One year ago, I wrote an article for CoinDesk in which I humbly argued that the price of ether didn’t matter and what everyone in the blockchain community should focus on is building useful applications instead.

Hate to say I told you so, but… I did.

A few short months later, CryptoKitties were chased away by the bears, the initial coin offering (ICO) boom was gone, and the euphoria of $1,000 ether and $20,000 bitcoin had been replaced by the dire prognostications that crypto was “ded.”

Below I review what I regard as the major developments of 2018, and what lies ahead in 2019. And at the risk of being accused of double-spending, I’m going to quote freely from my earlier article, since many of the points I made have been vindicated or bear repeating.

When you’re #ODL and you know it…

Until June 2018, enticing crypto engineers to work on any enterprise product was hard, very hard. The lure of tokens ran rampant.

Most people in my dot-com generation learned the hard way that showing up at 8 a.m. and burning brain fuel until 10 p.m. is kinda the only way. But what 24-year-old who can write a grammatically correct sentence with “token” and “moon” in the same breath wants to do that?

When the dot-com microcaps were booming, I didn’t either. What exactly are these cash flows… duh! But, as I wrote a year ago:

When most of the tokens later crashed spectacularly, moon and lambo swiftly retreated from the social discourse and boring middle class concepts like enterprise technology, real human users and a fiat salary re-entered human conversation.

Deja vu, deja vu…

The year of regulation

I quote myself, yet again: “Dealing with other people’s money is always going to be regulated”.

In 2018, when folks in crypto weren’t talking about the tanking prices, we were talking about regulation or hoping it’d go away. Well, it didn’t.

In February, Chairman Christopher Giancarlo of the Commodity Futures Trading Commission advocated a “do no harm” approach to crypto regulation, referring to the erstwhile U.S. approach to the internet.

The clearest and most concise guidance from a regulator came in February from the Swiss, who, to their credit, have been forward-looking in their acknowledgment of the potential of blockchain technology so far. The Swiss Financial Market Supervisory Authority, or FINMA, clearly laid out the various types of tokens and what makes a token a payment token or a utility token or a security.

Both sides of the securities law debate were woken up by the U.S. Securities and Exchange Commission (SEC) director of corporate finance, William Hinman, when he stated in June that to his understanding, “the ethereum network and its decentralized structure, current offers and sales of ether are not securities transactions.”

We the British, maintained our classical studious approach, studying and further studying the space and to our credit, doing no damage, either in support or opposition of the crypto space while calling for good behavior and manners… yes, manners all this time.

On the policy front, the European Commission led the way with a systematic approach to engaging with the blockchain community through the EU Blockchain Observatory.

The year of ‘ded’ ICOs

That said, the news flow in 2018 was dominated not by hardworking engineers building great technology but by traders and bankers mooning and REKTing things, as they do best.

Against the flow, as ICOs boomed I mused…

Well, they didn’t.

As EY reported:

Forgive them for they know not of which they speak

So many many folks mused that since ICOs were doing so badly and since most ICOs were launched on ethereum, ethereum must also be “ded.” Well, the price chasers were wrong then and they are wrong now.

As I said to CoinDesk editor in chief Pete Rizzo in a video interview at Consensus 2018, “cryptocurrencies are online community assets.”

Any token that has survived at least one boom or bust and has a thriving community (of people, not trolls and trading bots) has the potential to be used by many many more people over the next two decades as this technology matures and as these platforms scale.

We haven’t even scratched the tip of the iceberg with our ice skates yet. Further, ethereum is the leading platform today because of its ecosystem, which only seems to grow and accelerate…

The year of the ecosystem

Turns out, the price of ether is the least interesting feature of ethereum. I said back then…

At DevCon4, Joseph Lubin, the illustrious co-founder of ethereum, made his famous “killer ecosystem” speech. The way I understood it was that we’re so early in this technology that it’s the quality and depth of the ecosystem surrounding a blockchain platform that’d define its long-term success or failure.

Waiting for a killer app is a fool’s errand because killer apps don’t quite tell you in advance that they are killer apps. The way to get to a whole range of killer apps is to unleash the creative power of developers, enterprises, investors and other agents of society.

That to date has been ethereum’s singular achievement.

The week before, Joe received a memorable reception at Sibos, the biggest conference in banking. Sibos featured enterprise platforms like komgo, Adhara and Trustology in addition to solutions from DAH, Hyperledger, Corda and Ripple and ran talks to packed business audiences.

At the end of Sibos, the most common refrain from the attendees was… “blockchain is here to stay”.

Indeed, the crypto ecosystem of hoodies had just started to merge with the enterprise ecosystem of suits

The year of #buidl

I am insufferable… I quote myself again:

In my book, the crowning glory of the year for the entire enterprise blockchain community, and not just the ethereum community, was the production release of VAKT, a platform for trading of physical commodities and komgo, a trade finance platform for commodities that interoperates seamlessly with VAKT. These two platforms were built from start to finish within 2018 on ethereum and marked the arrival of enterprise ethereum in real production use.

The coolest piece of kit produced by enterprise blockchain in 2019 was Kaleido. Built by ex-IBM engineers at ConsenSys, Kaleido enabled one-click industrial-grade deployment and support of enterprise ethereum-based applications. This is a much bigger deal than it sounds.

Development is arguably less than 20 percent of the effort over the lifetime of any enterprise application. Deployment and support are the other 80 percent. Kaleido took 80 percent of the effort out of that 80%.

The most valuable piece of engineering in blockchain was Open Law which enabled the creation of smart contracts whose execution corresponds demonstrably with the underlying legal contracts. In essence, Open Law put the “contract back in smart contracts” and opened up a vast range of real-world applications in financial and non-financial asset markets.

The most readable news in blockchain was Evan Van Ness’ “This Week in Ethereum,” a relentlessly BUIDL focussed newsletter that was a source of perspective through the amusing hysteria and paranoia of the #crypto investor community.

The year tokens came to enterprise

While no one was watching, tokens came to enterprise financial services as Euronext and other ecosystem partners went to pilot at Liquidshare, a consortium re-engineering the interaction between post-trade parties by leveraging blockchain technology and developing a new infrastructure for small and medium-size enterprises (SMEs) in Europe.

In June, the South African Central Bank. working on Project Khokha, proved that a new wholesale payment system built on ethereum can process a day’s worth of interbank payments in less than two hours, that too with full confidentiality and finality.

The Monetary Authority of Singapore and SGX, the city-state’s stock exchange, announced in September that they have successfully developed delivery versus payment (DvP) capabilities for the settlement of tokenized assets across different blockchain platforms.

The public blockchain space started to create enterprise-friendly (and -unfriendly) fiat tokens at pace. As CoinInsider reported, 45 stablecoin projects had raised $350 million in funding by November.

The jokes about a stablecoin going to the moon suddenly didn’t sound like jokes anymore.

2019… The year of enterprise tokens

When you follow the market news too closely, it’s difficult to not be blinded by the obvious. So what’s really going on?

It turns out that the first killer app of the internet was not email. It was the ridiculously simple web page. The first killer app of blockchain is the ridiculously simple token.

A token is a mere smart contract that encapsulates the rules governing the exchange of an asset. Once this contract can be generated from an underlying legal contract and shown to execute in line with the legal contract, regulated, legally sound applications of blockchain become possible. This is a big deal.

It turns out, all economic activity, micro or macro is built on top of legal contracts. Unfortunately, because of information asymmetries, cost of enforcement, the risk of disputes and uncertainty in legal systems, the cost of contracting in too many transactions can exceed the benefit of the transaction.

Smart contracts that execute in line with legal contracts provide evidence of state on-chain and ship with dispute resolution systems can dramatically reduce the costs of contracting and the cost of enforcement, unlocking economic activity across industries and economies.

All that in a little token…

Ok, so should I buy? SODL? HODL?

I quote myself again

In 2019, tokens will invade the enterprise in full force. The de-siloing of systems that began with multiple energy and bank companies creating VAKT and komgo will accelerate exponentially across applications such as gaming, securities markets, trade finance, intellectual property, digital collectibles, patents and licenses, real estate and many many more, and by 2020, start to show what all the fuss around blockchain was really all about.

Even more importantly, the boundary between public and private networks will start to disappear as assets on one network need to be exchanged with assets on another. Ethereum is uniquely position to grow from this phenomenon.

*This post is credited to Coin Desk

The Thailand Securities and Exchange Commission (SEC) has decided to explain how already existing laws could be applied to crypto securities. Another thing to mention is that Thai companies that are planning to issue securities tokens abroad need to follow specific regulations. The information was released a few days ago by the Bangkok Post.

According to the Bangkok Post, regulators are still not sure how to deal with securities token offerings (STO). To be clear, these STOs are crypto tokens that are backed by real assets, including gold or real estate. While IPOs are regulated under the Securities Act, Initial Coin Offerings (ICOs) follow the Digital Asset Act.

However, the SEC has to issue licenses for ICOs if they want to raise money in Thailand. And this regulatory framework has barely got off the ground.

According to Tipsuda Thavaramara, the deputy secretary of the SEC explained that the regulator has to consider how to deal with STOs. The share of ownership, voting rights and dividends are some of the issues to take into account.

Apparently, if STOs share the same conditions to other securities, they would have to follow a similar process that IPOs follow. That means that they will be regulated by the SEC Act. Additionally, STO trading would fall under the Digital Asset Act just in case the fund-raising is carried out in the same way as for Initial Coin Offerings.

Tipsuda commented about these regulations:

“At the moment, we have not decided whether STOs fall under the SEC Act of the Digital Asset Act, but it depends on the STO’s conditions and the details in its white paper. The SEC will have to consider carefully how to respond to each STO.”

At the same time, Prinn Panichpakdi, the managing director of CLSA Securities Thailand, explained that STOs are popular and trendy in overseas markets and they would reach the Thai market in the near future. However, regulators in the country are not ready to issue digital asset licenses.

Prinn said that the environment is changing and that the SEC would have to see how to deal with companies that launch these products in other markets.

Regulatory issues around the world related to virtual currencies are not clear and are generating troubles among crypto companies and investors. Nevertheless, there are some countries such as Malta or Japan that are trying to be ahead of the market creating clear regulations and protecting investors from fraudulent activities.

*This post is credited to Bitcoin Exchange Guide

After being left behind in the Internet revolution, places like France, Malta and Switzerland are making a concerted effort to stay ahead of the crypto-asset curve.

Could Europe be a future blockchain paradise? Unthinkable just a few months ago, the idea is quickly gaining ground, especially in European capitals, from Paris to Valletta, where the lessons of the Internet left their mark. Just look around. More than 20 years after its creation, the Web is dominated by American and Chinese groups, much to Europe’s chagrin, which has promised itself not to let that happen again with the blockchain.

Brussels keeps repeating that Europe must be on the offensive on this front. And they’re right, because even if the world’s two leading economies again have a head start — with giants such as Binance, the “Alibaba of cryptocurrencies,” or ConsenSys, the world’s “studio” for blockchain — Europe has the means to catch up with them. More importantly, it can really establish itself.

That’s because European countries have paidclose attention to the Bitcoin boom and understand it. Most have already begun adapting their laws. Malta, Estonia and Lithuania — and Switzerland too — are obviously at the forefront, with increasingly clearer tax laws and regulations, but they are not the only ones.

Larger players, such as France, are also making huge progress, and Paris wants to become a driving force in Europe. The government is working on new economic legislation with which it seeks to “send a clear message that France and Europe are a destination of choice,” says lawmaker Pierre Person, who has been involved in a parliamentary mission on cryptoassets.

The Old Continent also understands that blockchain is a technology that requires a lot of flexibility. In their approach, European countries are trying to reconcile the need for regulation with the flexibility the blockchain needs to grow and evolve. “That’s the whole point: to succeed in putting a legal framework around technology without preventing it from developing,” says Pierre Person.

Above all, Europe — with its 500 million inhabitants — is a vast market like China and the United States. It has the means to carry a lot of weight, with several technological hubs, researchers and important financial centers. It also has a favorable economic model that is industrial, financial and liberal at the same time. This isn’t necessarily the case in China and the U.S., where the former’s interventionism and the latter’s economic financialization are very strong and not exactly compatible with a massive adoption of the blockchain.

The first negative signals, in fact, have already been seen in China, where the Communist regime has begun taking control of things after 12 months of laissez-faire. It must be said that the philosophy carried by the blockchain is contrary to the Asian giant’s economic approach. The blockchain decentralizes, while the Chinese economy centralizes: everything goes through Beijing.

The Chinese authorities have recently closed down several cryptocurrency trading sites and confirmed the ban on initial coin offerings (ICOs) to finance Blockchain projects. Europe is doing the opposite by trying to attract investors. Even the EU’s financial regulator is considering the most appropriate legislation for ICOs. Beijing has also decided to take a closer look at investments made by Chinese giant companies in the sector.

Across the Atlantic there’s a different problem. Companies have carte blanche to develop, but the ecosystem’s growth and maturity seem limited, at least in its global dimension. The ecosystem is already highly financialized and close to Wall Street, with several giants already on the case, such as Fidelity, BlackRock or Goldman Sachs. This situation could deter potential future new players, as the development costs of a blockchain project continue to increase.

The blockchain economy is developing, but the market is still very immature.

“This is the American particularity,” a U.S. fund manager explains. A large number of projects have taken on a merely financial dimension, notably under the impetus of the Securities and Exchange Commission (SEC), which regulates the sector at a snail’s pace by applying to it the current legislation on financial securities. A position that European regulators reject, preferring a more open approach, mostly so they can continue to let the sector innovate and develop.

The United States also has to work with the power of its technology giants, who dominate not just the American but also the global economy. This is the whole paradox with Google, Apple, Facebook, Amazon and Microsoft. These giants, which represent nearly $4 trillion in capitalization, are looking at the blockchain. Microsoft has started to invest in the sector. Facebook has made the blockchain one of its research areas to find out how to “make the best use” of cryptocurrencies.

But these companies have little interest in developing the blockchain on a large scale because their model is based on centralization and massive data collection. “The blockchain economy is developing, but the market is still very immature. Everything still remains to be done,” explains Joseph Lubin, boss of ConsenSys. And that’s the head of one of the most powerful companies in the sector speaking.

*This post is credited to World Crunch

The German Federal Financial Supervisory Authority (BaFin) issued a warning Nov. 29 that a firm called Platin Genesis DCC is not authorized or approved by the proper authorities.

In the warning, BaFin states that Platin Genesis was advertising a “Platinum Coin Crypto Fund” on social media, which it claimed was “approved and released by BaFin.” The watchdog clarifies in its statement that this is not true.

Per BaFin, the firm does not have permission under section 34 of the German Banking Act to conduct banking activities or offer financial services. The firm is not under BaFin’s supervision.

The firm’s token “Platincoin” is listed on CoinMarketCap, and is trading at $4.48, down 1.11 percent on its daily chart at press time.

Earlier this month, BaFin ordered a partial cessation of activities of U.K.-based crypto-related firm Finatex Ltd. The firm was ordered to “immediately” put a halt to cross-border proprietary trading on its trading platform, Crypto-Capitals.

Finatex purportedly offered “options, contracts for difference (CFDs) on shares, indices, currencies and commodities,” without authorization by the German Banking Act.

BaFin has maintained a hawkish stance toward ICOs, and has called for international regulations in the sector. Last month, BaFin chairman Felix Hufeld said that “the number (of ICOs) and the volume (of money) per ICO are both getting higher. Investors have mostly minimal rights.”

Referencing ICOs, Hufeld recommend private investors to “keep away from such things” adding that discussions on ICO regulations were underway in “multiple international forums.”

*This post is credited to Cointelegraph

Companies have only recently begun taking advantage of recent SEC regulations that allow projects to raise funds. The two regulations, Reg. Crowdfunding (C.F.) and Reg. A, allow companies to secure between $1 million and $50 million. These avenues for fundraising are compliant, cost-effective, and synergistic with ICOs.

A controversy in the cryptocurrency space revolves around crypto securities classification. Many projects attempt to avoid regulation by claiming that their coin is a ‘utility token,’ rather than a ‘security token.’

These classifications result in a gray space where some cryptocurrencies attempt to avoid regulation, some are uncertain but may be penalized in the future, and some that are securities that the SEC has not yet acted upon.

However, if the SEC rules that a particular project is a security and that project has failed to register as such, then the project will, at a minimum, be penalized, required to return funds to investors, and forced to go through precise disclosure and reporting requirements.

This kind of activity was seen in the SEC’s recent string of enforcement actions. Just this month there were a series of high profile investigations.

The founder of decentralized exchange EtherDelta, Zachary Coburn, was charged with operating an unregistered securities exchange. Two ICOs, Paragon and AirFox, were penalised for failing to register their tokens as securities with the SEC.

The Previous State of Affairs

Prior to 2015, in order to raise funds, companies had to go through the lengthy initial public offering (IPO) process, which requires an enormous amount of accounting and legal legwork.

According to a report from PwC, an IPO costs on average $4.2 million, plus a hefty 4-7% of gross proceeds raised from the offering.

The oft-opted alternative, a Regulation D (Reg. D)exemption, allows companies to raise funds strictly from accredited investors. Accredited investors are individuals who earn more than $200,000 or have a net worth of at least $1 million.

In aggregate, these regulations have limited investment opportunities in startups and small companies to the wealthy, and only made effective fundraising easily accessible to large corporations.

The Remedy to Fundraising

However, a new piece of legislation has changed the current state of affairs. The Jumpstart Our Business Startups (JOBS) Act was signed into law in April 2012, and mandated that the SEC implement new regulations that make it easier for companies to raise funds, especially from distributed pools of investors.

Two additions to the fundraising regulations were added to the Securities Act of 1933. Regulation Crowdfunding (C.F.) and Regulation A(+). These regulations allow projects to raise between $1 million and $50 million without going through the costly requirements of a traditional public offering.

The most exciting of the two regulations, Regulation C.F., was implemented in May 2016. This regulation allows projects to raise over a million dollars to small-time investors. The regulation allows individuals to invest $2,200 and up, depending on income, through a registered broker-dealer or funding portal.

Meanwhile, Regulation A was implemented in March of 2015. Regulation A allows a company to raise up to $50 million without going through the strict IPO process or the narrow Reg. D exemption.

Regulation A is split into two tiers. Tier 1 offerings allow a company to raise up to $20 million over 12 months, and a Tier 2 offering up to $50 million. Tier 2 offerings require additional investor screening and disclosures.

How the Crypto Market Is Responding

One fascinating observation is that broker-dealer and crowdfunding portals have been slow to crop up in response to these regulations. Even though these regulations were implemented over three years ago, it is only now starting to have an impact.

At the moment, only 30 companies are registered as broker-dealers or funding portals. Many of these portals are only raising limited amounts of funds, in-operational, or do not service the crypto markets.

In all, there are only three competitive crypto funding portals taking advantage of these regulations. The most notable of the crowdfunding platforms, StartEngine, is one of the portals that stand out; The company launched the first Regulation C.F. and Regulation ICOs, and has since helped cryptocurrency companies raise millions.

Another popular crowdfunding platform, Republic, received the backing of Binance and has helped ICOs raise millions in compliance with the SEC.

These regulations have the potential to unlock a swath of investors who were previously too reluctant to invest in wildcat ICOs.

With the potential to save ICOs millions in penalties and legal costs, these regulations could improve investor confidence as compliance becomes more streamlined.

*This post is credited to Cryposlate 

The bad old days are back. Crypto prices are in free fall and no one’s sure where the bottom lies. Even mighty Bitcoin wasn’t spared as prices crashed below the $6,000 mark—regarded by many as an unofficial floor—and then fell further to below $5,000. What’s going on?

Three recent events might explain the current collapse. The first is the SEC’s announcement on Friday that the operators of two “Initial Coin Offerings” (ICOs) broke the law by selling unlicensed securities, and must pay fines and restitution. As others have noted, this is only the beginning: Crypto bros spent most of 2017 poking the SEC bear, and now the bear is awake and ready to mete out a world of punishment. This development might be enough to spook some crypto investors, but it hardly come as a surprise. Anyone paying attention to the regulatory space knew this was coming, and so much of the fallout should have been priced into crypto token prices already.

Likewise, it’s hard to see how last week’s Bitcoin Cash fork—a second possible explanation for the crypto crash—could tank the market so badly. Sure, the fork was messy and created renewed centralization concerns over Bitcoin Cash. This hurt the price of Bitcoin Cash, and possibly spread contagion to the rest of the market. But Bitcoin Cash has always been dodgy and dysfunctional, and the crypto world has weathered forks before, so it’s hard to see how this triggered the crash.

This leaves a third possibility: Crypto investors got spooked by bad news from chip-makers Nvidia and Advanced Micro Devices, which recently reported steep sales declines for cryptocurrency equipment. The sales declines suggest interest in crypto has waned, and is unlikely to pick up anytime soon. This could explain the chill on crypto asset prices, but also raises a chicken-and-egg question: Namely, is the chip makers’ misery a cause of the collapse, or just another symptom of it?

It’s possible, of course, that it was a conflation of all three events that KO’d the crypto markets. That would be welcome news for investors, in a sense, because it would mean individual shocks explain the downturn—and markets recover from shocks.

There is, however, a more existential explanation for the collapse: the whole thing is a bust. This is the position of tech exec Sam Gellman who, in a thoughtful series of tweets, points out that crypto has sucked up $30 billion in ICO money in two years and hasn’t delivered a user base beyond crypto speculators. It’s been ten years since Bitcoin came out, he says, and there is little of value to show for it. Needless to say, plenty of folks are popping up to refute Gellman but, if he’s right, look for investors to keep rushing for the exits.

*A version of this article appeared in the November 19 edition of The Ledger’s weekly newsletter.

Taiwan’s highest legislature has approved amendments to existing laws, enabling the country’s regulator to combat anonymous cryptocurrency transactions.

On Friday, Taiwan’s Legislative Yuan passed a legislative proposal that mandates cryptocurrency transactions to fall under the purview of existing money laundering laws.

The amendments to the Money Laundering Control Act and the Terrorism Financing Prevention Act enables the country’s Financial Supervisory Commission (FSC) – Taiwan’s financial regulator – to gather KYC information of cryptocurrency investors from trading platforms, Focus Taiwan reports.

Specifically, the regulator “now demand that operators of virtual currency platforms implement “real-name systems” that require users to register their real names, according to new provisions,” an excerpt from the report added.

Further, banks will also be required to report ‘suspicious’ transactions that are anonymous, to the regulator. The amendments, Taiwan’s Ministry of Justice (MoJ) said, align the country’s laws with international anti-money laundering norms.

The revisions follow a pointed proposal by Taiwanese lawmaker Jason Hsu who, in October, sought to enforce a similar framework used by the EU’s Anti-Money Laundering Directive.

Hsu, a congressman from Taiwan’s Nationalist Party, has advocated against calls for a cryptocurrency ban and instead called on Taiwan to take a different position to the hostile stances taken by neighbouring China and South Korea.

“Just because China and South Korea are banning, doesn’t mean that Taiwan should follow suit – there is a huge opportunity for growth in the future,” Hsu said in a parliamentary session last year. “We should emulate Japan, where they treat cryptocurrency as a highly regulated, highly monitored industry like securities.”

As reported in October, the chairman of Taiwan’s FSC has also revealed that the regulator is preparing guidelines for regulating initial coin offerings (ICOs) in the country.

*This post is credited to CCN

Taiwan’s legislature has amended the country’s anti-money laundering and terrorism financing prevention laws to include regulatory requirements for cryptocurrency transactions.

Taiwan’s Anti Money Laundering Regulations for Cryptocurrency

According to Focus Taiwan, the amendments grant the country’s top financial regulator (FSC) the power to clamp down on anonymous cryptocurrency transactions. Beyond regulating digital currency transactions, the Financial Supervisory Commission (FSC) can also monitor crypto exchange operators.

Based on the new provisions, the FSC will mandate all cryptocurrency exchange platforms to operate a “real-name system.” Exchange operators must insist that users register with their real identities. Banks can halt anonymous transactions and report same to the financial regulator.

Speaking on the decision, the Ministry of Justice had this to say:

A compliance culture and mindset is an important part of effectively fighting money laundering, and that culture and mindset can only be fostered through good habits and practices in the operations of local companies and institutions.

Before this development, some government officials led by Jason Hsu launched a self-regulatory body for the country’s cryptocurrency and blockchain industry. The Taiwan Crypto Blockchain Self-Regulatory Organisation is a voluntary coalition of industry participants tasked with drafting policies for the sector. These new provisions on anti-money laundering are possibly a result of various dialogues between the TCBSRO and the FSC.

Last year, the country’s lawmakers passed the Financial Technology Innovations and Experiments Act to create a “sandbox” for innovative fintech companies. Companies that meet the law’s assessment will be allowed to operate without regulatory risks (for a specific period). ICOs for example who gain the approval of the FSC will be allowed to bypass certain regulatory requirements.

Money Laundering Prevention Efforts in The Cryptocurrency Industry

Money laundering is a primary concern for governments and institutional investors alike.  Its use in virtual currency fraud cases appears to be on the rise.  In September, Sydney police arrested a married couple suspected of using virtual currencies to launder $300,000.  In Israel, police seized a wallet containing over 1,000 BTC in connection to a fraud case.

Though anti-money laundering regulatory frameworks exist for traditional financial transactions, there are calls for crypto-specific provisions.

The FATF recently announced plans to issue laws regulating digital currencies in line with its global anti-money laundering standards. As reported by Ethereum World News, the international regulator has amended its standards to include cryptocurrency transactions. Starting from June 2019, it will issue these amendments and offer guidelines for implementation.

*This post is credited to EthereumWorldNews

Europe is slowly becoming the largest and most influential cryptocurrency hub as evident from the millions of dollars pumped into various cryptocurrency projects. According to News BTC, the total value of token sales in Europe is almost exceeding that of the United States and Asia combined.

Fabric Ventures carried out a study that revealed some of the plausible causes of the current surge in European Initial Coin Offering in 2018. Note that Fabric Ventures is a venture capital fund firm that is well known for investing thousands of dollars in decentralized network projects and blockchain.

Some of the reasons highlighted in Fabric Venture’s report include separation of economies in the European Union and increasing rate of development activities. In 2018, initial coin offering in the region is estimated to be $4.1 billion. This figure is almost two times that of the $2.3 billion recorded in Asia and $2.6 billion recorded in the United States.

Friendly Cryptocurrency Regulations in Europe

Europe financial regulators have begun to develop cryptocurrency regulations that are friendly to the industry thanks to the do-no-harm approach. The stringent regulatory authorities hamper ICO funding in Asia in Singapore and Hong Kong. It is important to note that Hong Kong and Singapore are considered the two main cryptocurrency hubs in the region. The financial regulators consider cryptocurrencies as security products, and so they are subject to more regulatory scrutiny that discourages potential investors.

In Europe, the do-no-harm approach has significantly helped the financial regulators to come up with policies that are friendly to the industry. The non-restrictive regulations encourage investors to spend more money on new initial coin offerings.

European Nations Significant Funding of ICOs

Malta and Gibraltar are two of the smallest nations in Europe that have put in place policies that promote growth and development of the cryptocurrency industry. Recent reports indicate that the two have drawn more than $300 million in ICO Funding and the figure is expected to skyrocket as more people become aware of how cryptocurrency and blockchain technology works.

The report also shows that the United Kingdom has managed to raise $490 million to fund various cryptocurrency projects while Switzerland has raised approximately $556 million this year alone. Lithuania has also shown serious interest in cryptocurrency and has raised $271 million to support ICOs.

Strong project foundation and national support for cryptocurrency could also be one of the primary causes of the increased European ICO fundraising. Cryptocurrency founding teams are aware of this fact; and have set up offices in major cities such as London, Berlin, and Zug.

Conclusion

2018 has being a successful year for ICO fundraising despite the challenges in the market. It is reported that more than 889 ICO projects have already managed to raise three times more funds than what was raised in 2017. Financial regulators continued support for this industry will significantly help to boost its growth and promote adoption of this new technology, especially in the developing countries.

*This post is credited to CoinRevolution

For all the attention afforded bitcoin, it is its rival ether that is hitting the headlines, with the popularity of its blockchain technology Ethereum driving concerns that have sent investors fleeing.

Virtual currencies have struggled across the board this month after US investment banking giant Goldman Sachs pulled back from its plans to open a trading desk for bitcoin, damaging sentiment for the entire sector.

Ether has slid 20 percent in value, taking a further hit from comments made by Vitalik Buterin, co-founder of Ethereum, which powers the cryptocurrency.

Earlier this month, the 24-year-old Russian-Canadian programmer told Bloomberg that “the (Ethereum) blockchain space is getting to the point where there’s a ceiling in sight”.

A blockchain is essentially a ledger for recording transactions, which is both open to all who use it but extremely secure, and has enabled the rise of cryptocurrency trading.

A multimillionaire thanks to Ethereum, Buterin has previously spoken about “scalability” probably being the number one challenge facing the sector.

Blockchain traffic jam

Unlike bitcoin’s blockchain, which carries out transactions involving only the cryptocurrency, Ethereum can host different virtual tokens and also enable certain digital applications and so-called smart contracts.

Such programmes can for example automatically trigger payments without the use of a third party when pre-defined conditions are met, such as winning a sports bet.

Ethereum is also home to two-thirds of initial coin offerings (ICOs), essentially a fundraising tool for companies which issue the tokens against cryptocurrencies much like issuing shares on a stock market.

An explosion in the number of ICOs in 2017, two years after ether’s launch, resulted in the cryptocurrency’s price rocketing 160 times in value over a 12-month period.

The craze surrounding ICOs has also caused congestion to Ethereum’s network, contributing to ether’s price collapse beginning in January.

“The more it’s demanded, the more likely you are to clog the network,” said Jerome de Tychey, president of Asseth, an association promoting the use of Ethereum.

A clogged Ethereum results in higher charges for clients wanting their transactions prioritised—and average fees briefly hit a record $5.50 in July according to bitinfocharts.com. Generally though, fees fluctuate around a few cents.

Delays to a planned overhaul of Ethereum’s scalability have meanwhile likely discouraged some investors from using the blockchain, according to de Tychey.

Naeem Aslam, an analyst at traders Think Markets, said Buterin “isn’t doing the job which he is supposed to do”—that is, to make companies “trust the technology and provide them (with) what they need”.

Virtual currency, real plunge

The plunge in the value of ether has indeed been dramatic. Since the start of August, it has lost more than half its value.

Going back to May, the drop is 75 percent, with the total value of the virtual currency tumbling to about $23 billion from $82.5 billion.

Yet the huge drop has only taken ether back to its value of a little over a year ago, at some $220 for one token.

Another factor weighing on ether’s price has been the success of ICOs. The companies which raised funding in ether with ICOs now need to sell to them to cover operating expenses in fiat currencies.

According to sector analysts Diar the companies that raised funding before the price boom at the end of last year have sold off some 20 percent of their ether holdings since April, weighing on its price.

*This post is credited to Phys