early 2020, China’s proposed digital currency was seen as a potential threat to the greenback, and former Bank of England Governor Mark Carney had gone so far as to propose a “synthetic hegemonic currency,” potentially provided “through a network of central bank digital currencies.” 

“There’s a lot of discussion of substitutes for the dollar as the global reserve currency,” Bill Adams, senior international economist for the U.S. bank PNC, told CoinDesk around the start of the year. 

But based on officials tallies of the dollar’s share of global foreign reserves, the U.S. currency looked as strong as ever.  

It didn’t take long for the bitcoin market to get a jolt – after a U.S. drone strike killed a top Iranian commander during the first week of January, fueling speculation that heightened geopolitical turmoil might spur demand for the cryptocurrency. Bitcoin jumped to $7,300, as analysts said it might serve as a safe-haven asset similar to gold, whose value is expected to hold in times of geopolitical or economic instability. 

The flap soon faded from the news and crypto traders turned to what they thought would be the bitcoin market’s marquee event of the year – the once-every-four-years “halving” that would take place in May, where the pace of new supply of cryptocurrency issued from the Bitcoin network gets cut by 50%. It’s stipulated in the 11-year-old blockchain’s underlying programming.

From December through February, Google searches on the term “bitcoin halving” doubled in a month to the highest levels since 2016, and some enthusiasts even created a dedicated website, bitcoinblockhalf.com, to count down the remaining days, hours, minutes and seconds until it happens.

Cryptocurrency lenders reported a quickening pace of customer activity, in some cases more than 10 times the loan growth reported by big banks like JPMorgan Chase. The traditional financial companies were tethered to the broad economy, where U.S. growth had slowed to a 2.3% expansion in 2019 from the 2.9% clip in 2018. (A newly launched futures contract focused on the U.S. presidential election, launched by the cryptocurrency exchange FTX in early February, suggested Donald Trump had a 62% chance of winning.)  

Crypto traders bandied about analyst predictions the halving could send prices skyrocketing to $90,000 or higher. 

They had no idea, of course, how dramatically the events of the ensuing months would reshape the global economic outlook. By late February, traders saw clearly just how far bitcoin was from being a safe haven – as prices tumbled alongside U.S. stocks as authorities globally struggled to stem the spread of the coronavirus beyond China. U.S. Treasury bonds, seen as a traditional safe-haven asset, rallied, as did gold. 

Bitcoin is “not the same as owning Treasury, and not the same as owning gold,” the cryptocurrency analyst Greg Cipolaro told CoinDesk on Feb. 24.   

Jeff Dorman, chief investment officer of the crypto-focused firm Arca Funds in Los Angeles, raised the prospect of a separate potential catalyst for higher bitcoin prices: Monetary-policy easing by the Federal Reserve to stimulate coronavirus-infected markets. 

“I don’t expect bitcoin to trade as risk-on or risk-off asset,” he said. “But over a longer period of time, anything that’s inflationary, or said another way devalues other currencies, strengthens the purchasing power of bitcoin.”

That view would take hold in the bitcoin market over the rest of the year, attracting the notice of mutual-fund companies like Fidelity Investments and BlackRock, hedge funds including Tudor Investment and more recently the 169-year-old insurance company MassMutual. 

Prices have nearly tripled in 2020 to near $20,000. 

Iran rarely came up again in bitcoiners’ conversations about the market, and these days, there’s barely any market talk about the halving. Now, it’s all about the money printing. Questions remain about the future of the dollar. 

Coming Wednesday: The coronavirus hits, and bitcoin prices tank – until the Federal Reserve arrives and embarks on the biggest money-printing episode of its 107-year history. 

– Bradley Keoun

Bitcoin watch

Bitcoin again failed to hold gains above $19,500 early Tuesday, possibly due to profit-taking by large Asia-based investors, according to one analyst.

In the two hours between 4 a.m. and 6 a.m. coordinated universal time (UTC), the cryptocurrency fell from about $19,500 to about $19,050. An increased inflow of coins onto the crypto exchange Huobi Global, which has a Hong Kong presence, was observed before prices began falling.

“A total of 2,013 coins were transferred to Huobi in blocks 661,425 to 661,430 just 15 minutes before the price dip,” said Ki Young Ju, CEO of CryptoQuant, adding that block number 661,425 carried 1,017 coins, the highest single-block inflow on Huobi since Nov. 30. Monday saw 8,836 BTC arrive on Huobi in total, with a mean transaction of 4.5 BTC, the highest since March 2018, according to CryptoQuant.

The uptick in the average size of exchange deposits indicates that larger investors were transferring their coins to Huobi and may have liquidated their holdings around $19,500, a level that has acted as stiff resistance of late.

At press time, bitcoin has rebounded to near $19,300, and the path of least resistance for the cryptocurrency remains to the upside, according to analysts. However, forcing a breakout above $20,000 in the short term may prove to be an uphill task for the bulls, since there are sizable sell orders open in the approach to a new record high spot price.

“There are still offers above $19,500 up to $20,000,” Patrick Heusser, head of trading at the Zurich-based Crypto Broker AG, told CoinDesk. “The US-based cryptocurrency exchange Coinbase shows 700 bitcoin for sale right at $20,000, but all other exchanges show some offers up there as well in the region of 200-300 coins.”

– Omkar Godbole

Read More: Bitcoin May Have Hit Wall of Profit Takers Around $19,500

What’s hot

Mt. Gox creditors’ wait nearly over as trustee announces draft rehabilitation plan (Cointelegraph) 

Charles Calomiris, chief economist for the U.S. Office of the Comptroller of the Currency, cites benefits of issuing bank charters to stablecoin providers (CoinDesk) 

Wall Street firm Evercore says PayPal’s crypto offering could bring big business boost (CoinDesk) 

Supermarket kiosk company Coinstar adds Coinme bitcoin ATM functionality to 5K change-sorting machines across U.S. (CoinDesk) 

Hybrid blockchain maker Kadena onboards Celo’s dollar stablecoin, plots January launch for decentralized exchange (CoinDesk)

Ethereum founder Vitalik Buterin takes to Twitter to warn followers not to take out personal loans to buy cryptocurrencies (CoinDesk)

Pornhub now accepting crypto only after being cut off by Mastercard and Visa (CoinDesk)

Analogs The latest on the economy and traditional finance

Google outage shows perils of centralization (CoinDesk)

Reckoning looms for commercial real estate (WSJ op-ed)

U.S. electoral college votes to formalize Joe Biden’s victory in November U.S. presidential election (WSJ)    

New home price increases slow in China as government pushes to deleverage heavily indebted residential real estate sector to curb financial risk (Nikkei Asia Review)

Australian prime minister says Chinese ban on coal imports likely breaches World Trade Organization rules (Bloomberg)

Chinese factory outputs up 7% from a year earlier, signaling recovery as consumer demand increases (Reuters)

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Crypto Finance AG Hires SIX Group Exec to Lead Brokerage Business

5 years 10 months ago

Swiss digital asset services firm Crypto Finance AG has appointed a new CEO of its brokerage business effective Dec. 15.

  • The new hire, Rupertus Rothenhaeuser, was previously head of business and ecosystem development at SIX Group’s digital assets exchange, SDX, and before that worked at Boerse Stuttgart and BNP Paribas, among others.
  • He takes over the role from company founder Jan Brzezek, who will remain CEO of Crypto Finance AG.
  • Rothenhaeuser helped set up the SIX Digital Exchange as the “first regulated exchange and CSD” for digital assets, per the announcement. SIX Group also operates the primary stock exchange in Switzerland.
  • “Rupertus Rothenhäuser brings a rare combination of financial sector and technology expertise with an outstanding track record in institutional customer relationship management,” said Brzezek.
  • The firm has also appointed a new head of trading, Patrick Heusser, as it prepares for an expected license as a securities firm from the Swiss Financial Market Supervisory Authority.

See also: Swiss Crypto Firm Closes $14.5M Series B to Help Secure Brokerage License

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WEF, Mining Giants Develop Blockchain Platform for Tracking Carbon Emissions

5 years 10 months ago

The World Economic Forum (WEF) and seven major mining companies have completed the initial stage of a blockchain platform that tracks carbon emissions along the mining value chain.

In a press statement on Monday, the Mining and Metals Blockchain Initiative (MMBI) from the WEF said its proof-of-concept carbon tracing platform COT was in development for over a year. The finalized platform will track embedded greenhouse gas emissions from the mine to the final product using distributed ledger technology.

The seven mining firms – Anglo American, Antofagasta Minerals, Eurasian Resources Group, Glencore, Klöckner & Co, Minsur and Tata Steel – launched the collaboration in 2019, aiming to develop a platform that would meet their corporate, social and environmental responsibilities.

Related: Ukraine Oligarch’s Troubled US Steel Plant Has Been Quietly Mining Bitcoin: Report

The effort is also supported by Dutch-based blockchain firm Kryha and MMBI project manager Susan Joseph. The developmental phase will progress to the next stage of accumulating and processing stakeholder feedback.

“MMBI’s Proof of Concept is a first practical step to create a solution facilitated by blockchain technology to reduce emissions and conserve the environment,” said Tata Steel CEO T.V. Narendran.

The initiative will test the “technical feasibility” of the tech, as well as exploring the “complexities of the supply chain dynamics” in order to set the requirements for data utilization in the future, according to the WEF statement.

See also: World Economic Forum Wants to Standardize Ethical Data Collection

Related: World Economic Forum Wants to Standardize Ethical Data Collection

“There is an increasing demand for metals and minerals, and an increasing demand for sustainable and responsible and traceable supply chains,” said Jorgen Sandstrom, head of Mining and Metals Industry at the WEF. “There is a potential to create a full value chain view with downstream visibility.”

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Mt. Gox Creditors’ Wait Nearly Over as Trustee Announces Draft Rehabilitation Plan

5 years 10 months ago

Mt. Gox’s trustee Nobuaki Kobayashi has at last filed a draft plan for the rehabilitation of creditors including former users.

  • Posted on the Mt. Gox website Tuesday, the trustee’s announcement states: “The Tokyo District Court and an examiner will review the draft rehabilitation plan and determine whether to proceed with the rehabilitation proceedings relevant to the draft rehabilitation plan.”
  • While there are no details provided on the plan, the announcement marks the beginning of the end for users who have been waiting for refunds since 2014 when the exchange collapsed.
  • As reported by CoinDesk, the submission deadline for the rehabilitation had previously been pushed back a number of times after opposition from some creditors.
  • In 2014, Mt. Gox declared bankruptcy after hackers allegedly stole 850,000 bitcoins from its servers over a period of time.
  • The Mt. Gox estate comes from 200,000 bitcoins found in an old wallet after the exchange collapsed, as well as bitcoin cash created in a fork of the bitcoin blockchain.
  • At last count, it is estimated Mt. Gox still holds approximately 141,600 bitcoin and 142,800 bitcoin cash.

See also: Mt. Gox Deadline Extended Again After Creditors Criticize Refund Proposal

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CoinDesk

Mt Gox Creditors’ Wait Nearly Over as Trustee Announces Draft Rehabilitation Plan

5 years 10 months ago

Mt. Gox’s trustee Nobuaki Kobayashi has at last filed a draft plan for the rehabilitation of creditors including former users.

  • Posted on the Mt. Gox website Tuesday, the trustee’s announcement states: “The Tokyo District Court and an examiner will review the draft rehabilitation plan and determine whether to proceed with the rehabilitation proceedings relevant to the draft rehabilitation plan.”
  • While there are no details provided on the plan, the announcement marks the beginning of the end for users who have been waiting for refunds since 2014 when the exchange collapsed.
  • As reported by CoinDesk, the submission deadline for the rehabilitation had previously been pushed back a number of times after opposition from some creditors.
  • In 2014, Mt. Gox declared bankruptcy after hackers stole 850,000 bitcoins from its servers over a period of time.
  • The Mt. Gox estate comes from 200,000 bitcoins found in an old wallet after the exchange collapsed, as well as bitcoin cash created in a fork of the bitcoin blockchain.
  • At last count, it is estimated Mt. Gox still holds approximately 141,600 bitcoin and 142,800 bitcoin cash.

See also: Mt. Gox Deadline Extended Again After Creditors Criticize Refund Proposal

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SatoshiPay to Become First User of German Bank’s Euro Stablecoin

5 years 10 months ago

Cryptocurrency payments provider SatoshiPay has inked a deal with German bank Bankhaus von der Heydt to become the first user of its recently revealed euro-backed stablecoin (EURB).

  • Announced Tuesday by SatoshiPay investor Blue Star Capital, the payments firm plans to integrate the regulatory complaint EURB into its cross border money transfer service called DTransfer.
  • Bankhaus von der Heydt, an institution established in 1754, partnered with Bitbond to launch its euro-backed stablecoin on Stellar last week.
  • Bitbond played a role in the development and integration of EURB, while Bankhaus von der Heydt provides its banking infrastructure and regulatory framework.
  • U.K. based Blue Star, which has a 27.7% stake in the company, said the addition of EURB would be good for SatoshiPay users.
  • Bankhaus von der Heydt brings “a stable on and off-ramp for EURB transactions with instant EUR-based bank transfers within the Single Euro Payments Area,” according to the announcement.

See also: Stellar Throws SatoshiPay a $550K Lifeline After Coronavirus Knocks Out Series A

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CoinDesk

Bitcoin May Have Hit Wall of Profit Takers Around $19,500: Analyst

5 years 10 months ago

Bitcoin’s ascent above $19,500 was cut short early on Tuesday, possibly due to profit taking by large Asia-based investors, according to one analyst.

The top cryptocurrency fell from $19,555 to $19,035, with most of the drop unfolding during the two hours to 06:00 UTC, according to CoinDesk 20 data.

“I think Asian whales sold around $19,500 causing prices to drop,” Ki Young Ju, CEO of South Korea-based blockchain analytics firm CryptoQuant, told CoinDesk. He highlighted an increased inflow of coins onto the crypto exchange heavyweight Huobi Global, which has a Hong Kong presence, soon before prices began falling.

Related: Market Wrap: Bitcoin Pushes Past $19.2K; Ether at 3% of BTC Price

“A total of 2,013 coins were transferred to Huobi in blocks 661,425 to 661,430 just 15 minutes before the price dip,” Ju said, adding that block number 661,425 carried 1,017 coins, the highest single-block inflow on Huobi since Nov. 30.

Monday saw 8,836 BTC arrive on Huobi in total, with a mean transaction of 4.5 BTC, the highest since March 2018, according to CryptoQuant.

The uptick in the average size of exchange deposits indicates that larger investors were transferring their coins to Huobi and may have liquidated their holdings around $19,500 – a level which has acted as stiff resistance of late.

Bitcoin has failed multiple times to establish a foothold above that point since Nov. 25 – that’s thought to be largely due to some investors booking profits on fears of a near-term sell off.

Related: JPMorgan Discusses $600B in Potential New Bitcoin Demand

At press time, bitcoin has rebounded to near $19,300 and the path of least resistance for the cryptocurrency remains to the higher side, according to analysts.

The options market sees a 35% probability of bitcoin ending December above $20,000, according to data source Skew. That’s significantly higher than the single-digit probability seen three months ago when bitcoin was trading near $10,000. Some investors look to have bought call options at the $20,000 strike price on Monday.

Skew data shows the open interest or the number of open positions in the bullish $20,000 call rose by 1,054 contracts on Deribit, the world’s largest crypto options exchange by volume and open interest.

However, forcing a breakout above $20,000 in the short term may prove to be an uphill task for the bulls, as there are sizeable sell orders open in the approach to a new record high spot price.

“There are still offers above $19,500 up to $20,000,” Patrick Heusser, head of trading at the Zurich-based Crypto Broker AG, told CoinDesk. “The US-based cryptocurrency exchange Coinbase shows 700 bitcoin for sale right at $20,000, but all other exchanges show some offers up there as well in the region of 200-300 coins.”

Also read: How One Bitcoin Options Trader Turned $638K Into $4.4M in 5 Weeks

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Kadena Onboards Celo’s Dollar Stablecoin, Plots January Launch for Decentralized Exchange

5 years 10 months ago

Hybrid blockchain maker Kadena said Tuesday it is collaborating with fintech firm Celo to put its U.S. dollar stablecoin, cUSD, on Kadena’s platform using a trustless bridge.

Kadena said that in addition to the bridge, the blockchain platform will wrap its native KDA token on Celo’s platform. This will allow both Celo’s cUSD stablecoin and Kadena’s KDA token to operate on each other’s platforms, the company said. That will allow KDA token holders to participate in collateralizing Celo’s stablecoin and thereby earn revenue.

  • Hoping to use its hybrid blockchain as a selling point, Kadena had announced in November it was partnering with stablecoin maker Terra to expand its platform’s decentralized finance (DeFi) offerings. 
  • The platform’s decentralized exchange (DEX), Kadenaswap, was announced in September and is expected to roll out at the end of January next year. 
  • The launch of Kadenaswap will be preceded by a bounty program incentivizing participants to find bugs in the platform. “If participants can hack the network to ‘steal’ KDA, they keep the proceeds,” the announcement said.  

Read more: Kadena Looks to Capture DeFi Energy With New Decentralized Exchange

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Grayscale Now Has $13B in Crypto Assets Under Management

5 years 10 months ago

Digital asset manager Grayscale Investments has passed another milestone, reaching $13 billion in assets under management on Dec. 14 for the first time.

  • Data tweeted by the firm showed that the largest holdings remain in bitcoin, with the Grayscale Bitcoin Trust having $10.82 billion in the top crypto asset. The firm’s Ethereum Trust now has $1.72 billion in AUM.
  • Grayscale also has trusts for litecoin ($74.8 million), bitcoin cash ($58.6 million), ethereum classic ($74.3) and others with less significant holdings including XRP, Stellar lumens and zcash.
  • The Ethereum Trust recently added another 131,455 ether which was valued at $74 million on Dec. 10, according to an SEC filing.
  • Michael Sonnenshein, managing director at Grayscale Investments, told Bloomberg in a recent interview, “Over the course of 2020 we are seeing a new group of investors who are Ethereum first and in some cases Ethereum only. There’s a growing conviction around Ethereum as an asset class.”
  • New York-based Grayscale is owned by Digital Currency Group, which is also the parent company of CoinDesk.

See also: Guggenheim Fund Files to Be Able to Invest Up to Almost $500M in Bitcoin Through GBTC

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OCC Economist Cites Benefits of Issuing Bank Charters to Stablecoin Providers

5 years 10 months ago

The chief economist of the Office of the Comptroller of the Currency (OCC), a banking regulator within the U.S. Treasury, believes issuing national bank charters to “fintech shadow banks” could bring “substantial advantages.”

In a paper titled “Chartering the FinTech Future,” Charles Calomiris set out how stablecoin providers chartered as banks that do not rely on funding from deposits would themselves gain advantages from regulatory oversight.

Such companies would benefit by “coming out of the shadows,” he wrote, with geographic reach and market credibility outweighing the added cost burden of regulation.

Related: Women in Tech Say Proposed STABLE Act Harms Those It Claims to Protect

The banking system and its consumers would also benefit, according to Calomiris, evolving over the next decades with the added advantages of efficiency, convenience and stability from a regulated network of “stable value coin banks issuing non-depository liabilities.”

“It would be desirable to allow such banks to obtain national bank charters,” Calomiris concluded.

The term “shadow banking” appertains to financial middlemen who provide the creation of credit within the global financial system but are not subject to regulatory oversight. Stablecoin issuers are considered such entities in the paper.

“At the OCC, we know that new technologies and consumer preferences, not regulators, will decide the future of banking,” wrote Calomiris.

Future threats

Related: India’s Banks Are Once More Serving Crypto Traders and Exchanges

Calomiris’ paper also examined the U.S. Federal Reserve’s grip on monetary power and its potential to oppose fintech banks.

“The Federal Reserve is a very powerful organization that stands to lose its monopoly over the payment system as blockchain-based networks develop,” wrote Calomiris. “One can hope that the Fed will be guided more by public interest than a desire to preserve its own power.”

Calomiris wrote that as far as he was aware, the Fed had not yet taken an official position on fintech chartering. “Time will tell,” he wrote.

But he suggested that politics as much as economics will decide whether consumers will ever benefit from a “chartered FinTech future.”

“When considering whether FinTech shadow banks, including stable coin providers, will eventually become an important part of the chartered banking system, it is crucial to take into account the political power of the special interests who stand to lose from doing so,” Calomiris said.

The OCC, under the leadership of former Coinbase executive Brian Brooks, has recently taken a notably crypto-friendly stance in its policies. In July, the Office issued a letter enabling nationally chartered banks in the U.S. provide custody services for cryptocurrencies.

Brooks was also reported to be pushing forward a plan to offer national banking charters to payment firms that don’t take deposits in September. Brooks said at the time, it could potentially consider companies like PayPal and Coinbase.

In recent months, a number of crypto and blockchain firms have applied to the OCC become federally regulated banks in the U.S., including BitPay, Anchorage and Paxos. Kraken and Avanti have already become the first crypto-native banks in the U.S., though they secured state charters from the Wyoming Division of Banking, not federally via the OCC.

See also: Paxos Becomes Latest Crypto Firm to File for Federal Bank Charter

In the paper, Calomiris said the OCC is also considering extending the national bank charter to include stablecoin providers. However, under the presidency of Joe Biden from next year, the OCC’s plans may see high-level pushback. In early December, Rep. Maxine Waters, chair of the House Financial Services Committee, wrote a letter calling on Biden to rescind or monitor all of the cryptocurrency-related guidance issued by the OCC.

Read the paper in full below:

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How Israeli VCs Are Doubling Down on DeFi Startups

5 years 10 months ago

The three co-founders of Collider Ventures all agree Israel’s vibrant crypto industry waned, yet didn’t fizzle, throughout 2020.

“For us, [COVID-19] had a positive impact that pushed us into a corner, and we decided to start Collider Labs in order to become sustainable,” said Collider Ventures co-founder Adam Benayoun, describing how his firm raised over $1 million for a separate accelerator fund.

As such, Collider Labs is exploring a different way for venture capitalists to invest in decentralized finance (DeFi), at a time when bitcoin is captivating local attention. Israeli blockchain consultant Maya Zehavi said via direct message that local investors are now “more pro-bitcoin than any other crypto,” with a penchant for custody services or cryptography.

Related: Market Wrap: Bitcoin Pushes Past $19.2K; Ether at 3% of BTC Price

This is a notable departure from the last bull run of 2017, when Israeli entrepreneurs rushed to use Ethereum to raise enormous sums for their fledgling token projects. 

The change in mood is perhaps reflected in a more bitcoin-centric view of what DeFi can offer. Similar to the leading Japanese crypto companies, Israel’s DeFi scene is more inclined toward bitcoin-based solutions than the Ethereum builders of Silicon Valley. 

Collider’s approach

Avishay Ovadia, who spearheads Collider Labs, said in a phone interview his Israeli accelerator program only accepts one startup at a time. Ovadia previously shepherded the Israeli crypto startup Portis until it got acquired in 2020. Now he’s focused on the DeFi startup Sovryn, run by Israeli expats in London. Ovadia said he works part time at the participating startups for up to two years.  

In exchange for ample time and $75,000, Ovadia said, the sister venture fund takes roughly 5% of the startup’s equity and a comparable amount of tokens (if the startup has a token). Benayoun added the venture fund views any prospective token earnings as illiquid for much longer than the two-year program. 

Related: Bloccelerate VC Raises $12M Fund to Bet on Enterprise Blockchain Adoption

“We don’t have bitcoin or ether in our portfolio, like a hedge fund, but we’re going to run a validator for the RSK Network,” Ovadia said, referencing the bitcoin-adjacent network that Sovryn’s DeFi solution relies on. “We think RSK is in a better position to bring more bitcoin maximalists into DeFi, because you don’t need to convert to ether.”

Skeptics like BHB Network co-founder Giacomo Zucco say RSK’s connections to bitcoin are debatable at best. 

“The fact that RSK issued its own ‘native token’ made my [skepticism] even stronger,” Zucco said in a direct message. 

But even this staunch purist admitted he would prefer an RSK-based solution over an Ethereum-based DeFi offering, if a given situation required some type of DeFi tool. All things considered, the six-person Collider team managed to keep its financial goals on target throughout 2020, according to co-founder Ofer Rotem, by narrowing its focus.

“We’ll only work with two or three companies per quarter,” Ovadia said 

This pace offers a stark contrast to the Chicago DeFi Alliance (CDA), which already churned out dozens of alumni. Ovadia also said portfolio companies like IDEX are welcome to simultaneously participate in programs run by the Chicago DeFi Alliance. The Israeli program is focused on business and engineering, not trading, like its counterpart in Chicago.

Staying lean

“We want to learn from those that failed,” Rotem said, declining to specifically name any of the dozen Israeli blockchain companies that have folded or had massive layoffs since 2017. 

“They tried to build these huge conglomerates from scratch and it didn’t work out well for them. They grew too fast and hired too many people,” Rotem said. “We’re all on lean salaries. We’re not eating our budget.”

Slowly but steadily, Rotem said, his venture fund still invests in roughly one startup every six weeks, even during Israel’s unusually strict pandemic lockdowns. One of the firm’s previous investments, the wallet startup KZen, is on track to turn a profit next year, according to KZen CEO Ouriel Ohayon. 

Ohayon said that before the lockdowns, his team worked in the same office as its investors and often collaborated. Now, because the startup is a bit more mature, the team has switched to a remote-first approach. He said KZen, which was founded in 2018 and launched the ZenGo Android app in January 2020, benefited greatly from hands-on investor attention during the first two years.

“Close to $100 million of crypto funds moved through our wallets. It’s nothing compared to Binance, but we only really started this year,” Ohayon said in a video interview. “The crypto space in Israel has changed enormously in the past few years. It shrank [but] now you have maybe up to 10 good companies and three to 10 good investors. They [Collider Ventures] are among the few that stayed in the space after the Israeli crypto ecosystem shrank.”

Long-term plan

Collider’s co-founders said it will take at least a decade to complete the returns on the investments they’ve started. 

“We asked investors to lock their funds for eight years, which was unusual,” Benayoun said.

He said his firm will help build DeFi tools for people who are bullish on DeFi, like themselves, to weather market swings such as the infamous “Black Thursday” price plunge this past March.

“I learned the hard way. I invested in a fund that lost 70% of its money on Black Thursday because of bad risk management, so that accelerated our efforts to create a way to invest with better risk management,” Benayoun said.

The DeFi space can be especially risky, even compared to other crypto sectors. Plus, Ovadia said, the team didn’t have a trusted recommendation when the fund’s investors asked how to participate in Ethereum staking. As such, the lab’s second startup slot will go to a staking project. 

“These companies in the lab are solving problems that we saw,” Ovadia said. “It’s a solution that we will use.” 

His firm often focuses on companies with modest rounds, under $10 million, and staff under 20 people. Unlike 2017, Israel now has an unemployment rate over 20% and an economy paralyzed by the pandemic. It may continue being a Middle Eastern blockchain hub, if remaining bitcoin advocates focus on helping local fintech powerhouses enter the DeFi market with calculated risks. 

“In 10 years from now, we’ll probably just be called a fintech fund,” Benayoun said. “We were able to raise during the bear market, and when things were slowing down during the pandemic we doubled down. We’re very committed.”

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