BlockFi Eyes European Market in Q1 2021; Excludes the UK Due to Regulatory Uncertainty

BlockFi, a crypto lending service, is eyeing the European retail market with an expected product launch in Switzerland, Italy, and the Netherlands by the first quarter of 2021. The crypto lending firm has already begun the trials for the launch in Italy. However, to many people’s surprise, BlockFi has excluded the United Kingdom from the list despite having several London offices.

David Olsson, Blockfi’s vice president for Europe and Asia, shed some light on the launch of their retail products in the European market and said,

“They’re large enough markets that it’s worth our while to go in and put the resources to work to get traction there, and there is also the regulatory certainty that they’re more pro-crypto and it’s a stable regulatory environment.”

The crypto lending firm said that they are only focusing on institutional clients in the UK for now. The reason for excluding the UK could also be attributed to the latest crypto regulation update in October made by the Financial Conduct Authority (FCA). The October update prohibited offerings of derivative crypto products to retail investors.

While the October update does not impact BlockFi, the firm is currently observing the country’s retail market and regulatory policies surrounding it. The crypto lending firm believes it’s too complicated at present to roll out an elaborate business model in the country.

Olsson said that the October ban on derivatives offering for retail investors would hamper the future of crypto services in the country. He said that the ban looks like “it’s putting crypto on a different footing to equities,”

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Author: Silvia A

Crypto Finance Firm, Amber Group, Partners With BitGo As The Custodian For Institutional Investors

Global crypto finance service provider Amber Group announced BitGo Trust as its qualified custodian for its institutional investors and traders.

Amber Group is a renowned name when it comes to high-frequency trading and crypto financing for institutional investors. The firm is trying to use its industry experience in partnership with the BitGo to expand its offerings. The firm wants to expand its market reach to next-generation cryptocurrency traders as well as high net-worth investors.

Amber says BitGo is the right custodian partner

Amber Group says it chose BitGo for its collaboration because of the company’s user policy controls, compliance tools, and battle-tested institutional-ready custody used in securing customers’ assets.

Another major factor that swayed Amber Group towards BitGo is the benefit of issuance. Last year, BitGo launched the most expansive and comprehensive insurance policy for digital assets, including the $100 million as protection against assets held in custody. It provided a certain level of assurance of digital assets protection that isn’t common in the industry. The assurance of funds protection is one reason why Amber Group choose BitGo as a partner in this new project.

BitGo is offering protection for funds held in its custody via the European marketplace and a syndicate of insurers in the Lloyd’s of London.

The clients who buy Excess Specie Insurance, as it is called, will stand as Dedicated Customer Loss Payee in the insurance policy, which offers an extra level of insurance protection.

The partnership will transform future finance

Chief executive officer of BitGo, Mike Belshe, has commented on the partnership. He said the partnership with Amber couldn’t have come at a better time, as Amber group has a leading edge in crypto innovations. Belshe further stated that the team at Amber was carefully selected, and they are all seasoned professionals, which is why the partnership with the firm is great.

He further reiterated that BitGo would be providing the custody infrastructure, liquidity, and security necessary for the transformation of future finance via the collaboration.

The Chief executive officer of Amber Group, Michael Wu, has also commented on the development. He pointed out,

“As we scale our operations into more jurisdictions, we prioritize partnering with reliable and well-reputable infrastructure providers like BitGo.”

He further said that the Amber group’s daily operations require the successful implementation of rigorous security measures. The company must choose the right partner committed to asset protection more than anything else in the industry.

Amber was founded in 2017 and has grown to become a top crypto-finance service provider, with more than 200 institutional clients worldwide. It has received funds from institutional partners like Coinbase Ventures, Fenbushi Capital, Blockchain.com, Dragonfly Capital, and Polychain Capital.

Amber says it’s committed to bringing professionalism and more transparency to the cryptocurrency market.

Rumor: PayPal Exploring Acquiring Crypto Companies, In Talks with Bitcoin Custodian BitGo

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Author: Ali Raza

Cashaa’s New Joint Venture, UNICAS, to Roll Out 22 Physical Crypto Banks in India

U.K. based cryptocurrency firm, Cashaa partners with India’s banking service provider, United Multistate Credit Cooperative Society, as the latter, introduces banking transactions using cryptocurrencies to 22 physical locations in northern India. According to a blog post on Medium, the two financial firms will operate under a joint venture, UNICAS, to launch the products in December this year.

The UNICAS venture will allow users to invest in cryptocurrency, real estate, gold, and other physical assets directly, buy crypto using cash at any of the 22 physical locations, and take up loans against their digital assets. Cashaa plans to open over 100 physical locations across India in 2021, currently stationed across three states – Delhi, Rajasthan, and Gujarat, with a combined population of over 140 million.

The Indian based bank will provide the physical locations and licenses necessary to operate in the country while Cashaa joins in with experience in the crypto space. Mr. Dinesh Kukreja, Managing Director of United Multistate Credit Co. Operative Society, will lead UNICAS as the joint venture’s chief executive.

“We are the first regulated financial institution in the world with physical branches where users can access crypto products,” Kukreja, CEO, UNICAS.

Kukreja stated the project would allow the company to “scale and offer customized financial and crypto products for the local Indian markets.” The banking location will be reconstructed as crypto launches, allowing crypto transactions using the rupee and asking for loans using your crypto assets.

At launch, the banks will allow transactions, buying, and selling of six cryptocurrencies, including – Bitcoin (BTC), Cashaa (CAS), Ethereum (ETH), Binance (BNB), Bitcoin Cash (BCH), EOS, Litecoin (LTC), and Ripple (XRP).

However, there still is the dark cloud of regulation from the Indian government following the Supreme Court’s ruling – overturning the blanket ban of cryptocurrencies imposed by the Royal Bank of India (RBI). Kumar Gaurav, Founder & CEO of Cashaa, said the confused nature of the government could be the reason “most Indians are not aware or are miss guided about cryptocurrency as an online product.”

“They tend to trust what they see or what the government recognizes and recommends,” he continued. “Also, India is still largely a cash-based economy despite a Demonetization drive. With UNICAS Crypto lounges we intend to address both issues which are slowing the process of cryptocurrency adoption in India.”

The joint venture aims at rapidly expanding its reach across India – targeting over 100 branches serving cryptocurrency customers in 2021. With the traditional finance world merging with the innovative crypto industry, Kukreja aims the partnership will “bring enormous transformation to both Indian fintech and the crypto industry.”

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Author: Lujan Odera

IRS to Revise Form 1040 to Make it Harder for Traders to Escape Crypto Tax Obligation

The Internal Revenue Service is planning to change the 2020 tax form and make sure all taxpayers report about their cryptocurrency transactions.

The standard 1040 form will be altered by adding the following questions on the front page:

At any time during 2020, did you sell, receive, send, exchange or otherwise acquire any financial interest in any virtual currency? And the taxpayer is required to check the box “Yes” or “No.”

“This placement is unprecedented and will make it easier for the IRS to win cases against taxpayers who check ‘No’ when they should check ‘Yes,’” says Ed Zollars, a CPA with Kaplan Financial Education.

The Wall Street Journal first reported the adjustment on Friday, noting that the question was previously, in 2019, in a spot that not all taxpayers had to fill out. But now it has been moved just below the taxpayer’s identity.

With this, the IRS is stripping any excuse for ignoring the rules. This also means, whoever fails to pay the taxes they owe on crypto transactions can be subject to penalties and, in some cases, even criminal prosecution.

“Primarily based on what we’re seeing, individuals are beginning to get scared,” said Chandan Lodha, the chief working officer of Cointracker, a software program firm promoting crypto tax-prep providers.

The tax agency has been focusing on virtual currency transactions for some time now. Just earlier this month, the IRS issued guidelines clarifying how cryptos are treated for tax purposes when received in exchange for certain services. An individual has to report the digital currency as ordinary income for receiving it through a crowdsourcing platform in exchange for providing a service, as per the memorandum.

In late August, it had also been affirmed that taxpayers must declare their cryptos as income, which were obtained for “microtasks.”

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Author: AnTy

Bureau Of Fiscal Service Revisits Blockchain Technology Development To Streamline Grants

The Bureau of Fiscal Service, BFS, is focusing its energies on innovative technologies such as blockchain technology in a bid to enhance the government’s fiscal policies and “streamline its financial processes.” BFS will launch two projects – Digital End-to-End Efficiency (DEEE) and Blockchain for Grants – in a re-imagining strategy on how federal governments carry out day to day businesses.

According to the release, the Blockchain for Grants project was started back in 2017, aiming to create digital solutions to ease the tokenization, redeeming and transfer of grant payments from the government.

Blockchain technology offers a transparent, public, and secure platform to enhance the disbursement of grants by reducing the financial costs and setting up better internal controls. According to the statement, the blockchain for grants project “will focus on evaluating the functional and legal implications of using blockchain technology for helping grant payments.”

Fiscal Service Supervisory Program Manager Craig Fischer said,

“By tokenizing relevant grant award information and combining it with grant payment information on the blockchain, we attain new payment transparency that we couldn’t reach previously without significant and burdensome reporting.”

The BFS office has launched both innovative projects for a six-month period.

The latest blockchain interest from the Bureau of Fiscal Service follows a blockchain-based initiative to track office tools across the country.

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Author: Lujan Odera

Crypto.com Forks Uniswap & Launches DeFi Swap on Ethereum

Hong Kong-headquartered Crypto.com has launched a DeFi Swap service, which allows users to swap and farm DeFi tokens.

A fork of Uniswap V2, the platform is powered by its native token CRO, the 10th largest cryptocurrency by market cap, which is trading at $0.160, up nearly 6%.

Other coins supported are Wrapped ETH (WETH), Tether (USDT), USDC, DAI, Chainlink (LINK), and Compound (COMP), with more to be introduced in the future.

One can start farming by using any WalletConnect enabled mobile wallet, which the company says will soon be coming on its DeFi Wallet.

Gains & Losses

The liquidity providers (LPs) will be rewarded with 0.3% of the respective liquidity pools’ trading volume. For selected pools, LPs will also receive tokens that are redeemable for coins of the participating DeFi projects.

Crypto.com is guaranteeing a minimum reward pool of 14 million CRO for the first 14 days on this Ethereum-based decentralized protocol.

Meanwhile, those who stake CRO can “boost their yield by up to 20x and harvest the daily yield in as little as 30 days.”

These services, however, are restricted to the residents & citizens of over 30 countries, including the US, Mainland China, Hong Kong SAR, Iran, Iraq, and Venezuela.

Much like any DeFi project, the company clearly states using it at your own risk as it cautions of risks involved that aren’t limited to the loss of virtual assets, collapse in liquidity, changes in the smart contacts, extreme volatility, counterparty risk, attacks, hacks, defects, loss of private keys, and regulatory uncertainty.

“Not a Bubble”

The ongoing mania has resulted in the DeFi space exploding with the total value locked in it amassing nearly $10 billion, which after the recent correction, is currently under $8 billion.

However, “DeFi is not necessarily a pure bubble about to burst,” said Crypto.com in its report on decentralized finance. The report continued,

“It might deflate once the hype subsides, but as globalisation progresses and the business ecosystem further shifts towards new-generation business models built upon shared governance and decentralisation, there will be a growing demand for solutions like DeFi which will provide new ways banking, trading and investing – perhaps even setting the standard for economies to climb out of the shadows.”

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Author: AnTy

IRS to Pay $625k Bounty For Building Monero (XMR) and Lightning Network Tracking Solution

The U.S Internal Revenue Service (IRS) has issued an incentive of up to $625,000 in bounty for anyone who will develop a Monero (XMR) Tracking solution for the law enforcement agency. According to the proposal floated last week, the IRS is looking to equip its Criminal Investigation (CI) better when it comes to virtual currencies; the focus is currently on private coins like Monero and transactions on Lightning Networks. The proposal reads,

“IRS-CI is seeking a solution with one or more contractors to provide innovative solutions for tracing and attribution of privacy coins, such as expert tools, data, source code, algorithms, and software development services.”

IRS pointed out that criminal activity related to private coins, especially Monero, has been on the rise in recent years. The latest market stats show that XMR is used for around 45% of darknet activity, only second to Bitcoin. Given its surging use for illegal activity, the IRS has since been prompted to act and looking to increase its investigative resources with this challenge.

Interested participants have up to September 16 to have submitted their working prototypes, after which the selected applicants will be granted an initial $500,000. This grant is expected to facilitate further development of the working prototypes for around eight months. The final process will be pilot testing and government approval for the applicants to receive the pending $125,000.

Expected Solutions!

The proposal highlights three fundamental goals of this initiative and specifically notes that all solutions must support crypto transactions that occurred this year. For starters, selected participants are expected to deliver by providing information and technical capabilities to the IRS Special agents such that they can trace Monero transactions in the near future.

Also, the underlying infrastructure should feature other functionalities like statistical likelihoods to help CI’s predict unusual patterns in private coin transactions. Last but not least, they should provide the code for their innovations and ensure that the IRS can further develop without external assistance.

“Provide algorithms and source code to allow CI to further develop, modify, and integrate these capabilities with internal code and systems with minimal costs, licensing issues, or dependency on external vendors.”

This initiative by the IRS is not the first debut of a Monero tracking solution, intelligence firm CipherTrace recently announced that it has developed Monero tracking tools for the U.S Department of Homeland Security.

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Author: Edwin Munyui

Food Delivery Giant, Just Eat, Starts Accepting Bitcoin Payments

The online food order and delivery service, Just Eat is now accepting Bitcoin as a form of payment in France, in partnership with bitcoin payment provider Bitpay.

The official page of the company’s France website puts bitcoin as an added payment method besides cash, vouchers, PayPal, and credit cards.

Users can choose the bitcoin option to pay for their food when finalizing the order and which then gets redirected to the payment provider, Bitpay, to complete the process. Just Eat doesn’t charge any fees for the payments made in the digital asset.

In case of order cancellations, a user is refunded in Euros into a traditional bank account, and the rate applicable is the one applied at the time of the payment because Bitcoin has already been converted into Euros.

Home delivery services have become the way of the norm during the coronavirus pandemic, after the lockdown and social distancing forced people to go with these options because they couldn’t go out. Users have also switched to online modes of payment that have the use of cash declining.

Just Eat also recorded revenue of €1bn in the first half of 2020, thanks to this phenomenon. Consumers unable to dine out pushed the food delivery groups’ revenue increasing by 44% year-on-year.

The Netherlands-based platform recently also received the regulatory approvals for its acquisition of US food delivery venture Grubhub. With this merger, which was signed in June for $7.3 billion, will mark Just Eat’s expansion into the US market and is also expected to make it the world’s largest online food delivery company outside of China.

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Author: AnTy

USPS Patents A Blockchain-Based Mail-In Voting System Despite President Trump’s Critics

The United States Postal Service (USPS) might have a blockchain-based plan for the U.S mail-in voting suggestion. According to a patent made public by the U.S Patent and Trademark Office on August 13, the USPS had filled an intellectual property application for a blockchain ecosystem dubbed ‘Secure Voting System’ back in February.

Interestingly, this development coincides with President’s Trump recent sentiments towards shutting down the USPC, a move that could ultimately stall mail-in voting.

The USPS patent features blockchain as a fundamental tech that will serve as a means towards a ‘trustworthy’ 2020 election in the U.S. Ideally, this blockchain voting ecosystem should leverage the aspects of reliability and security to enhance voting logistics as well as data transmission and storage of the same. The patent notes that registered voters will receive a computer-readable code, which in turn ought to confirm their identity and ballot information. The patent reads,

“The system separates voter identification and votes to ensure vote anonymity, and stores votes on a distributed ledger in a blockchain.”

Industry stakeholders, including Hedera Hashgraph Technical Lead, Paul Madsen, have since weighed in on the USPS blockchain-focused mail-in voting patent. In his opinion, such a move would be beneficial to everyone involved in the election process, but most importantly, to voters.

“The votes of individual voters would be recorded, either on the blockchain or effectively timestamped and then recorded elsewhere – and so both help to mitigate the risk of double voting, or vote manipulation as well as give the voter confidence through the transparency of the process.”

Successful Blockchain-Based Voting in the U.S

While the stakes are higher on U.S 2020 elections, the use of blockchain cannot be ruled out given the tech has been used in other instances. Some notable events in which stakeholders voted through blockchain include delegate selection for the Republican National Convention in the states of Utah and Arizona.

It was also used for absentee ballots in the 2018 West Virginia elections in representing the military who are overseas. Now that the USPS is looking to join this bandwagon, its Inspector General Office (OIG) has suggested other areas like supply chain, identity services, device, and financial management where it could further leverage blockchain.

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Author: Edwin Munyui

Popular Bitcoin Payment App, Square CashApp, Considers Launching Short-Term Loans

Jack Dorsey’s Square might soon be offering loans of up to $200 through its P2P service platform, CashApp. This revelation follows a recent report by TechCrunch, which highlighted that the firm is testing the new feature with about 1000 users as of press date.

Notably, Square attributed this strategic move to some factors, including the uncertainty of a second U.S stimulus. According to the firm, the market demand for loans between $20 and $200 might expand significantly as a result.

Users who qualify for these loans will be given a one-month payback period with a 5% flat fee charged on leveraged funds. Calculated annually, the interest translates to around 60%. However, it may seem quite high; it is more favorable compared to average payday loans in the U.S, which in some cases are charged as much as 700%.

Should the borrowing parties default, Square intends to put a one-week grace period, after which a non-compounding interest of 1.25% will be added to the cost every week. With the testing still in play, a CashAPP spokesperson mentioned that they are looking forward to feedback from the 1,000 clients featured:

“We look forward to hearing their feedback and learning from this experiment.”

Square’s BTC Streak Continues

Other than its prospectus loan product, Square has been making headlines in the crypto scene and is now positioning itself as the go-to platform for Bitcoin purchases. The company’s Q2 revenue from Bitcoin totaled $875 million, with $17 million as the gross profit from BTC related transactions.

These stats are up by 600% and 711% YoY, respectively. Going by these stats, a move towards loan issuance might even expose a more significant population who initially couldn’t afford a stake in the crypto market.

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Author: Edwin Munyui