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News Bytes for May 3, 2018

Use our news to inform cryptocurrency trading decisions, stay up-to-date on happenings in the industry, and more!

Crypto Exchange BitGrail Legally Forced to Shut Down Just Three Hours After it Opens

Yesterday BitGrail Tweeted “BitGrail is pleased to announce the re-open of our exchange!” only to announce three hours later that “We have temporarily disabled the BitGrail exchange pending further notice.” Users quickly became irritable, some pondering if they were “getting robbed”. BitGrail quickly responded with a post to their web site that they were “notified of a deed by the court of Florence requesting the immediate closure of BitGrail and this situation will persist until a decision is made by the courts…”

SEC Mulls Whether Ethereum is a Security Under US Law

US regulators are cracking down on non-compliant securities issuers, and senior officials are set to meet to discuss whether that group includes the founders of Ethereum.

Telegram Scraps Public ICO as SEC Cracks Down on Token Sales

The company behind wildly-popular encrypted messaging app Telegram has scrapped plans to open its initial coin offering (ICO) to the public, says an anonymous source close to the matter.

Goldman Sachs To Open Bitcoin Trading Desk

Goldman Sachs, hiring their first cryptocurrency trader, becomes the first major Wall Street bank to open a bitcoin trading desk. Trading will start in the next few weeks, accordingly to a New York Times report.

Reddit Likely to Bring Back Bitcoin Payments, Add Ethereum and Litecoin Support

Cryptocurrency payments will likely be returning to popular social media platform Reddit, a company executive said on Wednesday.

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News Bytes for May 2, 2018

Welcome to News Bytes with BlockExplorer, your daily cryptocurrency news roundup. Today we will discuss top auto manufacturers forming a blockchain coalition, the SEC urging caution on ICOs, Australia cracking down on ICOs, Ethereum being under regulatory scrutiny, and Bitcoin being a contender to replace cash payments.

BMW, Ford, GM and Renault Form Blockchain Coalition

Four of the largest car manufacturers have formed a consortium focused on applying blockchain tech in the automotive sector. The Mobility Open Blockchain Initiative (MOBI) launched with the fairly broad goal of making transportation “safer, more affordable, and more widely accessible using blockchain technology.”

Top SEC Enforcement Official Urges Caution on ICOs

A top SEC enforcement official, speaking at a conference in New York on “The Future of Financial Fraud”, said some ICOs could be putting investors at risk. “They’re raising a lot of money, but they’re not complying with the rules that are in place to protect investors,” says Valerie Szczepanik, SEC assistant director of enforcement.

Australian Securities and Investments Commission Cracks Down on ICOs

ASIC is investigating misleading or deceptive conduct in the selling of cryptocurrencies. “If you are acting with someone else’s money, or selling something to someone, you have obligations,” ASIC Commissioner John Price said.

Ethereum Falls Under Regulatory Scrutiny

Ethereum fell 6 percent yesterday after The Wall Street Journal reported it has come under scrutiny by regulators. The cryptocurrency’s creation in 2014 was “probably an illegal securities sale” in the eyes of some regulators, The Wall Street Journal reports, citing people familiar with the story.

St. Louis Federal Reserve Bank: Bitcoin Could Be a Contender to Replace Cash Payments

Bitcoin could eventually become a contender to replace government-issued fiat money as a means of payment as it rapidly drives out the use of cash, according to a report from the St. Louis Federal Reserve Bank.

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News Bytes for May 1, 2018

Welcome to news Bytes with BlockExplorer, your daily cryptocurrency news roundup. Today we will discuss Caltech using Blockchain technology to share research data, Morgan Stanley moving into the crypto market, the FTC holding a ‘crypto scam’ workshop, and Oscar Mayer launching ‘Bacoin’.

Caltech Uses Blockchain Tech to Share Cell Biology Research with Public

Caltech’s Jensen Lab has announced a new initiative using blockchain technology that allows cellular biologists to share their research with other academic institutions as well as the general public.

Morgan Stanley Allegedly Accelerating Move in to Crypto Market

Big brokerage firms are racing to start trading cryptocurrencies. Insiders share Morgan Stanley may be trying to beat them all to the punch, creating a specific desk for institutional traders, ICOs, and arbitrage quickly.

Federal Trade Commission Holding ‘Decrypting Cryptocurrency Scams’ Workshops

The FTC is launching a crypto workshop in hopes to protect consumers using new financial technologies, according to their press release. The free June 25 workshop will be held at DePaul University in Chicago, and the event will also be available over a webcast.

Oscar Mayer Launches Cryptocurrency for Bacon— Enter Bacoin

To file in the “Because. Bacon.” category this week, hot dog maker Oscar Mayer has launched a cryptocurrency called Bacoin, redeemable for packs of bacon. It’s “the first ever cryptocurrency backed by the gold standard of Oscar Mayer bacon,” the company declares in their press release. Oscar Mayer also warns that, “similar to other cryptocurrencies, the value of bacoin can be volatile.”

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Goldman Sachs still denies it’s launching a cryptocurrency trading desk, but that may not be true for much longer.

Finance industry news site Tearsheet reports that the firm recently hired former securities trader Justin Schmidt — formerly a senior vice president at Seven Eight Capital — to become the investment bank’s first head of digital asset markets.

Citing sources familiar with Schmidt’s hiring, Business Insider says that he will not trade anything at Goldman Sachs  — cryptocurrencies or otherwise — though he will explore ways that the bank can make a deeper foray into cryptoassets. At present, the bank’s brokerage arm clears bitcoin futures for clients, though it does not trade them directly.

Despite hiring Schmidt, Goldman claims that it still has no plans to launch a cryptocurrency trading desk, which would allow institutional clients to make large trades over-the-counter (OTC)  — where they will not have a major effect on the cryptocurrency’s price — rather than through a conventional exchange.

“In response to client interest in various digital products, we are exploring how best to serve them in the space,” Goldman Sachs spokeswoman Tiffany Galvin-Cohen said in a statement. “At this point, we have not reached a conclusion on the scope of our digital asset offering.”

Bloomberg first reported in December that Goldman was quietly assembling a cryptocurrency trading operation, though the bank — and CEO Lloyd Blankfein — have denied on multiple occasions that this is the case. Sources told the publication that the bank intended to have the desk up and running by the end of June, though this timeline now appears to be in question.

While a variety of OTC cryptocurrency trading desks currently serve institutional clients — including one managed by Circle, a company that has received financial backing from Goldman — none are operated by a major US bank.

Barclays, one of Europe’s largest banks, is currently holding preliminary discussions about launching a cryptocurrency trading operation, though it has not yet decided whether it will proceed with these plans.

Featured Image from Pixabay

Bitcoin trading volume has achieved a new record in Venezuela, surpassing $1 million per day as locals turn to cryptocurrency for relief from the hyper-inflated bolivar.

Citing data from peer-to-peer (P2P) trading platform LocalBitcoins, Bloomberg reports that bolivar-to-bitcoin trades accounted for $1.006 million in volume on Monday, marking the first time that this trading pair has eclipsed the seven-figure barrier in a 24-hour period.

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Daily Bolivar to Bitcoin Trading Volume | Source: Bloomberg

The country’s economic woes have been well-documented, and they have been underpinned by runaway inflation that has seen prices rise by nearly 8,900 percent over the past calendar year.

The government no longer issues official inflation figures, so platforms like LocalBitcoins, which allow users to organize trades on their own terms, provide efficient price discovery for the bolivar, whose value rapidly declines on a daily basis.

After obtaining bitcoin, Venezuelans often trade it for USD, which is the primary currency of the country’s black market. Others have taken to keeping most of their liquid assets in bitcoin, trading it for bolivars only when they need to make a purchase.

Venezuela’s government has turned to cryptocurrency as a solution to its economic ills as well, creating a state-backed cryptocurrency called the “petro” that is allegedly backed by barrels of oil from the country’s crude reserves.

The government has said that the petro will become legal tender for all government transactions within the next several months, forcing government agencies to accept payments made with the token, which runs on the NEM blockchain.

President Nicolas Maduro claims that the initial coin offering (ICO) for the petro, which began in January,  has raised more than $5 billion, a figure that would be a record for cryptocurrency token sales. However, most independent analysts — and the country’s opposition party-controlled legislature — dispute its accuracy, and there is currently no evidence that the petro has raised any money at all.