Hodler’s Digest, October 21-October 28: US SEC Mulls Over Bitcoin ETFs, While Bakkt’s BTC Futures Inch Closer To Approval
Coming every Sunday, the Hodler’s Digest will help you to track every single important news story that happened this week. The best (and worst) quotes, adoption and regulation highlights, leading coins, predictions, and much more — a week on Cointelegraph in one link.
Top Stories This Week
US SEC Releases Memorandum From Meeting Over Bitcoin ETF Proposal
The U.S. Securities and Exchange Commission has published a memorandum from a meeting about the Bitcoin exchange-traded-fund (ETF) proposal from VanEck and SolidX that included EC Commissioner Elad L. Roisman and his counsels Dean Conway, Matthew Estabrook, and Christina Thomas, along with representatives from SolidX, VanEck, and the Chicago Board Options Exchange (CBOE). The memorandum outlines the parties’ arguments over the regulators decision to disapprove SolidX’s previous ETF application, specifically the failure to comply the section of the Securities Exchange Act over the prevention of fraud and manipulation.
Crypto Exchange Coinbase And Circle Launch USD Stablecoin
Cryptocurrency exchange and wallet Coinbase has now launched the USD Coin (USDC) stablecoin, which was developed in collaboration with Coinbase and blockchain-powered payments tech company Circle. Coinbase users in the supported jurisdictions can now trade in USDC at Coinbase.com, as well as the iOS and Android apps. According to Coinbase, USDC will soon be supported on Coinbase Pro. The coin is reportedly 100 percent collateralized with U.S. dollars.
New York Regulators Approves Coinbase’s Crypto Custody Offering
The New York State Department of Financial Services authorized Coinbase’s wholly-owned subsidiary Coinbase Custody Trust Company LLC to add a range of custody services for virtual currencies, including Bitcoin, Bitcoin Cash, Ethereum, Ethereum Classic, Ripple, and Litecoin. Coinbase had launched its custody services in July, with the aim to bring in institutional customers and able to store large amounts of digital currency.
NYSE Parent Company Announces BTC Futures Launch Date On Bakkt Platform
The Intercontinental Exchange, the parent company of the New York Stock Exchange, announced a Dec. 12, 2018 launch date for Bitcoin futures on its Bakkt platform this week. According to the release, ICE will list Bakkt Bitcoin (USD) Daily Futures Contracts for trading starting in December, and the product will be physically-settled and cleared by ICE Clear U.S., Inc. Also this week, an unnamed source told a tech outlet that ICE’s Bakkt crypto platform could get approval as soon as the first week of November.
Indian Crypto Exchange Detained For Unregistered Bitcoin ATM
Harish BV, the co-founder of Indian cryptocurrency exchange Unocoin, was held in custody this week shortly after setting up an allegedly unregistered Bitcoin ATM in Bangalore. Harish BV reportedly installed the ATM kiosk at a mall together with fellow Unocoin co-founder Sathvik Viswanath. According to local Indian media reports, Harish BV was detained because the ATM did not receive permission from the state, and was dealing with crypto outside of regulations.
Most Memorable Quotations
“I look forward to delivering even more music that would make Dad proud,” — Young Dirty Bastard, speaking about the Ol’ Dirty Bastard’s estate’s upcoming release of O.D.B. Coin
“The minister’s statement was clear: Cryptocurrencies are not legal tender in India. He did not say ‘illegal tender.’ There’s a huge difference. It means you bear the risk of your investment and there’s no regulation for the industry,” — Sathvik Viswanath, co-founder of Indian crypto exchange Unocoin
Laws And Taxes
Spanish Crypto Investors Could Face Mandatory Reporting Of Crypto Holdings For Taxes
Spain this week approved a new draft law that could require cryptocurrency investors to report their crypto holdings for tax purposes. Finance minister María Jesús Montero said that the new measures would apply to all Spanish citizens, even if they are currently living overseas. The draft bill specifically would requires both the identification and the balances of each investor’s virtual currencies. If the latest draft becomes approved as law, virtual currency holdings would need to be included in Spain’s “notorious” tax reporting structure known as the 720 form.
Taiwan Plans Initial Coin Offering Regulation To Be Issued By June 2019
The current chairman of Taiwanese finance regulator, speaking at a meeting of the Legislative Yuan Finance Committee, said that the country plans to release ICO regulation by June 2019. According to the chairman, “the more we regulator, the more this new economic behavior wanes.” Despite the chairman’s statement on ICO regulation, Taiwan does not have any plans on “curbing the creativity and productivity associated with cryptocurrencies” provided they do not constitute securities.
New York Judges Throw Out Class Action Lawsuit Against Nano Developers
A class action lawsuit brought on by a crypto investor against the development team of altcoin Nano was dismissed by a New York judge this week. According to court documents, the lawsuit alleged that the developers had lured him to trade in Nano on a platform that lost hundreds of millions of dollars’ worth of the cryptocurrency. The lawsuit had asked that Nano do a “rescue fork” to return investors’ missing money. However, in the dismissal, the judge notes that the case had lacked merit.
Coinbase Lawsuit Over Insider Trading Of BCH Dismissed
A U.S. district judge has dismissed the lawsuit over alleged insider trading against crypto wallet and exchange Coinbase during its launch of Bitcoin Cash support last year. The lawsuit alleged that Coinbase employees had benefited from insider trading in the process of adding support for the altcoin. However, the judge noted that the plaintiff didn’t have a sufficient legal basis for his claims in the complaint, and dismissed the class action without prejudice.
US Tax Agency Advisory Committee Asks For Additional Guidelines For Crypto Transactions
An advisory committee of the U.S. Internal Revenue Service has asked the agency to provide more guidelines for the taxation of crypto transactions, according to a 2018 general report. In 2014, the IRS had issued commentary specifically concerning digital currencies, with the recommendation that they be treated as property. However, the advisory committee has brought up several questions surrounding crypto taxation, including whether crypto can be considered as a “specific foreign financial asset.”
Visa Plans Quarter 1 Launch Of Blockchain-Based Digital Identity System
Visa is planning to release its blockchain-based digital identity system for cross-border payments in the first quarter of 2019. The system, called Visa B2B Connect, support a blockchain-based solution for financial institutions to securely process cross-border payments by tokenizing sensitive business data and creating a unique cryptographic identifier for transactions. The solution will use a Hyperledger Fabric framework, along with Visa’s “core assets.”
Report Finds Demand For Blockchain Engineers Has Grown 400 Percent Since 2017
Hired’s 2018 State of Salaries Report has found that demand for blockchain role has risen by 400 percent since the end of 2017. According to the report, the average earnings of a blockchain engineer has soared to between $150-175,000 per year. This salary puts blockchain engineers into the same category as artificial intelligence specialists, as the need for blockchain-able engineers increases. CNBC notes the demand is further fueled by the interest of global tech giants such as Facebook, Amazon, IBM and Microsoft, all of whom are currently advertising for specialists from the emerging sector.
Sony Creates Contactless Cryptocurrency Hardware Wallet
Japanese technology firm Sony’s research arm announced this week that it had created a contactless cryptocurrency hardware wallet that utilizes IC smart card technology to communicate with the Bitcoin or other cryptocurrency network. According to the developers, the wallet’s advantages lie in dispensing with the need to attach the wallet to a device with a USB, the current industry standard.
Oracle Announces Suite Of Blockchain-Based Software For Supply Chain Management
Oracle Corp., a software development company, has announced the release of a suite of blockchain-based software-as-a-service (Saas) applications based on its Oracle Blockchain Cloud Service. Oracle’s new product is designed to increase the traceability and transparency through supply chains. The new product, called the Oracle Blockchain Applications Cloud, includes four apps: Intelligent Track and Trace, Lot Lineage and Provenance, Intelligent Cold Chain, and Warranty and Usage Tracking.
Binance’s Fiat-Crypto Exchange Goes Live In Uganda
Binance, the world’s largest crypto exchange, has officially launched its fiat-to-crypto exchange in Uganda this week. Binance Uganda has launched its live trading, enabling users to buy Binance and Ethereum with local fiat currency Ugandan shillings. This week’s announcement also noted that Binance Uganda is the “first step” to the expansion of crypto exchange markets for a “more inclusive ecosystem that will involve fiat currencies.”
Mergers, Acquisitions, And Partnerships
China’s Largest Newspaper To Launch Blockchain Lab With Tech Firm
The official newspaper of the Communist Party of China’s venture capital wing has made a deal with Shenzhen-based technology company Xunlei Limited. According to the agreement, People’s Daily Online and the tech firm will create a laboratory for “technology innovation” at the People Capital’s Blockchain Research Institute. In addition to blockchain research, the partners will also create a “high-level industrial service platform” for organizing seminars, as well as promote and identify startups in the blockchain industry.
Largest Port In Europe Partners With Dutch Bank, Samsung For Blockchain Shipping Tests
The port of Rotterdam, the largest port in Europe, has announced a partnership this week with Dutch bank ABN AMRO and the IT subsidiary of Samsung to test blockchain use for shipping. The trial, according to Samsung SDS, will focus on shipping containers from an unnamed factory in Asia to the port of Rotterdam. The experiment will officially start in January, and the results will be announced in February.
Johnny Depp Partners With Crypto-Powered Social Entertainment Platform
U.S. actor and producer Johnny Depp has partnered with crypto-powered social entertainment platform TataTu in order to create and produce film and digital content together. The content will be produced by the Infinitum Nihil film production firm owned by Depp, who will be collaborating with TaTaTu founder Andrea Iervolino. TaTaTu, which launched in May of this year, aims to combat illegal piracy and improve transparency for rights holders, as well as to assist high-quality brand advertising by using distributed ledger technology (DLT).
VeChain, Republic Of Cyprus Sign MoU For Blockchain Development
Singapore-based blockchain platform VeChain Foundation, the U.S. blockchain startup CREAM, and the national investment partner of the Republic of Cyprus have signed an MoU for blockchain development and its use cases. According to their agreement, the parties will collaborate on national level investment strategies, using blockchain-powered economies and promoting blockchain technology, particularly in the field of financial services.
Government-Owned Holding Firm Subsidiary Invests In Binance Singapore Expansion
Vertex Ventures, a subsidiary of Singapore-based government-owned investment company Temasek Holdings, has announced an investment in crypto exchange Binance to support its expansion into Singapore. The investment is a joint effort between Vertex Ventures China and Vertex Ventures Southeast Asia and India, and will support Binance’s plans to create crypto-fiat services throughout South Asia. Wei Zhou, CFO at Binance, said in the release that the exchange “look[s] forward to building up the blockchain ecosystem and working with all stakeholders in Singapore to support continued innovation in the local fintech space.”
Overstock’s Medici Ventures Announces Investment In Decentralized Social Networks
Medici Ventures, Overstock’s venture capital subsidiary, has invested an undisclosed Series A investment in Minds, Inc., a decenetralized social network. Minds, founded in 2011, is a social network platform that rewards users with crypto for their activity online. According to the press release, Minds has adopted the Electronic Frontier Foundation (EFF) Manila Principles as the platform’s Digital Bill of Rights in order to “ensure freedom of speech” for its users.
Winners And Losers
Bitcoin is remaining stable this week, trading at around $6,473, with Ethereum at around $204. Total market cap is currently at around $208 billion.
The top three altcoin gainers of the week are PrimeStone, HappyCoin, and Paypex. The top three altcoin losers of the week are CJs, EPLUS Coin, and Etheera.
For more info on crypto prices, make sure to read Cointelegraph’s market analysis.
FUD Of The Week
$50 Million Australian ICO Shuts Down, Cites Regulatory Requirements
Australian crypto startup Global Tech Exchange (GTE) has ceased the operations of its ICO — which had a fundraising goal of $50 million — citing the Australian Securities and Investments Commission (ASIC) requirements. The firm had gained popularity after being endorsed by Michael Clark — a former Australian cricket captain and national celebrity. As of press time, the reasons behind the ICO’s closure have not yet been publicly commented on.
Head Of Indian Nonprofit Trade Organization Calls Cryptocurrency “Illegal”
The president of India’s National Association of Software and Services Companies (NASSCOM) said this week that cryptocurrency is “illegal” and asked businesses to obey the law. Speaking to a local news outlet, the president said that the illegality of crypto is the result of the government’s apparent failure to keep up with innovation. While cryptocurrency is actually currently legal in India, the Reserve Bank of India banned the country’s banks from servicing crypto-related businesses in July.
Thai SEC Issues Warnings About Investing In Nine Unregistered Tokens And ICOs
The Thai Securities and Exchange Commission has issued a warning about investments in nine digital tokens and ICOs, which have reportedly not been registered. According to the Thai SEC, the regulator has initiated an investigation into digital tokens and ICO investments promoted on social media platforms, and have found nine where the product was not authorized. The Thai SEC notes that as the digital assets and ICOs do not have the SEC’s official approval, investors should be aware of associated risks of investment.
Coinbase Lets Fifteen Staff Members Go, Sources Report
Major U.S. cryptocurrency exchange and wallet Coinbase has let “at least” fifteen staff members go after hiring 250 this year, according to unnamed sources speaking to Yahoo Finance. The crypto company confirmed the layoffs, noting that their hiring practices moving forward would only allow for employees to be hired into Coinbase offices. One source told Yahoo that “people here are pretty upset about it, and so far senior leadership is handling communications poorly.”
Hong Kong-Based Crypto Exchange OKEx Delists 50+ Trading Pairs
Cryptocurrency exchange OKEx will delist over 50 trading pairs — not the coins themselves — that reportedly have weak performance. According to the exchange’s announcement, the exchange will halt the trading of more than 50 pairs at 6:00am on Oct. 31, 2018 CET, warning users that they should cancel their orders of the affected pairs from the platform. Andy Cheung, Head of Operations at OKEx, said that “as leaders, we are responsible for promoting a robust ecosystem [...] We need to take action on those underperforming tokens now.”
Wired speaks to math teacher Krista Hannesdóttir about her innovative crypto mining strategy in Iceland: she pays farmers for the use of their excess geothermal energy for running mining equipment. While the crypto mining scheme is relatively small — she makes around £7,876 (about $10,107) in Ethereum each month — they have to keep it on the down low in case the question of its legality could threaten the subsidies farmers receive for geothermal energy use.
Bloomberg Business looks at the role of Bitcoin futures in the market, from the initial hype in the fall and winter of last year, to current day realities of CBOE and CME trading around a combined 9,000 contracts a day. In comparison, CME traded over 18 million contracts daily in Q2 for oil, gold, and interest rates. However, even with the low daily trading rate, the BTC futures are “probably considered statistically one of the more successful products, both out of the gate and with the growth in the first six months.”