New Jersey Introduces Bill For Crypto Firms To Obtain Licenses From State Authorities

A New Jersey lawmaker introduces a bill to regulate the cryptocurrency and digital assets industry. The bill states each virtual asset company must obtain and maintain their operation license with the authorities in the state.

In a public report released on Feb. 20, New Jersey’s Assemblywoman, Yvonne Lopez (D-Middlesex), introduced a bill titled “Digital Assets and Blockchain Act” to the House. The bill is set to be tabled on the New Jersey Assembly Financial Institutions and Insurance Committee to be discussed. If the bill passes into law, then cryptocurrency companies in the state will be required to obtain operating licenses from financial authorities.

The bill is set to protect consumers from the risks and dangers digital assets pose to their investment, according to the official announcement. Lopez said,

“We must take steps to protect consumers looking to invest in cryptocurrency, while also allowing the sector to continue to develop and expand in New Jersey.”

Crypto firms in New Jersey to obtain licenses

If the DAB Act passes through to law, the blockchain and cryptocurrency companies will need to register with authorities and obtain an operation license from the New Jersey Department of Banking and Insurance. Companies with licenses from other recognized states will also be allowed operation in NJ. The announcement further reads,

“In the application process, a cryptocurrency business would be required to disclose its legal name and any fictitious or trade name the applicant uses to conduct business.”

Notwithstanding, crypto companies in the state will need provide a slew of information to the financial authorities including but not pertained to,

“any license revocation, suspension, rejection or other disciplinary action taken against the applicant in another state; a list of criminal convictions, deferred prosecution agreements, and pending criminal proceedings against the applicant; and anti-money laundering and anti-terror financing policies.”

While the overall stance on regulation in crypto and blockchain world is heavily looked down upon by crypto actors, cofounder of the Blockchain Association of New Jersey, Guillermo Artiles, believes protection of investors in the field is important for the field to grow. He said,

“Those with businesses connected to these novel technologies are eager to ensure there are protections against questionable activities for the sake of the industry’s legitimacy. As a new industry, image is important.”

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Author: Lujan Odera

KuCoin Joins Binance, Huobi In Offering A White-Label Crypto Exchange Solution

The global digital asset trading platform KuCoin has made on Thursday the announcement that it’s launching a white-label solution that will allow its customers to make in only 72 hours fully functional crypto exchanges.

The platform will be called KuCloud and have 2 products to offer: XCoin and XMEX. Both these products will include KuCoin Spot and KuMEX Futures’ functionalities. Here’s what KuCoin’s co-founder Johnny Lyu said about KuCloud:

“The idea of KuCloud started in 2018 as a concept called ‘subnets’, with which we intended to give our exchange a powerful advantage when expanding into new markets since each new exchange can act as a separate entity.”

The Platform Will Be Customizable

Details about what the platform will offer were also presented in the announcement. Therefore, KuCloud will provide services of staking, spot trading, fiat gateway to as much as 150x leverage KuCloud futures trading, and margin trading. Besides, the platform will be customizable according to every client’s needs. Lyu added that:

“Now we go one step further and upgrade the ‘subnets’ to KuCloud, eliminating the difficulties and hassle of opening a crypto exchange, allowing all our partners to build crypto-related platforms with us to contribute to the liquidity and mass adoption of crypto.”

White-Label Solutions are the Future

KuCoin comes to present KuCloud soon after Binance announced the launch of a similar product. Binance Cloud will also introduce coins through an initial exchange offering (IEO) platform and use the over-the-counter trading service. More than this, it will also enable token issuers, fund managers and brokers to develop new streams of revenue and access the native liquidity of Binance.

In 2019, Huobi presented a product that’s quite the same and targets customers in North Africa and the Middle East (MENA region). In order to compete with Binance and Huobi, KuCoin comes with zero fees for launching crypto exchanges, but only for its initial clients.

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Author: Oana Ularu

Sweden’s Riksbank Launches Its Central Bank Digital Currency (e-Krona) Testing

Sweden is getting closer and closer to issuing its own central bank digital currency (CBDC), as it already started testing the e-krona.

The pilot program for the new digital currency is supposed to last for a year and thus, to end in February 2021. It’s not yet clear when the e-krona will be launched and made available to the public, but one thing’s for sure: a blockchain-based currency would improve the banking activities and payments in the country. Therefore, credit cards would no longer be swiped as transactions would be moved to the blockchain and no longer use fiat currencies.

Sweden Is Definitely Not Late

After the Bahamas, Sweden is the second country to reveal its plans about working on a national cryptocurrency. In December 2019, the Bahamas launched a CBDC pilot program that’s expected to be rolled out during 2020’s second half. While China has also talked a lot about the development of its own CBDC, it seems things aren’t as serious as in Sweden or the Bahamas. It doesn’t come as a surprise that Sweden wants the e-krona seeing the country almost no longer use cash anymore.

Riksbank to Analyze the Implementation of the E-Krona

Riksbank will analyze whether Sweden is ready or not to implement a CBDC in an efficient manner. The consultancy firm developing the e-krona is called Accenture. Preliminary tests in sandbox testnet are already being run by this company. 80% out of all payments in the country are being made through other means rather than cash.

This means the implementation of a CBDC will be an easy process for the Swedish citizens who are already used to not having money on them, not to mention the transition from credit and debit card payments to a digital currency is simpler. Germany, for example, would most likely have a problem implementing a CDBC, seeing German people are still using cash to make most of their payments.

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Author: Oana Ularu

Crypto Custodian, BitGo, Acquires Harbor to Expand its Digital Currency Services

BitGo has announced that it will soon be an all-stack digital currency service provider following the acquisition of Harbor. The crypto custodian also acquired Harbor’s business subsidiaries which include a transfer agency and broker dealership for digital currencies.

The beauty about Harbor’s existing operations is that they are legally under the supervision of the Financial Industry Regulatory Authority and SEC. According to the announcement made on Feb 18, BitGo has already initiated the process of a transfer of functions with both FINRA and the SEC. This milestone will allow BitGo to implement a replica of traditional financial services within its tokenomics.

Mike Belshe, the CEO of BitGo, was keen to note that the firm’s vision was always bigger than its current business as a custodian;

“Our vision has always been bigger than wallets and custody and acquiring Harbor furthers BitGo’s vision of building a new digital infrastructure for financial services.”

This acquisition is clearly a big deal for both BitGo and Harbor given its mutually beneficial nature. The former however seems to have been the bigger winner since BitGo will now be the first firm to have an agency, broker and custodian license for crypto assets. Harbor on the other hand stands to leverage BitGo’s custodial services although a clear roadmap is yet to be defined.

Josh Stein, Harbor’s CEO, is also expected to join BitGo as part of the acquisition deal. He however mentioned that they have previously worked together with BitGo given both provided services that the other didn’t have;

“BitGo has been an important partner since Harbor inception. We’ve worked closely together to integrate BitGo Business Wallets and BitGo Custody into Harbor’s services.”

Belshe is optimistic that consolidating services will reduce the barriers to entry in the crypto market. In addition, BitGo will scale its security token services to a number of functions including issuing, transferring and trade executions.

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Author: Edwin Munyui

People’s Bank of China Has Filed 84 Digital Payment Patents For CBDC’s: Report

According to the Chamber of Digital Commerce, China has filed 84 patents for the digital yuan, its new upcoming digital currency.

The patents date to 2017 and are credited to the People’s Bank of China’s (PBoC) Digital Currency Institute. They were filed to the Chinese Patent Office (SIPO) and indicate some important aspects like the one where the Chinese government is able to alter the currencies supply after some specific events like interest rates going up, or the one of integration with traditional bank accounts while the connection with digital currency chips cars or digital wallets is still possible.

The Chinese Government Will Track Down Transactions

The patent applications are related to the integration of the digital currency in the already existing banking infrastructure. This is what Mark Kaufman, the patent attorneys for Rimon Law and a former employee of the Chamber of Digital Commerce said about them:

“Virtually all of these patent applications relate to integrating a system of digital currency into the existing banking infrastructure.”

Meanwhile, the Chamber’s president, Perianne Boring, mentioned how a mechanism that’s able to stop the tracking of transaction by the Chinese government doesn’t exist yet.

Will Other Governments Take China’s Example?

In November 2019, Mu Changchun, the head of PBoC’s Digital Currency Institute, spoke at a Singapore conference and said:

“We are not seeking full control of the information of the general public.”

The newly filed patents come only to prove that the Chinese government is committed to issue a digital currency, which may convince other governments to take action in the same direction. For example, the Japanese government recently talked about China’s digital yuan and Facebook’s Libra, saying these should be combated with a digital currency released by Japan. Norihiro Nakayama, the foreign affairs parliamentary vice-president of Japan said,

“China is moving toward issuing digital yuan, so we’d like to propose measures to counter such attempts.”

Will the US Release Its Own Digital Currency?

There have been signs that the US may be considering issuing its own digital currency too, as Jerome Powell, the Federal Reserve Chairman, said on Tuesday that this matter needs to have an answer and that:

“We’re working hard on it.”

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Author: Oana Ularu

Circle Gets Leaner As Digital Asset Broker Voyager Acquires Crypto Investing App

Circle Invest, the digital asset investment app of Circle Internet Financial Ltd., has been sold for an equity stake to Canada-based Voyager Digital Ltd.

Voyager will now issue to Circle common shares that represent around 4% ownership at Circle. It will also reimburse some costs to the Boston-based company. On Tuesday in New York, Voyager shares were traded at around 22 cents.

Circle To Focus on USD Coin (USDC)

First being focused on retail-oriented cryptocurrency businesses, Circle has started as of late to pay more attention to its own USDC stablecoin. Back in December 2019, they sold Circle Trade, an over-the-counter business based on trading that it owned to Kraken, the famous crypto exchange.

Voyager to Add Over 40,000 Retail Accounts

With the new acquisition, Voyager is going to add over 40,000 retail accounts, so its customer base is sure to reach more than 200,000 users, as a statement released by the company says. The transaction for the agreement is supposed to be closed by the end of next month.

As the partnership says, the collaboration is meant to deliver the companies’ joint customer base rapid and global payments at low costs. This is what Voyager’s chief executive officer, Steve Ehrlich, had to say about the matter:

“It’s transformative for Voyager in that we get to scale our business in an efficient way with such a great partner as Circle.”

Circle Invest’s Retail Customers Will Gain Access to Voyager’s Brokerage

Retail customers of Circle Invest will gain access to Voyager’s services for brokerage, including the 0 commission trading of over 30 crypto assets, digital transfers, secure omnibus custody portfolio, and wallet management tools and lock-up free interest yield for the popular coins. This is what Circle’s Director of Product Management, Rachel Mayer said about her company’s agreement with Voyager:

“We’re very happy to be able to provide Circle Invest customers with a broader depth of retail investment features through the transaction with Voyager.

This transition comes at a time when Circle is launching new platform services and products for businesses around the world to help them bring the benefits of stablecoins into their products and grow global commerce in new and innovative ways.”

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Author: Oana Ularu

Ukraine’s Ministry of Digital Transformation: Crypto Mining Doesn’t Need Govt. Regulation

The Ministry of Digital transformation in Ukraine has stated that it has no intention to come up with measures to regulate crypto mining in the country, CoinDesk reports.

On Feb 7, the ministry released a document on digital assets outlining Ukraine’s approach on crypto assets. According to the document, the major aim for the government when it comes to crypto assets should be creation as well as implementation of a government policy which enhances innovation as well as assuring the creation of digital assets and tokenization.

Notably, the ministry stated that there are no intentions of regulating the crypto mining sector since the sector is self-governed through blockchain consensus rules as well as network members. The manifesto stated:

“Mining does not require regulatory activity from governmental oversight bodies or other third-party regulations, this activity is regulated by the protocol itself and network members.”

The ministry also expressed its willingness to support the development as well as implementation of blockchain-based technologies and solutions. To this effect, the ministry will start sandboxes which will help to analyze, verify as well as assess the potential risks when the technology is introduced in the market.

The ministry also stated that it will act as a bridge between the digital assets developers and the financial market. The report also says that the government will strive to come up with the best procedures when it comes to digital assets taxation.

Ukraine has been actively exploring on how it can enhance innovation in the blockchain and crypto space. Last month, the country’s minister in charge of finance revealed that the nation’s State Financial Monitoring Service of Ukraine (SFMS) had been mandated to monitor Ukrainian’s crypto wallet to establish the source of crypo and how it has been used.

Late last year, Ukraine passed a new anti-money laundering law which is in tandem with FATF guidelines. As developed, the new AML law also gives guidelines on how to handle digital asset service offerers. The law also provides guidelines regarding how the government will monitor as well as regulate crypto trading.

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Author: Joseph Kibe

Japan Lawmakers Proposes Close Coordination with the US over Digital Currency

Politicians in Japan are appealing to the G7 members to collaborate and perform research on digital currency as a response to China’s schedule to launch the digital Yuan.

Some Japanese lawmakers believe China’s Digital Currency Electronic Payment (DCEP) could spread widely among the emerging economies and threaten the dollar’s dominance. This won’t bode well for Japan which relies heavily on dollar-based settlements.

On February 7, senior Liberal Democratic Party (LDP) members informed reporters that Japan should share information with the US and the other G7 members on digital currencies because the digital Yuan is a serious threat to the greenback’s global supremacy. Akira Amari, LDP leader, and the former economy minister said,

“We live in a stable world led by dollar settlement. How should we respond if such a foundation collapses and if [China’s move] gives rise to a struggle for currency supremacy? As this year’s G-7 chair, the U.S. should include digital currency on the agenda for the next meeting of the group.”

Formal Proposal for More Cooperation to Be Officially Presented to the Government

The formal proposal that calls G7 members to cooperate on the digital currencies matter is going to be next week officially presented to the government. Just like numerous other countries, Japan relies on a US dollar-denominated system of settlement when it comes to business and transactions, which means the digital Yuan would indeed be a serious threat to the country’s economy.

Japan to Issue Its Own Digital Currency?

The lawmakers in LDP said at the end of January they will propose for Japan to issue its digital currency in a project between the private sector and the government. Also in January, the Bank of Japan (BoJ) started conducting joint research with 5 other central banks among which the EU and the UK’s were included, coordinated research into what digital currencies would involve.

The central banks’ group’s first meeting is scheduled to take place in mid-April, at the International Monetary Fund (IMF) conference from Washington D.C. At the press conference from Friday, lawmakers talked about Japan issuing its digital currencies, but no announcements have been made about the initiative. Taking into consideration the legal and technical barriers involved, it’s unlikely this will happen too soon. But with both private, like Facebook-led Libra, and governments, Chinese DCEP, pushing for their own digital currency that decision may come faster than they would have liked.

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Author: Oana Ularu

UK Crypto Financial Service Provider Becomes First ‘Authorised Payment Institution’ By FCA

A British crypto company similar to Bitstamp, Galaxy Digital and Coinbase was awarded a license for payments by the UK Financial Conduct Authority (FCA).

The announcement was made on Monday, by the BCB Group. It’s saying that BCB Payments Ltd., a subsidiary of BCB Group, is the first and only UK crypto company to be registered as an Authorized Payment Institution.

Banks in UK Aren’t Too Keen on Crypto Firms

Since British banks don’t really want to work with crypto companies, BCB stands as the only option for cryptocurrency enthusiasts. It has mentioned that it provides B2B payment services like cryptocurrency market liquidity and business accounts for some of the largest crypto financial institutions in the world. This is what the CEO and founder of the BCB Group, Oliver von Landsberg-Sadie, had to say about the latest FCA license award obtained by BSB Payments:

“This regulatory approval for our firm, a leading crypto-dedicated payment service provider, is a testament to how we’re able to push ahead with digital asset innovation while remaining in full compliance with some of the most stringent regulations in force globally.”

BCB Payments Already Registered as a Small Payment Institution

BCB Payments hasn’t been a stranger to the FCA, as it has been registered as a Small Payment Institution with the regulator ever since June 2018. Becoming an Authorized Payment Institution is more like an “upgrade”. The Swiss BCB OTC Trading SARL has also been regulated by an organization which is self-regulated, with the supervision of the Swiss Financial Market Supervisory Authority (FINMA). With the new license, BCB Payments expects to gain new international clients from both Switzerland and the UK.

BCB Group Working with ClearBank

The problem with banks in UK being reluctant to the crypto space came into attention in July 2019, when Coinbase had to put the transactions denominated in the British pound on hold because it was dropped by Barclays. In October, it reinstated its services, after closing a partnership with ClearBank. The BCB Group is also collaborating with ClearBank to offer British clients the UK Faster Payments scheme. In July last year, BCB started to provide this service for the crypto exchange Bitstamp.

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Author: Oana Ularu

China’s Digital Yuan will “Certainly Erode the Dollar’s Primacy in the Global Financial Market” – Deutsche Bank Report

  • Cash to remain part of the economy for decades to come but digital payments will grow at “light speed”
  • Mobile payments to quadruple in the next five years while blockchain wallets by decade end
  • Cryptocurrencies have the potential to revolutionize payment standard

The latest research on “The Future of Payments,” by Deutsche Bank titled “Part I. Cash: the Dinosaur Will Survive … For Now,” talks about the existence of cash even though there would be a transition to the digital payments.

The first in a three-part series where the bank forecasts trends in cash, online, mobile, cryptos, and blockchain, it predicts that cash will be part of the economy for decades to come because people have developed a deep-rooted trust in the paper during uncertain times.

Factors contributing to Cash‘s long-term existence involves the paper money being easier to monitor the spending, faster to pay, really convenient, accepted almost everywhere, a secure method of paying, and keeping the purchases anonymous. Cash is also easier to tip and to avoid cyber-attacks on users’ money, said the 3,600 customers surveyed across the US, UK, China, Germany, France, and Italy by the bank.

Digital Payments to Grow at “Light Speed”

While cash will exist, this period will also see digital payments growing at “light speed,” which it says would lead to the extinction of the plastic cards.

Despite encountering regulatory hurdles, blockchain wallet users continue to “mirror” the Internet users which the bank expects to hit 200 million, quadruple, by the end of the decade.

Over the next five years, the German multinational investment bank says mobile payments are expected to quadruple, the effects of which are expected to arrive sooner in emerging markets.

“As China (and India) develop electronic, crypto, and peer-to-peer strategies, the epicentre of global economic power could shift,” it says.

The bank points out how China is already working on a central bank-backed digital currency that could be used as “a soft- or hard-power tool.” Companies in the country are, in fact, forced to adopt a digital yuan which Deutsche Bank says “will certainly erode the dollar’s primacy in the global financial market.”

Further experimentation expected in a post-financial-crisis environment

While providing a detailed explanation of the most famous cryptocurrency Bitcoin, it notices that BTC is a highly volatile currency. To minimize the fluctuations, fiat-backed stablecoins have been embraced whose “price stabilisation usually requires some kind of trusted intermediation or centralised infrastructure.”

Cryptocurrencies, the banks says is still in the early adoption stage but “we should expect further experimentation to take place in the context of a rapidly digitising society and a post-financial-crisis environment.”

As for the crypto adoption, though stores have started accepting cryptos as a payment method, the number is small but the growth trend is noticeable among online travel booking platforms and through retailers like AT&T and Newegg.

Payments made by Bitcoin have also taken off but they still represent a “tiny fraction” of global payments.

“Nevertheless, cryptocurrencies have the potential to revolutionise payment standards,” said Deutsche.

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Author: AnTy