Tuesday, December 4, 2018

Case is Closed 🏛

December 4, 2018

Federal Court Rules in Favor of ICO, Against SEC in Monumental Court Case

SEC vs ICOs

The Securities and Exchange Commission (SEC) has had a very busy 2018 and has inserted themselves into the cryptocurrency space more than ever before.

The SEC has been hell-bent on enforcing their regulation onto the new and evolving asset class of cryptocurrencies. Within the past weeks, the SEC has penalized two initial coin offerings (ICO), the decentralized exchange EtherDelta, as well as Floyd Mayweather and DJ Khaled for promoting ICOs.

Court rules in favor of ICO

Last week, a US Federal Court held a case involving the blockchain startup Blockvest and the Securities and Exchange Commission. The SEC had recently ruled that Blockvest is a security and froze the company's assets.

Blockvest disagreed with the SEC's decision and claimed that their token should not be considered a security. So, Blockvest took the case to a Federal court.

In the end, the court ruled that the SEC did not have enough evidence to classify Blockvest as a security. In addition, the court ruled that a token's method of distribution can't be used as the only evidence to classify it as a security.

Setting a precedent

The case sets a precedent for the future.

Marco Santori, the president and chief legal officer at Blockchain, analyzed the case and concluded that if there is not a "risk of financial loss," the court would rule in favor of the ICO.

PRIVACY

Department of Homeland Security Wants to Track Privacy Coins

Tracking the untrackable

The Department of Homeland Security recently published a document that discusses the use cases of cryptocurrencies. More notably, the document indicates that the Department wants to know if it is possible to track privacy-focused cryptocurrencies, like Monero and Zcash.

The Department of Homeland Security is wary that privacy coins may be used for illegal activities like money laundering or funding of terrorism.

An excerpt from the document reads:

"This proposal calls for solutions that enable law enforcement investigations to perform forensic analysis on blockchain transactions. This analysis can be approached in any number of ways and may consider different data situation use cases depending on whether additional data from off-chain sources are available."

Good luck

The government has shown that it is able to track transactions on cryptocurrencies like Bitcoin. Bitcoin is only pseudonymous, not anonymous. All transactions and accounts are viewable to anyone.

However, privacy coins are a different beast. No one has yet been able to track the top of the class privacy coins. The Department of Homeland Security will surely be met with disappointment when they realize that they won't be able to crack privacy coins.

GOVERNMENT

Thailand is Testing Blockchain as a Method to Prevent Tax Fraud

According to an article published by the Bangkok Post, the Thai government has been testing an implementation of blockchain technology that would help the country fight tax fraud. If the government decides to actually implement blockchain, it would be the first country ever to use blockchain to prevent tax fraud.

Thailand's Revenue Department (the country's equivalent to the US's IRS) is heading the project. The department envisions using blockchain to track value-added tax (VAT) payments. All VAT invoices will be issued and confirmed on the blockchain in order to bring transparency and stricter compliance to tax laws.

In addition to blockchain, the Thai Revenue Department is also researching Machine Learning and Artificial Technology technologies. The department hopes to utilize these technologies to learn, study, and prevent fraudulent tax reporting efforts.

Blockchain technology gaining credibility

Everyone is aware the cryptocurrency market has been on a year-long slide. However, the crypto market is not nearly an indicator of blockchain adoption.

Despite price declines, adoption of blockchain technology has been on the rise during 2018. As in this case, more and more governments are researching and testing blockchain for real use cases to better the world. Also, blockchain patent applications have been higher than ever. Corporations, like governments, are pondering how they can use the new technology.

It is unclear where blockchain will gain real, live adoption but now it seems certain that the technology will disrupt some areas of traditional government and corporate systems.

BITS

But wait, there's more...

Crypto trading platform ErisX has closed a Series B funding round that raised $27.5 million from notable investors including Fidelity and Bitmain.
Nasdaq has confirmed it plans to launch Bitcoin futures in the first half of 2019.
Malta-based cryptocurrency exchange OKEx has launched a new derivative product called Perpetual Swap trading.

MEME