Category Archives: Altcoins

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D1 Coin Makes $20M Purchase from World’s Largest Diamond Miner

Diamond-backed cryptocurrency D1 Coin has just made a USD 20 million diamond purchase through KGK Diamonds via Alrosa, the largest diamond mining company in the world.

This purchase was for 1,500 investment-grade diamonds, bringing the total amount of diamonds in their reserves to 7,500 with a total weight of 4,400 carats (0.88 kg). While shy of a kilogram, these diamond reserves are worth almost USD 40 million, and plans are to expand this to USD 1 billion by the year’s end.

Essentially D1 Coin and its parent company will be a fully functional diamond exchange, and when D1 Coin goes live on cryptocurrency exchanges it hopes to provide an easy avenue to convert Bitcoin into physical diamonds.

D1 Coin joins a cluster of other new cryptocurrency backed by a physical asset, in an attempt to address one of cryptocurrency’s most discussed shortcomings of volatility.

All the diamonds in the D1 Coin reserve have an accompanying certification from the Gemological Institute of America. Every D1 Coin is backed by 1/1000 of a model standard diamond that is 1 carat, F color, excellent cut, and VS1 clarity. So far 3.3 million D1 Coins have been issued and all of them are backed by the diamond reserve which is in a vault and backed by an insurance policy. The diamond reserve is audited by a major firm.

When the D1 Coin redemption service goes live in June 2018 users will be able to select the diamond they want from the reserve, pay with D1 Coins, and then have the diamonds delivered to their home, after which point the D1 Coins involved in the transaction will be burned. Customers in Antwerp and Singapore can skip delivery and personally pick the diamonds up.

 

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James Rodriguez Launches JR10 Coin in Wave of Superstar Crypto Endorsements

James Rodriguez, an icon of Colombian football commonly known as James, has announced that he is partnering with SelfSell to launch his own crypto token called the JR10, reports USA Today.

The launch of the JR token, so named after his number 10 position in the Columbian squad, will elevate him to being the first active international player to move into crypto space through the launching of his own asset.

In next month’s World Cup in Russia, James, who also plays for German club Bayern München, will lead a Columbian squad competing against group members Japan, Senegal, and Poland.

Rodriguez is not the first footballer to embrace the blockchain space following Barcelona and Argentina star Lionel Messi’s recent affiliation with Sirin Labs who have marketed a blockchain smartphone with the superstar’s endorsement. Michael Owen, ex Liverpool and England International, also recently unveiled his merchandising, Owen Coin, supported by the Singapore-based Global Crypto Offering Exchange (GCOX).

The exchange scored another coup in March, this time signing a boxer to promote the exchange. Philippines Senator, Manny Pacquiao, better known for being the only eight-division world boxing champion, invested in the company which specializes in allowing celebrities to create their own digital currencies.

Sportsmen joining other crypto-crazy celebrities dipping their toes into fintech water include Jamie Foxx, Paris Hilton, football superstar Luis Suarez, rapper The Game, and stand-up comedian Kevin Hart and Canadian two-time speed skating world record holder Ted-Jan Bloemen who became the first cryptocurrency-sponsored athlete, according to Cryptovest.

The most notable event this year was American Boxer Floyd Mayweather’s endorsement of blockchain firm Stox to 16 million Instagram followers raising USD 33 million in 34 hours. This resulted in charges being made against the company by the US Securities and Exchange Commission (SEC) over allegations that the (ICO) was a fraudulent activity.

Rodriguez claimed that he will be involved in a range of activities following the launch including interacting with his fans, suggesting that the coin can be used to “become a new engine to grow the global football market”.

 

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“Show Me The Money”, Say Asian Crypto Investors

At the Blockchain Week recently held in New York, it emerged that two quite distinct differences exist between the Asian crypto market and the West.

In the US, initial coin offerings are about ideas rather than returns and vice versa when it comes to Asia, according to Coindesk interviews conducted at the conference. Asian investors want returns more quickly than US investors, who are in for the long haul, better invested in terms of financial knowledge than quick gains.

“At the very beginning, the information coming from Asia to the US was very limited. We didn’t know what’s really going on,” said Zhuling Chen, co-founder of Aelf, a Singapore startup.

With no real reference point, this resulted in the market evolving in Asia as a separate entity, not part of a Bitcoin or Ethereum ecosystem, but certainly informed by them, followed by Asian banks joining the fray in early 2016.

“Asians love to gamble,” commented Jason Fang from Sora Ventures at the Token Summit 111, one of the Blockchain Week events. Fan added that unlike Western projects, they don’t want to see long lock-up periods, but want their tokens out and realize quick returns.

Fang suggested that Asian investors have one eye on the market, knowing there will always be quick value increase after a coin is released, happy to let them go having made the quick return.”We’re money in, money out in crypto,” he said.

Ricky Li, co-founder of blockchain company Altonomy, told Coindesk that Asians rarely diversify their portfolios over time, again after that quick return:

“US and Europe ICO project teams are more well-invested in terms of financial knowledge… Chinese companies and their neighbors will raise funds in ether and largely maintain those positions, sometimes failing to lock in gain or riding volatility through their whole portfolio.”

“The general view is that a lot of American companies are pushing the boundaries of technological advancement,” Chen said. “In China, it’s slightly more balanced. More companies are looking from a business point of view.”

Nick Tomaino, of VC firm 1confirmation, thought that Asia was arguably the most important part of the world in terms of cryptocurrency, and that the Asian market does mirror Western protocols. He felt, however, that there was a willingness to find common ground between US and Asian companies within the space.

Asian markets very much follow a common theme that is recognizable to all Chinese, that of family, or in terms of business, community, and localization:

“The best way is to have your own project that’s local,” Li concurred. “That’s very appealing to investors in China culturally.”

This, of course, has been affected by the Chinese ICO ban which is now driving companies to towards global business ventures, although this is seen as somewhat of a double-edged sword, giving benefits which weren’t considered before, due to the localized nature of Chinese business.

 

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US Department of Justice Opens Criminal Case into Bitcoin Price Manipulations

The US Department of Justice (DOJ) has opened a criminal investigation into whether traders are manipulating the price of Bitcoin and other cryptocurrencies, according to a report published Thursday by Bloomberg.

The most notable concern coming from the DOJ relates to a suspected potential that the volatility of the market creates an opportunity for investors to push price valuations in a way to favor themselves.

Additionally, authorities feel cryptocurrencies are particularly susceptible to fraud due to a concern over the lack of regulations, as well as skepticism that every exchange actively pursues those deceiving the rules of the platform.

Spoofing and wash trading

People familiar with the situation told Bloomberg that the DOJ is specifically looking into spoofing and wash trading from colluding traders. These two illicit tactics are forms of market cheating that have been combated by regulators in the futures and equity markets for years.

Spoofing involves a trader submitting a number of orders, then cancelling them once they are satisfied they have affected the prices enough in the desired direction.

Wash trading involves a cheater creating trades with themselves to create a false impression of market movements, which influences others to move in a specific way.

It was reported that both Bitcoin and Ether are being investigated for this, but the DOJ declined to comment on the case at Bloomberg’s request.

Protecting investors

After a Bitcoin price surge last year spanning between USD 1,000 and USD 20,000, the cryptocurrency industry has found a host of new supporters and investors. The number of ICOs has also skyrocketed, with a growing number of people aware and involved with altcoins.

Regulators across the globe are now seeing the industry as a growing concern, as investors enter the market without a clear understanding of what cryptocurrencies are, and the risks involved.

Cryptocurrency exchange platforms operate internationally, with many remaining unregistered with any government agencies, leading to a heightened fear of fraudulent activities in general.

Of course, the vast majority of platforms maintain there own strict security measures to protect users and are willing to pursue fraudsters, if not only to protect their own reputation.

 

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Crypto Tax Lifted as Poland Heeds Public Demand

Poland has reviewed its position on cryptocurrencies in the country, as part of a thorough analysis of the crypto space, announcing that it is to temporarily suspend tax collection for digital currencies, according to Cointelegraph.

In a similar move to the French government’s, who recently heavily reduced its taxation on sales of cryptocurrency, Poland’s ministry of finance has been forced to heed public demand for changes to cryptocurrency legislation.

The ministry had issued a statement prior the end of the Polish tax year, which ends at the end of April, informing consumers that cryptocurrency falls into two income tax brackets of 18% and 32%.

These announcements provoked immediate public response through a Change.org petition which gained over 5,000 signatures asking for tax exemption for crypto technology dealings. Although the government has responded positively to the petition, it has stated that “the obligation may arise to pay tax in an amount often exceeding the funds invested”.

The government announcement claimed, “Temporary abandonment of tax collection will allow for an in-depth analysis and preparation of system solutions regulating this economic space, including in the tax context.”

However, the Polish government continues to be wary of cryptocurrency and is continuing its information campaign to the public. The Financial Supervision Authority (KNF) has employed a company to conduct a social media campaign on its behalf which illustrates the dangers associated with cryptocurrencies, such as pyramid schemes and forex trading.

The anti-crypto stance was highlighted recently through a secretly-funded YouTube video about a man who lost all his money from crypto trading, as part of an ongoing collaboration between the Central Bank of Poland and the Polish government’s KNF.

Reports in January had revealed that a group of researchers at Lazarski University in Warsaw had created a digital currency called the dPLN, which could be linked to Poland’s fiat currency, the Polish zloty (PLN). The project was initiated by the Polish Blockchain Technology Accelerator (PATB), which operates under the patronage of the ministry of digitalization.

According to Prof Krzysztof Piech who was in charge of the project, he felt that “multiple countries will soon adopt the blockchain-based nationalized digital coins in 2018, and Poland’s dPLN can be paired with any currency of the world”.

 

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Jo’Burg’s First ATM Hopes to Enthuse Local South Africans Towards Bitcoin

South Africa has its first cryptocurrency ATM since 2104 and the new Northwold Spar machine in Johannesburg will become the only one operating in the country, reports Bitcoinist.

George Neophytou, the General Manager of the Northwold Spar and self-confessed crypto enthusiast was inspired to purchase the machine after a trip to Europe, the continent with the world’s third market share of crypto ATMs, He comments:

“It is all awfully exciting. It will take away much the frustration of buying and selling cryptocurrency, and hopefully help make cryptocurrencies mainstream… It’s a different world there. Walking around in the streets of Germany you see signs with ‘Bitcoins accepted there’.”

The ATM, which was imported from Portugal, will be able to process various forms of cryptocurrency tokens including Ethereum and Bitcoin. It’s not the first in South Africa, as a previous machine was installed in 2014 at a men’s salon in Midrand, Johannesburg, but was closed down after a short period in operation. The store manager was excited about the prospect of making cryptocurrency available to his customers:

“It is all awfully exciting. It will take away much the frustration of buying and selling cryptocurrency, and hopefully help make cryptocurrencies mainstream…Lots of people in South Africa are also in the cryptocurrency space and lots of South Africans are watching it. However, not all individuals have access to it.”

Neophyou hopes that his ATM will make cryptocurrency accessible to those customers without a bank account, and hopes to roll out more ATMs, if successful. Although, he warns that those using the machine should do their research and understand that they should only spend what they can afford to lose.

A recent survey conducted in South Africa maintained that one in four respondents confirmed they plan to invest in cryptocurrency in the future, and another 15% said that they would invest in mining equipment. Although, warnings of electricity hikes of up to 50% in the near future may well dampen the enthusiasm of prospective bitcoin miners, according to LiveBitcoinNews.com

South Africa joins Zimbabwe and Djibouti are currently the only African countries to offer cryptocurrency ATMs.

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Switzerland Considers National Digital Currency ‘e-franc’

The Federal Council of the Government of Switzerland is considering the establishment of a national digital currency called the e-franc, with Reuters reporting Thursday a study has been requested into the possibility of its establishment.

The e-franc would utilize blockchain technology while operating under the jurisdiction of the Swiss state. The Federal Council requested the report, prompted by the vice-president of the Social Democratic Party, Cedric Wermuth. The motion is currently waiting for approval from the lower house of the Swiss Parliment before it can proceed.

The Federal Council commented on the study, saying: ”[The Council] is aware of the major challenges, both legal and monetary, which would be accompanied by the use of an e-franc. It asks that the proposal be adopted to examine the risks and opportunities of an e-franc and to clarify the legal, economic and financial aspects of the e-franc.”

The initial idea behind developing the state-backed cryptocurrency came from the chairman of the Swiss stock exchange SIX, Romeo Lacher. As reported by Cointelegraph, Lacher shared his positive sentiments of such a digital currency, saying “An e-franc under the control of the central bank would create a lot of synergies – so it would be good for the economy.”

While no timeframe has been provided regarding the period it will take for the lower house to come to a decision, should it be approved, the Swiss Finance Ministry will be responsible for coordinating the study.

Crypto in Switzerland

This news has come as somewhat of a surprise considering Switzerland’s largest bank UBS [SIX: UBSG] declined to facilitate Bitcoin trading earlier this month. Axel Weber, chairman of the bank, shared his negative perception of cryptocurrencies in a statement calling for stricter regulations. “[Cryptocurrencies] are often not transparent and, therefore, open to being abused,” he said.

Andréa Maechle, Board Member of the Swiss National Bank, last month expressed his view on nationally issued digital currencies, citing them as inferior to their private sector counterparts. Maechle noted that government-issued cryptocurrencies have an increased risk of bank runs- when a large number of customers of a bank or another financial institution withdraw their deposits simultaneously due to concerns about the bank’s monetary holdings.

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Apple, Twitter Founders Upbeat on Future of Bitcoin and Blockchain

Apple co-founder Steve Wozniak, appearing at the WeAreDevelopers World Congress in Vienna on Wednesday, told the assembled audience that he saw both blockchain and cryptocurrencies reaching their future full potential in just a decade, according to Cointelegraph.

Wozniak’s speech at the IT conference, Europe’s largest of its kind attracting roughly 8,000 visitors from 70 countries, opened the event, where he was attending to present his views on how blockchain was shaping the future of the technology sector. On this occasion, he focused his attention on the advancement of blockchain in his address with a less flamboyant approach, unlike his comments at the October Money 20/20 conference in Las Vegas last year, when he referred to Bitcoin as “better” and more “stable” than gold.

Referred to by the Apple co-founder as “the next major IT revolution that is about to happen”, Wozniak suggested that within the decade, decentralized technology would need to be adopted more widely and not simply limited to cryptocurrency, but applied to a diversity of sectors. However, he did point out that DLT had an advantage over fiat currencies due to the limitation on how many Bitcoins could exist, given that the US dollar could simply be printed, describing Bitcoin as more “genuine and real”.

Another major IT player, Jack Dorsey, was speaking at another gathering, the Consensus conference in New York, on the same day. The founder of Twitter and CEO of Square expressed a view there that he was positive that, in the future, the “internet is going to have a native currency”, hoping that it would be Bitcoin. He said that a common digital currency used by everyone would be the future, although until then people would continue to use various digital and traditional currencies to pay for goods and services, Fortune reports.

Like Wozniak, Dorsey has long been a supporter of Bitcoin and other digital currencies. His company Square allows for Bitcoin transactions, and buys and sells the digital currency.

 

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Educational Hoax ICO Site Launched by US Government

The US Securities and Exchange Commission (SEC) has produced a website advertising a scam initial coin offering (ICO), in an effort to educate the populace on how to identify such fraudulent websites.

In a Wednesday press release, SEC Chairman Jay Clayton discussed the intent behind the initiative. While acknowledging the rapid growth in the number of ICOs, he explained a need to help give investors the tools they require to recognize fraudulent sites.

”We embrace new technologies, but we also want investors to see what fraud looks like, so we built this educational site with many of the classic warning signs of fraud… I encourage investors to do their diligence and ask questions,”
Clayton detailed.

Howeycoin ‘ICO’

The mock ICO website advertises the fictitious Howeycoin token, reading: ”Howeycoin is the newest and only coin offering that captures the magic of coin trading profits AND the excitement and guaranteed returns of the travel industry. Howeycoins will partner with all segments of the travel industry (air, hotel, car rental, and luxury segments), earning coins you can trade for profit instead of points.”

Information provided on the website looks much like that supplied during a genuine ICO, with statements such as “We anticipate OVER 1% daily returns, with DOUBLE 2% returns on Tier 1 investors in pre-ICO stage secured purchases.”

SEC Chief Council Owen Donley noted the ease at which scammers can utilize convoluted jargon to lure individuals into false investments, but pointed out significant red flags that can indicate fraud.

By clicking on the internal website links, visitors are directed to an SEC site that notifies them of the truthful nature of the website.

The SEC notice explains: ”Our bogus site is a mash-up of a number of different things we’ve seen – any particular fraud may be harder to spot than the red flags here. Here are some of the signs of fraud that are on the Howeycoins site – we hope reviewing these may help you recognize a real fraud in the future!”

Targetting of ICOs

There is certainly an emphasis currently placed on targetting ICOs and cryptocurrency related scams, when in fact around less than 1% of Bitcoin-related transactions have been linked to illicit activities. Although, it is true that several high-profile ICOs have been shut down due to suspected, or convicted fraudulent activity.

While it is certainly necessary to regulate ICOs to ensure they are providing the services and tokens that they are advertising, the current enforcement of numerous subpoenas by the SEC does indicate an arguably overzealous approach towards cryptocurrency start-ups when compared to how mainstream financial scams are currently handled.

 

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Iran and Russia Join Crypto Chess Against US Dollar as Sanctions Loom

Both Iran and Russia have similar views on bypassing using the US dollar in favor of cryptocurrency in light of sanctions, reports Trustnodes. This is based on comments made by Mohammad Reza Purebrakhimi, the head of the commission for economic affairs of the Assembly of the Islamic Council (Parliament) of Iran, as reported by Interfax.

In a meeting with Russia’s head of the Federation Council Committee on Economic Policy Dmitry Mezentsev, Purebrakhimi suggested that the subject of cryptocurrency has been raised over the past year as a way of avoiding both the US dollar and the SWIFT banking system. To that end, the Central bank of Iran has been instructed by the Iranian government to begin the process of “developing proposals for using cryptocurrency”.

Purebrakhimi had discussed such moves with Russia’s lower house of Parliament, the State Duma’s Committee on Economic Policy, prior to the statement.

“They [Russia] share our opinion that if we manage to promote this work, then we will be the first countries that use the cryptocurrency in the exchange of goods,” Purebrakhimi said, according to a rough translation.

Russia had already stated earlier this month that its own clearing and payment system for banks, developed in 2014 as an alternative to SWIFT, is to run on blockchain by 2019 according to local media. This after suggestions they may be cut off from it due to sanctions. Russian daily Izvestiya reported:

“In 2019, the Central Bank will transfer the Financial Communications Transfer System (SPFS) – the Russian equivalent of SWIFT – to the blockchain system.” (translated)

Iran suggests that its own cryptocurrency is likely to be a tokenized bond similar to the Venezuelan Petro and must be viewed as a timely adoption in the context of a potential reinstatement of sanctions by the US after its recent withdrawal from the Iran Nuclear Deal.

Russian itself has made numerous references to adopting a state cryptocurrency under President Vladimir Putin. Just recently, the Financial Times reported that his economic advisor Sergei Glazev declared that cryptocurrency could be used to carry out “sensitive” state activities: “We can settle accounts with our counterparties all over the world with no regard for sanctions.”

Apart from such proposals as using cryptocurrency at the highest state level, the government is still highly regulating public use of digital currency. A new bill is being worked on within the Russian government, that would have cryptocurrency trading and mining banned entirely unless a person enters a list of approved individuals. According to Coindesk, crypto and digital tokens will only be traded on authorized exchanges complying with AML and counter-terrorism financing regulations.

 

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