SyncFab Platform 2.0 Integrates MFG after Scheduled Token Burn

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The SyncFab team is announcing that the MFG Token has been integrated into the SyncFab 2.0 Platform. The innovative company is now looking forward to sharing its next-generation blockchain-based manufacturing platform.

A previously announced token burn for unsold MFG Tokens took place on June 30th. SyncFab has shared an explanation of the process with the public.

What is a Token Burn?

A standard practice for many blockchain companies that run a token sale is to burn unsold tokens that were not previously allocated. By burning tokens, SyncFab is removing unsold tokens from the public sale pool, which will lower the total supply of available MFG tokens.

Why is SyncFab burning tokens in phases?

The company implemented a Phased Burn Process to ensure sufficient time for those who have yet to complete their token claim submissions in accordance with the KYC Requirements. There are few left who have yet to complete compliant token claims but for whom SyncFab still must maintain respect as members of their community and realize they may have extenuating circumstances. The final phase burn number is dependent on the number of ultimate KYC failures due to AML or banned jurisdiction flags the company encounters, as that will alter the amount burned in the final phase.

Token Burn Schedule:

The token burn takes place in 3 phases of nearly equal thirds, with the final number of the remaining balance to be announced upon conclusion of the Phase 3 Burn.

Phase 1 Burn: 50M MFGs — June 30, 2018

49 million unsold MFGs were burned and 1 million MFGs were burned from the team pool to compensate for unreturned tokens as detailed here.

Phase 2 Burn: 50M MFGs — July 31, 2018

49 million unsold MFGs will be burned and 1 million MFGs will be burned from the team pool to compensate for unreturned tokens as detailed here.

Phase 3 Burn: Unsold/Unreturned MFGs — August 31, 2018

The remaining balances will be burned, with the exact number announced upon conclusion of the third and final burn.

Haven’t redeemed your tokens?

After the June 30th cutoff date, SyncFab has shifted focus from distribution support to refocus on completing new product updates and daily operations growing the business in furtherance of its core mission. Tokens will still be available at a slower response rate to those who purchased by contacting [email protected] until August 30, 2018.

The team has also unveiled the SyncFab Token Tracker, which allows users to track the distribution status of tokens, and indicates steps to take for those who have yet to receive tokens.

Malta: Crypto Exchange Binance Backs Plans to Create First Decentralized, Tokenized Bank

The world’s second largest crypto exchange, Binance, is backing plans to create a blockchain-based bank with tokenized ownership, Bloomberg reports today, July 12.

The future “Founders Bank” would be owned by digital token investors and be based in Malta, known for its robust and transparent crypto regulatory climate.

According to Bloomberg, Binance has already invested in a 5 percent stake, along with other anchor investors, at a $155 million pre-money valuation.

The project seeks to become the world’s first decentralized, community-owned bank. The owners of the future bank will be issued with “legally-binding equity tokens” in return for their investment, via the blockchain-based equity fundraising platform Neufund.

As Bloomberg notes, before launching operations, the bank will need to seek a license from Maltese regulators, in accordance with EU financial laws.

Silvio Schembri, a junior minister within the Office of the Prime Minister of Malta, has reportedly said that the island “is honored to be chosen as the location of the first global community-owned bank.”

As Cointelegraph reported last month, the Maltese parliament has just recently approved three distributed ledger technology (DLT) and crypto-related bills, consolidating the island’s bid to remain at the forefront of blockchain innovation.

Binance first announced it was relocating its headquarters to Malta in March, last month revealing that the exchange had already set up a bank account on the island.

Ahead of today’s revelations, Binance has recently made its first foray into crypto-fiat trading, unveiling a new platform, Binance Uganda, which supports the Ugandan Shilling, alongside major cryptocurrencies.

According to CoinMarketCap, as the second largest exchange globally, Binance has seen $923.3 million in trades over the past 24 hours to press time.

The Genesis Files: With Bit Gold, Szabo Was Inches Away From Inventing Bitcoin

As his Hungarian parents had fled post-war Soviet regime to settle in the United States, Nick Szabo came to call the Californian Bay area of the 1990s his home. Here, he was among the first to frequent the in-person “Cypherpunk” meetings organized by Timothy May, Eric Hughes and other founding members of the collective of cryptographers, programmers and privacy activists centered around the ’90s mailing list of the same name.

Like the other Cypherpunks, Szabo was concerned with the receding guarantees of privacy in an upcoming digital age and took action to stem the tide where he could. For example, on the Cypherpunks mailing list, Szabo led opposition to the “Clipper chip,” a proposed chip that would have been embedded in phones, allowing the NSA to listen into calls. Szabo had a particular knack for explaining the risks of such privacy infringements in a way that resonated with non-technical people, sometimes giving talks on the topic or even handing out flyers. (The chip would eventually be rejected by manufacturers and consumers.)

But like the more libertarian-oriented Cypherpunks, Szabo’s interest in digital privacy was part of a bigger picture — it was not just about privacy alone. Inspired by Timothy May’s vision as laid out in The Crypto Anarchist Manifesto, Szabo saw the potential to create a “Galt’s Gulch” in cyberspace: a domain where individuals could trade freely, as described libertarian author Ayn Rand’s novel Atlas Shrugged. The pseudo-physics force field of the story, May and Szabo believed, could be substituted with the recently invented magic of public key cryptography.

“If we step back and look at what many cypherpunks are trying to achieve, a major idealistic theme is a Ghandian cyberspace where violence can only be make-believe, whether in Mortal Komat [sic] or ‘flame wars,’” Szabo wrote on the Cypherpunks mailing list.

Yet, Szabo also realized that free enterprise needs more than just encryption as a security layer. Inspired by another libertarian author — economist Friedrich Hayek — he found that the basis of human society is, to a large extent, based on building blocks, like property and contracts, which are typically enforced by the state. To create a stateless, non-violent cyber alternative, Szabo knew that these building blocks had to be transferred to the online domain.

This is how Szabo, by the mid 1990s, came to propose what he is perhaps best known for today: smart contracts. These (then-hypothetical) computer protocols could digitally facilitate, verify and enforce the negotiation or performance of a contract, ideally without the need of any third party. As Szabo had famously argued: “Trusted third parties are security holes.” These security holes would be targets for hackers or criminals — as well as nation states during times of political instability or oppression.

But smart contracts were only part of the puzzle. The second tool Szabo needed in order to realize his “Galt’s Gulch” was possibly even more important. Money.

Electronic Cash

Digital currency, a cash for the internet, was always a central goal for the Cypherpunks. But few dived into the subject matter like Szabo did.

In his essay “Shelling Out: The Origins of Money,” Szabo described how — as first hypothesized by evolutionary biologist Richard Dawkins — using money has been embedded in the very DNA of humans. Having analyzed pre-civilized societies, Szabo found that people across cultures tended to collect scarce, easy-to-carry objects, often to make jewellery out of them. It was these objects that served as money, which in turn allowed humans to cooperate: game theoretical “reciprocal altruism” through trade, at scale and across time.

Szabo also took a keen interest in free banking, a monetary arrangement advocated by Hayek, where private banks issue their own currency not bound to any particular state. Under such a system, it’s completely up to the free market to choose which money to use. While a novel idea today (and even more so in the years before Bitcoin), free banking was a reality in the United States of the 1800s, as well as in several other countries.

Szabo also went on to put his interest into practice and sold his expertise as an internet commerce consultant by the mid 1990s, long before most saw the potential of online commerce. Most notably, he spent some time working at David Chaum’s DigiCash startup, headquartered in Amsterdam. Chaum’s company introduced the first digital cash the world had ever seen in the form of eCash: a means to make payments online as private as cash in real life was.

But it was also at DigiCash where Szabo learned about the risks of Chaum’s solution. DigiCash was a centralized company, and Szabo found it was far too easy for him and others to mess with people’s balances if they’d wanted to. Trusted parties are security holes, after all, and this risk is perhaps nowhere bigger than with money.

“The problem, in a nutshell, is that our money currently depends on trust in a third party for its value,” Szabo argued in 2005. “As many inflationary and hyperinflationary episodes during the 20th century demonstrated, this is not an ideal state of affairs.”

In fact, he considered this trust problem such an obstacle that even a typical free banking solution could suffer from it: “[P]rivate bank note issue, while it had various advantages as well as disadvantages, similarly depended on a trusted third party.”

Szabo knew he wanted to create a new form of money that did not depend on trust in any third party.

Based on his analysis of prehistoric money, Szabo had come a long way in figuring out what his ideal money would look like. First, it had to be “secure from accidental loss and theft.” Second, its value must be “unforgeably costly, and therefore considered valuable.” And third: “This value [had to be] accurately approximated by simple observations or measurements.”

Best compared to precious metals like gold, Szabo wanted to create something that was both digital and scarce, where this scarcity did not depend on any third party trust. He wanted to create a digital gold.

Precious metals and collectibles have an unforgeable scarcity due to the costliness of their creation. This once provided money the value of which was largely independent of any trusted third party. Precious metals have problems, however. […] Thus, it would be very nice if there were a protocol whereby unforgeably costly bits could be created online with minimal dependence on trusted third parties, and then securely stored, transferred, and assayed with similar minimal trust. Bit gold.

Bit Gold

Szabo first came up with Bit Gold in 1998, though he only fully described it in public in 2005. His proposed digital money scheme consisted of a combination of solutions, some of which were inspired by (or resembled) previous electronic cash concepts.

The first central property of Bit Gold was proof of work, the cryptographic trick utilized by Dr. Adam Back in his “anti-spam currency” Hashcash. Proof of work represented the unforgeable costliness Szabo was looking for, as it required real-world resources — computing power — to produce these proofs.

Bit Gold’s proof-of-work system started with a “candidate string”: basically a random number. Anyone could take this string and mathematically combine — “hash” — it with another, newly generated random number. By the nature of hashing, the result would be a new, seemingly random string of numbers: the hash. The only way to find out what this hash looks like is to actually create it — it cannot otherwise be computed or predicted.

The trick, also utilized in Hashcash, is that not all hashes are considered valid within the Bit Gold protocol. Instead, a valid hash must, for example, start with a predetermined number of zeros. Because of the unpredictable nature of hashing, the only way to find such a valid hash is trial and error. A valid hash, therefore, proves that its creator expended computing power.

This valid hash would, in turn, be the next Bit Gold candidate string. The Bit Gold system would, therefore, grow into a chain of proof-of-work hashes, and there’d always be a next candidate string to work with.

Whoever would find a valid hash would quite literally own that hash, similar to how the person that finds a bit of gold ore owns it. To establish this ownership digitally, Bit Gold used a digital ownership registry: another Hayek-inspired building block proposed by Szabo. In this registry, the hashes were to be linked to the public keys of their respective creators.

It was also through this digital ownership registry that a hash could be transferred to a new owner: The original owner would literally sign off on a transaction with a cryptographic signature.

The ownership registry was to be maintained by a Bit Gold “property club.” This property club consists of “club members” (servers) that would keep track of which public keys own which hashes. This solution somewhat resembled Wei Dai’s proposed replicated database solution for b-money; both Szabo and Dai were not only active on the Cypherpunks’ mailing list, but also on a closed email list discussing these topics.

But instead of Dai’s proof-of-stake system to keep the system up to date, Szabo proposed a “Byzantine Quorum System.” Similar to security-critical systems like airplane board computers, if only one (or a minority) of these computers should fall out of line, the system as a whole would continue to operate fine. Only if a majority of computers were to fail at the same time would the system be in trouble. Importantly, none of these checks required courts or judges or police, backed by the state monopoly on violence: It would all be voluntary.

While this system was not in itself 100 percent watertight — it could for example be Sybil attacked (the “sock puppet problem”) — Szabo believed it could work itself out. Even in the scenario where a majority of club members would attempt to cheat, the honest minority could branch off into a competing ownership registry. Users could then choose which ownership registry to use, which Szabo thought would probably be the honest one.

“If the rules are violated by the winning voters, the correct losers can exit the group and reform a new group, inheriting the old titles,” he explained. “Users of the titles (relying parties) who wish to maintain correct titles can securely verify for themselves which splinter group has correctly followed the rules and switch to the correct group.”

(As a modern-day example, this can perhaps be compared with Ethereum Classic, which maintains a version of the original Ethereum ledger that did not undo The DAO smart contract.)

Inflation

The next problem that Szabo had to solve was inflation. As computers improve over time, it would become easier and easier to generate valid hashes. This means that the hashes themselves can’t function as money very well: they would become increasingly less scarce every year, to the point where abundance would dilute all value.

Szabo figured out a solution. Once a valid hash was found, it had to be timestamped, ideally with different timestamp servers to minimize trust in any particular one. This timestamp would give an idea of how hard it was to produce the hash: an older hash would have been harder to produce than a newer hash. Markets would then determine how much any particular hash is worth relative to one another, presumably adjusting its value for the date it was found. A valid “2018 hash” should be worth much less than a valid “2008 hash.”

But this solution, of course, introduced a new problem, Szabo knew: “the bits (the puzzle solutions) from one period (anywhere from seconds to weeks, let’s say a week) to the next are not fungible.” Fungibility — the idea that any currency unit is equal to any other unit — is critical for money. A shopkeeper wants to accept a payment without having to worry about the date the money was created.

Szabo came up with a solution to this problem as well. He envisioned a sort of “second layer” solution on top of the Bit Gold base layer. This layer would consist of a type of bank, though a securely auditable bank, since the Bit Gold registry was public. These banks would collect different hashes from different time periods and, based on the value of these hashes, bundle them into packets of a combined standard value. A “2018 pack” would include more hashes than a “2008 pack,” but both packs would be worth the same.

These packs, then, were to be cut up in a specific number of units. Finally, these units could be issued by the “banks” as a private and anonymous Chaumian eCash.

“[C]ompeting banks issue digital banknotes redeemable in solution bits whose market values add up to the face value of the bank note (i.e. they create bundles of standard value),” Szabo explained.

Thus, Bit Gold was designed as a gold standard-like base layer for a free banking system of the digital age.

Bitcoin

In the 2000s, Szabo went on to earn a law degree to understand the law and contract reality he wished to replace or replicate online even better. He also started to collect and publish his ideas on a well-respected blog, “Unenumerated,” which covers topics ranging from computer science to law and politics, but also history and biology. “The list of topics for this blog […] is so vast and varied that it cannot be enumerated,” Szabo explained the title.

By 2008 — 10 years after first proposing it in private — Szabo brought up Bit Gold on his blog once again, only this time he wanted to realize a first implementation of his proposal.

“Bit Gold would greatly benefit from a demonstration, an experimental market (with e.g. a trusted third party substituted for the complex security that would be needed for a real system). Anybody want to help me code one up?” he asked in the comment section his blog.

If someone responded, it wasn’t in public. Bit Gold, in Szabo’s proposed form, was never implemented.

However, Bit Gold did serve as a key inspiration for Satoshi Nakamoto, who published the Bitcoin white paper later than same year.

“Bitcoin is an implementation of Wei Dai’s b-money proposal […] on Cypherpunks […] in 1998 and Nick Szabo’s Bitgold proposal,” Bitcoin’s pseudonymous inventor wrote on the Bitcointalk forum in 2010.

Indeed, it’s not difficult to see Bit Gold as an early draft of Bitcoin. Apart from the shared database of ownership records based on public key cryptography, the chain of proof-of-work hashes has an eerie resemblance to Bitcoin’s blockchain. And, of course, the names Bit Gold and Bitcoin are not too far apart either.

Yet, unlike systems like Hashcash and b-money, Bit Gold was conspicuously absent from the Bitcoin white paper. Some have even considered this absence so notable they took it as one of several hints that Szabo must be the man behind the Satoshi Nakamoto monicker: Who else would try to hide Bitcoin’s origins like this?

Still, while similar to Bit Gold in several ways, Bitcoin did include some improvements over Szabo’s design. In particular, where Bit Gold still relies on trusted parties to an extent — servers and the timestamp services must be trusted to some degree not to collude — Bitcoin was the first system to solve this problem entirely. It solves it very elegantly, by having the required proof-of-work system serve as both an award system and a consensus mechanism in one: The hash chain with the most proof of work is considered the valid version of history.

“Nakamoto improved a significant security shortcoming that my design had,” Szabo acknowledged in 2011, “namely by requiring a proof-of-work to be a node in the Byzantine-resilient peer-to-peer system to lessen the threat of an untrustworthy party controlling the majority of nodes and thus corrupting a number of important security features.”

Further, Bitcoin has a very different monetary model than Szabo proposed, with a fixed inflation schedule that remains unaffected by hash power increases altogether. As computing power on the Bitcoin network increases, it just means that it’s harder to find new coins.

“Instead of my automated market to account for the fact that the difficulty of puzzles can often radically change based on hardware improvements and cryptographic breakthroughs (i.e. discovering algorithms that can solve proofs-of-work faster), and the unpredictability of demand, Nakamoto designed a Byzantine-agreed algorithm adjusting the difficulty of puzzles,” Szabo explained.

“I can’t decide whether this aspect of Bitcoin is more feature or more bug,” he added, “but it does make it simpler.”

Robinhood Adds Bitcoin Cash & Litecoin Trading, Will Support Crypto Transfers

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Rapidly-expanding fintech unicorn Robinhood has added bitcoin cash and litecoin to the growing stable of cryptocurrencies that users can trade on the popular stock trading app.

The commission-free stock trading app on Thursday announced that it had onboarded its five millionth user, marking yet another milestone for the firm which achieved a $5.6 billion valuation in May at the conclusion of its $363 million Series D funding round.

In tandem with this milestone, Robinhood added full support for bitcoin cash and litecoin to its nascent cryptocurrency trading service, which is currently available in 17 U.S. states and heretofore facilitated bitcoin and ethereum trading.

Perhaps even more significantly, the firm also announced that it plans to add support for coin transfers, likely confirming reports that the company is building an in-app cryptocurrency wallet. At present, users can buy and sell cryptocurrencies on the brokerage platform but cannot deposit, withdraw, or transfer them.

Users both inside and outside of markets where Robinhood Crypto is currently available can continue to add 16 cryptocurrencies to their portfolio watchlist, and the firm has said that it plans to continue to expand the list of cryptoassets available for trading.

Armed with its hundreds of millions of dollars in funding — as well as its successful equities trading platform — the company has said that it doesn’t intend to turn a profit on cryptocurrency trading anytime soon. Rather, it will continue to operate the service as a break-even venture designed to build its market share and help it become the world’s “largest crypto platform.”

As CCN reported, Robinhood is also said to have approached federal regulators about acquiring the licenses necessary to operate as a chartered national bank, which would allow it to offer traditional banking services to its customers and also exempt it from the patchwork of state-level regulations governing money transmitter businesses. It’s not clear how far these discussions have progressed, but other fintech startups — including Square — have thus far been unsuccessful in their attempts to secure national banking charters.

Header Image from Robinhood

Featured image from Shutterstock and charts by Tradingview.

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Bear Market’s Little Helpers? A Guide to Crypto Futures

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Since their triumphant advent in the wake of the December 2017 bull run, Bitcoin futures seem to have occupied an oddly fixed position in the minds of many cryptocurrency buffs. A popular view among those who follow the dynamics of the crypto world rests on a set of established points about BTC futures: they exist since late 2017; they are offered by Cboe and CME, two respectable regulated exchanges; they help manage investment risks and as such are supposed to draw institutional money into the crypto space, mitigating price volatility and lending credence to the underlying asset.

The recent weeks, however, saw a shift in this previously serene mental landscape, as new considerations about crypto futures began to pour into media space with increased frequency. From allegations of massively suppressing crypto prices to a widening range of platforms offering crypto derivatives to a real prospect of Ethereum futures coming about soon, these developments point to the need of revisiting the realm of cryptocurrency-based futures. Now that these derivatives have been around for more than half a year, a more nuanced picture of this asset class’ role in crypto finance is emerging.

The origins

In the simplest terms, a futures contract (or a future) is an agreement to buy or sell a certain product on a fixed date. Futures are used as both an instrument for mitigating risks associated with price volatility of vital commodities, and as a tradable derivative product. A comprehensive Cointelegraph primer timed to the launch of the first regulated BTC futures last December is still there for anyone in need to recapitulate the essentials.

There were many reasons for the crypto community to eagerly anticipate Bitcoin futures’ introduction to regulated derivatives markets. Futures have long been seen as the first stepping stone on the path to reconciling the world of crypto finance with the system of traditional financial institutions. Existing within a well-defined legal and operational framework, futures contracts offer legitimacy and security that judicious Wall Street firms were waiting for in order to finally jump onto the crypto bandwagon.

Some of the collateral perks included increased liquidity of the market and transparent reference prices – in other words, more legitimacy and stability. At the same time, crypto futures held a promise for an alleged horde of retail investors who were interested in crypto assets yet wary of trading them on unregulated spot exchanges. Perhaps the biggest advantage of Bitcoin futures for this category of traders is security: since owning a cash-settled crypto future does not entail touching a coin itself, the scheme does away with fears of hacking and theft of cryptoassets. However, a flipside of not owning an actual coin is that futures traders would not be eligible for free coins in an event of a fork.

As the Chicago Board Options Exchange launched cash-settled Bitcoin futures trading on December 11, and their rivals Chicago Mercantile Exchange followed suit six day later, prices of both BTC derivatives and the coin itself surged amid an unprecedented wave of publicity. Each Cboe contract was for one Bitcoin, while each CME futures represented five. Both enabled traders to take either long (agreement to buy) or short (agreement to sell) positions, meaning that investors could bet on both increase and decline of Bitcoin price.

Cboe capitalized on their partnership with Gemini, a cryptocurrency exchange ran by the Winklevoss brothers, and used their experience with tracking crypto assets’ prices to create a tool called Cboe Gemini Bitcoin Futures Index. CME Group created its own price tracking instruments, CME CF Bitcoin Reference Rate and CME CF Bitcoin Real Time Index, in cooperation with a UK-based firm Crypto Facilities, which has a vast experience with cryptocurrency derivatives.

Playing into bears’ hands?

Despite the tremendous hype, it turned out quite soon that the volume of Bitcoin futures trading is not as impressive as the some enthusiasts could expect, eliciting the first wave of pointed criticisms. The fact that after the initial spike Bitcoin prices went steeply downhill in January did not help the derivatives market’s growth, either.

Mati Greenspan, Senior Market Analyst with a social trading and multi asset brokerage firm eToro finds this dynamic unsurprising:

“The Bitcoin futures have indeed opened up the markets to new investors who wouldn’t otherwise be involved. However, the volumes so far have been rather tepid, which isn’t much of a surprise. Bitcoin’s price has been falling steadily this year and as long as the direction is down, there’s little incentive to jump in.”

While it is enticing to attribute the underwhelming trading volumes to the decline in the underlying assets’ valuation, some observers point out that the two are actually tied in a kind of an egg-and-chicken cycle, mutually influencing each other. As early as in January, when a multitude of versions explaining the crash of Bitcoin price began to emerge in media space, one of the less-visible yet sound considerations was that futures trading had opened the crypto markets to bear investors.

A curious pattern showcasing retail and institutional investors’ diverging strategies with regard to futures trading could serve as indirect evidence to such claims. As a January Wall Street Journal study had uncovered, ‘little guys’ were the ones who were more likely to wager on the rise of BTC prices, while institutional players tended to short.

At the time, however, these concerns seemed to have faded from the mainstream media’s radars. It wasn’t until May that they resurfaced full-blown following the publication of the San Francisco Federal Reserve Bank’s letter suggesting that the advent of Bitcoin futures and the coin’s price decline did not ‘appear to be a coincidence.’ The Fed analysists explained that the rise of crypto futures for the first time gave the ‘pessimists’ a tool to counteract the ‘optimists’ who had previously fueled the growth unimpeded. Another attestation in a similar vein has been Fundstrat’s Thomas Lee’s attribution of falling Bitcoin prices to Cboe futures’ expiration that made rounds in mid-June.

Yet the issue seems to be far from settled towards either of the two poles: those voices who blame Bitcoin futures for declining crypto prices encounter equally robust arguments from the other side.

“I’ve done the math recently and it doesn’t seem to add up,” – says Mati Greenspan, maintaining that the size of the futures market is simply not sufficient to thrust the whole crypto ecosystem into an extended bear cycle.

Rohit Kulkarni, Managing Director and Head of Research for investment platform SharesPost, acknowledges some influence that ‘pessimistic speculators’ have exerted, but attributes the bulk of the blame to the regulatory turbulence of the first half of 2018:

“The subsequent [to December 2017] bitcoin price declines were not caused by the introduction of these futures, but rather the regulatory uncertainty surrounding the cryptocurrency market. In addition, we believe irrational speculation by pessimistic investors has also contributed to the price movement over the past six months. As such, we see the ongoing crypto bear market as clearly cleansing the ecosystem from short-term oriented speculators, which will be good for the crypto ecosystem long-term.”

Further adoption

Over the last half a year, Cboe and CME were not the only entities to have a dig at crypto futures, and Bitcoin was not the only asset underlying these contracts. Since March, UK-based financial institutions were responsible for a steady supply of breaking news in this domain. In March, a British cryptocurrency exchange operator Coinfloor made headlines by announcing the launch of the first physically settled Bitcoin-based futures product.

Also in March, it suddenly emerged that the abovementioned startup Crypto Facilities has been offering futures contracts tied to Ripple’s XRP token since October 2016, without much publicity, for some reason. On May 11, Crypto Facilities exploded another bombshell in the crypto space, revealing ETH/USD futures as their latest offering. And to crown it all, in June the same company unveiled the first regulated Litecoin futures.

Due to regulatory hurdles, staggering cavalry charges like these would hardly be possible across the Atlantic. Some of the established players in the US, who seem to be in a position to join the crypto derivatives race, remain undecided.

Yet this is not to say that the US companies halted their efforts to facilitate crypto-based derivatives trading. During the first week of May, the New York Times reported that both Goldman Sachs and the New York Stock Exchange were briskly moving ahead with their plans to launch crypto trading platforms and products. A few weeks later, a Pennsylvania-based Susquehanna International Group listed Bitcoin futures among their financial products.

The Ides of June saw a regulatory breakthrough that might prove highly consequential for crypto futures in the US, as the SEC Corporation Finance Director William Hinman had shed some light on Ethereum’s status as perceived by the regulator, suggesting that ‘current offers and sales of ether are not securities transactions.’ This statement has energized the industry and prompted Chris Concannon, Cboe’s crypto-savvy president, to speak of futures on ETH as of a settled deal. If Cboe breaks the path with such a product, it’s not difficult to imagine CME catching up quickly, given the firm’s partnership with Crypto Facilities, whose Ethereum derivatives infrastructure is already in place.

Evidently, despite all the challenges, cryptocurrency-based futures have to a significant extent succeeded in facilitating institutional capital’s entry into the cryptofinancial ecosystem. Most experts are positive with regard to further development of this trend, envisioning crypto assets as a legitimate element of the financial system.

“As we approach the anniversary of futures trading, we expect more institutional investors to make big moves with crypto dedicated funds. One recent example of this was the recent announcement of A16Z, a $300 million crypto fund launched by Andreessen Horowitz dedicated to investing in cryptocurrencies and other blockchain-related projects,” – notes Kulkarni.

Shane Brett, Co-founder and CEO of blockchain solutions provider GECKO Governance, appears to be on the same page:

“The emergence of cryptocurrency futures is a definite sign of increased mainstream adoption on the horizon, as it serves to speed up the legitimation and maturation of the market.”

Speaking of the ‘little guy’ retail investor, the direct benefits of the introduction of crypto futures have likely been more modest so far.

“There really isn’t much benefit for Main Street investors to use the Wall Street futures. They can just as easily buy bitcoin directly. As well, the minimum contract size on the futures could be a barrier to entry. The contracts of the CME are set at blocks of 5 BTC each, which is more than most retail customers are used to dealing with. Even the CBOE contracts that are set at 1 BTC each are difficult to deal with for most people,” – concludes eToro’s Mati Greenspan.

Nick Spanos’s Zap Jolts Real Estate With Blockchain-Based Smart Contracts

New York realtors looking to avoid hiccups in their commission payouts can now turn to blockchain-based smart contracts. The first real estate commission split was brokered earlier this summer in Manhattan’s ritzy SoHo neighborhood by New York-based Bapple Realty.

Enabled through data uploaded onto the Zap platform, the seller divvied up a $3,400 commission — paid in Ethereum tokens — to pay the brokerage and the agents involved in the transaction.

Bapple itself is no stranger to blockchain technology and the use of cryptocurrencies. In 2014, the firm agreed to an $18,000 rent and commissions payment with bitcoin. With the current deal, the infusion of blockchain technology within the real estate industry becomes more solidified.

A primary requirement in implementing the blockchain-based transaction included the input of oracles: real world information uploaded into a decentralized application. This is where Zap, founded by Nick Spanos, comes into the picture.

Zap.org, a product of the Synapse Foundation, uses an Ethereum-based ERC 20 token (ZAP) to power its oracle marketplace for smart contracts.  

The opportunity to expand blockchain technology further into the real estate industry this summer came about as a Zap client and a Nordic Blockchain Association board member was looking to find a Manhattan-area apartment. At the time, Zap was conducting beta testing of its Android app for smart contracts.

“We thought this would be a good use case,” Spanos told Bitcoin Magazine in an interview.

Spanos, who also founded Bitcoin Center NYC and Blockchain Technologies Corp., explained that implementing smart contracts guarantees agents receive their agreed-upon commissions at the same time as their broker-fee payment.

“The industry needs smart contracts,” Spanos said. “In a real estate office, many people have disagreements because of informal oral agreements that are subject to people’s sometimes-selective memory. However, if their wallet is in the smart contract tied to the deal, it is fixed and immutable. You’re either in or you’re not. Trust is automated.”

Spanos added that Zap is currently testing an app that will allow real estate professionals to build and customize all types of contracts.

“It will compile them and put them on the blockchain,” Spanos said to Bitcoin Magazine. “It’s a small step in the vast potential for smart contracts, but a huge leap for the entire real estate industry.”

Real Estate: Just “One Small Use Case”

While Spanos describes Zap’s progress in the real estate industry as just “one small use case,” the organization itself continues work on expanding its marketplace to incorporate smart contract-compatible data.

“We have vendors preparing to sell every type of data feed, from political data to meteorological data, that will allow smart contracts to execute trades on futures based on anticipated crop yield.”

Spanos added, “ Zap.org recently partnered with Stox prediction markets to be a provider of consensus-verified data.”

A long-time advocate of Bitcoin and blockchains, Spanos’s enthusiasm for the technology continues to grow.

“When was the last time you heard of a technology that, when you think of any given problem, there’s a way that a single technology could be part of the solution? That’s how blockchain is the internet, reinvented,” Spanos said.

“The world has a trust protocol, where financial events can be triggered without depending on an intermediary. The trust revolution is the next revolution. The crypto economy will set the internet free from legacy holdovers in banking and government, and now, any form of exchange can be decentralized.”

In May 2018, Zap announced that it had developed a secure supply management and smart contracts DApp specifically for the oil and gas industry called EnergyLedger.

India May Avoid Cryptocurrency Ban, Classify them as Commodities: Report

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Authorities in India are likely to choose against a sweeping cryptocurrency ban and treat them as commodities, a report citing a government official has claimed.

Citing a senior government official involved in the ongoing regulatory discussion surrounding cryptocurrencies, Quartz is reporting that India is unlikely to enforce a blanket ban on cryptocurrencies despite the newly-enforced central bank mandate that prohibits banks from providing services to the burgeoning sector.

As reported previously, the Reserve Bank of India (RBI) issued a circular in April to bar all regulated financial institutions in the country from allowing their customers to purchase cryptocurrencies through their bank accounts and stopping services to cryptocurrency businesses altogether. The central bank’s policy, which went into effect on July 5th, came despite the establishment of an inter-governmental committee comprising of multiple government ministries and domestic banks tasked to propose a regulatory framework for the sector in 2017.

Contrary to the usual regional media narrative, the official has revealed that the notion of a blanket crypto ban hasn’t been considered. “I don’t think anyone is really thinking of banning it (cryptocurrencies) altogether,” the senior government official with knowledge of the panel’s discussions told Quartz.

Instead, the panel’s concerns are more inclined with regulating cryptocurrency trading to keep a track of the money trail.

Drawing a direct parallel to traditional trading markets, the official stated:

“Trade is not a criminal offence. Most of us trade in various asset classes in the stock market. So how is this [cryptocurrency trading] any different? What has to be in place is a mechanism to be sure that the money used is not illegal money, and to track its source is the most important thing.”

Last month, the head of the same government panel and secretary of the department of economic affairs confirmed the panel had made headway in drafting a regulatory framework and is currently in an advanced stage with guidelines expected to be published in July.

“Allowing it as (a) commodity may let us better regulate trade and so that is being looked at,” the anonymous official confirmed on Wednesday’s report, soothing fears among domestic cryptocurrency adopters and the wider industry.

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Blockchain in Telecoms Will Become $1 Billion Industry by 2023: Report

Blockchain will contribute almost $1 billion to the telecoms sector alone within the next five years, MarketWatch reports Wednesday, July 11. a new research forecasts this week.

According to a global market research store Research and Markets, blockchain technology in telecoms will explode from a $46.6 million industry in 2018 to one worth $993.8 million in 2023.

The 132-page report singles out “rising security concerns” as one of the major factors driving the spread of blockchain, which operators in the arena view as a potential safeguard despite its still-fluid regulatory status.

“The blockchain in telecom market is driven by various factors, such as the increasing support for OSS/BSS [operations support systems/ business support systems] processes and rising security concerns among telcos,” an abstract of the report summarizes.

“However, growing concerns over the authenticity of users, and uncertain regulatory status and the lack of common standards can hinder the growth of the market.”

That regulatory uncertainty forms one of a series of reservations which other sectors of the global economy have raised in recent weeks as part of what some have described as waning confidence in blockchain’s benefits.

As Cointelegraph reported, the banking sector in particular has voiced doubts about how the technology can bring mass innovation, while other projects aim at addressing concerns from businesses over its adoption.

Research and Markets nevertheless appears unfazed by the broader mixed reception, foreseeing an 84 percent compound annual growth rate (CAGR) for blockchain in telecoms.

Crypto Market Drops Another $10 Billion as Bitcoin Price Retreats to $6,150

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Over the past 24 hours, the valuation of the crypto market has dropped by $10 billion, as bitcoin fell to $6,150 and ether dropped below $440.

Even after recording a steep 5 percent fall from $6,700 to $6,400 and demonstrating an oversold condition with low Relative Strength Index (RSI), bitcoin struggled to rebound and attempt a corrective rally.

Low Volume

On July 11, CCN reported that a corrective rally is unlikely even with bitcoin at $7,400 due to its low volume and overly strong downtrend. Although bitcoin broke RSI trendlines with optimistic momentum indicators, its low volume at $3.6 billion prevented the dominant cryptocurrency from surging to the upside.

CCN’s report that was released yesterday read:

“If bitcoin had rebounded to the $6,600 mark in the past 12 hours, a corrective rally could have occured, delaying or even preventing another drop in the short-term to the lower end of $6,300. However, after briefly recovering to $6,413, the price of bitcoin fell again to the mid-$6,300 region, reducing the probability of a bear trend reversal and corrective rally in the upcoming days.”

The condition of the bitcoin market remains nearly identical, with lower a daily volume and stronger downtrend. The RSI of BTC is still showing oversold conditions, which may lead BTC to climb back up to $6,250. But, at this point, given that BTC has failed to rebound to $6,200 over the past three hours, a further drop below the $6,100 mark is expected.

On a downward trajectory, small cryptocurrencies and tokens often tend to perform worse than major digital assets like bitcoin, ether, Ripple, and Bitcoin Cash. Tokens like Power Ledger, Nebulas, Ontology, Pundi X and Bancor, which performed relatively well throughout April and May, dropped by another 10 percent in the past 24 hours, after recording large losses in the past three days.

The low volume and lack of demand from bulls have reduced the probability of a corrective rally occurring in the next 24 to 48 hours. If bitcoin can recover back to $6,300 and stabilize in that region, it could eye a move towards $6,400. However, if BTC fails to find any momentum at this price range, a further drop is inevitable.

Where are $50k and $60k Price Targets Coming From?

Based on the trend of the market over the past two weeks, the $50,000 price target for BTC of many large investors and experts seem highly unlikely.

In essence, $50,000 and $60,000 BTC price targets by the end of 2018 are based on an assumption that a significant change can be made on the regulatory side of the cryptocurrency sector that can enable various publicly tradable instruments like bitcoin exchange-traded funds (ETFs).

Bitcoin could certainly rebound past its all-time high and eye a rally to $50,000 in the long-term. As Coinbase CTO Balaji Srinivasan said, the crypto sector has always gone through the pattern of bubble-crash-build-rally since 2010.

Featured image from Shutterstock.

Featured image from Shutterstock and charts by Tradingview.

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Australia: Crypto Exchange Bitcoin.Com.Au Appoints Ex-Exec of Accounting Giant PwC as CEO

Australian cryptocurrency exchange bitcoin.com.au has appointed former consulting giant PricewaterhouseCoopers (PwC) executive Ben Ingram as its new CEO, Business Insider Australia reports today, July 12.

Ingram held the role of director in charge of digital strategy at Big Four auditor PwC, leaving the company in March of this year.

Business Insider Australia writes that Ingram’s work at bitcoin.com.au will include both improving the exchange’s trading functionality and focusing on expanding crypto-based financial products into the traditional market space.

Ingram specifically mentioned instituting crypto investment products into areas like superannuation, which is a company-created organizational pension plan for employees. He also noted that the emergence of crypto-focused funds could “perhaps [be] a hedge against poorly managed central bank currencies.”

Ingram told Business Insider Australia that bitcoin.com.au can be considered more of a gateway service than a full crypto exchange, as it provides same-day settlements, letting people get into Bitcoin (BTC) and “importantly, get back out of bitcoin.”

Bitcoin.com.au currently offers transactions in Bitcoin and Ethereum (ETH), having added ETH in March, though Ingram noted the firm would like to add other cryptocurrencies in future.

Ingram also voiced his personal interest in the technology behind cryptocurrency, telling Business Insider that the “core premise of distributed ledger technology (DLT) has very obvious widespread appeal. Even if the tech capabilities at present aren’t capable, I think humans will prevail,” continuing:

“We know this tech doesn’t have a dead-end. While the evolutionary path hasn’t been fully determined, I think there’s enough evidence that there is a path.”

Ingram isn’t the first Wall Street exec to join the crypto sphere, as an apparent exodus from traditional financial markets into crypto has been ongoing since this spring.

In March, bitcoin.com.au made buying BTC and ETH for fiat possible at 1,200 newsstands across Australia.

Australia, which ended the practice of double taxation of cryptocurrencies in July 2017, is considered by some to be a growing cryptocurrency hub. The government recently signed a $740 million deal with IBM to use blockchain and other new technologies to improve data security.