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  • Coinbase and Circle Launch USDC Stablecoin With Purported Full Backing in US Dollars
    by Ana Alexandre on October 23, 2018 at 5:10 pm

    Crypto exchange Coinbase has launched the USDC stablecoin, which is fully collateralized by U.S. dollars and available for trading. Major U.S. cryptocurrency exchange Coinbase has launched the USD Coin stablecoin (USDC), making it the first stablecoin for trade on the platform, Cointelegraph learned at the Money 20/20 conference Oct. 23. The underlying technology behind USDC was developed collaboratively between Coinbase and blockchain-powered payments technology company Circle.Coinbase customers in supported jurisdictions can now purchase, sell, send, and receive USDC at coinbase.com and the exchange’s iOS and Android apps. Coinbase notes in the statement that its U.S.-based customers outside the state of New York are able to buy and sell, while customers around the world can send and receive the coin.Coinbase states that USDC will be coming to Coinbase Pro in the coming weeks and is already supported on Coinbase Wallet, with more jurisdictions to become available in the future. The coin is purportedly 100 percent collateralized with U.S. dollars, which are held in accounts that are subject to public reporting of reserves. At the Money 20/20 conference in Las Vegas, Coinbase President and COO Asiff Hirji said:“We are issuing stablecoins backed 1:1 with the U.S. dollar, completely audited, completely transparent. We think this is a key step toward unlocking innovation in crypto.”  A stablecoin is a digital currency tied to another stable currency like the U.S. dollar, and is designed to minimize price volatility. The value of a stablecoin is based on the value of the backing fiat currency, which is held by a third party regulated financial entity.Earlier this month, another stablecoin Tether (USDT) found itself at the source of controversy after volatility caused it to lose its long-time peg to the U.S. dollar. At the time, USDT traded around $0.975, at one point dropping as low as $0.91. The problems arose amid rumors that crypto exchange Bitfinex, the CEO of which is also CEO of Tether,  was facing insolvency.Following the news, cryptocurrency investor and entrepreneur Michael Novogratz said that USDT should create more “transparency” about its operations. Novogratz said that he thinks “Tether didn’t do a great job in terms of creating transparency," while also noting that “the concept of stablecoins makes sense.&rdquo […]

  • Coinbase Gets Approval to Offer Crypto Custody Services in the State of New York
    by Ana Alexandre on October 23, 2018 at 4:40 pm

    Crypto exchange Coinbase has received approval for its application to roll out crypto custody services in the state of New York. New York state regulators have approved Coinbase Custody Trust Company LLC to roll out their cryptocurrency custody services in the state, according to an official announcement published Oct. 23.The New York State Department of Financial Services (DFS) has authorized Coinbase’s wholly-owned subsidiary Coinbase Custody Trust Company LLC to provide a limited range of custody services for virtual currencies, including Bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH), Ethereum Classic (ETC), Ripple (XRP) and Litecoin (LTC).Commenting on the approval, Asiff Hirji, President and COO of Coinbase, stated that “since 2014, the New York Department of Financial Services has proven itself to be a strong advocate in its support for the responsible growth of the cryptocurrency industry.” Hirji further added:“The New York State Limited Purpose Trust charter, which now enables Coinbase Custody to act as a Qualified Custodian for crypto assets, builds on our unparalleled success as a crypto custodian while holding the company to the same exacting fiduciary standards and oversight of other, mature financial institutions operating in New York.”Coinbase launched its custody services ‘Coinbase Custody’ in July, focusing on institutional customers and optimized to store large amounts of digital currency. The product purportedly utilizes a range of security measures, including “on-chain segregation of crypto assets,” “offline, multi-sig and geographically distributed transaction protection” and “robust cold storage auditing and reporting.”Coinbase Custody also uses systems from SEC-registered broker-dealer and FINRA-member Electronic Transaction Clearing (ETC). In August, Coinbase announced plans to add 40 new assets to its custodian service. The crypto assets in question, however, may be added “for storage only,” as Coinbase is not currently considering the assets for trading. […]

  • New York Judge Dismisses Case Against Nano Developers
    by Ana Alexandre on October 23, 2018 at 4:20 pm

    A U.S. District Judge has dismissed a case against Nano token developers, in which the plaintiff claimed the company had run afoul of U.S. securities laws. A New York judge has thrown out an investor’s proposed class action lawsuit against the  development team of altcoin Nano (XRB), according to court documents filed Oct. 22. The lawsuit accused the devs of luring him to trade the coin on a platform that lost hundreds of millions of dollars’ worth of the cryptocurrency.Initially, the lawsuit was filed in April by an American individual, Alex Brola, who reportedly bought $50,000 worth of XRB on Dec. 10, 2017, through Silver Miller law firm. The suit accused Nano’s core team of violating U.S. securities laws by selling unregistered securities and negligently misrepresenting the reliability of Italian crypto exchange BitGrail, from which around 17 million XRB ($187 million at the time) was stolen in February.In the lawsuit, Brola asked that Nano be ordered to “rescue fork” the investors’ missing XRB “into a new cryptocurrency in a manner that would fairly compensate the class of victims.” Although Brola is the named plaintiff in the lawsuit, the complaint claimed there are “at least hundreds if not thousands of putative Class members,” that Silver Miller planned to contact during the discovery period.U.S. District Judge Nina Gershon dismissed the case about a month after Brola voluntarily withdrew the suit. While the notice of dismissal does not state why the suit was dropped, the lead defense counsel Peters Scoolidge reportedly told legal news site Law 360 that “the plaintiff withdrew the complaint because the case lacked merit.”Prior to Brola’s decision to withdraw the lawsuit, the defendants urged the New York federal court to dismiss the suit, claiming that the tokens are not securities and therefore are not subject to securities laws.In a motion to dismiss filed in September, the XRB team stated that the cryptocurrency can not be classified as a security because the company had never gained any money in exchange for its insurance and has no investors. “Nano’s value does not derive from a group of managers or executives managing other people’s property; rather, Nano’s value is derived from its utility or potential utility as a currency,” the document further states.Following the hack, both BitGrail and Nano have accused the other of being responsible for the $187 million theft of XRB tokens. BitGrail CEO Francesco Firano told Cointelegraph that “it’s impossible to refund the stolen amount.&rdquo […]

  • Russia: Business Lobby Group Sends Prime Minister Medvedev Proposal on Crypto Regulation
    by Ana Berman on October 23, 2018 at 3:47 pm

    A lobby group of Russian entrepreneurs has presented their alternative to the current draft bill on cryptocurrencies to Prime Minister Dmitry Medvedev. A lobby group of the Russian Union of Industrialists and Entrepreneurs (RSPP) has recently sent its proposals for crypto regulation to country’s prime minister Dmitry Medvedev, Russian business media RBC reports Monday, Oct. 22.Per a document obtained by RBC, the head of RSPP Alexander Shokhin criticizes the main draft that was accepted by the Russian State Duma in the first of three readings in May. He urges Medvedev to postpone the hearings until 2019 to develop new aspects of the draft law that would serve both entrepreneurs’ and regulators’ interests.According to Shokhin, the current legislation, if accepted, would force Russian startups to move to other jurisdictions abroad that are more friendly to cryptocurrencies.The lobby group also proposes to classify tokens in three groups — security tokens, cryptocurrencies, and digital “signs” — and develop a proper framework for each of them. For instance, security tokens would be under the strict control of the central bank, whereas utility tokens would enjoy a more liberal regime. In the case of “hybrid” tokens, as defined by Shokhin, the central bank should review each token separately.Russian financial newspaper Kommersant revealed that RSPP’s proposals on crypto regulation will be discussed by three federal ministers in late October.RSPP, which consists of high-ranking Russian entrepreneurs such as mineral mining and smelting billionaire Vladimir Potanin, and Viktor Vekselberg, head of the Russian innovation fund Skolkovo, first announced it was working on the alternative crypto bill in early September.Kommersant later wrote that Potanin’s interest in the crypto space spread farther than the draft bill — the billionaire reportedly planned to launch his own crypto-related projects.The main bill “On Digital Financial Assets” was first introduced in January by the Russian Ministry of Finance. In March, a slightly different version that established know your customer (KYC) regulations for crypto exchanges appeared and was later approved by the State Duma. The second hearing was postponed till the parliament’s fall session.Prior to the second reading, the document had been considerably edited. As Cointelegraph reported following the matter, the Duma Committee on Financial Markets removed terms defining “mining” and “cryptocurrency” from the draft bill, focusing on tokens and Initial Coin Offerings (ICOs) instead. […]

  • Financial Giant SBI Group to Develop Wallet Following New Partnership
    by Ana Alexandre on October 23, 2018 at 2:19 pm

    Japanese financial services giant SBI Group will develop a wallet following a partnership with Danish cryptography services firm Sepior ApS. Japan-based financial services firm SBI Group and Danish cryptography services company Sepior ApS have partnered to jointly develop a proprietary wallet, according to an announcement published Oct. 13. The wallet is set to ensure secure transactions on SBI’s cryptocurrencies exchange platform, VCTRADE.The SBI Group was established in 1999 in Japan as an Internet-based financial services provider. Since then, the company has formed a financial conglomerate with a focus on new technologies, including fintech, Internet of Things (IoT), artificial intelligence (AI), and others. In 2018, SBI reportedly invested over $533 million in the blockchain and AI sectors.Per the press release, Sepior and SBI have signed an agreement to license Sepior’s Threshold-Sig Wallet Security technology and to jointly develop a proprietary wallet to secure online content and transactions on SBI’s digital currencies trading platform, VCTRADE.With this move, SBI is reportedly looking to set new standards for crypto exchange security, partly through the development of more effective key management and protection. Sepior’s patented Threshold Wallet technology reportedly allows faster signing of transactions involving multiple parties and “eliminates the need for any device or entity to possess the entire private key at any time, making it effectively impossible for an attack to result in key theft.”Yoshitaka Kitao, Representative Director, President and CEO of SBI Holdings commented on the technology:“After extensive investigation, our security research team determined threshold signatures based on multiparty computation (MPC) offered our desired level of security, performance, and scalability needed to manage transactions for our growing SBI Virtual Currencies customer base.”Earlier this month, Ripple-powered payments app MoneyTap went live. The service was co-developed by Ripple and SBI Holdings, and will use Ripple’s blockchain solution xCurrent to enable domestic bank-to-bank transfers “in real time.”In September, SBI Holdings began trialing a crypto token “S Coin,” that can be used to make retail purchases with users’ smartphones. In the trial, SBI Group employees will reportedly use the S Coin platform to complete cash-free purchases at cafes and eateries around the premises of the SBI headquarters. […]

 

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