On November 16, the Hong Kong-based blockchain startup Crypto.com announced that it is planning to issue its prepaid card, MCO Visa Card, in the United States. The company says the card has been approved for launch in partnership with its local bank partner Metropolitan Commercial Bank. Its metal cards promise up to two percent token rewards with its native MCO token, airport lounge access (select cards), tap-and-pay functionality, as well as competitive interbank rates.

Convert crypto to fiat with a few taps

According to Crypto.com, users of the MCO Visa Card can easily convert their crypto to fiat using the mobile wallet to be spent at over 40 million locations worldwide, online and offline. However, the company highlights that users need to exchange crypto to fiat currency first via Crypto.com’s Wallet before transacting.

The company began shipping cards to Singapore users in October, and says it currently has reservations for over 100,000 cards.

The blockchain startup says that the cards come with no annual or monthly fees, and no-fee ATM withdrawals.

The company’s official announcement quotes Mark DeFazio, President and CEO of Metropolitan Commercial Bank, who said that they are pleased to work closely with Crypto.com, as “the MCO Visa card is quite unique and provides a bridge between the traditional banking and cryptocurrencies in a safe and compliant way.”

Card reservations are made through a Crypto.com’s Card & Wallet App available for iOS and Android users.

More than a card

Crypto.com believes their product range will be useful for both crypto newcomers and experienced users. In addition to the MCO Visa Card, the company has created products that are geared towards making cryptocurrency more accessible to a broader group of customers.

Crypto.com’s Wallet is designed to securely buy, sell, send, store, and track a range of cryptocurrencies including Bitcoin, Ether, XRP, Litecoin, Binance Coin, and its own MCO Token. Crypto Invest is a tool to help democratize quant trading. Crypto Credit, which is not yet released, will allow customers to “spend crypto without selling.”

Crypto.com assures, that their App is easier to use than some other platforms. For example, buying cryptocurrency requires only a few taps compared to the complex process of other wallets, the company says. With Crypto.com’s Track Coin feature, users can track coins, compare exchange rates and prices, and sort coins by capitalization, performance, and volume.

Crypto.com Co-Founder and CEO Kris Marszalek said, “Our vision is to put cryptocurrency into every wallet, and the upcoming card roll out in the United States is a huge step in that direction. Our products are beautifully designed to connect the fiat and crypto worlds and drive mass market adoption.

About the project

The company was founded in July 2016. Crypto.com was formerly known as Monaco until its rebrand to Crypto.com in July 2018. The founders had raised $26.7 million during their token sale in June 2017. Crypto.com is headquartered in Hong Kong.

This post credited to cointelegraph Image source: Cointelegraph

Analysts from Bank of America Merrill Lynch have said that the crash in cryptocurrency and oil markets are indicators of a looming “flash crash” in markets, Reuters reported Nov. 16.

The strategists reportedly suggested that rising volatility across various asset classes and deleveraging, such as that which happened in oil markets over the past weeks, are signs of the evolution of a bear market.

On Nov.14, Bitcoin (BTC) price slumped below $5,400, while total market capitalization of all cryptocurrencies dropped as low as $174 billion. The price dive marked a new volatility record for markets this year, while the BTC volatility rate exceeded the index of seven on Bitcointicker for the first time since April 2018.

On Tuesday, Brent crude reportedly hit an eight-month low, making it the most extreme one-day fall in over three years. As a result of the current bear market, cash has outperformed stocks and bonds this year for the first time since 1992. The strategists reportedly said:

“Ingredients of flash crash rising … bond, FX, equity volatility all trending up, vicious deleveraging events, dislocation risk via abnormal spreads … triggers could be violent U.S. dollar move and/or shock macro data forcing abrupt GDP and earnings downgrades.”

The analysts told Reuters that, despite bearish signals, $122 billion has flowed into equities, $35 billion into money market funds, and $24 billion into bonds. At the same time, markets saw large outflows from corporate bonds, where investment grade corporate bond funds lost $2 billion and high-yield bond funds lost $2.3 billion.

The “last bulls standing” are high-yield corporate bonds and the U.S. dollar, according to the strategists. The U.S. dollar will purportedly rise by the end of the current year and continue climbing further in the first quarter of 2019 before falling.

Fundstrat analyst Rob Sluymer predicted that Bitcoin’s collapse on Nov. 14pushed crypto markets into a “deeply oversold” area, while “longer-term technical indicators aren’t so favorable.” Sluymer concluded that Bitcoin will be able to support a “multi-month rally,” but only after the “significant” damage done this week has been overcome.

Yesterday, a trader at eWarrant Japan Securities K.K. in Tokyo, Soichiro Tsutsumi, told Bloomberg that the loss of $6,000 support looks like a “dangerous sign” for industry players, especially the ones with “business models reliant on a client pool.”

This post credited to cointelegraph Image source: Cointelegraph 

In the crypto bull market of late 2017, when tokens reached a valuation of tens of billions of dollars, blockchain networks comfortably surpassed the valuation of commercial companies in the cryptocurrency ecosystem.

At the time, for venture capital investors, direct investments in digital assets and cryptocurrencies seemed substantially more profitable than early-stage funding rounds in startups like CoinbaseBinance, and Circle. These companies have since become behemoths in the cryptocurrency sector, achieving multi-billion dollar funding valuations with profitable and stable business models.

Are Crypto Startups Better Investments Than Blockchain Projects?

In November of last year, retail traders and individual investors triggered an unforeseen short-term rally of cryptocurrencies, allowing the market to collectively reach a valuation of over $800 billion.

However, as CoinShares executive Meltem Demirors explained, institutional investors are more interested in investing in the market through investment vehicles that are stable and regulated.

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Crytpo’s market crash could be the beginning of something bigger. @Melt_Dem says is in a financial crisis.

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As of current, the vision of mega-successful crypto companies like Coinbase and Binance is quite clear; to improve the adoption of digital assets and strengthen the infrastructure of the cryptocurrency exchangemarket.

To institutional investors and large accredited investors, indirect investments in the crypto market are more appealing, partially because blockchain projects, decentralized initiatives, and initial coin offerings (ICOs) have been struggling to remain relevant and to establish a clear vision.

“Many crypto projects that raised money through an ICO face massive challenges to stay relevant and create real purpose. for now, our collective hopes and fears are expressed as speculative price moves. projects don’t die the way companies do, and the arc of time is long,” Demirors said.

Given that institutional investors and venture capital firms favor new companies building infrastructure rather than digital assets with unproven business models, in the short-term, companies are expected to outperform most projects in the global market.

“Most investors aren’t going out and buying crypto directly, nor will they do so anytime soon (sorry) that ‘institutional herd’ is getting exposure through existing investment vehicles that they know and understand (even if the assets are new and strange) more and more traditional financial institutions are looking at crypto as a way to: 1. create new revenue streams 2. play ‘innovation’ theater 2. build enterprise value.”

The majority of tokens in the market have also failed to maintain active GitHub repositories, with low double-digit code commits recorded last quarter and hundreds of daily on-chain transactions.

Could the Trend Change?

Chart shared by Meltem Demirors and CoinShares

In the long-term, as the mainstream opens up to decentralized systems and institutions begin to see value in blockchain projects, Demirors stated that a trend reversal is inevitable.

“If the next five years are anything like the last, expect value to flow from centralized corporate entities to less centralized networks and applications. we can’t pinpoint when that shift will happen, but here at CoinShares- we believe it’s inevitable.”

There exist a few key factors that could drive an increasing amount of investment in the blockchain space. In the upcoming months, if major markets like the US, Japan, and South Korea establish clear guidelines to regulate and govern the ICO market, it could open a regulated channel for institutions to invest in the market in a secure and stable manner.

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With the close of 2018 in sight, Fundstrat founder and analyst Tom Lee has lowered his year-end prediction on the price of Bitcoin.

Lee now says he believes Bitcoin will hit $15,000 by December 31st, down from his long-standing prediction of $25,000. He is basing his revised forecast on the amount of profit that Bitcoin miners, who validate transactions on the network, can currently make.

As reported by CNBC,

“A key driver was Bitcoin’s ‘breakeven’ point, the level at which mining costs match the trading price. That level is down to $7,000 from an earlier estimate of $8,000 for the S9 mining machine by Bitmain, according to Fundstrat’s data science team. Based on that, Lee estimates that fair value for Bitcoin would be roughly 2.2 times the new $7,000 breakeven price.”

In a new note to clients, Lee compared the current bear market to the one that happened from 2013 through 2016, noting that the price “never sustained a low below breakeven.”

“While Bitcoin broke below that psychologically important $6,000, this has led to a renewed wave of pessimism. But we believe the negative swing in sentiment is much worse than the fundamental implications.”

Lee also points to institutional factors – like the coming launch of Bakkt and Fidelity entering the crypto market – as catalysts that will help boost the price of Bitcoin.

As for this week’s sudden plunge in the Bitcoin and crypto market, Lee points to the tumultuous Bitcoin Cash fork as a leading factor.

This post credited to Daily HODL Image source: Daily HODL

Dutiful CCN readers may recall this journalist’s questioning of the Paragon ICO over a year ago. Paragon responded to that article with legal threats, as noted in the author’s subsequent analysis of the initial coin offering in question. Now that some time has gone by, and the whole market capitalization of Paragon is about a third of what the company raised during the ICO, the government has stepped in, knocked heads, and forced some changes within Paragon.

According to a press release today from the Securities and Exchange Commission, both Paragon and another company doing business as Airfox (officially registered as CarrierEQ) have reached settlements with the agency for failure to register their tokens as securities or their token sales as securities offerings. It is a crime in the United States since 1934 to sell virtually anything that can resemble an investment contract without first registering with the SEC or applying for an exemption. The Securities Act of 1934 was one of many pieces of legislation designed to prevent future crashes on the order of the crash of 1929, which led to what is historically referred to as the “Great Depression.”

Each firm has agreed to a settlement of $250,000 and several important items of responsibility. First and most notable, all affected investors in either company have an opportunity to request a refund.

Source: Coinmarketcap.com

Given that Paragon, for example, sold $12 million in tokens but PRG has a sum market capitalization of not quite $3,000,000, it would seem there will be people interested in pursuing as much. Whether this leads to bankruptcy for Paragon, time will tell, but surely they’d prefer that to the various other penalties a government inquiry can bring on (such as jail time.)

The SEC press release on the subject reads:

“The orders impose $250,000 penalties against each company and include undertakings to compensate harmed investors who purchased tokens in the illegal offerings. The companies also will register their tokens as securities pursuant to the Securities Exchange Act of 1934 and file periodic reports with the Commission for at least one year. Airfox and Paragon consented to the orders without admitting or denying the findings.”

The SEC settlement documents illustrate a somewhat-disconcerting accuracy on the part of the agency, which has only previously prosecuted one non-fraud ICO case (a company called Munchee which simply backed out upon contact, giving all the funds back). Point 17 in the Paragon document illustrates a familiarity with token technicalities:

“PRG tokens were distributed to purchasers on October 22, 2017, on the Ethereum blockchain using the ERC-20 protocol.”

It seems that Ethereum tokens are not just for eccentric investors anymore.

SEC Enforcement Co-Director Steven Peikin believes that its enforcement actions against Airfox and Paragon will help stimulate the registration of other US-based ICOs in advance of any further non-fraud prosecution, saying:

“By providing investors who purchased securities in these ICOs with the opportunity to be reimbursed and having the issuers register their tokens with the SEC, these orders provide a model for companies that have issued tokens in ICOs and seek to comply with the federal securities laws.”

Twitter was abuzz with the news at the time of writing, with many ICO skeptics taking a victory lap.

nic carter@nic__carter

Landmark case today. This is going to happen hundreds and hundreds of times in the next 2-3 years until all the ICOs are gone.

View image on Twitter

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Five percent of Moscow residents who use non-cash methods of payment are open to using cryptocurrencies, according to a recently conducted survey, Forbes Russia reported Nov. 13.

The investigation into the e-payment market in Moscow was carried out by Russian payment service Yandex.Money and the Moscow Information Technology Department (ITD). The experts purportedly surveyed 1,000 Moscow residents of various age categories by way of a phone survey.

The experts found that among those Moscow residents who use non-cash forms of payment, one percent also use digital currency, while 5 percent expressed readiness to start using cryptocurrency to pay for their purchases.

Among the most common forms of non-cash payments, 96 percent of respondents said they use bank cards, 40 percent pay for their purchases via mobile bank apps, 32 percent use Internet banking, while 16 percent said that they use e-money.

Ivan Buturlin, head of the analytics department at the ITD, reportedly said that “34 percent of Moscow residents use primarily non-cash methods of payment, wherein 63 percent conduct electronic transactions at least once a day.”

The experts skeptically regarded respondents’ intent to pay with cryptocurrency, suggesting that people simply assumed a more broad usage of high-tech processes in the future.

When asked why they refrain from using cashless payment systems, 40 percent of respondents expressed security concerns, 22 percent said they do not want to pay additional service fees, 11 percent said they did not understand how to use non-cash payment services, while 9 percent answered that they do not know what cashless payment methods are.

“In order for non-cash payments to penetrate into the lives of a larger number of citizens, people should also change their perception to understand that this is a safe method of payment,” stated Ivan Glazachev, CEO of Yandex.Money.

As Cointelegraph previously reported, 93 percent of British citizens have heard of Bitcoin (BTC), but only 4 percent claim to have bought it, per a poll by U.K. market research firm YouGov.

Meanwhile, 55 percent of respondents in a recent German poll claim they have heard of cryptocurrencies, while 77 percent of those who are aware of digital currencies admit they are not likely to invest in them.

This post credited to cointelegraph  Image source: Cointelegraph 

Colorado regulators took action against four ICOs Thursday, bringing the state’s total number of cease-and-desist orders against crypto startups to 12.

The state’s “ICO Task Force” rebuked Bitcoin Investments, Ltd, PinkDate, Prisma and Clear Shop Vision Ltd. Where the companies are based is unclear, a spokeswoman for Colorado’s Division of Securities told CoinDesk, though the unregistered securities they promoted were available to Colorado residents.

Colorado Securities Commissioner Gerald Rome told CoinDesk:

“We want to ensure that the state’s securities market and the investors that operate within it are protected from unscrupulous actors that are taking advantage of the enthusiasm surrounding this field to perpetrate fraud and in some cases outright theft. There are many companies in Colorado that are working hard to conduct their ICOs the right way, and we are eager to continue working with them to build a regulatory framework for the industry as it relates to securities.”

Rome added that the enforcement action is meant to advance Colorado as an “innovative leader” in the cryptocurrency space. Though the state’s ICO Task Force has been active since May, the cease-and-desist orders come just days after Colorado elected a crypto-friendly governorin Congressional Blockchain Caucus member Jared Polis.

More U.S. state regulators are taking action against potentially fraudulent token sales. Earlier this week Texas issued emergency cease-and-desist orders to crypto mining firms based in Australia and Canada.

As CoinDesk reported in August, a coalition of North American securities regulators is conducting more than 200 investigations. The so-called “Operation Cryptosweep” – which the Colorado Division of Securities is participating in – is meant to stifle cryptocurrency scams.

“You’re starting to see now the results of those investigations,” said Bob Webster of the North American Securities Administrators Association (NASAA), which is playing a coordinating role in the Cryptosweep effort.

Webster says Colorado is among the more active jurisdictions in the U.S., along with Texas, North Dakota and Massachusetts.

Anthony Tu-Sekine, who heads up the cryptocurrency arm of law firm Seward & Kissel LLC, says a number of state regulators are jumping into the fray to combat what are often “thinly disguised Ponzi schemes.”

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Bitmain has released (and already sold out of) its Antminer S15 model traditional ASIC Bitcoin miner. At a price of $1,475 per unit and a per-customer limit of two, it is comparably one of the better bargains as mining hardware goes.

It clocks up to 23 terahash per second, meaning that 3-4 units would be required to match the performance of Bitfury’s Tardis, which goes up to 80TH/s. The Tardis, however, is much more expensive on a per unit basis, with resellers getting almost $7,000 per unit. BitFury themselves do not publish the price of a single unit. Presumably their pricing varies based on the buyer’s requirements in terms of quantity.

However, for just $50 more than the Antminer S15, miners will soon be able to acquire Ebang’s Ebit 11+, which touts 37TH/s, for $1517 — far and away the best deal of the major mining hardware providers mentioned here. At the same time, one cannot simply purchase a single E11+ – you must buy at least 50, for a minimum investment of $75,850. Further, the E11+ won’t be available until January, whereas S15’s will begin appearing on the web before long. It has long been a profitable business model in the mining industry to simply reserve some upcoming hardware and resell it as soon as the manufacturer sells out – which is normally.

Ebang Likely the Best Deal

The best deal on mining hardware is always dependent on the miner’s goals and budget. The minimum investment at Ebang would give one a starting hashpower of 1,850 TH/s. This is a sizable mining operation from the get-go and certainly a foothold in Bitcoin mining. According to CoinWarz, it would take just over 6 months to begin earning a profit, with all factors considered. Solo mining would not be an option, despite the conceivable size of the operation, with this few machines. You would need approximately ten fold the minimum order to have a prayer against the massive pools of mining out there.

Bitcoin mining in general has fallen off as an extremely profitable way to make money. It requires a large up front investment and the profit margins can be slim for those who must convert their coins right away. However, miners who are able to hold on to some or all of their Bitcoin have historically made millions.

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The lack of suitable institutional-grade platforms is undoubtedly one of the greatest obstacles to institutional money flowing into the burgeoning field of cryptocurrencies.

However, the fact that this type of platform has not emerged so far is somewhat understandable. Not only are cryptocurrency markets a lot less mature than traditional finance markets, the specific characteristics of cryptocurrencies mean that simply overlaying existing solutions won’t suffice. One example of cryptocurrency uniqueness is having your digital assets stored on a blockchain and controlled through a set of public and private keys. This is a new paradigm for potential investors to get used to, as is the fact that keys rather than currency are stored in what is referred to as your wallet.

Even once a given user has acquainted themselves with the intricacies of how digital cash functions (no easy task), they need to navigate the confusing and fragmented landscape of exchanges – each of which provides different offerings when it comes to the cryptocurrencies and tokens made available.

These new rules and terms of engagement are a world away from the one that sophisticated investors are comfortable with, having become used to dealing with a single interface when trading in traditional financial markets. Not having a single solution that allows them to trade quickly, easily, and efficiently can be a major barrier for these investors to follow through on any initial interest they may have in the world of cryptocurrencies.

Which is why something needs to change if we want to see serious investments take off. As mentioned, there are various unique problems that need to be solved. However, one of the most significant is that of being able to place large orders and know that you are getting the best price available from the various exchange options. It seems about time, given the growing interest in the space, to build a platform capable of aggregating information from various exchanges into a single intuitive interface, with sophisticated APIs being deployed to interact with the myriad of exchanges in a streamlined fashion.

Caspian crypto echange
Gerrit Van Wingerden is the CTO and co-founder of Caspian

To these ends, I think Smart Order Routing (or SOR) could be an incredibly valuable mechanism to incorporate, so as to reduce the inconvenience of the aforementioned fragmentation issue.

Smart Order Routing is not a new solution, as it is already used across financial markets when individual assets trade across various exchanges. In fact, it has been a part of Tora’s offer to the asset management industry for many years now. However, SOR is not common in cryptocurrency trading, even though everyone is aware of the fragmented exchange landscape that is so characteristic of the market right now.

Notably, it can help ensure that the end user has a single pool of liquidity made up of all the exchanges available to them. For instance, if an investor wanted to place a large order for an obscure and rarely listed coin, they would only need to input the order into the platform and allow the SOR algorithm to take care of the rest. In doing so, it would take into consideration factors such as fees, liquidity, and commission accrued by given exchanges so as to effectively fill orders and to reduce any slippage.

There is currently $130 trillion of traditional assets under management, a number that trumps the $215 billion market cap of cryptocurrency. If even a fraction of the former were to be allocated into the latter, it would have a massive impact on the emerging industry as a whole. However, it’s not enough to simply look at this figure, note the potentially transformative effect on the market, and simply assume that such a change will happen. Instead, we need to collectively put forward solutions to the user problems that are holding back adoption and engagement.

More generally, the idea of investment into cryptocurrency needs to be decoupled from the complexity that’s associated with trading. High barriers to entry are limiting the number of investors getting involved. As the industry continues to evolve, it’s imperative that we turn our focus on adoption through enhanced user experience, with easy-to-use yet powerful trading tools that exist in the legacy financial system.

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In an official statement, the Ukranian government confirmed its plans to establish regulatory frameworks to legalize crypto in the region.

As a part of an initiative to consider and acknowledge cryptocurrency as an emerging technology, the Economic Development and Trade Ministry in Ukraine released a new state policy to oversee various cryptocurrency-related sectors which will be put in full effect by the end of 2021.

Two-Part Plan

Throughout 2018 and 2019, the government of Ukraine will integrate regulatory frameworks to strictly govern the local cryptocurrency exchange market. Crypto trading platforms will be required to implement Know Your Customer (KYC) and Anti-Money Laundering (AML) systems to help local authorities monitor the market.

By 2020, the government plans to delve into the cryptocurrency mining industry, smart contract protocols, and taxation, as the second part of the initiative to recognize cryptocurrencies as an asset class and an established industry.

cryptocurrency mining

Researcher Denis Zarytsky stated that the official document released by the government of Ukraine outlined a 5 percent tax payable by entities and individuals with cryptocurrency holdings, a rate that is substantially lower than other regions like France and the UK that have over 10 percent tax on cryptocurrency investments.

Regions that have recognized cryptocurrencies as properties impose higher taxes, as Japan and Australia have done in the past. In early 2018, both Japan and Australia removed double taxation on crypto.

“They aim to determine guidelines for token classification. Additionally, they will be touching upon issues that relate to smart contracts and cryptocurrency mining. Therefore, this work will be ongoing. There will be two separate stages to the implementation of this new state policy. The hope is to have this policy in full effect by 2021. In addition to the new state policy, the government notably has brought in a new taxation bill. This outlines a new 5% tax that is payable by entities and individuals with cryptocurrency holdings.”

In October, Yuriy Derevyanko, a member of the anti-corruption Movement of New Forces and a legislator of Ukraine, called for the complete elimination of taxes on crypto by the end of 2020.

Derevyanko firmly stated that crypto has the potential to become one of the major markets of Ukraine and a driving force of the country’s economy.

“I believe we need to impose a moratorium on taxation of [the crypto] area for the next 10 years. We have to regulate and legalize this segment, which will become an engine for a new economy.”

Currently, both the opposing and the ruling party of Ukraine remain positive on the long-term growth of the cryptocurrency sector and blockchain technology.

The positive sentiment towards the new asset class in the country could lead to a sped-up process of implementing the policy drafted by the government to legalize cryptocurrencies within the next three years.

Falling Back Behind Japan and South Korea

Singapore, South Korea, Japan, Switzerland, the UK, and France as of late have shown significant progress in terms of regulation and infrastructure establishment to facilitate increasing demand towards the asset class.

While local experts remain optimistic regarding the three-year plan of Ukraine, some have expressed concerns in the timeframe of the initiative and that the period of three years could allow other emerging cryptocurrency markets to take first-mover advantage.

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