October 16, 2018
QUOTE OF THE DAY
"It would be impossible for every Fidelity brokerage customer to own even one Bitcoin. This is why Bitcoins are worth thousands of dollars, while a dollar is only worth one dollar (and only until next year when it's worth 97 cents). Save wisely."
- Erik Voorhees
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| COIN | PRICE | 24H |
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| BTC | $6,613.89 | -0.67% |
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| ETH | $210.32 | 0.00% |
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| XRP | $0.455859 | +2.17% |
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| BCH | $459.33 | -0.02% |
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| EOS | $5.43 | -0.72% |
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*Information as of 10:00 AM EST
Fidelity Announces Plans for Crypto Trading and Custody Platform
Here is the rundown on Fidelity
Fidelity Investments is a financial services company headquartered in Boston, Massachusetts. The company was founded in 1942 and now employs 45,000 in offices across the globe.
As the fourth largest asset manager with $2.4 trillion in assets under management (as of end of 2017), the company operates a brokerage firm, manages mutual funds, and also provides advice on investments, wealth management, and retirement.
The company has had a little bit of a history with cryptocurrencies. In 2013, it launched a blockchain incubator and rumors once circulated that Fidelity would eventually implement cryptocurrency trading when it enabled its users to view their Coinbase balances on its platform.
Spinning off a cryptocurrency subsidiary
On Monday, Fidelity made a major announcement that pleased cryptocurrency investors. It announced that it is forming a subsidiary called Fidelity Digital Asset Services. This subsidiary will provide crypto related services to institutional investors.
Fidelity Digital Assets will perform three services for institutions: a trading execution platform, enterprise-grade custody solutions, and institutional advising solutions.
The company will be open 24 hours a day, seven days a week, 365 days a year. Since the cryptocurrency markets never close, Fidelity Digital Assets will never close.
Tom Jessop, who is heading the new subsidiary, said during the announcement:
"In our conversations with institutions, they tell us that in order to engage with digital assets in a meaningful way, they need a trusted platform provider to enter this space. These institutions require a sophisticated level of service and security, equal to the experience they're used to when trading stocks or bonds."
Coming very soon
Fidelity Digital Assets is already on-boarding companies and will begin normal operation early next year. The subsidiary will consist of 100 employees at launch, making it perhaps the largest launch of a cryptocurrency asset manager.
At inception Fidelity Digital Assets will offer Bitcoin, Ethereum, and "other digital assets".
Two of the World's Largest Crypto Exchanges Expand Past Tether
Tether turmoil
Yesterday wasn't a pretty day for Tether (USDT). The stablecoin dropped from its 1:1 US Dollar peg to lower than $0.95 and has yet to recover fully.
Now, while panicking USDT investors are offloading the stablecoin in mass and causing a "run on the bank", crypto exchanges are taking the opportunity to expand their stablecoin offerings.
Third and fourth place change gameplans
Yesterday, the world's third largest crypto exchange OKEx announced it will be listing four new stablecoins and today Huobi, the world's fourth largest crypto exchange, is following suit.
Both exchanges will list the same four stablecoins, including two that are regulator-approved:
- True USD (TUSD)
- USD//Coin (USDC)
- Paxos Standard Token (PAX)*
- Gemini Dollar (GUSD)*
* Regulator-Approved
The four new stablecoins are meant to give customers a new suite of stablecoin options rather than a permanent replacement for USDT since neither exchange has made the decision to restrict trading, deposits, or withdrawals of USDT.
The competition is catching up
USDT's first-mover advantage has suited the stablecoin well. However, as exchanges begin to expand past USDT with new offerings, the stablecoin king will need to recover its reputation if it wants to remain on top.
As a start, Tether's representatives attempted to ease investor worries by issuing a statement last night that claims "all USDT in circulation are sufficiently backed by U.S. dollars."
But this statement alone won't keep regulator-approved stablecoins like PAX and GUSD from creeping into USDT's market share.
Coinbase Packs the Bags for Ireland
Hedging for Brexit
Announced yesterday, San Francisco-based Coinbase has opened a new office in Dublin, Ireland.
The move is notable for two reasons:
- It will help Coinbase expand European operations.
- It will prepare Coinbase for the day the U.K. leaves the E.U.
Speaking on the second reason, Coinbase CEO Zeeshan Feroz told the Guardian:
"As we plan for all eventualities, it's important that we continue servicing our customers across Europe, and Ireland would be our preferred choice there if it comes to it."
Encouraging innovation
While Brexit would allow Ireland to operate with the E.U. should the U.K. leave, it also has a reputation for encouraging innovation.
In addition to low corporate taxes, IDA Ireland, a government agency responsible for attracting foreign investment, recently began an initiative to bring blockchain innovation to the country.
Fight or flight
It's clear crypto companies are moving to countries that welcome the new technology. Malta and Singapore have been notorious for attracting new blockchain-based businesses including Binance, the world's largest exchange.
And thus the decision is clear: welcome blockchain innovation with progressive regulations or risk losing top talent to other countries.
Crypto Startup Bringing Cryptography to Central Banks Raises $15 Million
Funding secured
Adhara, a blockchain startup based in South Africa, has recently raised $15 million in funding. The company was founded by former banking innovators and hopes to bring crypto to that same sector.
ConsenSys was the investor behind the $15 million. If you are not familiar with ConsenSys, it is a sort of incubator that consists of software companies building infrastructure, applications, and practices for the Ethereum network. It is also the largest blockchain software company in the world with roughly 900 employees. The organization is operated by Joseph Lubin, one of the co-founders of Ethereum.
To learn more, read our exclusive interview with Joseph Lubin.
Teaming up with banks
Adhara aims at bringing cryptography and blockchain to banks, especially central banks for the use case of international payments. The company is developing zero knowledge proofs and other cryptographic technology to privacy to fund transfers. Adhara will be enabling private payments all while keeping the industrial grade payments mechanism required by banks.
While most in crypto are looking to get away from banks, Adhara is taking a different approach. The company thinks that targeting banks can make the biggest impact. There is a challenge to bring blockchain to the real world and Adhara is trying to move the technology forward.
Julio Faura, one of Adhara's co-founders described the company's love for crypto:
"If you are religious – like we are – about tokenization, you can see it unlocking possibilities to mix this with other assets; trading with a digital representation of value means you can focus on other aspects of the financial industry."
But wait, there's more...
- Paxos claims it has so far issued a total of $50 million-worth of its Paxos Standard crypto stablecoin since its official launch last month.
- Encrypted messenger service Telegram will release a test version of its blockchain-based TON platform "this autumn."
- Former chairman of the U.S. Commodity Futures Trading Commission (CFTC), Gary Gensler said that most tokens sold through Initial Coin Offerings (ICOs) should be classified as securities.
Vertcoin (VTC)
Vertcoin is a cryptocurrency like Bitcoin and Litecoin with an added focus on keeping the ecosystem as decentralized as possible. Vertcoin is a zero frills development coin that solves real cryptocurrecy problems rather than fluff that crowds the space.
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