Maitland/AMO ICO Monitor – 12 September 2018
The Big Read
In August 2018 the smallest amount raised from start-ups occurred since May 2017. ICOs using the Euthereum blockchain are seen as one of the main catalysts for sending Ether’s prices surging last year and are now being blamed for the decline. Bloomberg, 10 September 2018.
A federal judge in Brooklyn refused to throw out a case in which a defendant argued two cryptocurrencies were beyond the reach of federal securities laws. Bitcoin and ether are the only digital assets and SEC has explicitly said are exempt from securities law and are instead viewed as commodities. The judge in this case denied the motion to dismiss and said current securities laws should be clear enough for a jury to decide. CNBC, 11 September 2018.
The underlying technology of blockchain goes way beyond those of Bitcoin digital currencies. The new levels of data transparency, faster access to information and features such as ‘’smart contracts’’ will bring significant changes to financial operations and potential benefits for CFO. Other benefits will include: increased efficiency, reduced loss and fraud and higher availability of capital. Forbes, 11 September 2018.
Blockchain technology is a revolution which is impacting more and more industries, including banks, governments and marketing sectors. The advantages that blockchain offers CMOs include: decentralised data, privacy and transparency. Although there are still a number of disadvantages which need to be identified for such as, hacks, electricity cost and regulatory status. Forbes, 10 September 2018.
New Kid on the Block – The Technologies, Funds and ICOs you should know about
The new technology will be called software-as-a-service (SaaS) and it will be used to manage data and analytics for customers in the field automatically. The automatic control will be used to filter through information related to location and activities. Quisitive is a company under the Microsoft umbrella and they will be responsible for engineering the software that takes advantage of blockchain technology with tracking capabilities. BitcoinExchangeGuide, 11 September 2018.
Global fintech company Quoine has unveiled Liquid, a cryptocurrency one-stop trading portal. It allows users to match trades across multiple transactions and cryptocurrencies. This is expected to increase the liquidity of all available cryptocurrencies on Liquid. This should provide market stability and empower a new wave of digital asset traders to buy and sell token more safely. Coin Telegraph, 7 September 2018.
Scams, Sanctions and Suspicious Activity
Research has found that as many as 890 token sales did not raise any funds at all. Yet, on the other hand 743 token sales were able to reach the $1 million mark. This could be due to scams, no market or poor marketing techniques. CoinDesk, 10 September 2018.
CEO Jack Dorsey told a Congressional committee that the social media company is exploring blockchain solutions for its platform. Twitter currently have no way of identifying scams that seek to defraud users out of their cryptocurrency holdings. Therefore, the company is looking for possible solutions for shoring up digital trust. CoinDesk, 5 September 2018.
Nouriel Roubini, Chairman of his own Roubini Global Economics firm, stated that the whole ICO industry is a scam and that the US Securities and Exchanges Commission’s rejection of several Bitcoin ETFs was no surprise. In his opinion Bitcoin doesn’t comply with the definition of money and the fact that banks are investing resources in testing blockchain doesn’t mean they are going to adopt it. Coin Rivet, 11 September 2018.
Bulls & Bears of the week
‘’There is a lot of justifiable excitement around blockchain right now, but it can be difficult for companies to separate what’s real from what is hype.’’ – Scotty Perkins, Senior Vice President, Product Innovation, Quisitive
“It’s a scam. The whole ICO industry is a scam. People are robbing, raising funds for projects with zero value,” - Nouriel Roubini, Chairman of Roubini Global Economics firm and a Professor at NYU’s Stern School of Business