Category: Blockchain

Bermuda is banking on the blockchain

On By mehranmuslimiblogIn Blockchain, FintechLeave a comment

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Something unusual has just happened in Bermuda, the Caribbean island paradise, retreat for the rich and offshore haven — the government has told the island’s banks that they are just not moving fast enough into the cryptocurrency market. It’s a rare occurrence, because most governments are taking a cautious approach to cryptocurrency and none seem to be insisting the conventional banking industry adopts a crypto-friendly approach.

A new class of bank for crypto

In fact, Bermuda is going even further. It is making amendments to its Banking Act so that it can establish a new class of bank that will be able to serve the crypto community, fintech startups and any other type of business that is blockchain based.

The local banks have only themselves to blame for this radical move. They have been denying service to crypto companies, citing fears about risk and regulatory concerns as the reason for shutting the door in potential clients’ faces.

Government supports fintech growth

The government takes a rather different view: Bermudian Premier and Minister of Finance David Burt said that the banks’ stance “cannot be allowed to frustrate the delivery on our promise of economic growth and success for Bermudians.” It appears that Bermuda wants to emulate the successes of jurisdictions like Gibraltar and Malta in becoming safe havens for blockchain explorers, and they all share the characteristic of being relatively small in terms of population, but big on financial services that serve the whole world. Of course, this is perfectly understandable: if you don’t have the environment to be a manufacturing or agricultural economy, financial services are the best way of ensuring that your economy thrives, especially if you keep introducing innovations that attract companies or individuals who can’t find a banking home elsewhere.

David Burt also said in parliament: “The fintech industry’s success globally depends on the ability of the businesses operating in this space to enjoy the necessary banking services. In other jurisdictions, banking has been the greatest challenge and for us in Bermuda, it is equally so and therefore it must be resolved.”

Bermuda welcomes Binance and Shyft

He clearly sees that Bermuda’s future must not be held hostage by the banks’ fear of the blockchain. This year Bermuda has already signed deals with Shyft network, which will reportedly provide $10 million on blockchain technology education and economic development on the island, and Binance is on Bermuda to establish funding for educational programmes related to fintech and blockchain. It has said it wants to build a “global compliance base” on the island.

It’s a smart move by the Bermuda government and is yet another step forward in opening up the banking sector worldwide to the reality that businesses operating in the crypto sector need forward-thinking banking — and that they’re going to grow in strength rather than disappear. Ignore them at your peril.

What game is Facebook playing?

On By mehranmuslimiblogIn Blockchain, ICOLeave a comment

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I can tell from a quick review of the main crypto press outlets online this morning that I’m not the only one puzzled by Facebook’s decision to reverse its crypto advertising ban. Why now and what is Facebook up to with this latest announcement? It seems like progress, even though advertising ICOs or binary options is still prohibited.

The Facebook crypto ban confusion

Going back to January 30th when Facebook announced its ban, because of “misleading or deceptive promotional practices,” we were somewhat confused then. On the one hand, Facebook had imposed a blanket ban on any cryptocurrency and/or ICO advertising, yet Mark Zuckerberg made public statements pointing to his personal interest in them. He said: “There are important counter-trends to this — like encryption and cryptocurrency — that take power from centralized systems and put it back into people’s hands […] I’m interested to go deeper and study the positive and negative aspects of these technologies, and how best to use them in our services.” I think the key element of what he said then is “how best to use them in our services,” suggesting to many onlookers in the crypto community that Facebook’s ad ban wasn’t quite so much “for the greater good’ as for “the good of Facebook.”

And now we’ve been taken by surprise with this latest announcement. (No doubt, Twitter and Google will follow, since they followed the FB ban.) It may have a positive effect on the crypto markets, which have been taking a battering for several months now and who can forget that Bitcoin’s price took a hit right after Facebook announced the ad ban. That’s one possible positive that might come out of this — at least it will be good for cryptocurrency owners.

Crypto ban lifted — just a little

So now we are in a situation where cryptocurrencies can be advertised again on Facebook, but not ICOs. And before we all jump for joy, look at what Facebook also says in its on-site statement — only pre-approved advertisers will be ‘admitted’.

Facebook says: “Advertisers wanting to run ads for cryptocurrency products and services must submit an application to help us assess their eligibility — including any licenses they have obtained, whether they are traded on a public stock exchange, and other relevant public background on their business.”

Facebook is still in control

Therefore, Facebook still has all the control. And it hasn’t explained why it has made this U-turn on crypto advertising. Consequently, theories about what the media giant is really up to are sprouting like daisies. Carlos Grenoir, CEO of Olyseum suggests Facebook’s ad ban reversal could be selfishly motivated: “The reasons for Facebook reversing its decision to ban crypto ads are not clear, but the motivation could have something to do with its own strategy regarding the evolving crypto space.”

Others, like WhalePanda, a respected voice in the crypto markets, believe it has more to do with Facebook losing advertising revenue. Cointelegraph, a company that suffered the effects of the ban reports, “The posts which have been put forward for review by Cointelegraph have become stuck, and are not being confirmed, nor denied by Facebook, during the ban as well as after the ban was ‘reversed.’” Basically, it is still a confusing space for advertisers who want to boost posts.

We don’t know what Facebook’s vetting process and while it looks like a positive move from the crypto community perspective, Facebook needs to come clean about what exactly they are doing, because for the moment it looks like it is playing a game, and one that it hopes to win by any means.

Is Trilliant offering a new form of ICO?

On By mehranmuslimiblogIn Blockchain, ICOLeave a comment

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In a move to serve the growing consumer demand for cryptocurrency tokens, tech business Trilliant is launching 500 ‘next generation’ ATMs in Europe, which should be fully operational by the beginning of 2019. Trilliant is a Swiss-based company that started out as Crypto Capital AG, but now focuses on ATM operations, having moved away from being an investment platform.

Currently ATMs don’t have the facility to purchase cryptocurrencies using fiat currencies, but the new ATMs rectify that situation. Surely, this represents a leap forward for cryptocurrency, especially with regard to mainstream adoption.

What Trilliant is offering is a way to promote stability in the marketplace. Its goal is to have at least 500 ATMs operational by 2019 — a goal that doesn’t seem overly ambitious considering that the next generation ATMs offer more value to cryptocurrency investors than the 2,700 cryptocurrency ATMs currently in-place across the globe.

Founder and CEO, Sebastian Korbach said: “In the long run, we want our machines visible on every corner, creating greater awareness for cryptocurrencies in general.”

It is also offering investors the opportunity to purchase Fractional Ownership Units. These units cost upwards of $100 and will be sold on the Trilliant website. Essentially it means that investors will be able to purchase partial ownership of Trilliant’s operating cryptocurrency ATMs.

Is this a new type of ICO?

This is different to an ICO, the fundraising platform that is more typical for blockchain and crypto projects. A Fractional Ownership Unit is similar to a profit sharing agreement, which means investors stand to benefit from Trilliant’s profits. However, it is still holding a token sale and has a whitepaper — so isn’t it an ICO in another disguise?

This raises some interesting questions about the ICO landscape in the future. Is the basic model that emerged in 2017 simply that — a basic model? Will we see the ICO develop different formats, such as this Fractional Ownership concept. Fractional Ownership is by no means a new thing and it isn’t just connected to the cryptocurrency ecosystem — you can have fractional ownership of vineyards, racehorses and supercars. What other formats are likely to emerge and how will this test the strength of the regulatory frameworks for crypto ecosystems and token sales?

We have only seen the tip of the iceberg with ICOs — there is undoubtedly much more to come in terms of this fundraising tool.

The Enigma Code for Smart Contracts

On By mehranmuslimiblogIn Blockchain, Smart ContractsLeave a comment

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During the Second World War, the Enigma Code proved one of the toughest to break. Eventually, Alan Turing, one of a group of elite code breakers working at Bletchley Park in the UK devised a technique to unravel the messages being sent out by the Enigma machine and he became known as the father of modern computing. Fast -forward to 2018 and we are seeing the emergence of another Enigma, a blockchain startup that enhances the privacy of smart contracts.

Privacy and secret contracts

Enigma is working with Intel on perfecting secret contracts. These are a type of smart contract for public blockchains that use cryptographic tricks to keep transaction data hidden from view. The project started at MIT with the aim of creating a more private platform for decentralised applications. To do this it is using Intel’s Software Guard Extensions (SGX).

A spokesperson for Enigma said: “Privacy is currently the biggest barrier to smart contract adoption. Blockchains are good at correctness, but bad at privacy by design. Smart contracts and decentralized applications will need to be able to use private and sensitive data to see global adoption.”

Trusted execution environments

It is expected that a ‘proof of concept’ product will be launched late in 2018 and that it will demonstrate the way the two technologies can work together. The team is also exploring trusted execution environments (TEEs), which are an integral part of Intel’s SGX technology that securitises data and code.

The urgent need for secret contracts

The announcement of the Enigma-Intel comes at a good time. The Bithumb hack this week and memories of past attacks, such as Mt Gox and DAO, are still quite fresh. The DAO hack in 2016 is particularly relevant, because it happened due to flaws in a smart contract.

Enigma’s CEO Guy Zyskind, has been talking up the need for secret contracts for some time and has pointed out the issues “with coin-mixing and zero-knowledge proofs, the latter of which he said are particularly vulnerable in multi-party cases where several “untrusted and pseudonymous” parties are executing computations,” as he wrote in Medium. Zyskind also said, “secret contracts provide the ‘missing piece’ by executing computations using encrypted data that stays hidden from network nodes.”

Churchill said that the work Alan Turing did shortened WWII by two years; perhaps the ‘new’ Enigma will fast-forward the crypto industry into a more secure marketplace before 2020.