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Facebook’s Libra forcing China to Step up Plans for its Own Cryptocurrency, Says Central Bank Official

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Facebook

Facebook’s plans to create its own cryptocurrency have forced China’s central bank into stepping up research into creating its own digital currency as Libra could potentially pose a challenge to Chinese cross-border payments, monetary policy and even financial sovereignty, a People’s Bank of China official said on Monday.

“If [Libra] is widely used for payments, cross-border payments in particular, would it be able to function like money and accordingly have a large influence on monetary policy, financial stability and the international monetary system?” asked Wang Xin, director of the People’s Bank of China (PBOC)’s research bureau during an academic conference hosted by Peking University’s Institute of Digital Finance.

The PBOC are paying “high attention,” according to Wang, after Facebook released a white paper in June outlining plans to create its own long-awaited cryptocurrency and a related blockchain-based financial infrastructure project. The PBOC was the first major central bank to study digital currencies in 2014, a step to counter the challenge from cryptocurrencies like bitcoin, with a research institution set up in 2017 to further facilitate the research.

China maintains a blanket ban on new listings or trading of any digital currency, including bitcoin, as Beijing regards digital tokens as a source of financial risk. At the same time, China’s central bank has been longing for a “sovereign” digital currency that would fall under its control, although it has so far made little progress. Concerns have risen, in some quarters, that Libra will fuel a new round of international currency competition and a challenge to financial sovereignty. According to Facebook’s white paper, Libra will be linked to a basket of major currencies and governed by a Switzerland-based non-profit consortium, the Libra Association, which includes more than two dozen companies, including Visa, Mastercard, PayPal, Stripe, eBay and Uber.

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Business

Binance.US Launches Registration

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Binance

Launching tomorrow, Binance.US is a fast and secure digital asset marketplace, delivering the world’s leading digital asset trading technology, speed, and experience to everyday users in America. Ahead of registration, we’ve answered some of the questions you’ve been asking.

If you don’t read any further, take note:

  • Trading Fees are Zero until November 1, 2019.
  • Binance.US is rolling out to most states, but states not available upon launch are listed below.
  • Everyone will be a new user of Binance.US. Please verify your account and deposit funds to be eligible to access trading.

Who will be available to register for an account at Binance.US at launch?
We are rolling out Binance.US gradually across America. At launch, new users with a valid government ID (driver’s license or passport) and social security number (SSN) will be able to register for Binance.US in most U.S. states, excluding the following states:

  • Alabama
  • Alaska
  • Connecticut
  • Florida
  • Georgia
  • Hawaii
  • Idaho
  • Louisiana
  • New York
  • North Carolina
  • Texas
  • Vermont
  • Washington

Although it is upsetting that we cannot offer Binance.US in the states where I grew up and earned my education at this time, please rest assured that this is just the beginning, and it is our mission to bring access to those of you in these states many of us call home.

Can my coins/tokens held at other trading venues or custody solutions be automatically transferred to Binance.US, or will I need to manually transfer them?
Binance.US is an independent entity. Therefore, any of your digital assets held by other trading venues or custody solutions will not automatically transfer to Binance.US.

You are permitted to deposit digital assets and/or fiat, depending on your account verification level, in accordance with the terms of our User Agreement. It will be an easy few clicks to deposit funds to your Binance.US wallet.

What are the trading fees on Binance.US?
Reducing the barriers to digital asset adoption is one of our goals. Other marketplaces charge users excess fees to pass operational costs to marketplace users. We aim to change this trend by using a straightforward fee schedule. For personal accounts, we offer a flat fee of 0.10% per trade. If you buy $100 of BTC, your fee will be $0.10.

However, standing by our values of reducing the barriers to digital asset adoption, we are lifting all fees for trading at launch — Zero Fees until November 1, 2019.

Corporate accounts will have an adjusted fee schedule given their trading volume.

Will U.S. customers be able to buy listed coins/tokens with USD, credit cards, or debit cards?
U.S. customers will be able to buy listed coins with USD through ACH or wire transfer methods. We will be exploring other options based on the demand of our users.

What can I do with my coins/tokens that are NOT listed on Binance.US?
All coins/tokens not yet listed on Binance.US can still be stored with other custodians in the custody method of your choice (ex. hot wallet, cold storage, etc.) and traded on other venues that have live order books in those pairs. Over the coming weeks, we will be adding coins that satisfy our Digital Asset Risk Assessment Framework.

Will Binance.US customers be insured against theft, hacking, etc?
Binance.US takes security seriously. We prioritize customer protection and have measures dedicated to protecting customers from theft and hacking.

Will trades on Binance.US be separate from Binance.com?
Yes. Binance.US is a separate company, operated by BAM Trading Services. Your digital assets will be stored in Binance.US wallets.

What happens once registration opens on September 18 at 8am ET?
We will be accepting inbound transfers of BTC, ETH, XRP, BCH, LTC, USDT, and USD upon appropriate account verification starting tomorrow. We will accept deposits prior to enabling full trading and will be updating you when liquidity conditions are met allowing for trading to begin on set pairs. Trading on the order books will commence once a sufficient supply of these coins is established on the platform to allow for healthy markets. Support for additional jurisdictions and listings may be added at a later date.

See you bright and early Wednesday morning!

– C. Coley
CEO, Binance.US

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Blockchain

BlockFi Removes Minimums and Fees for Its Crypto Interest Account

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BlockFi

BlockFi is excited to announce today that it has dropped all minimums in the BlockFi Interest Account (BIA). BIA clients will no longer have to meet a minimum deposit amount in their Bitcoin, Ether, or GUSD balances in order to earn interest. Additionally, BlockFi has removed the early withdrawal penalty from the account and is now offering one free withdrawal per month to all clients.

When BlockFi first launched the BIA, the price of one Bitcoin was significantly lower than it is today. In March 2019, one Bitcoin cost around $4,000. Since then, the price has more than doubled. Due to client feedback and increasing demand for the BlockFi Interest Account, the company has decided to remove the minimum to earn interest and make its products more widely available to all crypto investors.

“We’re thrilled to see the growth in platform activity from crypto investors leveraging our wealth management products. This update to our terms will make our products more widely accessible – which is a key theme of the crypto sector and part of our mission at BlockFi.” – Zac Prince, CEO and Founder.

“Earlier this year, we expanded into new markets such as India. By making BIA open to all, we plan to target clients in Latin America, where banking services and credit reporting are limited. U.S.-grade financial products have typically only been available to high net worth individuals in countries like Argentina and Costa Rica. BlockFi’s platform leverages blockchain rails to make wealth management products available on a much broader scale.” – Flori Marquez, Co-Founder and VP of Operations.

Having recently raised its Series A financing round, led by Valar Ventures, BlockFi is currently focusing its efforts on rapidly scaling its core business, making its current products (BIA and crypto-backed loans) more accessible to a wider crypto audience, and developing new products to expand its addressable market. To this end, BlockFi is actively working on innovative approaches to bring more value to its current clients and crypto investors at large. For example, BlockFi recently added a new feature to the BIA, Interest Payment Flex. With Flex enabled, clients holding Bitcoin, Ether, or GUSD in their BIA can select which of the three offered currencies to receive all their interest in. Dropping the minimums to earn interest is the latest step in this process: this change will allow crypto investors holding any amount of Bitcoin, Ether, or GUSD to benefit from BlockFi’s wealth management offerings.

Although there is no longer a minimum balance required to earn interest, accounts are still subject to Gemini’s withdrawal minimums: 0.003 BTC and 0.056 ETH. Withdrawals for balances smaller than these amounts may take up to 30 days to process.

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Blockchain

Facebook’s Libra seeks Swiss payment system license

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Libra

Facebook’s Libra cryptocurrency project is seeking a Swiss payment system license, financial watchdog FINMA said on Wednesday, noting the breadth of the planned services would require broad oversight. The world’s largest social media network announced plans in June to launch a cryptocurrency as it seeks to expand beyond social networking and move into e-commerce and global payments, though the plans have drawn intense scrutiny from global financial officials.

“Due to the issuance of Libra payment tokens, the services planned by the Libra project would clearly go beyond those of a pure payment system, FINMA said, noting this mean it would be subject to such additional requirements.

These would extend to capital allocation for credit, market and operational risks, risk concentration and liquidity, and the management of the Libra reserve, it said. “We are engaging in constructive dialogue with FINMA and we see a feasible pathway for an open-source blockchain network to become a regulated, low-friction, high-security payment system,” the Geneva-based Libra Association said.

It has asked FINMA to clarify the status of the association and the Libra coin under Swiss supervisory law, the regulatory said. [bit.ly/2kEP7bk]

U.S. Under Secretary of Terrorism and Financial Intelligence Sigal Mandelker told reporters in the Swiss capital on Tuesday that cryptocurrency project must meet the highest standards for combating money laundering and terrorism financing if it is to get off the ground.

“Whether it’s bitcoin, Ethereum, Libra, our message is the same to all of these companies: anti-money laundering and combating the financing of terrorism has to be built into your design from the get-go,” Mandelker said.

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Business

ArBinance Makes Arbitrage Trading Easier

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ArBinance

ArBinance is a cryptocurrency arbitrage platform. It allows traders to benefit from the difference in price value between cryptocurrency markets.

The platform, which deals with over 100 cryptocurrency exchanges, aims to make arbitrage trading easier for professional and novice traders alike. The trading platform uses its specially designed software that is both highly functional and easy to use for traders.

Seeing that arbitrage is not only about finding beneficial trades but making them promptly, ArBinance’s software is built with efficiency in mind. The platform’s application instantly identifies profitable trade opportunities and acts upon them just as swiftly. This process makes sure that individual traders could benefit from market events within seconds of their initiation.

ArBinance is Allowing Users to Take Fair Advantage of Arbitrage

Arbitrage trading refers to the practice of benefiting from the difference in price value between various markets. When traders spot this price difference, they buy the asset from the lower-cost market and sell it in a place where it is at a higher price.

This difference is simply a fraction of the total price of the asset. As such, buying and selling it in a single transaction does not bring in massive profits. But when this price difference is spotted, and essential purchases or sales are made a few times a day, it could bring in astounding results. That’s one of the many reasons why arbitrage trading is so prevalent in conventional markets.

As the cryptocurrency market grows with more and more exchanges, arbitrage trading has also started to gain significant traction within the sector. More exchanges mean more opportunities to spot pricing differences, which translates to higher profitability.

Traders must be their best at all times to determine the price difference between hundreds of exchanges. Since no one can keep up with an avalanche of trades, traders are not able to gain full advantage of arbitrage trading even if they want to do so.

That is where automated solutions such as ArBinance come in.

ArBinance Offers Targeted Arbitrage Solutions

To help traders make the most out of arbitrage trading, ArBiance has designed an intuitive interface. The application is easy to use and boasts of a few significant functions, such as the ability to perform automated arbitrage trading. Trades are possible even when users are away from their computer screens.

ArBinance works round the clock and lets its users take advantage of 24/7 arbitrage to make sure that they never miss out on potential gains. The automated platform has been designed to spot price differences in over 100 hundred cryptocurrency exchanges and make trades instantly. This way, traders can benefit from relevant opportunities without manual tracking of prices or execution of trades.

ArBinance provides its arbitrage solutions through its website, where interested traders could sign up to use its services. To learn more about ArBinance and its offered trading solutions, head to ArBinance.com today.

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Altcoins

Binance Partners with Paxos to Launch USD-Backed Stablecoin ‘BUSD’

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Binance

The regulated financial institution that digitizes and mobilizes assets, Paxos Trust Company, and global cryptocurrency exchange and blockchain ecosystem, Binance, today announced its partnership to launch a USD-denominated stablecoin, Binance USD (BUSD), which has received approval from the New York State Department of Financial Services (NYDFS).

Rich Teo, Paxos Co-Founder and CEO Asia, commented, “NYDFS’s approval of BUSD is a vital step towards long term stability in global crypto markets. We are proud that our stablecoin as a service offering enables trusted companies like Binance to introduce products customized for their users. The Paxos brand symbolizes regulatory integrity, consumer protection and transparency for all of our partners.”

Later this month, BUSD will be available on the Paxos platform for direct purchase and redemption 1:1 for U.S. dollars and available on Binance.com for trading initially against BTC, BNB and XRP. Paxos will serve as the USD custodian and issuer of BUSD.

“Paxos is leading the digital trusts space and we are excited to work with them in developing our native stablecoin,” said CZ (Changpeng Zhao), Binance CEO. “We hope to unlock more financial services for the greater blockchain ecosystem through the issuance of BUSD, including more use cases and utility through the power of stable digital assets.”

Additional details regarding this partnership will be revealed on-stage at Invest: Asia 2019 where Paxos’ Rich Teo and Binance’s CFO Wei Zhou will discuss it live on September 12, 2019, at 4:20 pm local time.

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Business

Alibaba, Tencent, Five Others To Receive First Chinese Government Cryptocurrency

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STO

China’s central bank will launch a state-backed cryptocurrency and issue it to seven institutions in the coming months, according to a former employee of one of the institutions who is now an independent researcher. Paul Schulte, who worked as global head of financial strategy for China Construction Bank until 2012, says the largest bank in the world, the Industrial and Commercial Bank of China, the second largest bank in the world, his former employer, the Bank of China, the Agricultural Bank of China; two of China’s largest financial technology companies, Alibaba and Tencent; and Union Pay, an association of Chinese banks, will receive the cryptocurrency.

A separate source, who’s involved in the development of the cryptocurrency, dubbed DC/EP (Digital Currency/Electronic Payments), confirmed that the seven institutions would be receiving the new asset when it launches, adding that an eighth institution could also be among the first tier of recipients. The source declined to provide the name of the additional company. Speaking under terms of anonymity, the source, who previously worked for the Chinese government, confirmed that the technology behind the cryptocurrency has been ready since last year and that the cryptocurrency could launch as soon as November 11, China’s busiest shopping day, known as Singles Day.

At the time of launch, the recipient institutions will then be responsible for dispersing the cryptocurrency to 1.3 billion Chinese citizens and others doing business in the renminbi, China’s fiat currency, according to the source. The source added that the central bank hopes the currency will eventually be made available to spenders in the United States and elsewhere through relationships with correspondent banks in the West. “That’s the plan, but that won’t happen right away,” the source said.

The plan to use a diverse set of China’s trusted institutions to disperse the cryptocurrency is reminiscent of a number of other ideas currently percolating around the world. For instance, Facebook’s planned libra cryptocurrency will be backed by a basket of currencies issued by central banks with support from companies like Mastercard and Uber in the United States, Vodaphone in England and Mercado Pago in Argentina. And last week, Bank of England governor Mark Carney floated the idea of a new currency backed by a number of central banks to replace the U.S. dollar as the global reserve currency.

What sets China’s DC/EP apart from libra and Carney’s “synthetic hegemonic currency” (SHC), according to Shulte, is that while libra is little more than early-stage computer code and the SHC doesn’t appear to have gone much further than Carney’s mind, the Chinese cryptocurrency is ready to launch. “China is barreling forward on reforms and rolling out the cryptocurrency,” says Schulte, who now runs an eponymous bank research firm. “It will be the first central bank to do so.”

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Blockchain

Facebook Posts Lobbying Retainer Amid Cryptocurrency Controversy

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Facebook

Facebook has hired a Washington-based lobbying firm in light of increased Congressional and regulatory pushback the social media network has received due to its forthcoming cryptocurrency offering, Libra

The social media giant in August retained consulting shop FS Vector for support on “issues related to blockchain policy,” according to lobbying registration documents filed with Congress.

Facebook formally unveiled the details of its planned blockchain digital currency initiative in June, which could potentially bring the world’s “unbanked” billions into the digital economy by allowing anyone to securely buy, sell or send money to others via Facebook. The proposed digital currency, which has yet to meet regulatory approvals, is set to launch sometime next year.

Announcement of the social network’s forays into the digital asset space has since raised serious concerns among lawmakers. Congress in July drafted a bill, titled “Keep Big Tech Out of Finance Act,” which would prohibit “large platform utilities”—defined as a tech company that earns annual global revenues of $25 billion or more—from being a financial institution or operating “a digital asset that is intended to be widely used as medium of exchange, unit of account, store of value, or any other similar function, as defined by the Board of Governors of the Federal Reserve System.”

House Financial Services Committee Chair Maxine Waters (D-CA) in June called for a moratorium and Congressional review of Facebook’s Libra project, “given the company’s troubled past.” Appearing in July on CNBC’s “Closing Bell,” Waters likened Facebook’s cryptocurrency venture to “starting a bank without having to go through any steps to do it.”

Federal Reserve chairman Jerome Powell in July posited that “Libra raises many serious concerns regarding privacy, money laundering, consumer protection and financial stability.”

President Trump raised concerns about Facebook’s proposed cryptocurrency as well, tweeting in July that “if Facebook and other companies want to become a bank, they must seek a new Banking Charter and become subject to all Banking Regulations, just like other Banks.”

FS Vector, which was founded in 2018, bills itself as a regulatory compliance, public policy and business strategy advisory firm that specializes in the fintech, cryptocurrency, blockchain and financial services markets.

FS Vector partner John Collins leads the Facebook account. Collins formerly served as vice president of international policy at the American Bankers Association’s international subsidiary, the Bankers Association for Finance and Trade. Prior to that, he was a staffer on the U.S. Senate Committee on Homeland Security and Governmental Affairs and also led Congress’ first work into digital currencies in 2013.

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Business

SEC Warns Over Crypto Trader Investment Scams

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scams

The Securities and Exchange Commission’s (SEC) is warning over a new form of investing scam, in which victims are lured into investing with websites claimed to be legal digital currency traders operating overseas.

Pol Lt Co Woranan Silam, a spokesman for the Department of Special Investigation, on Saturday relayed the SEC’s warning to the public, saying FX Trading Corporation is not authorised to trade in digital currencies as claimed.

Several other companies and websites are also involved in the fraud, he said. Most claim to be foreign companies operating outside Thailand offering services via their online portals. It is not known how much they have ripped off from an unsuspecting public.

The SEC says it has authorised only three companies to operate digital assets businesses, namely Bitcoin Co (www.bx.in.th), Bitkub Online Co (www.bitkub.co.th) and Satang Corporation Co (www.satang.pr), he said. And Coins TH Co (www.coins.co.th) is the only authorised digital currency broker or dealer, he added.

The spokesman also warned that, since the scams also involved overseas companies, Thai authorities require cooperation from their counterparts in other countries to investigate or step in as appropriate.

Such probes could take years to conclude or recover any lost investments, he said.

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Blockchain

Binance Announces Open Blockchain Project ‘Venus’

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Binance

Binance announced its plans to initiate an open blockchain project, Venus, an initiative to develop localized stablecoins and digital assets pegged to fiat currencies across the globe. Binance is looking to create new alliances and partnerships with governments, corporations, technology companies, and other cryptocurrency companies and projects involved in the larger blockchain ecosystem, to empower developed and developing countries to spur new currencies.

With its existing global blockchain ecosystem, Binance has already reserved its public chain technology and cross-border payment system for secure operations of new stablecoins. Since its launch last April, Binance Chain has been running securely and robustly and has issued a range of stablecoins, including a BTC-pegged stablecoin (BTCB) and the Binance BGBP Stable Coin (BGBP) pegged to the British Pound. Binance will provide full-process technical support, compliance risk control system and multi-dimensional cooperation network to build Venus, leveraging its existing infrastructure and regulatory establishments.

Binance welcomes additional government partners, companies and organizations with a strong interest and influence on a global scale to collaborate with us to build a new open alliance and sustainable community. We encourage like-minded people and organizations to contact us and discuss the infinite possibilities of the digital world together: venus@binance.com.

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Business

‘Strategic differences’ force departure of Swiss digital exchange boss

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Swiss

The CEO of Switzerland’s crypto assets stock exchange will step down just eight months into his job following disagreements on how the nascent trading platform should be run. Martin Halblaub will depart at the end of August when his contract expires.

SIX Groupexternal link, which owns the Swiss stock exchange and its SDX digital exchange projectexternal link, played down the development, saying it will not affect the operation or its timetable. But this may be viewed as a blow for Switzerland’s ambition to host the first national stock exchange to trade a new breed of digital assets.

“I fully support SDX’s ambition and business model and would have loved to lead SDX into the future.  However, I have decided with a heavy heart – given our differing ideas on strategy, combined with the stretch the role is for my life model – that I cannot engage in a long term commitment as Head of SDX,” Halblaub is quoted in the memo.

SIX internal memo

Dear colleagues    As you know, Martin Halblaub was engaged as a Senior Advisor by SIX to lead SDX through its initial phase until the SIX Board …

The key strategic difference is that Halblaub wanted SDX to be launched as an independent company – a plan that grated with SIX’s board who wanted the new exchange to operate under the overall SIX umbrella.

Halblaub will be replaced as SDX CEO on September 1 by Tomas Kindler on an interim basis, according to an internal memo released on Tuesday. Halblaub’s tenure has proved short-lived having only been appointed to the top position at the start of this year.

Kindler is currently number two to Thomas Zeeb, head of securities and exchanges at SIX. Zeeb says in the memo that an “executive search” has been launched to find a permanent replacement and that Kindler is one of the candidates they are looking at. Zeeb added that Halblaub has expressed an interest in remaining at SDX as a senior advisor.

Global competition

“Martin [Halblaub] led SDX through its initial phase with great success. He helped shape SDX’s ambition, strategy and business model and has built a strong Management team around him.  We thank him for his support during this phase,” SIX CEO Jos Dijsselhof says in the memo.

In an interview with the NZZ am Sonnntag newspaperexternal link on Sunday, Dijsselhof made no mention of the internal conflicts at SDX.

Announced in July 2018, the SDX project was initially timetabled to be operational by mid-2019. But that date has been put back to the first or second quarter of 2020 following internal tests later this year with banks that have ownership stakes in SIX.

SDX faces competition from several other countries and one domestic project as it seeks first mover advantage in the tokenized digital asset business that has been tipped to bring vast efficiencies to the trading of shares, bonds and an anticipated wave of new financial products.

Projects ranging from Germany, the United States and Thailand are also bidding to become the first national crypto asset exchanges. Budding crypto bank Sygnum in Zurich has teamed up with national telecoms operator Swisscom, the Deutsch Börse and other partners to offer a Swiss trading alternative.

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