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“Time Traveler” Millionaire Investor Plans Australia’s First Crypto Bank

An Australian crypto enthusiast has set plans in motion to open his own crypto bank. Fred Schebesta has decided on a radical scheme in order to circumnavigate restrictive regulations by Australian banks towards anything cryptocurrency-related by opening his own bank and doing what he needs to get a share in an established bank.

The West Australian enthusiast has purchased a personal shareholding in an existing bank, West Australia’s Goldfields Money, in order to obtain an authorized deposit-taking institution (ADI) license to get his plans on the road.

Tiny by banking standards, Goldfield’s Money has a USD 35 million market cap but it does have the much-needed ADI, in fact, the only one in Western Australia to have it. Schebesta explains his reasoning:

“You don’t have your money. The bank has your money. Have you ever gone to the bank and asked for all your money? If everyone did a bank run on CommBank [Commonwealth Bank of Australia] right now, they wouldn’t be able to service it. That’s why I’m so big on crypto. I think eventually people will go, “Oh my god, this is so messed up”, and they’ll move to where they can hold their value. Not all of their money, but some of it.”

The current legal situation that the crypto banker-to-be is clearly attempting to come to terms with is as follows:

“New entrants to the banking industry will be able to apply for a Restricted ADI license, which will have a lower barrier to entry than a full ADI license, to assist their transition into the industry over a two-year period…  Restricted ADIs will be subject to an aggregate deposit limit of $2 million and must disclose to all its customers that they are operating on a restricted license.”

Schebesta clearly feels that his crypto bank idea is worth all the paperwork regardless of Bitcoin’s current fluctuation fortunes in the crypto market. He explains:

“At its core, you’ve got to remember, just because the price of Bitcoin has gone down and people feel angry, that doesn’t reduce the interest… We’re living in the future. That’s what I’m all about. I think I’m a time traveler. I travel forward five years into the future, work it out then come back and try to take active steps to make it happen.”

His enthusiasm is reflective of Australia’s current drive towards crypto adoption, with recent deals in the pipeline including a new contract which will allow IBM to explore blockchain technologies and integrate some of the results into the Australian political structure over the next five years.

The passionate crypto-enthusiast hopes to have his bank ready for business within 18 months. If Australia is ever governed by blockchain, Schebesta’s crypto bank will certainly be well placed for business.

 

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Can the Saudi Kingdom Move with the Times in a Blockchain World?

After Saudi Arabia’s first blockchain meeting, Translating Blockchain KSA 2018, the country is showing signs of incorporating new technologies to diminish the relevance of oil production.

Since 1938, the Kingdom has since become the world’s largest oil producer and exporter, controlling the world’s second-largest oil reserves with the sixth-largest gas reserves and is the only Arab country in the G20.

Also, the country still struggles with bridging the gap between history and modernity, having been projected into wealth by the discovery of oil before the Second World War. The kingdom has drawn criticism from advanced economies over various civil and social rights issues, which it intends to be based under religious laws under the absolute rule of the Saudi royal family.

This is sometimes a huge contradiction coming from a society which would rather present a more advanced and contemporary image. Saudi’s Vision 2030 is key to this change as outlined by Prince Mohammed bin Salman bin Abdulaziz:

“The second pillar of our vision is our determination to become a global investment powerhouse. Our nation holds strong investment capabilities, which we will harness to stimulate our economy and diversify our revenues… Our country is rich in its natural resources. We are not dependent solely on oil for our energy needs… our real wealth lies in the ambition of our people and the potential of our younger generation.”

In keeping with the new Saudi direction and this new image as proposed by Saudi Vision 2030, blockchain has been seen as a pivotal technology. This has resulted in the Riyadh Municipality partnering with IMB this year to strengthen blockchain in order to streamline government services and transactions. Computerized reasoning, IoT, and blockchain are fast becoming a priority in a country which wants to advance its economy and its technological footprint, while also moving away from its reliance on oil by cultivating new business models.

Takreem El Tohamy General Manager, IBM MEA has indicated that the city of Riyadh, the Saudi capital, is already planning to incorporate DLT as a means to enhance and digitalize its current record keeping through working with computerized arrangements supplier Elm.

 

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Citigroup Reportedly Eyeing Crypto Products

It appears that US banking giant Citigroup is looking into crypto products, according to an insider at the bank.

In April, an initial expression of interest was expressed by the group through a report entitled ‘Bank of the Future: The ABCs of Digital Disruption in Finance’, suggesting in the report that in the future banks will need “senior leadership teams to be focused on digital transformation” for their future well-being.

Although this is rather a broad statement, a contact at the bank has reportedly come forward and suggested that things have moved on since that statement, saying that Citibank “has moved beyond thinking about crypto” and now wants to look at it terms of a consumer product.

The current debate, particularly among major Wall Street financial institutions, is whether to take a wholehearted plunge into cryptocurrency and some are now dabbling around the futures market to see how it pans out. This kind of toe-dipping is mainly driven by customer pressure, whilst the banks continue to deal with the world outside which is still driven largely by apprehension and skepticism when it comes to cryptocurrency.

Such concerns reportedly led to Citibank’s Head of Consumer Crypto Asset Innovation title removed from her LinkedIn page for just that guilt by association scenario.

Although Citigroup has not confirmed the suggestion that it is considering moving down the crypto road, it has signed up for IBM’s trial blockchain project with USD 5 trillion a day foreign exchange settlement provider CLS.

There may be a suggestion of a hint in the recent 128-page Citigroup report though. It lists use cases for smart contracts, is also pro-Ripple and suggests that Bitcoin isn’t losing steam but banks may well be under some pressure.

Wednesday’s US Treasury Department statement that cryptocurrencies are “poised to impact innovation in financial services”, may well give some credibility to Citibank’s plans if they turn out to be a credible reflection of the company’s future direction.

 

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IBM, Barclays, Citi Create Blockchain App Store for Financial Services

American technology corporation IBM has teamed with banking giants including Barclays and Citi to create an app store style platform for financial blockchain services.

The LedgerConnect project aims to increase efficiency in banks’ ability to access and utilize blockchain solutions from fintech and software developers, offering services in areas of market data, know your customer (KYC) processes, collateral management and sanctions screenings. Nine financial institutions were part of the proof-of-concept of the app for use by their peers.

Trying something new

Those behind the LedgerConnect project say it will benefit users by pre-approving and certifying applications as secure to be used, potentially saving research costs for banks looking for blockchain services. Dr Lee Braine of Barclays noted that a hub such as this gives banks a chance to try something new in the area, allowing them access to the various deployment options of distributed ledgers in banking, and experience in combining infrastructure-hosted and bank-hosted nodes in the private network.

The hub itself runs on IBM’s blockchain platform, offering just Hyperledger-based applications for the time being, although the founders are looking into hosting alternative blockchain solutions, citing R3’s Corda and Quorum as viable options so long as they meet the security specifications.

A good thing for start-ups?

Should the hub find success in the sector, it will not only be beneficial for the banks using it, but also for the blockchain companies whose services are being advertised. By addressing a connectivity gap as the project says it is, the number of blockchain trials by big banks such as those the Bank of Canada has become known for may decrease, allowing smaller start-up firms to have their own solutions employed by those entities.

It could, in fact, encourage further research and applications be developed now there is an easier way for their work to be advertised and used by financial institutions.

 

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Crypto Giant Huobi Australia-Bound for ‘Knowledgeable and Sophisticated’ Trading

Singapore crypto giant Huobi has announced it has begun trading from Sydney on its new Australian platform, reports the Asia Times.

It has been a huge week for Huobi, the world’s third-largest crypto exchange by trade volume also announced that it has opened registration on its newly created U.S.-based “strategic partner” trading platform.

The new Australian venture has come about following Huobi’s comments that Australian traders are reputed to be well respected. The company will be trading 10 pairs including BTC, ETH, BCH, and LTC in Australian dollars.

The company suggests that Huobi’s billion dollars a day in trade volume can be further boosted with the addition of new trading pairs. Smaller pairs at present include Ethereum Classic (ETC), Power Ledger (POWR), Aelf (ELF), Cortex (CTXC), Data (DTA) and IOST with more “obscure” pairs to follow.

In another development, tech giant IBM has been expanding into Australasia and has signed a five-year deal security deal worth $740 million with the Australian government. The focus of the deal is to improve the company’s cybersecurity capabilities by employing blockchain related technologies.

IBM Australia and New Zealand managing director David la Rose says that the deal is a testament to their 40-year partnership with the Australian government, adding, “We look forward to helping the Australian government to re-define the digital experience for the benefit of all Australians.”

The new deal can be seen very much as a rebuilding of trust between IBM and the Australian Government which has recently been dented by the company’s 2016 national census survey receiving four “distributed denial of service” notices at the time, which temporarily shut down the service. IBM agreed to pay the Australian government more than A$30 million ($US20 million) in compensation.

Huobi’s latest US cryptocurrency marketplace comes via a San Francisco-based company called HBUS, which will support nine cryptocurrencies: Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), Ethereum Classic (ETC), Bitcoin Cash (BCH), Tether (USDT), DASH, Civic (CVC) and TrueUSD (TUSD), according to Cointelegraph.

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Blockchain Jobs are Number One In US – Upworks Skills Index

The number one position on Upworks US skills index is now blockchain expertise, making these the most sought-after positions for with current employers, writes Forbes.

The Upworks index is a strong indicator of the rising need within the US professional’s employment market for employees with blockchain experience and also is a gauge which indicates that blockchain has arrived and it is clearly not going away any time soon. According to Burning Glass Technologies, there were more than 5,743 jobs posted needing blockchain skills in the last 12 months.

As Bitcoin News has reported, multinationals such as IBM and Samsung have shown the world the value of the new technologies by embracing blockchain wholeheartedly. Companies such as Walmart are updating their supply chains and state governments in the US are increasingly turning to the technology to streamline government departments and state law.

What kind of blockchain related positions become available very much depends on demand. Blockchain developers, or engineers are top of the tree, being in high demand due to these positions highly technical nature. The whole process of developing a blockchain platform very much relies on the expertise that these professionals can bring to the project.

Blockchain project managers and designers are also in demand. The manager is responsible for tying technical aspects of the blockchain to the company’s actual business requirements. The job calls on standard management skills that might have been earned in other industries, using this ability to communicate to customers who may not have the tech skills nor vocabulary, but while still having the technical know-how themselves to communicate with staff.

One aspect of the tech that is becoming increasingly important, and perhaps is illustrated quite graphically by the recent Italian court case involving BitGrail, is the need for companies to employ a blockchain attorney or legal consultant in order to tackle the legal ramifications of using blockchain.

It is likely that the need for these professionals will swell over the next two years as blockchain takes on a more mainstream profile across sectors. Bernard Marr, writing in Forbes, suggests, “Blockchain has become what the “cloud” was in the mid-2000s, poised to be the most highly talked about technology and one that offers tremendous professional opportunity.”

 

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Ripple’s $50M University Blockchain Investment Gives Graduates Boost

Ripple has announced a USD 50 million University Blockchain Research Initiative (UBRI) partnering with 17 universities around the world, reports, Business Wire.

The initiative will support the workforce of the future, including academic research, technical development and innovation in blockchain, cryptocurrency and digital payments.

Ripple’s UBRI partners include some of the world’s most prestigious universities including Princeton University, MIT, and University College London (UCL). Several universities across the US, along with others in Korea, the Netherlands, Luxembourg, India, Brazil, Cyprus, and Australia are also included in the project, giving the initiative a distinctly international flavor.

Although each university is to decide on its own individual research topics, Ripple is committed to collaborating with universities regarding subject matter and technical resources along with providing financial backing.

A 2017 report has shown that global fintech investment in companies has grown by 11% due to the continuing demand for technological solutions. In addition, 4,500 job openings with the terms “blockchain,” “Bitcoin” or “cryptocurrency” in the title were posted on LinkedIn this year showing an increase of 151% on 2017 figures.

Eric van Miltenburg, SVP of Global Operations at Ripple says that the figures reflect the degree to which he feels that university graduates will increasingly fill situations in the fintech space as cryptography and blockchain matures. Universities will play a major role in the development of these new technologies:

“Much of the enthusiasm and activity to date around blockchain is disconnected from real use cases that result in clear benefits to businesses or civil society. While Ripple won’t dictate research parameters, we are excited to play a role in helping to support faculty and student-led projects that explore increasingly useful applications of blockchain and cryptocurrencies.”

There are now many opportunities for blockchain developers, but clearly not enough skilled technicians to fill these gaps. Toptal, a marketplace for hiring tech talent, recorded a 700% increase in demand for blockchain developers since January 2017. These positions can be well paid. According to Jerry Cuomo, VP of IBM’s blockchain technologies division, the best blockchain developers can command a salary above USD 250,000.

The university sector is increasingly becoming a beneficiary of tech companies drives to further develop blockchain education. Last year, The University of Edinburgh and the Tokyo Institute of Technology received a commitment of USD 1 million to set up new blockchain labs from Charles Hoskinson, who helped develop Ethereum.

 

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Gavin Brennen: 100GHz Quantum Computers Aren’t Threat to Blockchain

In May 2018, Australian physicist Gavin Brennen shared his team’s research into how quantum computing would affect blockchain. Jeffrey Tucker reported: “He began with his frustration over the headlines that swept the tech world last October and November. They were as alarmist as they were misleading.”

Scaremongering around how quantum computers will disrupt the security of blockchain technology is often exaggerated and not balanced with the possible solutions or counterplays to defend against the underdeveloped hardware left out.

Future iterations of quantum computers have the potential to reach speeds which are far greater than conventional computers, performing the calculations that blockchain is built on at a much faster rate. Quantum computers would use less energy and pose the threat of hijacking mining operations, redirecting currency and centralizing the network. With a powerful enough quantum computer, you would be able to crack the private key associated with a given public key, undermining the security of the blockchain.

Brennen and his team explored scenarios and made estimates of timeframes in which the technology would sufficiently develop to achieve this. Their research goes onto explain how current application specific integrated circuit (ASIC) hardware is performing proof of work (PoW) computations at hash rates of 14TH/s, which is one thousand times faster than the current gate speeds for quantum architectures which run at 66.7MHz (equates to 13.8GH/s). At the current difficulty level, this gives quantum computers no advantage. Future advancements in the development of quantum technology could see gate speeds of up to 100GHz. Quantum computers would then surpass current technology in its ability to solve the PoW algorithm.

Quantum computers’ future development

The development of hardware achieving these speeds, given the current progression is predicted to fall at the end of the decade, by which time advancements will have been made in ASICs similarly. Many large companies are well underway with research into quantum computing so in the next ten years technology may grow and develop around it. IBM has been making progress with its own quantum processor, with Intel getting closer to that reality as well. Scientists have been delving into silicon-laced diamonds and basic silicon as a means of manufacturing quantum architecture. Both Google and Microsoft are looking to develop cloud-based solutions and new coding languages for the technology. With a widespread availability of the technology and blockchain developing alongside the growth of this technology, it is unlikely for it to have such a detrimental impact.

Gavin also detailed several post-quantum signature schemes that help defend against quantum attacks, with at least four classes of known fixes, all of which are achievable by programmers today. A ten-year head start is ample time to improve on and further develop them into a protocol.

 

Image Source: Flickr: Steve Jurvetson – A Wafer of the Latest D-Wave Quantum Computers

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CEOs Say Amazon and Walmart Sparked Blockchain Revolution

CEOs are posing the question whether major companies such as retail giants Amazon and Walmart, and tech multinational Microsoft adopting blockchain technology will create a “blockchain revolution”, writes Hedge Co.net.

All of these companies have announced recent blockchain projects this year. Walmart published plans to use the technology in partnership with the IBM Corporation and Microsoft recently announced its Azure Blockchain Workbench, aiming to provide developers with tools to implement the ready-to-use infrastructure for blockchain application solutions, according to TruthMedia.

Amazon with its Amazon Web Services (AWS) blockchain templates, will now implement a system similar to Microsoft’s which claims “provide a fast and easy way to create and deploy secure blockchain networks using open source frameworks”.

Walmart’s vice president of food safety and health, Frank Yiannas, says that its new blockchain system reduces food tracking time from six days to two seconds, reducing contamination and food wastage.

According to Luis Manuel Lopez, the general coordinator at Workchain Centers, blockchain initiatives by Walmart and Amazon will have a positive impact on the retail industry.

He says, “Having started in a pure and theoretical technological world, blockchain has come second place in applications that make our life more comfortable, including assembly lines, traceability of objects… we are facing the beginning of a revolution that will change our way of doing business, buying food, curing our illnesses. And this will come sooner or later because it takes time, but it will come, sure.”

Vadim Kurochkin, CEO of Soundeon, sees the moves of multinationals unsurprising as the technology is brought to the mainstream, suggesting that research and development projects will reap the benefits due to increased activity in crypto space.

“As this technology is brought to mass-market, we foresee a robust merger and acquisition activity within the sector. Hence, early crypto-investors in successful, research and development driven projects will reap the benefits.”

Juan Imaz, founder, and CEO of Profede, also sees the potential of such companies influencing others to move towards updating its systems with the new technology:

“The cryptocurrency industry is likely to see a revolution in the near future across different industries, with the addition of giants adding, evaluating and planning to use blockchain which will change how the world works.”

 

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Charities Must Embrace Blockchain to Make Genuine Impact, Report Says

A report conducted by independent think tank Charity Futures concluded that charities have yet to engage with blockchain with the kind of urgency required to keep up with technological advances, writes Live Bitcoin News.

The study, ‘Nothing to Lose (But Your Chains)’, was clear in pointing out that the charity sector had as yet failed to tap significantly into available blockchain technologies.

Asheem Singh, former interim chief executive of the charity’s lead body Acevo, who commissioned the report, said that blockchain held great potential for charity organizations. “Blockchain could herald the sort of seismic changes in the charity sector as the digital revolution before it,” he wrote.

The report suggests that there is one area of significance where blockchain could make the most impact should it be employed. Foreign aid was singled out, noting that aid distributed by the UK government currently stands at 0.7% of GDP, which in 2016 was GBP 12.7 billion. International aid has been susceptible to corruption and bureaucracy in many receiving countries, which are exactly the kinds of problems that blockchain’s accountability can address.

Many charity organizations are dragging their heels regarding the new technology according to the report. “Despite the potential benefits, the charity sector is currently behind the curve on blockchain technology,” the study said.

The report recommends the use of DLT by creating a transparent, end-to-end supply chain for each project. This means that all those involved – government departments, NGOs, funders, charities, local offices, delivery partners, and the individuals receiving the benefit have access up to the moment information regarding the funds or supplies donated.

Some charities and NGOs are getting it right, however. Along with IBM, both the UN and the World Food Programme (WFP) are now proactively using blockchain to record transactions.

As previously covered by Bitcoin News, WFP has been employing the blockchain in a number of its projects and making a significant impact in the field as a result. In just one of its recent programs, the organization has distributed cryptocurrency-based food vouchers to more than 100,000 Syrian refugees living in Jordan, bypassing bureaucracy and getting aid to where it’s needed.

Singh feels that it is time charities came together with those actually creating the technology, in order to fully draw on its potential across the whole sector.

“It may be time for the sector to convene a high-level task force that brings together charity leaders and technologists… to articulate the contribution blockchain can and should make to the charity sector and the problems it is trying to address.”

 

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