Two cryptocurrency startups have agreed to register their initial coin offering (ICO) tokens as securities after settling charges with the U.S. Securities and Exchange Commission.

The SEC’s Friday announcement centered on two firms: CarrierEQ Inc., also known as Airfox, and Paragon Coin Inc., both of which conducted token sales last year. Airfox raised $15 million through its sale, while Paragon raised $12 million, according to statements.

The U.S. securities regulator contended that neither startup registered their ICOs as securities offerings, and neither qualified for registration exemptions. In addition to registering their tokens as securities, both companies will refund investors, file periodic reports to the SEC and pay $250,000 apiece in penalties.

The SEC’s statement noted that these two cases are the SEC’s “first cases imposing civil penalties solely for ICO securities offering registration violations.”

SEC Enforcement Division co-director Stephanie Avakian said that the agency has “made it clear that companies that issue securities through ICOs are required to comply with existing statutes and rules governing the registration of securities.”

She added:

“These cases tell those who are considering taking similar actions that we continue to be on the lookout for violations of the federal securities laws with respect to digital assets.”

The release further referenced the Munchee ICO, which the regulator halted last December. Like Airfox and Paragon, Munchee agreed to refund investors in its $15 million token sale, though the SEC did not impose additional fines at the time.

Friday’s announcement comes on the heels of the SEC revealing settled charges against Zachary Coburn, founder of the decentralized exchange EtherDelta, with running an unregistered securities exchange.

At the time, an individual familiar with the SEC’s thinking noted that the regulator is likely to focus increasingly on token trading platforms.

This post credited to coindesk Image via Shutterstock

Speaking before an audience at the Singapore Fintech Festival 2018, managing director and chairwoman of the International Monetary Fund Christine Lagarde made the case for digital currency.

Says Lagarde,

“A new wind is blowing, that of digitalization. In this new world, we meet anywhere, any time. The town square is back – virtually, on our smartphones. We exchange information, services, even emojis, instantly… peer to peer, person to person. We float through a world of information, where data is the ‘new gold’– despite growing concerns over privacy, and cyber-security. A world in which millennials are reinventing how our economy works, phone in hand.”

Lagarde outlines how new forms of money will make their way into everyday usage.

Integration
  • Through social media, readily available for online and person-to person use, including micro-payments
  • Will be cheap and safe, protected against criminals and prying eyes

Lagarde points out a number of signs indicating digitization.

Key signs of an emerging digital economy
  • Signs in store windows read “cash not accepted”
  • Bank deposits feeling pressure from new forms of money
  • E-money from AliPay and WeChat in China, PayTM in India, M-Pesa in Kenya

According to Lagarde,

“Even cryptocurrencies such as Bitcoin, Ethereum, and Ripple are vying for a spot in the cashless world, constantly reinventing themselves in the hope of offering more stable value, and quicker, cheaper settlement.”

Advantages of digital currencies
  • Reaching people and businesses in remote and marginalized regions
  • Backup means of payment
  • Low-cost and efficient alternative
  • Privacy
Disadvantages and risks of digital currencies  plus creative solutions
  • Despite risks to financial integrity, programmable money by central banks could allow regulators to “lift the veil of anonymity” if suspicions arose.
  • Despite risks to innovation by having central banks cover everything from digital wallets, to tokens, to back-end settlement services, new public-private partnerships would allow central banks to handle back-end settlement, while financial institutions and start-ups focus on client interface and innovation.
  • Despite risks to financial stability due to pressure on bank deposits, “the jury is still out on whether digital currencies would really upset financial stability.”

Lagarde says we should embrace change.

“My message is that while the case for digital currency is not universal, we should investigate it further, seriously, carefully, and creatively. More fundamentally, the case is about change – being open to change, embracing change, shaping change. Technology will change, and so must we. Lest we remain the last leaf on a dead branch, the others having decided to fly with the wind.”

The Singapore Fintech Festival, which took place on November 12-16, attracted over 250 global representatives from central banks and regulatory agencies, financial institutions, venture capital firms and fintech companies who made a wide range of presentations covering monetary policy, and the future of blockchain, digital assets and cryptocurrencies.

You can download the full speech here.

 

This post credited to Daily HODL Image source: Daily HODL

Over the last 24 hours, the valuation of the crypto market has fallen from $185 billion to $181 billion, by around $4 billion.

On November 15, amidst one of the worst single-day corrections in all of 2018, the crypto market saw a wipeout of more than $27 billion. The market extended losses throughout the past two days.

Bitcoin Cash, even with the combined value of Bitcoin Cash SV (BCHSV) and Bitcoin Cash ABC (BCHABC), has fallen by more than seven percent. Subsequent to the fork, the price of BCHABC, the original Bitcoin Cash chain with the roadmap set forth by bitcoincash.org, dropped by more than 15 percent to $250.

$4,800 the Bottom For Bitcoin?

Yesterday, on November 16, CCN reported that Crypto Rand, a cryptocurrency technical analyst and trader, said that the probability of a $4,800 to $5,000 bottom for Bitcoin (BCH) is increasing.

“Crypto Rand, a respected digital asset analyst, stated that a fall to the $4,800 to $5,000 range is possible, given that technical indicators have not shown any signs of a bottom,” the report read.

The Crypto Dog, another prominent analyst, said that a bottom at $4,800 has become more likely for BTC.

“Same target I’ve held since February of this year, I think there is a strong possibility that $4,800 is the bottom.

While both major cryptocurrencies and small tokens have started to demonstrate independent price movements by breaking its correlation with BTC, a further 12 percent drop from $5,500 to $4,800 could result in intensified downward movements for cryptocurrencies with lower daily volumes.

Currently, the daily trading volume of BTC is hovering at around $5 billion. In contrast, Ripple (XRP), Bitcoin Cash (BCH), and Stellar (XLM) are demonstrating volumes in the range of $100 million to $800 million, less than 16 percent of the volume of BTC.

If the most dominant cryptocurrency in the market continues to demonstrate weak momentum and massive sell-pressure, then digital assets with lower volume will inevitably fall with BTC.

On Thursday, almost immediately after the fall of BTC from $6,300 to $5,500, Josh Rager, an investor in various blockchain initiatives, said:

“$5,500 area currently holding up BTC, when (it’s only a matter of time) a daily candle closes below here it will head to $4,900 area Strong support between $4,300 to $4,600 – BTC will likely bounce very hard here – in my opinion, a good place to buy R/R regardless if it heads lower”

Overall Negative

The sentiment around cryptocurrencies has generally been negative this week, due to the sheer intensity of the crash of the market over the past several days.

For tokens and small market cryptocurrencies, the U.S. Securities and Exchange Commission’s accelerated investigations into token sales and initial coin offerings (ICOs) could lead to a large short-term drop in confidence from investors in the public market.

With Paragon and AirFox already ordered by the U.S. SEC to refund investors and pay a $350,000 additional fine, investors will likely avoid investing in tokens until regulatory frameworks around the space are properly established.

This post credited to ccn Image from Shutterstock.

A pair of institutional giants have just secured cryptocurrency-related patents.

Bank of America (BofA) won a patent for a crypto storage platform in enterprise accounts, while Amazon won patents for cryptography and distributed data storage.

Bank of America’s patent, submitted for approval in June 2014, describes how the enterprise account will aggregate, or safely store, customers’ crypto assets. The patent filing states,

“As technology advances, financial transactions involving cryptocurrency have become more common.

For some enterprises, it may be desirable to aggregate cryptocurrency deposited by customers in an enterprise account.”

The patent emphasizes the possibility of making transactions and converting currency within the account, negating the need for exchanges by “simplifying the purchase and exchange of currencies and cryptocurrencies and reducing the fees associated with doing so.”

In a report filed with the US Securities and Exchange Commission in February, BofA outlined how cryptocurrencies are a threat to traditional banking. As a hedge against fintech and its rapid transformation of legacy systems, BofA has been filing dozens of crypto and blockchain-related patents.

In June, Fortune reported the bank’s patent tally at that time. According to Catherine Bessant, BofA’s chief operations and technology officer,

“We’ve got under 50 patents in the blockchain/distributed ledger space. While we’ve not found large-scale opportunities, we want to be ahead of it. We want to be prepared.”

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Meanwhile, Amazon was just awarded two patents. The first, filed in April, adds security to users’ signatures by “protecting the integrity of digital signatures and encrypted communications.”

The patent states,

“…the signature authority provides a key-distribution service that distributes blocks of cryptographic keys to authorized signing delegates. An authorized signing delegate contacts the key-distribution service and requests a block of cryptographic keys.”

Amazon plans to base the encryption system on a structure known in the cryptography world as the “Merkle tree.” A Merkle tree is constructed by hashing paired data, then pairing and hashing results until there’s only one hash remaining: the Merkle root. The goal of the process is to securely and efficiently verify large bodies of data.

“The collection of one-time-use cryptographic keys is arranged in a Merkle tree, and hash values associated with the one-time-use cryptographic keys are used to cryptographically derive a root node of the Merkle tree which serves as a public key for the signature authority.”

Amazon’s second patent, filed in mid-December 2015, focuses on data storage that would utilize a “grid encoding technique.” Data would be collected in “shards” and be logically grouped together and distributed. The techniques are designed for extending grids in data storage systems.

This post credited to Daily HODL Image source: Daily HODL 

The cryptocurrency community expected a tight hash power battle between Bitcoin Cash (BCH) and Bitcoin Cash (SV) on November 15. But, with a decisive win and an anti-climactic result, BCH came out the winner.

Bitcoin.com, a company owned by Roger Ver, saw its hash rate spike to 4 exahash, easily surpassing the entire computing power on the Bitcoin Cash network prior to the hard fork.

With ViaBTC and Bitcoin.com’s hash power, Bitcoin ABC has been able to mine a significant amount of blocks after the fork, mining 32 more blocks than Bitcoin Cash SV (BSV).

BCH Was Never Losing to SV

Bitcoin SV, the camp of Craig Steven Wright, CoinGeek, and billionaire Calvin Ayre, was said to hold more than 57 percent of the hash power on the Bitcoin Cash network prior to the fork, and the possibility of a 51 percent attack as suggested by Craig Wright led investors to lose confidence in the short-term trend of BCH.

However, on Thursday, as the hash rate conflict between ABC and SV kicked off, it was evident within less than 30 minutes that the majority of hash power was on the side of ABC.

The Chinese mining community and Bitmain, the $15 billion cryptocurrency mining equipment manufacturer and mining pool operator, were not needed; solely with the computing power of ViaBTC and Bitcoin.com, ABC was able to defend its protocol against SV and the threats released by Craig Wright.

On November 15, Jiang Zhuoer, the CEO of BTC.TOP and a miner based in China, disclosed that Bitmain has more than 20,000 P hashrate, or 20 exahash. That is, twice of the hash rate of Coingeek, Craig Wright, and Calvin Ayre.

“Mining pools under Bitmain (such as BTC.com and Antpool) collectively have 15,000 P hashrate. With ViaBTC where Bitmain is a shareholder, the entity has 20,000 P hashrate altogether.”

More to that, rumors have suggested, as Zhouer explained, that more than 90,000 mining devices owned by Bitmain in Xinjiang could be used to defend ABC.

“Rumour has it that, Bitmain has 90,000 mining machines in Xinjiang to prepare for the hash war — but they are all meaningless rumours. If Bitmain is using the hashrate of BTC to start a hash war and this would be the epitome of ‘survival of the fittest.’”

Purely based on the discrepancy of computing power between Bitmain and the SV camp, Craig Wright, Coingeek, and Calvin Ayre had no chance of standing against ABC if Bitmain was to redirect its hash power to ABC, which was ultimately not needed.

Criticism Against SV

Emin Gun Sirer, a professor at the prestigious Cornell University, explained that the outcome of the battle between ABC and SV portrayed the necessity of a community, vision, technology, and other components to successfully launch and operate a blockchain network.

But, Sirer emphasized that SV had none of the factors that lead to the creation of a solid blockchain protocol.

“This point is at the heart of the main lesson from the BCH hashwar. One cannot assemble a good team just with money. To attract top notch talent, you need a strong, scientifically valid vision and novel, exciting tech, among other things. BSV has none of these.”

This post credited to ccn Image from Shutterstock

BitMEX’s head of research, Jonathan Bier, gave a statement to Bloomberg this week that will soon be proven true or false. In regards to how the upcoming Bitcoin Cash fork would play out, Bier said that he believes that the important divide between the economic majority and the mining majority will sort itself out in rapid fashion.

“The chain will split in two, but the economy will support ABC and reject SV (Satoshi’s Vision). SV will have a low price and miners will leave it in a few weeks. That is my prediction.”

As head of research, Bier would have played an important role in the roll-out of the new fork monitoring tool that Bitmex has sponsored.

A Theory with Legs

Bier’s prediction is based on the reality of the situation rather than personal feelings regarding the technicalities of the upcoming hard fork. It is an informed and wizened view. The economic majority in a cryptocurrency is, in real terms, as important as the mining majority. There are a lot of reasons for this, not the least of which is the cost of the hardware involved in mining cryptocurrencies.

Miners take financial risks on hardware with the reasonable expectation that they will be able to earn a return. If one or the other chain is better equipped to service that result, then that will become the preferred chain of miners, and if they are within a few dozen dollars of each other in unit price, this preference can fluctuate algorithmically in ways that can have a dramatically negative effect on everyday users as difficulties rise and fall and make block times irregular.

Demonstration of this principle is not hard to find. There are many orders of magnitude more miners, pools, mining pools, and so forth contributing to the difficulty of the Bitcoin network than Bitcoin Cash’s current network as a whole. Yet, Bitcoin Cash itself (owing in large part to its architecture being almost identical to that of Bitcoin’s, with some important differences) likely has as much of a lead on the majority of other altcoins.

Some exchanges have decided in advance that they will not list Bitcoin SV at all, but they are just a few of hundreds of places that people transact in BCH. Multiple major exchanges have already made pairs including both versions of Bitcoin Cash, enabling traders to engage in pre-fork futures trading.

Other Possibilities

bitcoin cash fork
Bitcoin SV currently has majority support from miners, but will that persist following the fork? | Source: Coin Dance

While Bier’s informed opinion on the matter represents one likely outcome – that Bitcoin SV loses both economic and mining support in that order and in a short span of time – there are others.

As noted in the Bloomberg article, Calvin Ayre and other wealthy individuals – some of whom, like Ayre, own a lot of cryptos as well as mining hardware – have skin in this game. They could conceivably, by themselves and at a loss (although not in their rational self-interest), prop the SV price up for a time.

The likelihood that Ayre’s planned appeals to Bitcoin exchanges — to only list his version of Bitcoin Cash — are successful feels, well, very small. Purely to stimulate trading of the SV coin (or any trading at all) on their exchange(s) and encourage deposits, some exchanges might well list SV exclusively. It would alienate some users, but the 80/20 rule applies: 20 percent of customers make up 80 percent of many business models. In this case, some small exchanges might want that 20 percent to become SV diehards or just people looking to dump their SV coins, or some combination of both. But anything approaching a volume or economic majority? Forget about it.

A scenario that feels likely to this reporter is that both chains live on indefinitely. Whether or not either token enjoys a bullish token price across exchanges, it’s hard to imagine Craig Wright or Calvin Ayre coming back into the fold at this point, nor Roger Ver and Jihan Wu welcoming them back if they decided to do so. CoinGeek by itself has the capability to prop up the SV blockchain, and its media efforts have the capability to continually attract new users and widen the base. (Bitcoin ABC has the same capabilities utilizing a wider array of resources – Jihan Wu, Roger Ver, the coterie of major exchanges which have come out in definitive support of ABC.)

Ayre, Wright, and their sizable number of supporters seem to share a very specific vision for cryptocurrency, and it seems that only complete capitulation of their peers would be enough for them to call it quits this far in. A whole generation of Bitcoin mining hardware is soon to be obsolete with next-generation miners coming online, and this soon-to-be-resold hardware has a convenient retirement plan: mine on one or all of the latter-day Bitcoin blockchains. Effectively, a dedication or rededication of any significant amount of hash power from unexpected sources to either chain would change outcomes significantly, and this possibility relies very much, of course, on the market performance of either.

Disclaimer: The views expressed in the article are solely those of the author and do not represent those of, nor should they be attributed to, CCN.

This post credited to ccn Image from nChain/YouTube

 

The President of the Republic of the Marshall Islands Hilda Heine has narrowly survived a no confidence vote that was partly prompted by her plans to introduce a national digital currency, Asia-focused English-language publication Nikkei Asian Review reports Nov. 12.

The Marshallese parliament was reportedly split 16-16, just one vote short of the number needed to prompt Heine to resign the office of president.

The country’s parliament had initially backed the creation of a national digital currency, called the Sovereign (SOV), in February of this year, to be distributed and used along with the U.S. dollar, the country’s mainstream currency.

However, as Nikkei notes, the president’s critics had accused the proposed plan for a state-backed cryptocurrency of “tarnishing” the country’s reputation. Alongside eight dissenting senators, former president Casten Nemra was another vocal detractor of the Sovereign.

Nemra reportedly stoked political divisions over the government’s alleged failure to investigate investigate the loss of $1 billion from the Marshall Islands Trust Fund, which set up by the U.S. to compensate Marshallese citizens affected by nuclear tests conducted near the country.

Political tensions were further strained over a Chinese plan to turn the Marshallese atoll of Rongelap into a special administrative zone including a tax-free port and offshore company registration. Several of the senators who introduced the no confidence vote support the plan, while Heine sees the move as a Chinese incursion on Marshallese sovereignty.

Heine is reported to have told the parliament, also known as the Nitijela, that the attempt to overthrow her was a “referendum about our own politics.” She has also hailed plans for the Sovereign as a “historic moment for our people.”

As both Nikkei and major Israeli newspaper Haaretz report, the Marshallese government’s pursuit of a state-backed cryptocurrency was precipitated by a partnership with Israeli startup Neema, which is said to have persuaded the country’s politicians that the project could bring $30 million, of which half would go to Neema.

According to Haaretz, one of Neema’s owners, Barak Ben-Ezer, wrote this spring that “as a practical matter, SOV […] becomes real money from a legal standpoint […] without capital gains tax, without a securities regulator claiming that the currency is stock. SOV is a sovereign currency like the dollar, the euro and the yen.”

Nikkei today reports that Finance Minister Brenson Wase has declared the government will move forward with the Sovereign, and is waiting to fulfil requirements from the International Monetary Fund (IMF), the U.S. and Europe.

As previously reported, this September, the IMF warned the Marshallese government of the risks of adopting a cryptocurrency as a second legal tender, stating that “the potential benefits from revenue gains appear considerably smaller than the potential costs.” It further warned of potential reputational damage, compromised relationships with foreign banks, and risks of money laundering and terrorist financing.

This post credited to cointelegraph  Image source: Cointelegraph

Square’s mobile payments application, Cash App, posts impressive growth for Bitcoin transactions despite the bearish cryptocurrency market. In Square’s Q3 shareholder letter the company reports $43 million in Bitcoin revenues, contributing $560 thousand to quarterly net profit.

Square is a merchant services and mobile payments company based out of San Francisco. Founded in 2009, the company is known for its portable point of sale systems such as Square Reader and Square Register. Since inception, Square has become one of the most popular payment services for small and medium-sized businesses in the United States.

In a series of progressive moves, Square was one of the first major payment processors to support Bitcoin transactions.

The company made its first foray into crypto payments in March of 2017when Square Market, a tool for establishing eCommerce storefronts for small businesses, would also support Bitcoin payments.

The company continued to push for Bitcoin support in its more widely used Cash App (formerly Square Cash). Cash App is a mobile application that allows individuals and businesses to send and receive money through an online alias.

Square moved to beta test Bitcoin payments in November of 2017, and by January of 2018, the company had released the feature to most of Cash App’s users.

The move puts Square head-to-head with several incumbents in crypto payments processing. BitPay, an incumbent since May of 2011 and Coinbase Commerce a new entrant as of February of 2018.

Another competitor, PayPal’s Venmo is yet to offer any cryptocurrency support. Square’s push into the cryptocurrency market led to a surge in downloads for Cash App, surpassing Venmo mobile money service. Cumulative downloads for the Cash App now total 34 million, exceeding Venmo’s 33 million for the first time ever, according to data aggregated from the Google Play and Apple App stores.

Square is one of the first mainstream payment processors to tackle the shortcomings of cryptocurrency payments. Issues such as price volatility, long confirmation times, and poor ease of use still make cryptocurrency a cumbersome option for retail payments. However, Square is tackling many of these issues head-on.

By leveraging its large user base and popularity among small businesses it is possible Square could become a leader in crypto payment processing.

According to Square’s Q3 shareholder letter, the company had revenues totaling $43 million related to Bitcoin transactions, up 16 percent from last quarter. The transactions contributed $560 thousand to the company’s net income, up 33 percent from last quarter, with a net margin of 1.3 percent on all Bitcoin transactions conducted through the service.

Related: Bitcoin-Friendly Square’s Cash App Grows in Favor Despite Bear Market

These figures indicate impressive growth in transaction volume despite the bear market. Since the release of Cash App’s Bitcoin support, cryptocurrency market capitalization has decreased by approximately 66 percent while Bitcoin transactions on Cash App grow unabated. This consistent quarterly growth may signal growing adoption despite the decreases in market capitalization.

Square is making strides in addressing the issues that make cryptocurrency impractical for payments in brick-and-mortar stores. As cryptocurrency becomes easier to use mass adoption will follow.

Square’s stock is up 218 percent from this time last year, down 4 percent in the last month.

This post credited to cryptoslate Image source: Unsplash

The International Monetary Fund (IMF), a global financial organization run by 189 countries, is against the proposal of the Marshall Islands to launch a sovereign digital currency by adopting crypto.

As early as September 10, the IMF criticized the finalized plans of the Marshall Islands of creating a national cryptocurrency, citing potential money laundering, financial integrity, and macroeconomic risks.

“In the absence of adequate risk mitigating measures, the issuance of a decentralized digital currency as a second legal tender would not only increase macroeconomic and financial integrity risks but elevate the risk of losing the last U.S. dollar CBR.”

Could IMF Stop the Plans of the Marshall Islands?

According to the IMF, the Marshall Islands is largely dependent on external aids offered by major economies like the US. If the government pursues its proposal to launch a national cryptocurrency, the IMF suggests that many countries could cut financial aid that is currently being offered to the Marshall Islands.

In May, the Marshall Islands initially disclosed its plans to eliminate its dependence on the US dollar and switch to a national cryptocurrency.

At the time, David Paul, minister-in-assistance to the president of the Marshall Islands, said that as a nation, the Marshall Islands have the right and authority to launch a national currency regardless of the form of the currency.

“As a country, we reserve the right to issue a currency in whatever form it is, whether in digital or fiat form,” Paul said.

IMF has publicly expressed concerns regarding the national cryptocurrency of the Marshall Islands as it fears that the currency will be manipulated by criminals, crime syndicates, and businesses running fraudulent operations.

However, as demonstrated by several studies including economist Richard Wright’s “Less Cash, Less Crime: Evidence from the Electronic Benefit Transfer Program,” physical forms of money like cash are significantly overutilized by criminals than electronic alternatives, because by nature, cash is anonymous.

“It has been long recognized that cash plays a critical role in fueling street crime due to its liquidity and transactional anonymity. In poor neighborhoods where street offenses are concentrated, a significant source of circulating cash stems from public assistance or welfare payments,” the study read.

As such, the basis of the claim of the IMF that the creation of a national cryptocurrency by the Marshall Islands should be prevented due to the possibility of money laundering can be questioned, given that the effect of cash on enabling criminal activities is well documented.

Plan May be Working

The threat to cut financial aid to the Marshall Islands is working. Earlier this week, Dr. Hilda Cathy Heine, President of the Marshall Islands, faced political attacks due to the proposal of the government to pursue the development of a national cryptocurrency.

Political pressure could force the Heine administration to lay off the plans to launch a digital asset, at least temporarily. Eight senators in the Marshall Islands have already submitted a motion of no confidence, fiercely opposing the initiative set forth by President Heine.

This post credited to ccn Image source: CCN

According to a study conducted by Deidre Campbell, Global Chair of Financial Services at Edelman, reportedby the New York Post, crypto still remains as a preferable long-term investment amongst millennial investors.

“Anyone that has crypto tells me they wish they bought it sooner,” said Campbell, whose study revealed that more than 25 percent of millennials are already using or holding digital assets.

30 percent of the respondents of the survey disclosed an interest in investigating and studying cryptocurrencies with the intent to invest in the short-term. That is more than 55 percent of millennials already invested or planning to invest in the emerging asset class.

Millennials Don’t Trust Banks

Mainly due to inefficient systems and outdated models that are not tailored to young investors, who already suffer from immense financial pressure from student loans after graduating college, several studies have found that millennials do not trust banks with their money.

In 2015, when the awareness of crypto by the mainstream was relatively low and alternatives to banking systems were not made familiar to millennials, a study conducted by Harvard University’s Institute of Politics discovered that only 14 percent of millennials believe the Wall Street “do the right thing” for customers.

Upon the release of the study, speaking to The Street, Recon Capital Partners CEO Kevin Kelly stated that the newly emerging trend could spell trouble for banks and financial institutions in Wall Street.

“This could definitely be a problem for Wall Street. We haven’t seen Wall Street change since the financial crisis. Every day, we’re starting to see headlines still: Wall Street does it again, another Wall Street faux pas,” Kelly explained.

Three years later, cashless alternatives such as fintech applications and crypto have become increasingly popular amongst millennials. In China, AliPay, the fintech platform of Alibaba valued at more than $150 billion, has started to account for more than 80 percent of all domestic online transactions.

In underbanked regions and areas with no practical banking systems, fintech applications have appealed to millions of users. In the Philippines, for instance, major banks like Union Bank require both residents and citizens to store more than $2,000 as a fixed balance in bank accounts, disallowing a fairly large portion of the country from utilizing banking services.

As such, remittance companies like Lhuiller and Palawan have become the main financial service providers of day-to-day users. The popularity of cryptocurrencies has also increased significantly, as digital assets allow users to send and receive payments with mobile phones without depending on banks.

Coins.ph, the largest cryptocurrency trading and remittance platform in the Philippines, secured more than 5 million users in the Philippines alone, with millions of users in Thailand and Malaysia actively using the service to send and receive cryptocurrencies.

“Customers use Coin.ph’s apps to access financial services such as cross-border remittances, purchasing digital currencies, topping up their beep stored value card, paying bills and buying ‘load’ (mobile promotional networks) – all without requiring a bank account,” CCN reported in June.

US, South Korea, and Japan

In major cryptocurrency markets like the US, South Korea, and Japan with established and fully compliant cryptocurrency exchanges, payment processors, and applications, the usage of cryptocurrencies by millennials is expected to surge rapidly.

The government of South Korea has recognized cryptocurrency exchanges as legitimate financial institutions and is leading initiatives to convince young talents to enter the blockchain industry.

This post credited to ccn Image from Shutterstock.