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Tether's killer app

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July 30, 2019
TETHER REMITS: Tether’s (USDT) best-known application is allowing crypto traders to move money between exchanges quickly to take advantage of arbitrage opportunities. But according to several Moscow over-the-counter trading desks, the stablecoin has also become the go-to remittance service for local Chinese importers, as a way around China’s strict capital controls. Reportedly, Chinese importers in Russia are buying up to $30 million a day of tether from Moscow’s OTC traders, to send money across the border. Full story

DISPERSION DOUBT: In a U.S. Senate hearing on cryptocurrency regulation held Tuesday, lawmakers and witnesses scrutinized the oft-repeated claim that blockchain technology will spur financial inclusion. For one, Sen. Brian Schatz (D-Hawaii) questioned Jeremy Allaire, CEO of crypto exchange Circle Internet Financial, on the matter. “Do you really think that in a society in which only 81 percent of the public currently has a smartphone, we’re anywhere close to democratizing the use of these products?” Schatz asked Allaire. While Allaire countered that “this technology actually does provide an avenue to improve upon,” the current situation, he agrees “there’s no silver bullet here.” Full story

BLOCKCHAIN SHIELD: The U.S. Department of Defense (DoD) is looking to forge a blockchain cybersecurity shield. In a report titled Digital Modernization Strategy, the DoD outlined several ways to advance the nation’s digital defenses. This includes the integration of cloud and quantum computing, artificial intelligence, and improved communications through distributed ledgers. Specifically, blockchain may be deployed between units and headquarters as well as intelligence officers and the Pentagon. The DoD is also experimenting with the technology to facilitate the creation of an unhackable code to secure its databases. Full story

BITCOIN FOCUS: Square Crypto is focused on crypto more widely, not the publicly traded company’s specific products. That was the message Monday during a Twitter ask-me-anything (AMA) with the head of Square’s crypto team, Steve Lee. The unit’s playful Twitter account fielded questions from its followers as well as crypto-community luminaries. Probably the single most illuminating moment of the AMA was the response to the question of when the firm expects to have a working product. Lee said: “The product we're focusing on is Bitcoin. It has been up and running for over 10 years… but there’s still a lot that needs to be done before we reach mass adoption.” Full story

DOOMED ALREADY? Facebook has acknowledged what many have been saying – that regulatory issues may be an insurmountable barrier to the launch of its Libra global cryptocurrency project.  In a frank disclosure in the firm’s latest quarterly report to the U.S. Securities and Exchange Commission, Facebook said that the many barriers it will face regarding a new technology with unclear rules in the U.S. and elsewhere mean “there can be no assurance that Libra or our associated products and services will be made available in a timely manner, or at all.” Full story
EXCHANGE BID:  Bitcoin wallet and blockchain explorer provider Blockchain just launched its first exchange platform. Blockchain’s head of retail products, TD Ameritrade alum Nicole Sherrod, told CoinDesk the custodial exchange, called The PIT, can connect to non-custodial Blockchain wallets for nearly instant transfers. Registration opens today, with the ability to trade up to 26 assets rolling out over the next two weeks. Sherrod said that with nearly 40 million wallets already created – and an exchange matching-engine set up in London’s Equinix LD4 data center – PIT could be poised to attract more liquidity than competitors.  Full story
SPEEDY GROWTH: ABey, a fast blockchain designed for e-commerce, has seen tremendous growth in just one year, VentureBeat reports. Dr. Ciprian Pungila, chief scientist and co-creator of aBey said that, since its public launch in July 2018, “we have amassed more than 100,000 active users within the first twelve months of that date. aBey’s growth rate exceeds Bitcoin’s early growth by a factor of more than eight times.” The network is said to support up to 100,000 transactions per second, including refundable transactions, intrinsic lending, payment processing on chain, a crypto wallet and more.

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Libra might not be made available / Blockchain wallet launches exchange / Circle CEO to testify

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Market Watch: Bitcoin is still below $10,000 following news that Facebook's Libra might not be made available on time, or at all; however, market prices across the board remain up over a 24-hour period.

  • Bitcoin: $9,686 (⬆️ 1.32%) // $172.8 billion market cap.
  • Ethereum: $213 (⬆️ 1.50%) // $22.8 billion market cap.
  • XRP: $0.318 (⬆️ 2.84%) // $13.6 billion market cap.
  • Litecoin: $92 (⬆️ 2.35%) // $5.7 billion market cap.
  • Top 100 Winner: Crypto.com Chain: $0.062 (⬆️ 12.78%) // $528 million market cap.
  • Top 100 Loser: Japan Content Token: $0.205 (⬇️ 15.75%) // $60 million market cap.

Prices are as of 11:40 am EDT.

     

1. Facebook has said that its Libra stablecoin won't be "made available in a timely manner, or at all." In a filing to the U.S. Securities and Exchange Commission (SEC), the social media platform noted that it had "drawn significant scrutiny from governments and regulators" around the world. As a result, market acceptance of it was uncertain. Due to the team's lack of knowledge on crypto assets and the blockchain, the company has warned that this may affect its ability to develop and market its products. David Marcus, head of Facebook's new Calibra payments division, has also said that Facebook won't offer Libra until it had addressed regulatory concerns. –CNBC

     

2. Steve Lee, the head of Square's crypto team, said during a Twitter ask-me-anything (AMA) session that the product Square Crypto is focusing on is Bitcoin. According to Lee, a lot still needs to be achieved before the number one crypto asset reaches mass adoption. In another tweet, he indicated that they are focused on improving the Bitcoin experience for mainstream users with the user journey continuing to play a role in the team's thinking. –COIN DESK

Head of Square Crypto has said that the product the team are focusing on is Bitcoin
     
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3. Crypto wallet Blockchain has launched an exchange aimed at making fast trades that aids mainstream adoption. Called The Pit, Blockchain CEO Peter Smith claims that it can undertake buy or sell orders in "40 to 50 microseconds," which he adds makes it faster than the likes of Binance or Coinbase. With backing from British billionaire Richard Branson and Spotify backer Lakestar, it has already raised over $70 million from investors. It currently supports EUR, GBP, and USD via bank transfers. Crypto assets that can be bought or sold include Bitcoin, Ethereum, Litecoin, Bitcoin Cash, Tether (USDT), and Paxos Standard (PAX). –TECH CRUNCH

     

4. Jeremy Allaire, CEO of Circle, is to testify in front of the U.S. Congress which will be reconvening today to discuss the crypto market and potential regulations. As a representative of the Blockchain Association trade group, Allaire is expected to say that crypto assets should be considered a "new asset class." As such appropriate rules and exemptions for them should be established. It's likely, though, that new legislation will change "existing commodities, securities, and banking laws," he will add. –COIN DESK

Circle CEO to testify in front of U.S. Congress as it discusses crypto regulation
     
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5. International lawyer Mehrsa Baradaran is expected to say before the U.S. Congress crypto hearing today that digital assets are not the solution for financial inclusion and equity in banking. In a prepared statement, Baradaran notes that the issues cryptocurrencies are trying to solve are problems of policy, not technology. –COINTELEGRAPH

     

6. South Korean crypto exchanges Bithumb, Coinone, Korbit, and Upbit are facing tougher regulation as they attempt to renew their banking licenses. The strict stance follows after the Financial Action Task Force (FAFT) released guidelines in June on crypto asset service providers. One of which is that platforms must comply with anti-money laundering (AML) and terrorist financing laws. –THE BCHAIN

     

7. Smart Valor, a Swiss-based crypto exchange, has gone live with nine crypto-fiat trading pairs. At present, Bitcoin and Ether are available in CHF, EUR, GBP, and USD. The next step for the platform is to receive the Multilateral Trading Facility license (MTF), which will allow it to list and trade any type of tokenized security. –SWISS INFO

     

8. Brazilian city Fortaleza is to start accepting Bitcoin as payment for bus tickets by the end of 2019. The move is designed to help reduce operational costs in the bus ticketing system. Simply by scanning a QR code with their smartphones, bus users will be able to pay in the crypto asset. –COINTELEGRAPH

     

9. The National Association of Software and Services Companies (Nasscom), India's information technology body, has said that banning crypto in the country is not the way forward. The company states that it would "handicap India" from taking part in new use cases that crypto assets and tokens can offer. –BUSINESS STANDARD

     

10. Kenya's Information and Communication Technology Ministry task force has maintained that a sovereign digital currency would have a positive impact on the country's financial services. According to a report, it states that the case for a Central Bank Digital Currency (CBDC) was "strong" and that it could improve tax collection. –CITIZEN DIGITAL

     

This newsletter was written and curated by Rebecca Campbell. She has been writing and reporting on various industries for the past 10 years, more specifically tech in the last three. Connect with her on Twitter.

Editor: David Stegon (senior editor at Inside, whose reporting experience includes cryptocurrency and technology).

     
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