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Curated blockchain and cryptocurrency news – Week 49

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Our curated list is published weekly on www.crypto-news.net and is designed to provide you with the insight necessary to understand cryptocurrency and blockchain. We focus on developments that have the highest impact for the overall market and indiscriminately share them with you, regardless if we have covered them in our primary news or not.

These lists are most useful for people that do not have a lot of time to dedicate to following the cryptocurrency marketplaces and weekly traders that typically spend anywhere between 6-10 hours analyzing the news for key stories.

Instead of searching around hunting for the most important bits, we have done the work for you! Save yourself a lot of time by reading this weekly column, and if you benefit from it, share it with somebody else that would benefit as well.


Unlike last week, where Bitcoin was holding strong, this week we are looking at a different story. A particular down trend has developed over the course of these 7 days with some significant price movements on the 6th, 7th and 9th of December.

The market has recorded a loss on the weekly chart, but understanding how volatile things can become this is still considered quite stable. On the 6th of December probably the strongest event was the Morgan Creek bet, which you can read more about below.

Between the 7th and the 8th of December we notice a rather odd dump, which quickly recovered. There is a lack of negative news that could have affected the market, so this movement is most likely a whale (or group of whales) looking to shake out weak hands. It seems that he was successful, as the market did follow through on his lead.

The events on the 9th are in line with the announcement by IBM for their collaboration with Abu Dhabi’s ADNOC the 12th largest oil producer in the world. Other events that may have caused the positive movement is the showcasing of India’s government panel’s recommendations for cryptocurrency and Facebook’s publicized intentions to hire blockchain engineers.

The Bitcoin price does not always follow the news, as the market is decentralized and the majority of investors do not have a financial background. In addition, the industry is still new and relatively not established, so news and other types of information have a varied effect on the market.

Sometimes positive news are matched with negative price movements and vice versa, further strengthening the opinion that cryptocurrency markets do not follow the outcome of news as seen in the traditional investment world.

December 4th

Binance to start their own blockchain

Binance revealed that they are going to create “Binance Chain” where the main gas cryptocurrency will be their proprietary token “BNB”. It is still unclear when the blockchain will become operational but there is some information that is pointing towards the end of this year or early 2019. In addition to their blockchain, they will also create a decentralized exchange, which will enable thousands of cryptocurrency projects to list their tokens. Binance is fighting hard to remain a leader in the field and is doing everything it can to continue to provide value for the ecosystem.

Decentralized exchanges are maintained by the use of smart contracts and contribute to the original vision of decentralized cryptocurrencies. In recent light of regulatory developments we are looking forward to seeing how Binance will handle the various requirements from various organizations such as the IMF.

Other news:
Ripple and NEM launch EU blockchain association 
Blockchain payment system approved by New York regulators
Nasdaq’s Bitcoin futures confirmed for Q1 2019

 

December 5th

Switzerland’s FINMA published guidelines for their upcoming FinTech license

Switzerland is breaking new ice with their latest announcement for the upcoming FinTech license under the responsibility of the Swiss Financial Market Supervisory Authority (FINMA) which provides a clear distinction between FinTech and Banking.

One of the most important aspects of the license is the fact that it will grant these companies the ability to raise CHF 100 million from the public, as long as the funds are not invested and there is not interest paid on them. Naturally, the license is only available for Swiss-based businesses that operate in Switzerland. Whether this means that businesses operating under this license will not be able to provide foreign individuals with their services is unclear at the moment.

This license will enable various cryptocurrency and blockchain organizations to enjoy a rather relaxed regulatory environment when compared to banks. This should not affect the ICO markets too much, as securities are still heavily regulated and utility tokens do not have any issues (apart from being listed as a security).

Other news:
Corda’s R3 adds Ripple as the first addition to its payments dapp
Binance unveils DEX and explorer preview
Individuals in Singapore lose $78,000 to scammers

 

December 6th

Money laundering a problem in Japan, but cryptocurrency only 2% of the total

From a regulatory perspective, cryptocurrency is often seen as a vehicle for money laundering and rightly so. The decentralized nature of most cryptocurrencies such as Bitcoin and Ethereum means that there is no control or oversight over the exchange of money, creating loopholes through which individuals and companies can avoid paying taxes. These loopholes exist in the traditional financial system regulation as well and are sometimes utilized by numerous high ranking officers in banks or corporations in an attempt to avoid paying millions (or billions) of dollars in taxes.

Japan is dedicated to track down all cryptocurrency tax evaders and money launderers even if the relative number of these individuals is small, especially when compared to the overall picture. The total amount of suspected money launderers is 346,139, from which only 6000 are related to cryptocurrency. With the increase of hacking activities Japanese officials are striving to boost the security protocols in order to prevent stolen funds or unpaid tax to escape court justice.

Other news:
Switzerland’s national post and telecom combine forces to launch blockchain infrastructure
US government posts $800k bounty for anti-forgery blockchain solution
Gibraltar gives Huobi a DLT license
Trustology, crypto security startup gets investments from Two Sigma Ventures

 

December 7th

Coinbase to add 30 crypto assets to its exchange

Coinbase announced that it’s looking to add an additional 31 cryptocurrencies to the already existing roster available on the platform. The official announcement only claimed that the company is exploring the cryptocurrencies, but shortly after Coinbase Pro actually opened the doors for Civic, district0x, Loom Network and Decentraland.

The rest of the tokens included in the announcement have yet to see the light of day and it is unclear whether they will end up being included on the platform. The blog post only commits to the idea of exploration and analysis, and does not provide any conclusion in regards to the actual implementation.

Regardless, this is an unprecedented move for Coinbase, an exchange widely recognized by its extensive KYC and AML procedures and close collaboration with regulators. In the past the exchange has stayed away from the majority of tokens, so this really begs the question, “What changed?”

Other news:
Venezuela will trade oil for Petro
Two new US bills focus on regulations and anti manipulation
Winklevoss’ Gemini to support BCH ABC trading and custody
Mastercard files patent for anonymous blockchain system

 

December 8th

PayPal launches internal blockchain-based reward token

Over the last six months PayPal has been working in secret to develop an internal blockchain initiative and has finally made it available to the company’s workforce in mid-November. The PayPal’s San Jose Innovation Lab is responsible for the development of the system that the company hopes to incentivize employees to undertake activities that will help the company’s innovation efforts.

Employees can redeem these internal tokens for various experiences generated by the community and they can trade them with other employees. PayPal is providing a first-hand experience with blockchain and cryptocurrency for all of their employees, suggesting that the company is interested in moving closer to the technology. Historically PayPal has been against the adoption of Bitcoin which is why this story comes at a surprise. According to the company’s director of innovation the PayPal wants to educate the employees so they can bring the technology to the business, assuming there is a business case in the first place.

Other news:
Chinese courts use blockchain to protect intellectual property online
Investment company says that Bitcoin is headed for the ground
Israel on the hunt for cryptocurrency tax evaders
Gazprom to offer crypto asset services

 

December 9th

IBM to supply blockchain technology for Abu Dhabi oil company

IBM, well-known for their active participation in the implementation of blockchain systems across various businesses has partnered up with Abu Dhabi’s ADNOC, one of the top 12 oil producers in the world.

They will leverage IBM’s blockchain solutions and expertise to create a supply-chain implementation that will save them time, energy, and labor. The blockchain solution will track the production of oil and the monetary value of the yields. In addition it will follow the distribution of the products and their transformations through other ADNOC operational centers.

During the pilot stage, access to view the information will be available only to the company, but their plans include the involvement of all stakeholders and investors.

Abdul Nasser Al Mughairbi, ADNOC Digital Unit says: “Blockchain is a game-changer. It will substantially reduce our operating costs by eliminating time-consuming and labor-intensive processes, strengthen the marketing and trading of our products, and create long-term sustainable value that will ensure that ADNOC delivers on its 2030 smart growth strategy.”

While we are not sure if this will affect oil prices in the long-run or will the market let the company enjoy increased profits due to eliminating the operational overhead.

Other news:
Facebook is on the hunt for blockchain engineers
The crypto market crash is showcasing the reality
Crypto startups are struggling with the market crash
India’s crypto panel presents their recommendations
KFC to accept DASH in Venezuela

 

December 10th

Bitmain affected by the bear market, closes down offices in Israel

Bitmain, the largest producer of cryptocurrency mining equipment has felt the sharp cut by a market which has sustained its operations for the entirety of its existence. As a result the company has been forced to investigate their strategy and align with the current situation.

Unfortunately for the team in Israel, the decision ended up being to close down operations and lay everyone off. Surprisingly the VP of sales and marketing, Gadi Glikberg has also been laid off. Whether he was fired due to lack of results or left by his own volition the reasons remain unknown for now, and we will most likely never know. This story was selected to showcase the dangers for cryptocurrency focused companies, especially ones that have received ICO investments and hoped to use that money to fuel the development of the business.

Changes in the market are almost always dangerous, and only those that can predict the outcomes can hope to avoid being caught in the aftermath of market developments.

Other news:
UNICEF to fund 6 blockchain startups for selected global challenges
South Korea’s second largest bank to leverage blockchain technology
SEC postpones ETF decision as expected
Crypto startups layoff increases in battle for survival
Indian regulatory panel suggests that crypto arrangements should be illegal

We’ve curated this list including what we believe to be the most important news to our readers and you play a very important role in making sure to keep this list helpful and relevant. We try our best to include only the most important stories, but naturally some days are void of major developments.
By commenting on this article or another weekly list, you can provide us some insight into what is really important for you, which will in turn improve the relevancy of these articles.

CoinSpectator Free Crypto News Aggregator Review

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If you want to be actively involved in the cryptocurrency space, whether through trading or just keeping up with the latest developments, a crypto aggregator might just be what you’re looking for. Aggregators are websites that source data from a variety of websites to deliver a real-time feed of the latest news from the world of crypto and blockchain. Usually, they also allow users to vote on the news, making it easier to filter out less relevant events.

There’s many options on the market – some are free, while others require a payment. Today, we’ll be looking at the CoinSpectator crypto aggregator, which is available to everyone for free. CoinSpectator features up-to-date news from both smaller and larger crypto media outlets as well as a feed of upcoming ICOs. Don’t worry – if you enjoy our content at CoinCodex, you will be able to find it on CoinSpectator as soon as it’s posted.

Let’s head to CoinSpectator.com and check out what it has to offer. The first thing we see is the news feed which is being updated with new articles in real time. If we’re logged in to the site, we can also vote on each individual news article.

If we click on a news item, a window will pop up on the right side of the screen. The window includes a short excerpt from the article, and of course also includes a link to the original source if we wish to read the article in full. On the top of the window, there’s also a bar for community sentiment, which gives a more nuanced picture than the upvotes and downvotes.

On the top of the site, there’s a toolbar that we can use to search for relevant keywords and customize the news feed by filtering between news and blog sites (we can also choose to include both types of sources in our news feed).

On the left side of the main page, we can select the ICO section of CoinSpectator. Here, we can search for ICOs by name or filter them by tags. This section includes the start and end dates of ICOs and resources such as whitepaper and social media accounts for each project.

The website’s design is sleek and minimalistic, providing a comfortable user experience. If you’re looking for a free cryptocurrency news aggregator, CoinSpectator is definitely worth checking out.

Crypto Market Snapshot – December 10, 2018

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Today, the cryptocurrency market recorded a poor 24 hours, but losses were more contained than some of the recent sell-offs we’ve been seeing. The market dipped across the board, with only 8 out of the top 10 cryptocurrencies gaining value on the day, and 3 of them (USDT, USDC and DAI) are stablecoins.

Among the top 10 coins by market cap, none impressed, as all of the coins in this category (excluding Tether) posted a similar performance, ranging from -3.4% (TRX) to -6% (EOS). Recently, Stellar Lumens overtook Bitcoin Cash and now occupies 4th place in the cryptocurrency market cap rankings.

Bitcoin hit its yearly low of around $3,300 on December 7, which was followed by a relief rally that topped out at $3,650. Since, the price began to slip and Bitcoin is now very close to its low once again. BTC trading volume has been slowly tapering off in the last few days, and moved between $3.1 and $2.9 billion today. At the time of writing, Bitcoin’s market dominance is at 55%.

On non-fiat exchanges, BTC prices (on Binance, for example BTC is trading at $3,426 USDT) are still slightly higher than on exchanges such as Bitstamp, Kraken and Coinbase Pro, where BTC is trading at around $3,390. Bitfinex is more of an outlier, where the price of BTC sits at just above $3,500.

A few smaller coins managed to produce gains, but there were no significant rallies in the crypto top 100. Bitcoin Private topped the charts with a modest 4.8% bump, and Loom Network (fresh off a Coinbase Pro listing) outperformed the market as well.

Notably, DASH (the 16th largest cryptocurrency) dropped by 10%. Apart from Decred, the other coins in today’s worst performers category are in the lower part of the crypto top 100 (RVN, ELF, DEX).

Ethereum Upgrade to Happen in January, Platform At A Crossroads

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Ethereum Constantinople

The Ethereum development team has announced that the Constantinople update, which is the next step in the platform’s roadmap, is ready for release. The update will involve a hard fork that will take place at block 7,080,000, and is expected on January 16th. Ethereum prices have surged on the news, moving up more than ten percent.

The Constantinople update is the second phase of Metropolis, the third step on the Ethereum roadmap. Among its components is an upgrade to simplify off-chain transactions, which will better enable scaling. Constantinople will also delay the so-called “difficulty bomb,” which is a previously added algorithm modification designed to force miners to adopt the future proof-of-stake consensus method planned for later next year. There are a number of other additions as well, which will pave the way for the final phase of Ethereum’s roadmap, named Serenity.

The Ethereum development team intended to implement Constantinople in October, but was delayed due to a glitch in the consensus mechanism. The team has made it clear that the matter is now resolved.

The Constantinople update is good news for Ethereum, which more than ever is struggling to maintain its status as the dominant dApp platform. The dApp field is becoming crowded with platforms that are as advanced, if not more so, than Ethereum. These include Cardano, Tron, Stellar, EOS, and NEM, just to name a few. Many of these competitors not only challenge Ethereum in the technical realm, but they are gaining support in corporate, financial, and political spheres. Thus, for Ethereum to hold its position as leader of the pack, it will have to prove that it can outperform these newer rivals.

To its credit, Ethereum still has the largest development team of any blockchain system. It also has the overwhelming majority of developed applications and tokens. Its founder, Vitalik Buterin, is the best known figure in the crypto space, and is universally hailed as a visionary talent. Perhaps most significantly, Ethereum enjoys the benefit of “first mover” status among all altcoins. 

It is not surprising that investors and traders are concerned about Ethereum’s long-term hegemony among other altcoins. Like most cryptocurrencies, it has declined in value dramatically this year, from a high of $1,400 in late January to under $100 today. A rebound is likely, yet other platforms could very well pass Ethereum in adoption, and market value, when the turnaround begins. Already Ripple has passed it as the second most valuable coin by market cap, and Ethereum’s value of the total crypto space has fallen to below ten percent for the first time in two years.

It is thus easy to see why Ethereum’s future is tied to Constantinople’s success. There is presently little discord among the Ethereum community, and the hard fork is likely to proceed without issue. Also, despite the growing competition, Ethereum is in a very strong position to gain widespread adoption. Nevertheless, its challenges represent the dynamic, and rapidly evolving status of the blockchain revolution.

Bitmain Closes Israeli Research and Development Center

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According to Israeli media outlet Globes, cryptocurrency mining giant Bitmain has closed its research and development center in Ra’anana, which was established in 2016. The centre’s 23 employees will be laid off, and Gadi Glikberg, the center’s lead, said:

"The crypto market has undergone a shake-up in the past few months, which has forced Bitmain to examine its various activities around the globe and to refocus its business in accordance with the current situation."

Bitmain has plans to go public through an IPO in Hong Kong, although there are still many issues left to be addressed for the company. One of them is the performance of Bitcoin and the rest of the cryptocurrency market, which has been very poor in 2018. Another issue are Bitmain’s large holdings of BTC and BCH – the latter has been hit particularly hard by the 2018 bear market, losing 95% of its value since January 1.

Bitmain is the world’s biggest manufacturer of cryptocurrency mining hardware, and are best known for their Antminer series of ASIC cryptocurrency miners. The company also operates two of the largest Bitcoin mining pools, BTC.com and AntPool. The two pools combined represented 31.6% of Bitcoin’s total hashrate in the last 7 days according to data provided by BTC.com.

Bitcoin mining distribution by pools over the last 7 days. Image source: BTC.com

The cryptocurrency bear market has impacted several companies in the cryptocurrency and blockchain space. Recently, we wrote about Steemit laying off 70% of their staff and focusing on cutting costs. Consensys, the largest Ethereum development studio, is also scaling down and re-organizing. The firm recently announced that it will lay off 13% of its employees.

Gemini Lists Bitcoin Cash

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Gemini goes ahead with BCH listing after receiving regulatory approval

After receiving approval from the New York State Department of Financial Services, the Gemini cryptocurrency exchange has listed Bitcoin Cash. BCH joins BTC, ETH, LTC and ZEC as the other cryptocurrencies available on Gemini – BCH will have trading pairs with all of the available coins. 

While the Bitcoin Cash “war” that followed the November 15 hard fork is mostly perceived as being over, the exchange made it clear that it is listing the Bitcoin ABC chain, and (at least for now) doesn’t offer support for Bitcoin SV. The Bitcoin SV side has abandoned its claims to the Bitcoin Cash name. 

The hard fork and the controversies surrounding it has had a substantial negative impact on the confidence in Bitcoin Cash. Even though the crypto market as a whole has performed very poorly in the last 7 days, BCH has been the worst performer in the top 10 by a considerable margin, dropping by 32.6%. At the moment, BCH ($1.98 billion) is the 5th largest cryptocurrency by market cap.

Gemini is sticking with a conservative approach to listings

For now, Gemini is still employing a conservative approach towards listing new assets on its exchange. Another U.S. cryptocurrency trading company, Coinbase, has abandoned this strategy and is now looking to list as many cryptocurrencies as possible. Last week, they surprised the crypto community by listing 4 smaller ERC20 tokens on their Coinbase Pro platform. Among the listed coins, Decentraland is the largest by market cap with $63 million. The three others are all outside the cryptocurrency top 100 – Loom Network ($28.7 million), Civic ($19.9 million), and District0x ($9.6 million).

At the time of writing, Gemini is the 32nd busiest exchange by trading volume, handling $18.5 million worth of trades in the last 24 hours. 

Nasdaq & Fidelity invest in New Cryptocurrency Exchange

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Fidelity Investments and Nasdaq Ventures invested a total of US$27.5 million in a new cryptocurrency exchange called ErisX, as reported by Reuters on December 4th. Details about the investment are in short supply, as both investors were not available for comment. The new cryptocurrency exchange hopes to start operations next year if regulators approve. The company will offer traders and investors spot trading for bitcoins, litecoins, and ether, as well as access to a futures market.

Both Nasdaq and Fidelity are working on their own cryptocurrency-related financial products which include ETFs, futures contracts, and potentially OTC desks (although this is unconfirmed). This investment only strengthens their already strong position, by investing in startup companies that are basically a potential competitor otherwise. ErisX has had a previous funding round where an undisclosed amount was raised with the help of three U.S. companies, TD Ameritrade Holding Corporation, Valor Equity Partners and Cboe Global Markets Inc.

For now, the company says that they will use this latest investment round to push forward for the creation of a safe environment for digital assets where regulators can feel confident that steps to increase security are taken. The company largely depends on regulatory approval, so all of these companies are making a bet that they will get said approval sometime during the next year. With the company having said nothing about ETFs, it is quite possible that they will get the approval, as they will be talking to the CTFC, as opposed to the SEC.

Bitcoin has a clear-cut status as a commodity, securing it far away from the (rightfully) restrictive policies of the Securities and Exchange Commission. If successful, this new regulated exchange will help support the path towards ETF approval and provide the likes of VanEck with reasonable arguments in their battle for regulatory acceptance.

Crypto Recap of the Week Dec 3 – Dec 9, 2018

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Total Market Cap Came Close to Falling Below $100 Billion

The cryptocurrency market continued its general downturn this week and dropped significantly in value over the seven day period. The market approached an overall value last seen during August 2017 and the week began with a total cap of around $134B which soon fell to $130B. A later drop saw the total cap fall to $124B during the afternoon, and after recovering slightly, Monday ended with a total cap of $126B, as around 6% of value was lost over the day. 

Things improved slightly on Tuesday as the market hit $131B during the afternoon. However, this signalled the start of a sustained pullback as Tuesday closed out with a valuation of $127B, and the decline continued on Wednesday as the market fell to $121B at the end of the day. $13B or 9.7% of value was lost over the first three days of the week.

The situation worsened as the week progressed and after dropping to around $116B on Thursday, the market plummeted from $115B to $104B on Friday as 9.5% in value was lost. After recovering to hit $110B later on Friday, the market has continued to fluctuate at a similar value.  

Trading levels were consistent at the start of the week, as the daily trading volume moved within a $2B range and veered between $10B and $12B until Wednesday. This grew over Thursday and peaked at $16B on Friday. The 24 hour daily trading volume currently stands at $10.8B while the total market valuation stands at $109B. 

A Few Altcoins Shined But Most of the Top 100 Declined

Unsurprisingly, the majority of top projects declined significantly in value over the week and Bitcoin dropped 14.7% while Ethereum fell by around 19.1%. The largest losses were incurred by EOS and Bitcoin Cash which fell by 33.1% and 29.7% respectively.

Away from the top ten, Factom continues to perform well after announcing some new partnerships and grew by 16%, while Waves benefited from the mobile app launch to jump by 11.8%. Stablecoins were among the best performers and MobileGo, Bitcoin SV, Dogecoin, and Qash recorded smaller losses of 3%, 4%, and 5%, respectively. 

Bitcoin Fell Through $4,000 and Hit a $3,300 Low

Bitcoin began the week trading at a price of approximately $4,150 on Monday and fell by 5.5% in price over the day as Monday ended with BTC trading at around $3,920. BTC jumped by 3.8% to hit $4,070 during Tuesday afternoon. However, this led to a sustained decline and after ending Tuesday at $3,950, the price then fell to $3,795 during Wednesday evening.

BTC then touched $3,875 on Thursday before dropping 11.6% and falling to $3,425 during the early hours of Friday. The price reached a low point of just below $3,300 later in the day and Bitcoin fluctuated at this price range until Sunday morning when it broke $3,400.

Bitcoin’s trading volume generally stayed between $3B and $3.6B during the early part of the week, but grew to hit $5B on Friday. The 24 hour trading volume currently stands at $3.18B while BTC is trading at $3,555 and retains a market cap of $61.9B. Bitcoin also enjoys a dominance of 54.9%. 

Ethereum Is Back In the Double Digits

Ethereum started out trading at around $116 on Monday and lost 6.8% in value and fell to $108 during the evening. The price recovered slightly on Tuesday as ETH peaked at $113.

However, similar to BTC, Ethereum then declined consistently and ended Tuesday at $110 before dropping to around $104 on Wednesday. ETH fell even further on Thursday as the price fell by 13.6% to hit $95 during the evening, and after falling to $83 on Friday, Ethereum recovered slightly over the weekend and continues to fluctuate at around $90.  

Similar to Bitcoin, Ethereum’s daily trading volume grew over the week and after opening up at $1.2B, it broke past $1.5B on Thursday before climbing past $2B on Friday. The 24 hour trading volume currently stands at $1.42B and ETH is trading at $94.8 and retains a market cap of $9.84B. 

South Korea Announces Plans To Tax Crypto, Enforcement Will Be Difficult

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South Korea is one of the world’s most active nations for cryptocurrency investment and adoption. Although the nation accounts for only one percent of the world’s population, it accounts for approximately thirty percent of trading. This activity has prompted understandable concern from the government, which has placed significant restrictions on crypto activity. Now, South Korean authorities have announced plans for crypto taxation.

Incoming finance minister Hong Nam-ki announced the plans as part of a tax reform package that redefines the status of ICOs and other blockchain-based innovations. For some time such ventures have been classified as “start ups,” which under Korean law carries significant tax exemptions. Now, this classification will end.

Whereas details are unknown, it is likely that taxes will be levied at the exchange level, with individuals taxed on trades. Such a move would work in concert with recent regulations on South Korean exchanges that require confirmed user identification and prohibit foreign accounts. The exchanges themselves could also be subject to business taxes.

South Korea may be the first nation to announce a crypto tax, but many others are exploring the idea. India, for example, is considering an eighteen percent tax on trading. Britain is also exploring the idea, which could be part of larger regulatory legislation expected next year.

The concept of taxing cryptocurrencies is understandable, yet attempts to do so will present tremendous challenges. One of which is certain to be a backlash by much of the public. Already most nations have income taxes that require profits to be claimed after crypto is exchanged for fiat. Also, many nations require profitable crypto trades to be taxed, even if fiat was not part of the transaction. Adding another layer of taxation onto crypto use would thus be unpopular.

More fundamentally, enforcing taxes on cryptocurrencies will be extremely difficult, if not impossible, on a technical level. Crypto is a supranational currency that, by design, cannot be regulated by a government authority. Likewise, its decentralized nature enables anonymity, or near-anonymity, for most transactions. Without the ability to know the names behind the actions, it is folly to assume that governments can successfully force tax payments.

South Korea’s present solution to the anonymity issue, which requires cooperation from exchanges, highlights the core problems behind attempting to put any government regulations on crypto use. Simply put, Koreans that wish to avoid prying eyes can easily use exchanges based in other countries. No doubt many will should their government attempt to tax their trading.

The exchanges themselves could also push back against unwanted regulation by merely relocating outside of the country. Such moves have already taken place elsewhere. Notably, Binance relocated from Hong Kong to Malta after the Chinese government began to interfere with its operations. In fact, using decentralized exchanges, which are growing in popularity, renders any attempt to regulate crypto on the exchange level impossible.

Thus, the only possible means to effectively tax crypto use is to seek to collect revenue when users exchange cryptocurrency for fiat. However, mainstream use is expected to involve people using crypto to purchase goods and services, avoiding fiat altogether. In fact, governments, and their tax authorities, are not presently equipped to regulate the complex scenarios envisioned for blockchain assets. For example, the Internet of Things (IoT) is expected to involve billions of microtransactions between autonomous devices, smart contracts will automate complex activities that cannot be audited, and atomic swaps could seamlessly transfer value across various blockchains. Attempting to tax such actions would be an exercise in futility. In fact, given the incredible benefits of this advancing technological sector, governments would be foolish to even make such an attempt.

The South Korean government is expected to unveil more details on its upcoming tax policies in a few months. This information will reveal how serious the authorities are at regulating crypto use. More importantly, it will reveal the extent to which these leaders understand the true possibilities of blockchain technology.

 

Featured Image via BigStock.

The Future of Real Estate through Blockchain

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Opportunities in Real Estate

Real estate is one of the prime fields with vast investment opportunities. Although it represents an antiquated system of trade with plenty of roadblocks, it still has a huge following worldwide. The complexity of home ownership and enfolding transactions further aggravate the industry.

Technological advancement, massive marketing and ownership options have greatly aided the industry. Blockchain, in particular, has led to a paradigm shift within the crypto real estate industry. It has alienated existing major problems within the crypto sphere.

Miami’s first real estate Bitcoin purchase created a massive buzz in 2017. The blockchain revolution cannot come at a better time in an industry that’s more than ripe for disruption. In 2016, Goldman-Sachs projected savings of between $2 to 4 billion in title insurance costs when blockchain technology is applied to title examinations.

What is blockchain?

In simple terms, Blockchain is the rail under which digital currencies such as bitcoin run on. This database makes it possible for industry players who have little trust or knowledge of each other to share financial time stamped and verified records. Through cryptography, trust is built via transparent records. This process permits accuracy of information.

Commercial real estate transactions are slowly adopting this peer-to-peer cryptographic process through blockchain. The acquisition of property through cryptocurrency has also become a reality. The city of Vermont, for example, has signed into law limited liability companies based on the blockchain, and it is at the forefront of digitizing land titles via blockchain.

Lantmateriet, the Swedish government authority on land has premiered in setting the standards. It is currently registering property and land through blockchain, with the aim of drastically reducing the time spent on the signing of contracts and registering of sales from months to hours.

Blockchain revolution in real estate

Real estate is a very high-cost business. Millennials though are not impressed by monikers such as “million dollar homes.” They would rather have access to technology that enables them to save their hard earned cash.

Blockchain technology is reified as the answer to a monopolistic system; the overly complicated and bureaucratic world of real estate that increases prices and slows down transactions. Platforms such as SMARTRealty, for instance, enable property owners to list assets for rent or sale and ensure that this information is adequately distributed on rental and real estate sites across the globe.

The  International Blockchain Real Estate Association (IBREA) is going a long way in preluding collaborations and mainstreaming crypto blockchain technology. Its main goal is to assist in the creation of global platforms that are not only non-profit and open source but scalable and secure. With a membership of over 5,000 members, IBREA organizes meetups and conferences around the world.

Prior to making a large purchase like a home, it is vital to dedicate countless hours of rigor and research to uncover all potential pitfalls. According to a report by National Association of Realtors, at least 34% of new home buyers today are ‘Gen Yers’. The 2008 economic downturn made them very risk-averse. They are tech savvy and finicky and want technological answers to age-old problems. They crave for data aggregation resources like Carfax, and desire such a resource in the property market as well.

Blockchain has continued to fill this gap by improving buyer confidence which in turn limits foreclosures occasioned by unforeseen costs. The future lies in platforms such as Propy. Miguel Prados Rodriguez from Seville, Spain is remembered as the first property seller in the EU to enjoy blockchain’s ability to simplify the complexity of real estate selling through the platform.

The platform is user-friendly and accords users with peace of mind that is needed to enhance the safety of the entire transaction. This sale utilized cryptocurrency (ETH-ETH), through Propy’s platform and all parties involved enjoyed the fastest transaction speeds ever seen in cross-border real estate transactions.

Ubitquity is another blockchain firm that records and tracks real estate transactions, streamlining the otherwise complicated property title process. The platform works in parallel to the paper trail system, reducing future title search times and thereby increasing buyer confidence.

Tokenized ownership

A $30 million 12 unit luxury condo development in Manhattan has become the most significant tokenized asset on Ethereum of late. Blockchain tokenization is taking over traditional real estate financing thus eliminating the cumbersome traditional bank financing.

Tokenization as a process avails real-world assets as digital representations on the blockchain. It creates a more fluid market, thanks to blockchain’s ability to enable a transparent financial environment.  With home prices steadily rising, tokenized properties will appeal more to conscious buyers who can purchase stakes in terms of coins that suit their budgets. These stakes can be transferred easily thereby decreasing the vast amount of fees that build up with real estate transactions.

At the forefront of the tokenized property wave are firms like Brickblock, that provide a seamless platform that connects cryptocurrencies to physical assets. This ensures that cryptocurrency owners can invest in real-world assets. Hot on their heels is Atlant, Deedcoin, and Meridio who create fractional ownership through real estate tokenization.

Crowdfunded investing

In 2016, crowdfunding was valued at $3.5 billion. This value is expected to keep ballooning, as more millennials jump into the fray. With crowdfunding, anyone can share in the fruits of investment at a fraction of the investment’s cost. Blockchain technology is the answer to a seamless crowdfunded real estate investment project easing decision making and improving sharing of records.

Blockimmo, for example, enables the sharing of property ownership and investments on the Ethereum blockchain. Swinca, on the other hand, is not only a vehicle for tokenization of properties, but it also enables instant investment opportunities in real estate. Through Swinca you can receive income rent and capital gain without the consequent management hurdles.

While most of blockchain’s forays into the real estate world are still in their development stages, they are the catalyst the industry needs to make global real estate investment opportunities available. And while they may not solve all real estate challenges, they have started disrupting this archaic industry positively for the benefit of all.

 

Featured image via BigStock.

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