Fidelity Increases Its Stake in the First Hong Kong Regulated Crypto Exchange, OSL

Fidelity Investments, a leading global asset manager interested in crypto, has increased its capital allocation to BC Technology Group. This firm runs the first crypto asset exchange to be licensed in Hong Kong, OSL. According to the regulatory filing, Fidelity increased its ownership stake from 5.29% to 6.29% after acquiring an additional 3.3 million shares at HK$52.3 million ($6.7 million).

Before this event, Fidelity’s shares at BC Technology stood at 17,795,500, an investment that the asset manager acquired last year at a rough figure of $14 million. The latest increment is a sign of the bullish outlook in being exposed to Hong Kong crypto markets where regulators seem to have been slowing capital inflows. Notably, BC Technology raised around $90 million in a top-up share placement last week.

Having received the Hong Kong license, OSL crypto exchange might be well onto the path of exponential growth. This much-coveted license is issued by the Hong Kong Securities and Futures Commission, which means that OSL now gives crypto exposure to both retail and institutions. The exchange recently touted its status as the world’s ‘first SFC-licensed, listed, digital asset wallet-insured, Big-4 audited digital asset trading platform for institutions and professional investors.’

Going by such fundaments, Fidelity’s capital scaling in Asia comes as no surprise; in fact, the firm recently invested in a Singapore regulated fund manager dubbed Stack Funds in a move that will enable investors to purchase and store crypto assets. Fidelity also launched a Europe based unit towards the end of last year; this particular entity was launched in the United Kingdom and will focus on extending Fidelity’s services to the larger European market.

Overall, Fidelity has had quite a good run in the crypto space; its CEO, Abigail Johnson, a crypto enthusiast, recently revealed that their custody operations have been ‘incredibly successful.’ Having launched its Bitcoin fund in early 2020, Fidelity targets investors who can invest a minimum of $100,000. Per the company’s latest updates, an estimated 36% of institutional investors have exposure to BTC or other crypto assets.

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Author: Edwin Munyui

Bitcoin Miners Bullish as Network Difficulty Reaches a New Peak But Revenue Takes a Hit

Mining bitcoin has never been this difficult.

Today bitcoin mining difficulty has increased by 3.6% to hit an all-time high of 17.6 trillion. This was to be expected as recently, the hash rate of the network had also hit an ATH.

Hash rate took a decline last week after the floods in China affected the bitcoin mining operations in the country. Since then, it has also bounced back to 120 Eth/s.

But a jump in both difficulty adjustment and mining hash power has led to a decrease in miner revenues, notes F2Pool, one of the leading bitcoin mining pools.

The revenue generated by 1 Th/s of mining power has now fallen 1.16% to $0.083.

Source: @F2pool

Despite this drop in revenue, all the new generation mining machines remain profitable, even at $0.05 kWh all-in hosting, except for Bitmain’s old-generation S9 SE, which is the only bitcoin ASIC that is no longer profitable under current condition.

As such, in the short term, as a result of declining mining revenue, some of the miners may “turn to other SHA256 networks seeking higher profits,” according to F2Pool.

These miners will come back to bitcoin when either the difficulty drops or the relative price of the bitcoin, increases.

The BTC price has been stuck under $12,000 throughout this month while both retailers and institutions continue to accumulate — the number of addresses with less than one BTC and those with more than 1000 BTC has hit new all-time highs.

The good thing for BTC price is that while people continue to buy more BTC, investors are not looking to take off profits either, with the exchange balance reaching new local lows.

In the bitcoin mining space, one of the largest mining facilities, Energix, meanwhile has announced that it will open its business in mining-friendly country Kazakhstan next month. The mining facility is all set to open its 180 megawatts (MW) data center at the beginning of September.

The facility is expected to contribute 4% of bitcoin’s currency hash rate and will get its electricity from the Kazakhstani grid. Costing $23 million to construct it, the facility would handle electricity required to power 180,000 US homes.

The country has an abundance of cheap electricity, which has helped it move up from sixth to the fourth spot in the world hash rate distribution.

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Author: AnTy

Can RippleNet Cloud be a Game Changer for Post-COVID Banks and Financial Institutions?

The COVID-19 pandemic has undoubtedly increased the adoption of emerging technologies. Since the world was challenged by this virus, innovations by the FinTech community ranging from blockchain tech to cloud infrastructure have been accelerated. A company like Ripple, prominent for its blockchain built cross-border payment solutions, is now touting its cloud services as well, RippleNet Cloud.

As tech evolved, it became evident that existing on-premises infrastructure is in fact a huge cost in today’s business world. This is because of the underlying operations in staffing, maintenance, and migration to new systems. Therefore, cloud solutions are slowly taking over starting with tech giants like Microsoft and IBM who are among the largest service providers in this niche. However, financial institutions led by banks are still skeptical of moving their systems to cloud platforms given the sensitivity of clients’ data.

RippleNet Cloud

While cloud services may seem a concept of the future, their value proposition beats existing on-premises that are outdated, expensive to maintain, and inflexible. According to recent a publication on Ripple Insights, cloud services are now considered essential for the going concern of businesses post-COVID.

“Now, cloud-based technologies are considered essential to any business wishing to survive the pandemic—and keep up with rapidly changing consumer demands.”

Ripple’s cloud-based solution has since been hailed as a game-changer for banking ecosystems. Basically, the firm provides a platform for businesses to interact seamlessly on RippleNet via a common Ripple Payment Object (RPO). Compared to on-premises, clients on RippleNet can go live five weeks faster while cutting the costs attributed to staffing and hardware requisition.

In addition, RippleNet Cloud provides financial institutions the option to leverage on-demand liquidity for their settlements. Notably, clients also don’t have to stress with upgrades as they are handled with Ripple’s team. Given these underlying factors, RippleNet has attracted a number of prominent financial service providers including MoneyGram and India-based, Federal Bank.

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Author: Edwin Munyui

Citi Increases Its Equity In Ethereum-based Platform Komgo Specializing In Trade Finance

Citi bank, a founder & investor at Komgo has reportedly increased its stake ownership of the project. The bank is on course with integrating Komgo’s Blockchain Solution with its own trade processing systems. The current scope of the project set to expand in the foreseeable future to include inventory financing and auto-matching of electronic documents.

Komgo, a blockchain-oriented startup, launched in 2018 has been developing an Ethereum based enterprise Blockchain for trading finance. Their platform allows equities traders to maximize on Distributed Ledger Tech by establishing an ecosystem where they can interact with financial intermediaries as well.

Notably, during the unveiling of the project other founder investors were present; they include, Societe Generale, ING Group, and Sumitomo Mitsui Banking Corporation.

The global head of commodity trade finance at Citi, Kris van Broekhoven has highlighted that this would be revolutionary as for almost the last century banking systems have been reliant on manual passing and processing of paper documents. The Blockchain solution offering a unique opportunity of digitalizing the whole industry.

“Now Blockchain technology serves as a catalyst to disrupt the industry towards the processing of electronic data”

According to Kris van Broekhoven, the most appealing part of the venture is that it has incorporated both bank and corporate players in comparison to other Blockchain solutions. The input from all these players then helps Komgo uniquely tailor the Blockchain solution to look out for everyone’s needs, not just the banks.

“It is one of the only consortiums that combines banks and corporates as founders”

Citi has strategically positioned itself to leverage the platform by integrating it with its own systems in a bid to reduce its processing and waiting time. Having bolstered their security, Citi is keen to analyze their investment overheads to make sure the project is working as per requirements.

Komgo set to expand the scope of their Blockchain platform

Currently, the scope of the project has prioritized letters of credit, account receivables financing, and KYC. This is expected to change as they are set to increase the business to include support of inventory financing and auto-matching of electronic documents according to Kris van Broekhoven.

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Author: Edwin Munyui

Darknet Markets Account For Only 0.08% of All Incoming Crypto Transactions: Chainalysis

  • In 2019, darknet sales increased by 70% and for the first time, it surpassed $700 million
  • Active markets collected more revenue than ever, except in 2012 and 2013
  • Chainalysis expects more darknet markets to accept privacy coins like Monero in 2020

In 2019, cryptocurrency prices weren’t the only ones that saw an increase but the darknet market also grew. Its transaction activity actually hasn’t been influenced by the ebbs and flows of the crypto markets and other seasonalities.

According to Chainalysis, after a decline in 2018, the total darknet sales increased by 70% in 2019 to more than $790 million worth of cryptocurrency.

This has been the first time that the sales surpassed $600 million and for the first time since 2015, darknet market share of overall incoming transactions increased, doubling from 0.04% in 2018 to 0.08% in 2019.

Darknet markets total share of incoming activity remains “extremely low” but Chainalysis states,

“recent increased volume speaks to the resilience of darknet markets in the face of heightened law enforcement scrutiny.”

The trend that remained intact was that the vast majority of these transactions flow through exchanges. Exchanges are the most common service customers use to send cryptos to vendors and then sending these funding to cash out.

Active Darknet Markets Collected Huge Revenues

In 2019, eight of the darknet markets closed but eight new ones took their place, keeping the total number of active markets steady at 49. Each of these active markets also collected more revenue than ever, except during the height of Silk Road’s heyday in 2012 and 2013.

This revenue was driven by more purchases rather than larger ones. While the median purchase size remained constant in USD value, the number of transfers jumped yet again from 9 million to 12 million.

“This suggests that either more customers bought from darknet markets in 2019, or that old customers are making more purchases.”

Darknet Markets Implement Safety Features

In the darknet markets, drugs remains a popular choice. Markets specializing in other illicit goods also bring in sizable funds.

Chainalysis report finds that some of these darknet markets have begun implementing user safety features such as multi-signature technology and wallet-less escrow also knowns as direct deposit. Some are even adopting new infrastructure to avoid shutdowns by law enforcement.

Going forward, Chainalysis expects more darknet markets to accept or mandate the usage of privacy coins like Monero as used by Empire which it says “could change in 2020.”

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Author: AnTy

Are Institutional Investors Still Interested In Cryptocurrencies: 2019 Report

Over the course of the year, institutional investment has increased at a fast pace following the rapid development in the industry and exponential growth in Bitcoin over the last 12 months. CEO of digital asset manager Vision Hill Group, Scott Army, released the ten most important things that institutional investors should be looking for come 2020. How big can the blockchain and cryptocurrency market grow?

Here are some key concepts derived from the report, “An Institutional Take on the 2019/2020 Digital Asset Market.”

Bitcoin remains the supreme cryptocurrency

During the bear run in 2018, During the 2018 Bear run, BTC price dropped far less than the 90%+ of the top altcoins and has shown no signs of slowing in its dominance as 2019 saw the coin shoot up over 100% as altcoins remained relatively flat. The dominance by Bitcoin shows a clear disparity in the market – There’s bitcoin, and then there’s everything else.

Furthermore, the coin acts as the market beta, at least for now, given its huge market dominance – currently at 68.4%, as at the time of writing. The op-ed reads,

“Bitcoin’s size and its institutionalization has enabled it to be an attractive first step for allocators looking to get exposure (both long and short) to the digital asset market, suggesting that bitcoin is perhaps positioned to be digital asset market beta, for now.”

Institutional investment interest is on a gradual rise

The conversion numbers remained low during 2019 given the sustained bearish momentum through the previous year. Despite this, the field has witnessed a massive growth in institutional investor interest as educational progress took massive steps.

Big institutional funds, hedge funds, banking, and fund managers are taking a keen interest in the field with the processes for forming a digital asset strategy that is either getting started or already in motion in these firms.

Simplicity wins the day

It is getting clearer that active management in the space is dying a slow death with crypto fund managers opting to have singe asset index funds or exclusively trade in Bitcoin.

“Since the start of 2019, active managers were collectively up 30 percent on an absolute return basis according to our [Vision Hill] tracking of approximately 50 institutional-quality funds, compared to bitcoin being up 122 percent over the same time period.”

The slow process in approval of the Bitcoin ETF is yet another key moment through 2019 in institutional investing. Due to this, funds have resulted in privatized single asset vehicles such as Galaxy Digital’s, Grayscale Bitcoin Trust and other institutional investment products such as Bakkt futures and Fidelity’s latest London branch to serve European investors.

DeFi economies stamped authority in 2019

Smart contract powered collateral economies, one of the many cases DeFi, have seen a spike in interest as the world starts to embrace finance in a way, traditional finance cannot compete with. A platform such as Maker (MKR) allows users to earn value from their tokens by either lending or borrowing, giving the token a form of economic utility. The benefit of digital collateral is that it can be liquid and economically productive while at the same time serving its primary purpose.

However, the increasing value in DeFi and the economies built on smart contracts is not being reflected on the value of Ethereum, the platform hosting the ecosystem. Since the start of the year, ETH is trading over 30% lower despite hosting a multitude of Dapps and users.

Product market fit finally taking shape

With such a huge interest in the field, the development of fitting products to the market is only just a matter of time. The huge investments already poured into the field with Big Tech companies such as Twitter and Facebook announcing their Bluesky and Libra projects respectively signaling an opening market for blockchain.

“We are at the tip of the iceberg as it relates to the products and applications blockchain technology enables, and mainstream users will come with growing manifestations of product-market fit. As more time and attention gets spent on diagnosing problems and working on solutions, the industry will begin to achieve its full potential.”

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Author: Lujan Odera

SegWit Transactions Are On The Rise; Bitcoiner Makes A Deal With Binance’s CZ To Increase Adoption

Segregated Witness (SegWit) transactions on the Bitcoin network have recently increased. According to data taken from the network, the use of SegWit has spiked to 55% in September.

This is an optional protocol that helps the blockchain transactions to lower costs because it can accommodate more transactions in a single block. The SegWit protocol creates transactions which are around 25% smaller than non-SegWit ones.

Binance To Support SegWit

The CEO of Binance, Changpeng Zhao, has also indicated that the most important crypto exchange of the world could add support for SegWit transactions soon. As the exchange has a huge volume, it could help the network a lot.

In related news, Udi Wertheimer, a prominent Bitcoin developer, has affirmed that he would change the logo of his Twitter profile if the exchange added SegWit transactions. Despite signaling interest to do it, the exchange has been postponing the change for a long time now.

One of the main reasons why the upgrade has not happened yet is because SegWit is a “low priority” for the company. Zhao affirmed that current transactions “do work”, so upgrading them is not something that needs to be done as soon as possible.

Zhao has, however, hinted that the exchange could adopt SegWit transactions by 2020. Time will tell how this story will end, but the pressure for the world’s largest exchange to use this solution is growing a lot recently.

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Author: Gabriel Machado

Crypto Exchange CoinGate Sees Ripple XRP Payments Doubling Since February; Adoption Setting In?

Crypto Exchange CoinGate Sees Ripple XRP Payments Doubling Since February; Adoption Setting In?
  • CoinGate shows XRP payments have increased significantly since February 2019.
  • The digital currency provides many benefits to users including near instantaneous cross-border transfers.

CoinGate Informs XRP Transactions Grow

According to a recent report released by CoinGate, XRP usage continues to rise. The virtual currency is being used by crypto users in order to process cross-border payments. Other financial companies are also embracing the digital asset.

CoinGate informed that they have been processing XRP payments for merchants since February 2019. The number of people buying things with XRP has also been increasing every month. The main question asked by CoinGate is whether XRP is becoming a crypto for payments.

XRP Transfers Settled Faster Than BTC Transactions

The data provided shows that in February, the number of XRP purchases was 388, in March grew to 551 and continued the uptrend in April and May with 705 and 718 transactions each month respectively.

Compared to Bitcoin (BTC), XRP provides users with a fast and cheap way to process payments. While the Bitcoin network does not allow users to send micropayments as easily, it is possible to do so with XRP. Nonetheless, Bitcoin developers are currently working on the Lightning Network (LN) that is expected to help Bitcoin scale and process a larger number of transactions for low fees.

It is also worth mentioning that transactions on the XRP Ledger have remained stable since February until May. Last month, transactions moved from 392k transactions per day (TPD) to 979k TPD. Meanwhile, Ethereum (ETH) transactions have also grown during the same period of time. Bitcoin and Litecoin transactions remained without change since February.

Ripple Working With Financial Firms Throughout the World

Ripple has also been working on different partnerships with companies around the world, including bank and other financial firms that want to reduce costs and transaction times when processing cross-border payments.

Now it is possible to send XRP through the Money Message feature on Gmail. Moreover, the XRPTipBot is also helping individuals to send and receive XRP through different social media networks, including Discord, Reddit and also Twitter.

Currently, the third largest digital currency in the market has a price of $0.4112 and a market capitalization of $17.37 billion. In the last 24 hours, XRP lost 2.35% of its value.

All of Today’s Ripple (XRP) Price Analysis, Chart Forecasts and Industry News

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Author: Carl T