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Telegram and SEC Showdown Heats Up As Industry Waits With Bated Breath

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Cryptocurrency organizations have always had clashes with regulatory agencies and as time progresses the winds have been changing. In recent weeks, one major case involving the messaging platform Telegram and the Securities and Exchange Commission [SEC] has taken the case.

Touted to be one of the biggest cases in cryptocurrency history, several sectors of the fintech market, as well as the mainstream market, have sat up to take notice.

The issue pertains to the SEC taking Telegram head-on over its $1.7 billion token sales back in 2018. The Securities and Exchange Commission [SEC] stated that the Telegram had violated investor protection laws during the function. It claimed that Telegram token was actually security and not a currency, thereby subjecting it to a different set of laws.

The ongoing issue touches other things as well, such as the fact that it tests a rare two-part deal structure that the messaging platform used to hide from prying eyes. The SEC faces an uphill battle, however, because Telegram was not a weak opponent. Being used to scammers who swindle money using, Telegram acts as a different ball game after having Wall Street firms on their roster.

Companies like Kleiner Perkins Caufield & Byers and employees from SoftBank and Fortress investment were also a part of the group. Kenneth Herzinger, a partner at Orrick Herrington & Sutcliffe LLP had said:

“This is the biggest SEC cryptocurrency case yet. They have it all out on the line, and they’re pulling out all the stops. Until now, no court has dug into and addressed any of these complex issues before. If the SEC loses, it will certainly ripple through the industry.

Law enforcement agencies in the United States have also been wary of Telegram’s user base. Telegram’s encryption feature was also seen as a concern by the SEC. At one point, some ISIS proponents also used the messaging platform along with protestors in Hong Kong.

Telegram has deflected the claims made by the SEC thoroughly and explained why it skipped it. According to Telegram, it circumvented the SEC because investors did not actually receive the asset known as grams. By the time they receive Grams, the coin would be a commodity and out of its reach. The SEC countered by claiming investors were into the product only because of its profit-making capabilities. This sentiment made it look like an investment rather.

Companies such as GV, the venture capital arm of Alphabet had also considered investing in Telegram’s Grams. The lack of information surrounding this has been the major cause of this uncertainty.

 

Billion Dollar Startup Exits in Fintech

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The billion-dollar fintech startups list has 1 in 10 exits the market through a high valuation merger, acquisition or IPO. There is a staggering amount of fintech startups evolving every day and scaling cross borders. Venture capitalists are pouring more capital to support the next wave of scale.

Ideally, ideas originating from one location are developing and evolving elsewhere. A 2019 survey by Global Fintech Adoption suggested 96% of respondents were aware of at least one financial technology service. 75% of them had used a financial technology product or even money transfer. 

Looking at the figures, Fintech has not only evolved into a mainstream space but also become hypercompetitive. 

Billion Dollar Valuation Startups in Asia

The rate of cashouts and investment is also alarming. Fifteen financial technology firms in China have had exits valued at 1 billion dollar valuation, within the past three years. Data-driven studies in Asia indicate that South East Asia witnessed a record 80 deals and $700 million of investment in Q3 2019. 

The figures are accelerating in Africa as well, where fintech startups doubled their volume between Q2 and Q3 of 2019. Meanwhile, the promising behavior of the space has guaranteed incumbent firms to transform their business models. In fact, these entire space seems to be piquing investor interest be it -; insurance technology, on-demand fintech services, payment processing and so on. 

The leading nations with upperhand in fintech startups remained to be Hong Kong and China. While global startups in the industry raised a combined sum of $45 billion, both countries raised $26 billion. That is owing to the figures collected in 2018. The trend in the past year is evenly tremendous and we might see the amounts hit a peak this year. 

Since 2017, fifteen China and Hong Kong based fintech startups have exited through a merger or an Initial Public Offering at a billion dollar plus valuation. Prior to that year there had never been any $1 billion valuation exit from those regions. 

CBInsights Charts for High Valuation Fintech Exits

 

According to CBInsights, Zhong Insurance became the most valued exit with a whopping $11 billion dollar valuation. The leading insurance technology company came to birth following joint efforts by tech giants Ping An, Alibaba and Tencent. ZhongAn is China’s first online insurance service provider to have broken the $1.49 billion premium. 

valuation at the time of exit

Moreover, we have Challenger banks that are directly manifesting more holistic solutions to customers. The banks saw a blockbuster 2019 after raising over $3 billion in Q3.

Note that the banks are a spectacular phenomenon for customer money, paycheck, provision of intelligent insights for financial forecasting and the best in class financial technology products. There are at least 75 challenger banks today and we expect the number to grow this year. 

Qudian, an electronics retailer based in Beijing went public at a $7.9 billion valuation in 2017, following a $955 million in funding. In 2018, Carlyle and TPG Capital led a consortium of investors that bought  Du Xiamon Financial Services for $4 billion. 

The latest billion-dollar fintech startup in the spin of high valuation exists is OneConnect. A financial accounting management infrastructure, OneConnect went public at a $3.7 billion valuation in December. Hong Kong-based Futu Securities an online trading platform went public in March  2019 and exited with a $1 billion dollar valuation. 

 

Source: CBINSIGHTS

 

Bitcoin Cash Miners Pushing BCH Ecosystem Via Development Fund Infrastructure

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Bitcoin Cash Miners Pushing BCH Ecosystem Via Development Fund Infrastructure

The latest reports reveal that Bitcoin cash miners have to donate part of their profits to the development of the ecosystem. It was announced by Jiang Zhuoer, CEO of BTC.TOP, the largest Bitcoin Cash (BCH) mining pool. 

Jiang Zhuoer notes that miners should voluntarily transfer 12.5% of Bitcoin Cash (BCH) block rewards to a development fund. Besides BTC.TOP, Antpool, Antpool and ViaBTC и Bitcoin.com are the other large mining pools who are supporting the idea. Jiang quickly noted that; 

“12.5% of [the] BCH coinbase rewards to a fund that will support Bitcoin Cash infrastructure.”

 The fund is a Hong Kong-based entity, set up legally for accepting and dispersing funds and to provide funding up to six months for supporting the infrastructure of Bitcoin Cash.

 The sole aim of the fund is to execute this proposal into the May 2020 protocol upgrade of Bitcoin Cash. Amount of funds received per day would be approximately 112.5 BCH, and in six months it would become 20, 588 BCH. According to the current market prices of BCH, the fund is to receive an estimated $7.1 million in aggregate.

 The proposal has got support from other large mining pools that are working on Bitcoin Cash. Among other mining pools include BTC.com, Antpool, Bitcoin.com, and ViaBTC. More importantly, these five pools depict about 34.5% or more than a third of Bitcoin Cash’s hash rate.

 Furthermore, there have remained debates over funding BCH infrastructure development. Last summer, the Bitcoin Cash community accumulated money to go towards several BCH development teams. Recently, five pools have shown their desire for donating funds to engineering teams working on the development infrastructure.

 Zhuoer also mentioned that the corporate donation process on the verge of a few significant problems. One of the miners said that Zhuoer’s example of corporate donations that went badly is the influence of Blockstream over the development of Bitcoin Core’s which served centralization in BTC’s development. Besides, the blog post of Zhuoer emphasizes that centralized development has brought impediments to Satoshi’s plan.

 As per blog post, this proposal may be disputatious, and some in the community may have distrust toward it. However, despite the difficulties, the plan will move further.

 

Swiss Banks to Support Cryptocurrencies Including Bitcoin

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SEBA Bank AG took its start in November 2019 with a versatile banking license and a suite of services such as fiat storage, crypto custody, and a crypto-connected debit card that converts to fiat for shopping daily and crypto trading through the mobile app of the bank.

 As said by Guido Bühler, CEO SEBA BANK AG, the bank accumulated an estimated $103.4 million from angel investors like Guy Schwarzenbach, who founded Black River Asset Management. Schwarzenbach added that the pricing for trades in the SEBA app, permitted by the process of API integrations with exchanges functioning globally, provided the most competitive pricing compared to over-the-counter trades. He further said:

 “What I am really excited about for SEBA… is their upcoming deployment of a margin and lending business, including options and derivatives.”

 SEBA bank was the first bitcoin-backing Swiss bank. However, Falcon, a private bank, in 2017 started offering bitcoin management services. Monetary Systems Lead of World Economic Forum, Matthew Blake called crypto-based and licensed banks as:

 “A rising trend and something institutions can do to hedge.”

 Similarly, a crypto startup of Switzerland, Bitcoin Suisse also registered for a versatile banking license to offer several services from staking to loans.

 Marketing Lead of the startup said that Suisse was not applying for a banking license just to be like every other bank, we were pioneers at heart. He further said that they would, of course, offer cash accounts for their clients in their name. More importantly, they would be capable of start trading crypto securities, stablecoins, and synthetics like mini-futures and products to short the major crypto assets. 

 Among crypto-based banks so far, SEBA Bank provides a unique ability to acquire several kinds of fiat currencies which include US dollars, Hong Kong dollars, and Singapore dollars, and trade cryptocurrencies such as Bitcoin, Ethereum, and Stellar.

 CEO SEBA Bank Bühler stated:

  “You can open an account over the phone in 15 minutes, for an accredited investor, you don’t have to go to Switzerland. There’s always going to be aspects that banks are required for, and the first one is the storage of your private key.” 

 As per Bühler, excluding the United States, the young bank already offers services to individuals having high net worth and institutional investors from all over the world, and a few blockchain startups. 

 To Schwarzenbach, bitcoin banking makes sense for security profits. He would not desire the risk of someone to hurt him to get his bitcoin stash. He added that open source decentralized finance (Defi) platforms eventually and comparatively provide financial infrastructure to both the general and proverbial population.

 

OKEx COO Leaves OKEx to Start his Own Blockchain Consulting Firm BitWork

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Andy Cheung, the Chief operating officer (COO) of the largest crypto exchange OKEx has resigned the exchange to start his own blockchain consulting firm. Per the announcement, the new venture is known as “BitWork” which aims to drive “the mass adoption of cryptocurrencies”.

OKEx’s COO Resigns

Cheung served OKEx since 2017 and concerning his new venture, he said;

“My goal is to drive mass cryptocurrency adoption. But my contribution can be very limited in a cryptocurrency exchange. I decided, and we agreed amicably, that I can better achieve my goals with a new venture,”

Interestingly, a similar effect can be seen in Cheung’s Twitter bio which reads “cofounder and CEO at BitWork, Former COO at OKEx”. However, he also thanked OKEx in his most recent tweet and appears as equally excited to begin his new journey ahead;

It’s sad to leave the world’s largest crypto exchange. It really has been a pleasure in so many ways, and a wonderful learning experience. Thank you OKEx! Ready to begin my new journey ahead

As part of OKEx, it isn’t yet clear who will or has replaced Cheung’s position. However, for Cheung, the key priority is to resolve several questions he gets asked from blockchain projects such as “How to improve the quality of a project?”, “What do the markets need?” – and unlike. Cheung is building the one-stop solution to help these projects get exposure. He went on to say that BitWork will enable projects to connect with different markets and bring mass crypto adoption. As such, BitWork launched and operates in Hong Kong with key services including, advisory, branding, fundraising, marketing, and event management services to crypto and blockchain projects.

Before OKEx, Cheung worked across various industries and has been a seasoned entrepreneur. More so, Cheung has been named among the top crypto influencers announced by crypto media including CryptoSlate, Block Journal, CoinTelegraph and Bitcoin Insider.

Billionaire Mark Cuban and Ari Paul on Bitcoin as a weapon against oppression

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Recently, Ari Paul, co-founder and CIO of BlockTower Capital, tweeted a December 23 news highlighting a rally in Hong Kong, condemning “a police crackdown on a major fundraising platform for anti-government protesters and to call for sanctions against HSBC.” 

His post mentioned technology Billionaire Mark Cuban’s history of being an honest critic of Bitcoin and cryptocurrency. In addition, Mark said that Bitcoin is “too difficult to use, too easy to hack, way too easy to lose, too hard to understand, and too hard to assess value,” although he does not oppose it. 

ari paul tweet

As reported by South China morning post, police froze funds raised by the Spark Alliance platform to support protesters. In November, HSBC closed Spark Alliance’s bank account. 

Permissionless cryptocurrency is a defence

While Paul was pointing at the fact that possessing digital currency like Bitcoin is beneficial at times like people are going through in Hong Kong, where their property is being seized. 

In response, Mark “asked” Paul a series of questions, making a point that even Bitcoin can be frozen in any exchange and that “crypto works in oppressive regimes until the dictator feels threatened by it.”

mark

Paul explained that even though he believes Bitcoin is a safer bet, it is not perfect. 

He clarified that there is nothing that cannot be confiscated in all contexts, and called Bitcoin “seizure resistant.” Paul also said, “There is no perfect solution against oppression, but bitcoin is a powerful defensive weapon.”

He added, 

“Used by an expert, bitcoin is probably truly impossible to confiscate or censor, but few people can or will use it this way.  The more powerful point is that it impedes mass censorship or mass confiscation, and in practice, this is a game changing difference.”

Bitcoin Bandwagon

At the end of the long discussion on how Bitcoin could be a better option, a Twitter user @CryptoMarcobro commented, 

“Well I’m willing to bet Mark Cuban learned at least one thing from this chain of Tweets.   

Thank you Ari Paul for all that you do in this space! 

Much respect for both of these Warriors!”

To this, Mark replied,

“I learned that BTC ultra enthusiasts still think they are invisible to the government tactics they condemn, even after admitting that only the most advanced users have the knowledge required to avoid those measures while the vast majority of BTC are and will remain susceptible,”

“False binary that doesn’t at all reflect the nuanced arguments I provided,” Paul said. He also added that, in his opinion, it was equivalent to saying, “holders of USD don’t know their money can be confiscated without trial.” He called this “reductive, and…wrong.”

Amidst several comments in support of Bitcoin, and questioning his knowledge of Bitcoin’s use cases, Mark jumped in to compare the Bitcoin “bandwagon” to stock supporters. Similar to Bitcoin supporters, stock “partisans” on the Yahoo Finance boards would “try to convey how right they were about their favourite stock and how wrong everyone else was for any number of technical or other reasons.”

Bitcoin faced similar criticisms to the Internet and personal computers, when they were introduced, said Paul. 

Capture

The exchange of knowledge continued, with Mark reflecting on how it was easy for Bitcoin to take over digital products that were introduced in the “analogue world,” in terms of adoption. Mark said, “BTC is a digital product born into a digital world.”

“Pokeman and Candy Crush have taken off more than BTC. And why didn’t they use a btc crowdfunding solution ?”

Although there was no clear conclusion to this discussion, Paul stayed firm on his opinion of Bitcoin being a great option for people in need.

BitClub Network founders in hot water as investors call out scam worth $722 million

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The cryptocurrency market has been abounding with scams and frauds for a long time now, and millions of people have suffered from it. Despite the reduced occurring of these events now, one or two never fail to shock the crypto world. Just recently, the BitClub Network [BCN] and its five top members were found to be in hot water after cheating investors off $722 million.

The BCN had promised its investors that their money would be used to purchase mining equipment, and once they start producing Bitcoin, the investors would get a cut too. Federal prosecutors in the United States have taken multiple angles to analyse this case and concluded that it was a “high tech plot” in the “complex world of cryptocurrencies”.

The company even gave rewards to existing investors in exchange for recruiting others to join; a model made famous by the pyramid and Ponzi schemes. Revelations from reports showed that the founders [Matthew Brent Goettsche, Jobadiah Sinclair Weeks, and Silviu Catalin Balaci] had blatantly taken advantage of ill-informed investors and even called them “dumb” and “sheep.”

Some users in the space had first spotted discrepancies in the BCN ecosystem, with Japhet Mesa from Zambia being a major whistleblower. In a Medium post, Mesa had claimed:

“Unlike actual mining sites like Genesis Mining (please distinguish between miners and pool miners), the BCN website does not state who the owners or people behind the operations are. In fact, the website states vaguely that “BitClub is not owned by any single person or entity, we are a team of experts, entrepreneurs, professionals, network marketers, and programming geeks who have all come to together to launch a very simple business around a very complex industry”

The victims were still not identified, but the range of the company is far and wide. An advert was spotted on the Ben Franklin Technology Partners website where people were offered a “Founder” status for people who agree to purchase its mining pools.

Scams and frauds have been prevalent in the cryptocurrency space, especially since the 2017 Bitcoin boom. Since then, significant issues have rocked the crypto world, which was spread across the planet. A precursory analysis showed that countries such as the United States, Japan and some European countries where hotspots for scammers to capitalise on innocent citizens.

During the beginning of this year, investors in Hong Kong had claimed that they had lost almost HK$3 million in a crypto promoter stunt. The investors, aged between 20 and 50 suffered losses between HK$20,000 and HK$1 million each.

Disclaimer: The presented information is subjected to market conditions and may include the very own opinion of the author. Please do your ‘very own’ market research before making any investment in cryptocurrencies. Neither the writer nor the publication (TronWeekly.com) holds any responsibility for your financial loss.

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Ripple partner signs new partnership with Alipay; targets burgeoning Asian remittance market

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The entire cryptocurrency industry has noticed Ripple’s focus on the remittance market, and that has led to other organization wading into the field. In a new turn of events, Finablr, one of Ripple’s more popular and celebrated partners, announced their partnership with Alipay, the subsidiary of the Jack Ma founded Ali Express.

The deal will allow Finablr to use the Ant Blockchain Information System in a bid to attract more customers from Asian bigwigs such as China. Cryptocurrency proponents are expecting some retaliation towards Finablr from Ripple supporters, but as of now, there has been no significant ruckus from their end. Clara Shi, the head of global remittances business at Alipay, had stated:

“Using blockchain technology developed by Alipay, we have helped launch a blockchain remittance service between our e-wallet partners AlipayHK and GCash, providing round-the-clock, real-time transfers between Hong Kong and the Philippines. We are excited to partner with Finablr for global remittances, as we continue to explore new ways to apply our technology in order to benefit more people around the world”

The main of the partnership has been to expand the support and the networks of remittance network users in China as well as other major Asian countries. Once the system is in place and the partnership takes off, an Alipay e-wallet user will technically be able to send capital to another person on Finablr’s system.

Finablr has created waves in the United Arab Emirates remittance sector, an industry that is seen as the burgeoning growing field for the world’s largest remittances market. Promoth Manghat, the CEO of Finablr, had stated that one of the main focuses of the partnership was to empower the financial aspirations of billions of consumers with enhanced access and convenience for their cross-border payment needs.

Finablr has also been pretty active in partnering with mainstream companies, and its team-up with Samsung in October stood out. Finablr and Samsung were working together to take Money Transfer, a service available only in the US, to other countries as well.

The Ripple partner had said that the cooperation with the South Korean technology giant would involve creating a new in-app feature that will allow fund remittance to foreign recipients. The service will be spread to 47 other countries, including major ones such as Australia, Britain, China, Mexico, and Vietnam.

The Finablr owner Travelex will be responsible for handling worldwide transactions. Although cryptocurrency enthusiasts are fervently waiting for the process to use Ripple’s financial framework, the company has stated that it will continue to use SWIFT for all its transactions for the time being.

Disclaimer: The presented information is subjected to market conditions and may include the very own opinion of the author. Please do your ‘very own’ market research before making any investment in cryptocurrencies. Neither the writer nor the publication (TronWeekly.com) holds any responsibility for your financial loss.

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Major Chinese newspaper urges the US and China to work together in the blockchain

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The developments and creations in the United States and China have been driving the financial market, and the mainstream race has also been reflected in the cryptocurrency industry. With China revealing new details about its positive push into the digital asset industry, the US has been trying to keep pace with the Red Dragon.

Movements on social media platforms have mostly created the general dislike surrounding the two political and technological giants. Still, some members of the community have also taken a positive spin on it.

In a recent piece written by Edward Tse for the South China Morning Post, the author explained how blockchain could help in solving a lot of finance and economics issues. He suggested that if companies from both countries worked together, then it could result in substantial growth in the overall industry. He stated that:

“According to PwC, 40 percent of food companies find food fraud difficult to detect with current methods and 39 percent believe their products are easy to counterfeit. Blockchain could be the answer to such supply chain frictions.”

China has been thinking big in the blockchain industry and has even recently published regulations on blockchain use to cater for a significant increase in applications. In 2018 a blockchain platform was launched in Shenzen to serve the Guangdong-Hong Kong-Macau Greater Bay Area.

The United States, on the other hand, has been watching its back as China continues its spree to the top of the industry. During February of this year, Donald Trump ratified an executive order to put America at the top, which was rebooted again last month by a group of experts who work to propagate public policy on technology, education, and homeland security.

The States have also banned companies such as Huawei from operating within its borders, and the author believes that such bans will only result in the zero-sum game. Tse further opined that collaborations are the key to proper sustainability and even cited recent examples that prove his point.

Companies such as IBM, Walmart, Tsinghua, and JD.com had partnered up on a blockchain project in December 2017 to create food safety solutions using IBM’s blockchain platform. Edward Tse concluded by saying:

“Though differences exist, and will continue to exist, the world will benefit if the two leading economic powers can seek commonalities, rebuild trust, cooperate on technological initiatives, and establish global governance and code of conduct on blockchain technology and its applications.”

Disclaimer: The presented information is subjected to market conditions and may include the very own opinion of the author. Please do your ‘very own’ market research before making any investment in cryptocurrencies. Neither the writer nor the publication (TronWeekly.com) holds any responsibility for your financial loss.

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Bitcoin draws closer to gold as the crypto market holds steady

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Bitcoin and gold have witnessed the feud between them taken to new heights by proponents of both the industries. While the supporters of the crypto world have claimed that Bitcoin has more use cases than the precious metal, gold evangelists were confident that no asset could beat the longevity of gold. Ran NeuNer, the host of Crypto Trader reignited the feud when tweeted:

“Bitcoin per Ounce Gold:

2011   584 BTC =1 Oz Gold

2012  149 BTC =1 Oz Gold

2013   6 BTC =1 Oz Gold

2014   3,5 BTC =1 Oz Gold

2015   2,5 BTC =1 Oz Gold

2016   1,6 BTC =1 Oz Gold

2017  0,18BTC  =1 Oz Gold

2018  0,16BTC =1 Oz Gold

2019  0,15 BTC =1 Oz Gold “

NeuNer based his argument on the depreciating comparison factor between Bitcoin and Gold. Since Bitcoin’s inception, the cryptocurrency has only grown in Year on Year value, with some accompanying anomalies in between that saw its value shoot up or crash drastically.

Bitcoin’s price movement

At press time, Bitcoin was trading for $9330.18 with a total market cap of $168.18 billion. The world’s largest cryptocurrency also held a 24-hour market volume of $22.68 billion. Bitcoin had undergone a price surge two weeks back, which saw its value rise by a whopping 24 percent.

The price movement has also beaten market expectations because, at the mid-year point, many FinTech naysayers had predicted that Bitcoin would only sell in the $3000 range.

Gold’s price movement

The past two weeks have been a disappointing period for gold, with prices slumping on the financial indices. Major markets like India saw a slump in prices at the start of the month as the value fell off after the festival period. This taper has been consistent with the slow down over the past years, and it has also been talked about by major analysts. Samson Li, a Hong Kong-based precious metals analyst at Refinitiv GFMS, had stated:

“Spending sentiment remains weak. Gold price has to be about 30% cheaper for demand to pick up.”

Bitcoin vs. gold

The two assets have been going at it head to head since Bitcoin gained popularity, and with the advent of several crypto organizations, the digital assets have come out on top some times. This has also been the basis for Grayscale Investment’s DropGold campaign. The company released multiple adds to increasing the popularity of Bitcoin while calling out the flaws inherently present in gold.

Disclaimer: The presented information is subjected to market conditions and may include the very own opinion of the author. Please do your ‘very own’ market research before making any investment in cryptocurrencies. Neither the writer nor the publication (TronWeekly.com) holds any responsibility for your financial loss.

Never miss our daily cryptocurrency news, price analysis, tips, and stories. Join us on Telegram | Twitter or subscribe to our weekly Newsletter.