The election of Donald Trump as President of the United States brought with it, amongst other things, the whole idea of ‘fake news’. POTUS is always talking about it and has done a lot to create an environment where the public now doubt whatever they read.
In the past we generally accepted that what we read in newspapers or heard on news bulletins was reasonably close to the truth, although the smart people have always been aware that every paper has a specific political agenda and that any story needs to be read with that bias in mind. But, now we have reached a stage where completely false stories are pumped out, with social media channels being the chief way of ensuring they spread like wildfire.
The European Commission (EC), according to an article published in Techcrunch, has announced that it is going to use blockchain technology in a bid to combat the spread of ‘fake news’ and its press release said it has “identified blockchain as a critical part of what it will call the Code of Practice on Disinformation, which it intends to introduce by summer 2018.”
The announcement also stated that blockchain is, “one of emerging technologies which are changing the way information is produced and disseminated, and have the potential to play a central role in tackling disinformation over the longer term.”
The EC points to the fact that DLT can aid the transparency, reliability and traceability of news on the Internet. It said:
“Innovative technologies, such as blockchain, can help preserve the integrity of content, validate the reliability of information and/or its sources, enable transparency and traceability, and promote trust in news displayed on the Internet. This could be combined with the use of trustworthy electronic identification, authentication and verified pseudonyms…”
The commission’s next step is to develop the EU-wide Code of Practice on Disinformation that will be published by July 2018.
This represents a new application of blockchain technology in a very important arena – that of the news media. We cannot underestimate the value of once again being able to know that information has been verified and sources checked. And those who claim that certain stories are ‘fake news’, as POTUS frequently does, will find it harder to do so. This could change voters’ views in elections, as well as of government policies, in the coming years. We will be able to trace the trail of truth and lies, and that will be a good thing.
On Monday 23rd April, net neutrality in the USA ceased to exist. The net neutrality rules introduced during the Obama era prevented Internet service providers from blocking, slowing down or prioritising Internet traffic.
According to a report from Business Insider, this could lead to a whole new era of ‘build your own Internet.’ One company, is already piloting a programme in Venice, California, and guess who it is? Yes, it’s WeTransfer!
WeTransfer, as many of you will be aware is the file transfer company that businesses use on a regular basis when files, especially those with high resolution images, are just to big to be sent via email. The company, which started in Venice, CA, is partnering with another Los Angeles outfit called Community Broadband Project “to create a “mesh network” — a decentralized series of wireless routers that allow customers to get online without going through an ISP.”
What is a mesh network?
The short answer is that a mesh network is usually local. It can be created when households in an area install routers, called ‘nodes’ that are then connected to local antennas. And, that creates a local network.
The FCC is taking the country back in time
WeTransfer’s President, Damian Bradfield believes that what the U.S. government is doing via the Federal Communications Commission (FCC) is taking the country backwards in time to an era when a provider could tell you whether you could access Skype or BitTorrent. He said: “Fundamentally we believe the power shouldn’t be with the ISPs to make those sorts of decisions.”
What WeTransfer is doing is a form of grassroots resistance to the end of net neutrality. Mesh networks can sidestep the influence of powerful ISPs like AT&T. Until now, the use of this type of network has been confined to rural areas with little or no broadband coverage, but it may now become more widespread.
WeTransfer alongside the Community Broadband Project is offering an independent connection to households in the Venice area. “We were looking for a way that not only we could benefit from an internet that is net neutral, but also some degree educate people around us that there is an alternative,” Bradfield said.
WeTransfer is funding the project and it is still in the beta testing stage in the Venice area. Eventually they hope to offer a service that is cheaper than those of the large ISPs.
Ultimately, WeTransfer wants the FCC to reinstate net neutrality rules. States such as California, Oregon, and Washington are in the process of passing their own state-level net neutrality laws. However, he is not hopeful about a return to net neutrality, because the FCC commissioner Ajit Pai is against the Obama-era rules. But, as several states and companies are suing the FCC over this, perhaps there is some hope it might change.
A Dutch court has made a very important judgement that could positively affect all Bitcoin (BTC) holders. The court ruling came in respect of a plaintiff who was owed 0.591 BTC according to court document, which was released on 20th March.
The plaintiff, Mr. J.W. De Vries lodged the complaint against Koinz Trading BV back in early February. Koinz is not a public company and had already been ordered by a court in the Middle Netherlands jurisdiction to pay Mr de Vries proceeds from mining, the 0.591 BTC, or make a penalty payment of up to €10,000.
It seems that Koinz failed to comply with the court’s demands to pay de Vries in BTC, and as a result were told, “pay up or be declared insolvent.”
What is interesting for those of us involved in the world of cryptocurrency, is the Dutch court’s statement with regard to Bitcoin having “all the characteristics of a property right”, and that therefore any claim to transfer of BTC under property rights is legitimate. The court text reads as follows
“Bitcoin exists, according to the court, from a unique, digitally encrypted series of numbers and letters stored on the hard drive of the right-holder’s computer. Bitcoin is ‘delivered’ by sending bitcoins from one wallet to another wallet. Bitcoins are stand-alone value files, which are delivered directly to the payee by the payer in the event of a payment. It follows that a Bitcoin represents a value and is transferable. In the court’s view, it thus shows characteristics of a property right. A claim for payment in Bitcoin is therefore to be regarded as a claim that qualifies for verification.”
The court also found that there was indisputably a contract between Koinz and Mr de Vries and that because the contract detail was set in Bitcoin, Mr de Vries should be paid in Bitcoin. As Cointelegraph states, “The court considers the legal relationship as a civil obligation to pay.”
The Dutch court’s decision is a step towards recognising Bitcoin as a legitimate currency, however not everyone is going in the same direction, The G20 Financial Stability Board (FSB) also issued a report on 20th March suggesting it is sticking with defining cryptocurrency as ‘assets’ and not a currency as the Dutch court ruling suggests. G20 claims that crypto “lacks the traits of sovereign currencies.” Mark Carnet, Governor of the Bank of England seems to agree with the FSB, because he made a similar statement last month, saying that in his opinion, “cryptocurrency has thus far failed to display the traditional characteristics of money.” He also said, “nobody uses it as a medium of exchange.” That’s not quite true Mr Carney, as the Dutch court judgment and others using BTC to pay for goods and services indicates.
Chief Minister Fabian Picardo kicked off the event with a simple and clear message to all those in attendance:
”Gibraltar is open for business.”
Gibraltar Ahead in the Regulatory Space
With jurisdictions around the world trying to figure out how to regulate the blockchain industry, Gibraltar has already put in place a DLT regulatory framework based on best principles and is currently looking to release new accompanying regulations that focus on token sales within the jurisdiction. A bill is expected through the Gibraltar parliament in Q2 this year showing Gibraltar to be world-leading in this space.
The Minister for Commerce, the Hon. Albert Isola, whose Ministry has been driving the fintech and blockchain agenda in Gibraltar also addressed the full conference hall onboard. When talking about the jurisdiction’s continued development, the Minister made it clear that as a government, “we are not scared of innovation.”
He added that the government is looking to continue to operate with consumer protection at the heart of what they do.
With a wide variety of speakers in attendance, the focus was well and truly on regulations for blockchain and ICO, a sector that is booming and hit an astounding $3.7bn during the course of 2017.
Gibraltar Financial Services Commission on ICO Regulations
Sian Jones and William Garcia from the Gibraltar Financial Services Commission (GFSC) also gave a talk and answered questions from the crowd. The same event last year saw the GFSC present their DLT regulatory framework to attendees and the wider world, this year it was their proposed ICO regulations.
Sian Jones emphasised that the regulator would not be regulating individual ICOs but those that brought the token sales to market, adding that “it’s not the role of the regulator to approve any individual token offerings,” rather highlighting how regulations are implemented is as important as the rules themselves.
Sian added: “We as a regulator will not be setting a single code of practice that should be set by the market.”
A lot like the Gibraltar Blockchain Exchange (GBX) with its network of Sponsor Firms, the GFSC sees this emerging market needing the creation of “authority sponsors that are accountable to us [GFSC].” This format would encompass GBX, which already comes under the scope of the DLT regulations, effectively making it an ‘Authorised Sponsor’ which could open up many pathways of opportunity for the exchange.
During the presentations Q&A, the GFSC spoke of their core desire to embed consumer protection at the heart of their work, whilst being supportive of helping grow and develop this innovative industry: “Tokens as a new asset class are isolated from financial advice, but it is right that it should be regulated for consumer protection.”
The DLT Licence Experience
In the morning of the first day, GBX CEO Nick Cowan moderated the panel “The DLT Licence Experience to Date.” Joining Nick was Joey Garcia from Isolas, Anthony Provasoli from Hassan’s and Jay Gomez from Triay & Triay.
Nick prophesied 2018 to be “the year of the regulator,” pointing out that Gibraltar has the unique first mover advantage of having a regulator that truly understands this space, and is so accessible and open to dialogue. Nick began the panel by categorising the ‘DLT licence experience’ into three distinct areas, Government & Regulators, DLT advisors such as Gibraltar’s law firms and the users of DLT licences such as GBX, each with their own distinct experience.
Joey Garcia, who was a part of the working committee regarding the original DLT framework explained the reasons for a best principles approach by stating: “Let’s build a ground-up framework that is evolutional.” Nick complimented Joey’s sentiments by highlighting the collaborative nature of the DLT framework: “There is a trinity of bodies here, government, industry and users, coming together to find a solution”
The panel concluded that although Gibraltar has been successful in locating and nurturing emerging markets, such as e-gaming, it has seen an explosive reaction to its leading role with the DLT regulation.
Anthony Provasoli pointed out “3 years ago nobody knew where Gibraltar was, but that is very different today, especially in the last 12 months.” He also highlighted his experience on the perception of Gibraltar saying: “Clients love the fact they can come and sit down with the regulators and have an open discussion.” The panel’s experience echoed the Chief Ministers opening comment that Gibraltar is open for business.
The panel also touched on the subject of Brexit in relation to Gibraltar, which despite the outcome is making strides in placing itself strategically between Britain and the rest of Europe. Joey Garcia believes that due to the global connection of blockchain and the cryptocurrency market that Brexit would not have a negative impact, by saying: “High level, I don’t think it [Brexit] will affect this space.” It is a testament to that strategic approach of Gibraltar to pioneer itself in this emerging technology and become a forerunner ahead of the Brexit transition.
Challenges in the Current Crypto Exchange Landscape
Nick later participated in a panel entitled “The Crypto Exchange Landscape for 2018” moderated by Joey Garcia with Vitaliy Kedyk of CEX, David Honeyman from Lendo, and David Gyori of Banking Reports alongside Nick. The panel discussed the challenges of AML/KYC with current cryptocurrency exchanges, with Nick detailing how the GBX intends to create a new industry standard of governance and due diligence for token sales within a rules-based system that would gain access to a large pool of KYC cleared participants.
The question of centralised vs decentralised exchanges was debated, with a consensus forming that if blockchain technology is still in its early developments, then decentralised exchanges are far off in that timescale development. With the current challenges that existing exchanges face around AML/KYC, accountability and consumer protection, decentralised exchanges would not contain a solution. Vitaliy emphasised this by saying: “Decentralised exchanges can’t deliver the real user experience” which the panel agreed that if this space is to be adopted by mainstream consumers, the user experience would be of paramount importance.
Nick was invited to close the 1st-day proceedings of the conference. He championed Gibraltar for its bold stance on the global stage as a home for those businesses that are utilising DLT technology. Mirroring the success story of GBX and its successful completion of raising $27M in the RKT token sale, with the way Gibraltar fostered the exponential growth of the e-gaming industry a parallel to what we are witnessing in the blockchain space. Nick finished by telling the packed out audience that Gibraltar is open for business and made a call out to those looking to Gibraltar as a home for the business to “give us a chance”.
Blockchain Innovation in Gibraltar and Beyond
A key moment during the 2nd day of the conference came from Philip Young, the Marketing Director of GBX. Phil gave a presentation on the Blockchain Innovation Centre (BIC) an initiative set up by the Gibraltar Stock Exchange (GSX) to help create a hub of blockchain innovation in both Gibraltar and further afield. Phil gave the three bedrock tenants that would “Educate, Inspire, Connect.” Phil spoke of the BIC’s offer of a network of experts that would help select, fund, advise and guide blockchain-based startups in Gibraltar. Additionally, Phil proposed the idea of the BIC helping to establish educational programs seeking out universities both abroad and in Gibraltar to encourage collaborations.
Despite the heavy wind and rain hammering the Rock of Gibraltar, attendance was still high over the two-day event, with great networking opportunities between the panels and presentations. It was encouraging to see that more than 180 of the 300 attendees had travelled to Gibraltar for the event demonstrating that Gibraltar is quickly establishing itself as a global hub for all things crypto & blockchain.