$45 Million: Ukrainian Lawmakers Reveal Big Bitcoin Holdings

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August 15, 2017

Recent disclosures by members of Ukraine’s national legislature revealed that three lawmakers have a combined wealth in bitcoin worth more than $45 million.

According to a report from RIA Novosti, Russia’s international news service, the three lawmakers are all members of the “Petro Poroshenko Block”, which constitutes the largest grouping of legislators within the Parliament.

Of the three named by the report, Dmitry Golubov possesses the most bitcoin: 8,752 BTC, an amount worth roughly $36 million at current prices. Alexander Urbansky possesses 2,494 BTC while Dmitry Belotserkovets owns 398 BTC, worth approximately $10 million and $1.6 million, respectively.

The disclosures come as Ukraine inches toward regulating the cryptocurrency.

As reported previously, the National Bank of Ukraine – the country’s central bank – revealed last week that the legal implications of cryptocurrencies will be discussed at the next meeting of the Financial Stability Board of Ukraine. That hearing, scheduled for the end of August, will bring together the nation’s financial authorities.

It’s unclear at this time exactly what steps the government will ultimately take. Local sources reported last week that a large cache of bitcoin mining machines were confiscated after authorities discovered at a state-owned facility.

And while officials determine how they intend to regulate bitcoin, some agencies have moved to begin testing how blockchain might be applied more broadly to their offices. For example, work has begun on a new land registry powered by blockchain, with a formal trial commencing in October.

Money Management Firm Calls Bitcoin a ‘Fad’, then Files for Bitcoin ETF

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August 15, 2017

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Money management firm VanEck has filed for a bitcoin ETF despite claiming that the digital currency was a ‘fad.’

Regardless of the recent user activated hard fork (UAHF), which saw the creation of bitcoin cash, bitcoin’s value has soared. Over the weekend, the digital currency jumped to over $4,000 for the first time, quadrupling its value since the beginning of 2017.

However, despite claims that bitcoin’s price is similar to the 17th century Dutch tulip mania, it appears the rising interest in the digital currency is presenting a high-risk opportunity that is too good to miss.

This is the case for VanEck.

According to a report from CNBC, Joe Foster, portfolio manager and strategist for VanEck’s flagship International Investors of Gold Fund (INIVX), he said that bitcoin would never ‘replicate or replace’ gold.

Foster said:

Bitcoin and other digital currencies are a fad that has attracted the attention of programmers, speculators, and early adaptors.

He added that he didn’t think governments would permit digital currencies to reach the level required to challenge fiat currencies, claiming:

At best, digital currencies may eventually occupy some middle ground as a niche product. At worst, they become a failed experiment that ends in tears.

Now, though, in a complete reversal, the money management firm has filed with the U.S. Securities and Exchange Commission (SEC) for a VanEck Vectors Bitcoin Strategy ETF. Initially investing in bitcoin future contracts it will trade on the Nasdaq.

According to the filing, it states:

The Fund seeks to achieve its investment objective by investing, under normal circumstances, in U.S. exchange-traded bitcoin-linked derivative instruments and pooled investment vehicles and exchange-traded products that provide exposure to bitcoin.

Other prominent companies have also filed their own digital currency trading products with the SEC in 2017.

Most notable was the Winklevoss twins bitcoin ETF, which was rejected by the SEC in early March. If approved it would have traded under the Bats Exchange. After the decision was announced bitcoin’s price fell from $1,300 to just over $1,000.

In April, it was reported that the SEC would review its decision after receiving a request from the Bats Exchange.

The second rejection from the SEC was handed to SolidX after it filed a proposal to list its bitcoin ETF on the New York Stock Exchange at the end of March.

Foster concluded by saying that while the blockchain technology is a ‘game changer,’ another digital currency could easily threaten bitcoin’s dominance.

For now, the only thing we can forecast with confidence in the digital currency space is more volatility.

$8,000 Bitcoin is Possible if it Follows Litecoin’s Post-SegWit Example

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August 15, 2017

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Bitcoin’s miners recently locked-in the Segregated Witness (SegWit) upgrade, and it will be automatically activated at the next difficulty adjustment in about a week. SegWit represents a major upgrade to the network by itself, but it also enables even further improvements such as the lightning network.

Many are hoping that SegWit’s activation will result in further price appreciation. Traders are eyeing the example set by Litecoin, whose price doubled in just four months following its SegWit activation.

What is SegWit?

Segregated Witness is a change in Bitcoin’s code that will allow certain data within each block to be separated, or segregated, from ordinary transaction data. It effectively increases the size of Bitcoin’s blocks. SegWit also fixes Bitcoin’s transaction malleability problem. The malleability fix is extremely important because it will enable the deployment of the lightning network, enabling further scaling.

The Segregated Witness code was originally designed for Bitcoin, but Litecoin was the first major virtual currency to activate it.

Possible effects of SegWit on Bitcoin

With the SegWit activation for Bitcoin already locked in, more good things are expected for the leading cryptocurrency. SegWit activation should immediately reduce network congestion and fees and buoy confidence that Bitcoin’s civil war is finally over.

If Bitcoin follows Litecoin’s path, we will likely see $8,000 Bitcoin by the end of 2017. Nonetheless, markets are unpredictable and such a price increase is by no means certain.

Legally Binding Smart Contracts? 10 Law Firms Join Enterprise Ethereum Alliance

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August 15, 2017

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No, code isn’t law, but if the Enterprise Ethereum Alliance’s new members have anything to say about it, that might someday change.

Today, the alliance announced that ten law firms and four legal institutions that specialize in blockchain technology have joined the group. New members include Cooley, Debevoise & Plimpton, Hogan Lovells, Holland & Knight, Jones Day, Morrison Foerster, Perkins Coie, Shearman & Sterling and Cardozo Law School’s Blockchain Project.

With the news, the new members have also joined the alliance’s Legal Industry Working Group, chaired by Aaron Wright, co-director of the Cardozo Law School’s Blockchain Project.

However, the chairman of the Enterprise Ethereum Alliance board of directors, Julio Faura, told CoinDesk the law firms will be working to ensure that blockchain-based technologies are more than just compliant with the financial system, but also with the power delivery and telecommunications industries.

Faura, head of blockchain research and development at Banco Santander, said:

“If we’re going to represent all of these things using smart contracts, and we’re going to mimic the same properties that we have in the corporate world using smart contracts, then it’s very important that we do it in a way that is compliant with today’s laws and today’s policies.”

Coming just weeks after the U.S. Securities and Exchange Commission (SEC) released its first formal guidance on blockchain-based assets that might also be securities, the formation of the working group signals the desire by some parts of the industry to play by the rules.

Other industries, other blockchains

First revealed in July, the Legal industry Working Group is chartered to educate the legal industry about the potential benefits of blockchain technology, and to develop and standardize private versions of the ethereum blockchain.

Working in partnership with several existing members – BNY Mellon, Intel and JPMorgan Chase – the group is designed to ensure that ethereum smart contracts and assets comply with regulations and are legally binding.

He continued:

“We’re not trying to change the whole economic fabric from traditional systems to a blockchain. What we are doing is we are trying to use blockchain to reflect the reality that we have in our system, in the economic world in general.”

And not only are different industries in the group’s sights, but also the broader ecosystem of blockchains. Faura believes the implications of the group will expand beyond ethereum at some point.

“I’m sure this is going to have a big impact on all aspects of using blockchain in real-life situations,” he said.

Benefits for lawyers

While members believe the financial industry, power delivery systems and telecommunications businesses could be digitized and put directly onto a blockchain, the business benefit for lawyers may seem less obvious.

But founding member, Lewis Cohen of Hogan Lovells, contends there are advantages for legal institutions. There’s a learning component, one that his clients don’t want to pay for but expect him to know, especially as state governments around the world continue to weigh in on blockchain.

The need to know the difference between ethereum, Corda and any number of other distributed ledgers will only grow.

Cohen told CoinDesk the working group is a way for him to stay on the cutting edge for his clients, stating:

“I think it’s incumbent for lawyers in this space to educate themselves, and there’s no better way for lawyers to educate themselves than to be a part of this working group.”

Since the early days of blockchain-based self executing code – when some argued “code is law” – coders and lawyers alike have become increasingly sophisticated.

Not only is more being expected from smart contract code, but the workflows within institutions are being reimagined. And as smart contracts are entrusted with increasingly sophisticated tasks, Faura expects lawyer’s roles will grow, not shrink as some have worried.

Investors Can Still Win Even When ICOs Don’t Meet Funding Targets

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August 12, 2017

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Despite the recent ICO explosion, not all Blockchain projects manage to meet their funding goals. Fortunately, in the right hands, such projects can still provide a good return on investment.

The key requirement for any ICO is to raise enough money to develop the minimum viable product. Assuming this goal is met, there is still a chance that investors could see a positive return. Many ICOs fail to meet their funding targets due to poor marketing and publicity, not because the idea for their project is a bad one.

Timing is often a factor in ICOs as well. Any unfortunate event, such as a hacking scandal, a sharp price drop, or a well-advertised competing ICO, can result in a project receiving less funds than expected.

Undervalued projects can shine

Sometimes undervalued projects produce the best return on investment. Since they sold fewer tokens and raised less money, the value of their tokens isn’t as diluted. Consider both the debut of NXT and IOTA. Though ICOs–per se–didn’t exist back then, both projects raised money by pre-selling tokens.

Even when an ICO doesn’t reach its fundraising expectations, since the founders usually retain a large number of tokens, they are still properly incentivized to build a good product. Doing so increases the value of their own tokens and stands to make them a great deal of money over the long term.

Potential investors should analyze the team’s approach to issues and their level of commitment to get the job done. Investors should always do due diligence to confirm the viability of their investment in order to protect themselves from scams and to be sure that they are investing in a serious project.

While under-funded ICOs may not be flashy and make headlines, they can still make their investors rich slowly.

Enterprise Ethereum Alliance Gets to Work at 90-Member ‘Town Hall’ Meeting

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August 12, 2017

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The Enterprise Ethereum Alliance is on the verge of kicking off a new phase of its development.

After launching earlier this year, and quickly growing to include more than 150 members from around the world, the alliance is about to initiate a flurry of activity from its diverse group of members aimed at breaking new ground on enterprise blockchain solutions

Since revealing its first working groups and a technical steering committee in July, the chairman of the Enterprise Ethereum Alliance (EEA) says the consortium has been ironing out the details of its governance model, gathering even more new members and working to identify objectives.

This behind-the-scenes work took a step forward in a second “town hall” meeting that was open to all members, last month.

Details of the meeting revealed to CoinDesk yesterday by EEA chairman of the board, Julio Faura show the heads of each working group drawing up plans for coordinating their working efforts behind a series of “certified” standards.

Faura said:

“Most of these working groups are launching as we speak. We’ve been basically, this past month, getting our act together as it comes to governance and the technical steering committee.”

Behind the scenes

In total, 94 participants attended the meeting, including representatives from the Token Working Group, chaired by Alex Batlin of BNY Mellon; the Banking Working Group, chaired by Amber Baldet of JPMorgan; and the Healthcare Working Group, chaired by Merck’s Fabian Wahl.

According to a copy of the agenda provided to CoinDesk, addresses were given by Faura and membership committee chair Jeremy Millar, before the chair and vice chair of each working group was invited to speak.

While the meeting was closed to reporters, Faura described the discussion as focusing on how the group will now seek to create standards to ensure the many separate projects involved can interoperate.

Given the consortium’s focus on interoperability, each member is free to build with whatever implementation they choose. Platforms currently being used by members include Monax, Parity and Quorum, said Faura, who is also head of blockchain research and development at Banco Santander.

He continued:

“These working groups are not technical in nature. They may explore technical implications, of course, but they are not building different flavors of ethereum. What they’re doing is they’re discussing the use of ethereum in their respective situations.”

Demographic diversity

Also revealed at the meeting was a breakdown of the non-profit’s more than 150 members by region.

As a result of such diversity, not just across industries but across languages and borders, Faura said another priority topic is the creation of a governance model that describes how members relate to the groups as well as how the groups relate to each other and to the overall organization.

Currently, the rule-making process is being accomplished using traditional methods, but a level of distributed interoperability is also required. To that end, Faura said the group is considering using blockchain technologies to cast votes in a more reliable way.

Eventually, the objective is to create a feedback loop that strengthens the technological developments made by members. But that too is something that hasn’t yet been formalized, and is instead relying on a more organic transmission of lessons learned.

“Over time, we may end up having some operational things, for example, an operations working group may start putting together a testnet for others to work on,” Faura said, concluding:

“Later on, we may go into things more serious, but these are just discussions at this point.”

Paragon Coin: Rapper ‘The Game’ Is Helping Launch An ICO

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August 12, 2017

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No cryptocurrency hype cycle is complete without interesting celebrity appearances. Mike Tyson, 50 Cent, and other celebrities have from time to time gotten involved in cryptocurrencies, either accepting them or appearing at events hosted by their advocates. Dennis Rodman recently went on a human rights expedition to North Korea at behest and funding of PotCoin.

Speaking of PotCoin, it seems a new, mysterious ICO of a similar nature is in the near future. Miss Iowa 2014 Jessica VerSteeg is apparently the CEO of something called Paragon Coin, which from what we can tell is some kind of marriage between the cannabis industry and cryptocurrency.

Information about what Paragon Coin will actually do is mysterious, but references to marijuana are evident. We are invited to be “part of something great.” We find an empty blog, a Facebook page full of cryptocurrency links and only a brief video with rapper the Game and VerSteeg, in which the Game says:

We are revolutionizing cannabis […] hey, the world.

Again, with little actual information as to what is going on.

Problematically, something called Paragon Coins is already out there in the ether, relating to the Playstation game Paragon. We all know how friendly the entertainment industry is when it comes to intellectual property infringement.

Star Power

The Stox ICO closed an extremely successful funding round earlier this month and much of its success was attributed to the promotion of boxer Floyd Mayweather. While people in the cryptocurrency niche for a long time probably find it amusing that celebrities and legacy financiers are entering the market in droves now, it’s worth being wary of things which are based purely on hype.

There are, after all, some significant and legitimate efforts at disrupting the banking blockcade surrounding the cannabis industry. More are needed, as apparently regressive drug policy appears to be the rule of the day still in the United States at least, and that means cannabis companies actually gaining access to the banking system is going to take even longer. However, in the Paragon pre-hype we get nothing at all in terms of solutions. We get nothing but a distraction from whatever else we were doing. The move, absent anything else, reads as more of a test to see how much interest the pair can generate in something apropos of nothing than it does a sincere effort to “revolutionize” anything.

It seems the place to check for more information is ParagonCoin.com, next week.

Medical Society of Delaware to Pilot Blockchain Technology for Better Healthcare Access

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August 12, 2017

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The Medical Society of Delaware has partnered with healthcare technology startup Medscient to test a proof-of-concept involving Blockchain technology. The trial aims to improve healthcare access by creating a chain of patient records that can be made available to insurers and medical care providers.

According to the society, the proof-of-concept solution will focus on the preauthorization process for care providers and medical insurers. In his statement, the society’s vice president, Andrew Dahlke, said that the pilot initiative will pave the way for streamlining other healthcare administrative issues in their operation.

“We are confident that this proof-of-concept will not only address this particular pain point, but will lay the groundwork for streamlining other healthcare administrative issues as well.”

The project will be presented by the society and Medscient at the Medicaid Enterprise Systems Conference to be held in Baltimore, Maryland in late August 2017.

Delaware government approves Blockchain law

Meanwhile, Delaware became the first state in the US to pass a law allowing the use of Blockchain technology in business when Governor John C. Carney Jr. signed the bill legalizing the use of Blockchain for stock trading and record-keeping. The bill amends the state’s General Corporation Law.

Efforts to integrate Blockchain in government and business operations in the state were initiated by Carney’s predecessor Jack Markell in May 2016 when he launched a program to promote the technology in government agencies.

According to industry analysts, the signing of the bill into law will facilitate experimentation on the possible uses of Blockchain technology to achieve efficiency and transparency in government transactions.

This will also make it possible for custodianship, issuance, redemption, and trading to be conducted on a distributed ledger.

The Bitcoin Price Just Inched Up to Set Another All-Time High

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August 12, 2017

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The average price of bitcoin across global exchanges today reached $3,550 on the CoinDesk Bitcoin Price Index, setting yet another new all-time high.

The uptick coincides with a palpable improvement in public sentiment about the world’s first cryptographic asset, with bitcoin recently receiving positive mentions from leading asset managers and gaining increasing exposure in western media.

At press time, bitcoin was trading at $3,550, a figure that has appreciated nearly 50% over the last month of trading. Data from the CoinDesk BPI indicates the price of bitcoin was just $2,423 on June 12.

Yet, the strongest growth has been seen in the last week, following a fork of the bitcoin blockchain that resulted in the creation of a new cryptocurrency, bitcoin cash.

Perhaps most notably, bitcoin is up nearly 25% on the week since the split, rising from $2,871 seven days prior, while bitcoin cash, the new blockchain, has climbed just 17%, rising to $340 from $290 one week ago.

The interplay between the two currencies will no doubt be one to watch, as it could change attitudes toward blockchain forks and provide an illustration of how cryptocurrency markets will respond to technical changes in the future.

Thailand’s KBank to Start Digitizing Contracts With Blockchain by 2018

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August 9, 2017

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One of Thailand’s largest commercial banks is looking to digitize some of its financial contracts through a new blockchain solution developed with IBM.

Kasikorn Bank, or KBank, revealed today that it wants to move away from paper-based letters of guarantee – which are commonly issued by banks to ensure the delivery of certain types of securities – to a wholly digital format.

The process won’t happen overnight, though. According to KBank, the plan involves digitizing 35 percent of the total amount of these contracts it generates by the end of next year. For a sense of the scale, KBank said that it expects to issue as much as $9 billion in letters of guarantee during that time.

Of those, 5 percent will be executed on the blockchain-powered platform, which uses the Hyperledger Fabric software as a basis. And looking ahead, KBank wants to find other partners that would use the platform.

As Pipit Aneaknithi, KBank’s president, explained in a statement:

“Blockchain technology is applied to create highly secure networks of document filing and retrieval. As Thailand’s largest issuer of Letters of Guarantee, KBank is working with IBM to implement this innovative technology to further define and articulate our leadership in this market.”

The solution was previously tested in conjunction with Thailand’s central bank as part of its regulatory “sandbox”, or a framework in which new kinds of financial tech can be trialled in a limited setting.

As reported previously, KBank has been working with IBM to develop blockchain solutions for certifying the veracity of documents.

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$45 Million: Ukrainian Lawmakers Reveal Big Bitcoin Holdings

Money Management Firm Calls Bitcoin a ‘Fad’, then Files for Bitcoin ETF

$8,000 Bitcoin is Possible if it Follows Litecoin’s Post-SegWit Example

What is SegWit?

Possible effects of SegWit on Bitcoin

Legally Binding Smart Contracts? 10 Law Firms Join Enterprise Ethereum Alliance

Other industries, other blockchains

Benefits for lawyers

Investors Can Still Win Even When ICOs Don’t Meet Funding Targets

Undervalued projects can shine

Enterprise Ethereum Alliance Gets to Work at 90-Member ‘Town Hall’ Meeting

Behind the scenes

Demographic diversity

Paragon Coin: Rapper ‘The Game’ Is Helping Launch An ICO

Star Power

Medical Society of Delaware to Pilot Blockchain Technology for Better Healthcare Access

Delaware government approves Blockchain law

The Bitcoin Price Just Inched Up to Set Another All-Time High

Thailand’s KBank to Start Digitizing Contracts With Blockchain by 2018

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