As predicted, banks are changing their tune on crypto. But this JPM project misses the point – introducing a closed network today is like launching AOL after Netscape’s IPO. 2 years later, and bank coins still aren’t the answer https://www.linkedin.com/pulse/case-against-bankcoin-brad-garlinghouse/ …
The South Korean government reportedly plans to soften its crypto regulations in line with the policies set by the G20 nations in an effort to create “unified regulations.” The Korean regulators have also agreed to apply the standards set by the Financial Action Task Force to its crypto policies.
G20’s Unified Crypto Regulations
South Korea is reportedly planning to follow the policies set by the G-20 nations and soften its crypto regulations, the Korea Times reported.
The G20 is an international forum for the governments and central bank governors. Its members are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, South Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, United Kingdom, United States, and the European Union.
The top financial policymakers of these countries have agreed to acknowledge and regulate cryptocurrencies as financial assets, the news outlet noted, elaborating:
Financial policymakers of G-20 nations have set a July deadline for the first step toward ‘unified regulations’ of cryptocurrencies. One reason for the move by the G-20 is that they see cryptocurrencies as ‘too small to jeopardize’ financial markets. The combined market value of cryptocurrencies is less than 1 percent of the global GDP.
Financial Action Task Force Standards
While the G-20 classifies cryptocurrencies as financial assets, the Korean government has earlier classified them as non-financial products due to their speculative nature. Acknowledging the differences, the country’s Financial Supervisory Service (FSS) was quoted expressing:
It’s almost certain that cryptocurrencies will be classified as assets and the main issue will be centered on how to regulate them properly under the unified frame that will be agreed upon between G-20 nations. Given the current stance, this isn’t good, but we will step up efforts to improve things.
South Korea has also agreed to apply to cryptocurrencies the standards of the Financial Action Task Force (FATF), an inter-governmental body formed to fight money laundering and terrorism financing, the publication conveyed.
Softening Crypto Policies
Recently, the new FSS chief indicated that he will ease the country’s cryptocurrency regulations. Governor Yoon Suk-heun said there are many positive aspects of cryptocurrencies, promising to release updates on this issue in the near future.
Meanwhile, the country’s National Tax Agency has been collaborating with the finance ministry to collect tax data in order to establish crypto tax policies. While cryptocurrency transactions are currently tax-free in Korea, crypto operators are required to pay income taxes, the news outlet detailed.
Despite the new FSS chief suggesting an easing of crypto regulations, his department has launched an investigation into crypto exchanges, in collaboration with other related authorities. In March, the prosecution arrested four employees of crypto exchanges including the CEO of Coinnest. Last week, they started investigating the country’s largest crypto exchange, Upbit. This week, three people were arrested from HTS Coin exchange for alleged fraud and embezzlement charges.
Did JP Morgan Miss The Point Of Cryptos, and What Effect Will JPM Coin Have?
It’s only February and already, we’ve had one of the biggest announcements in the crypto industry. JP Morgan announced yesterday that it had successfully trialed the JPM Coin. It will use it for its $6 trillion wholesale payments business as well as securities transactions. In doing so, it became the first bank in the U.S to have its own cryptocurrency.
Unsurprisingly, the industry is already racking its brains pondering the implications of the newest crypto. There are those who believe that despite being centralized, the JPM Coin will inspire mainstream adoption of cryptos. It’s only a matter of time before the other banks turn to digital currencies.
There’s an even bigger group that believes that JP Morgan has missed the whole point of cryptocurrencies. The JPM Coin will be a centralized currency. Thus, the bank will have a stranglehold on its supply, who uses it and how it’s used.
One of the people who believe that the industry should not be celebrating the JPM Coin is Brad Garlinghouse. The eccentric Ripple CEO believes that the bank is taking us back to the old days as we try to move ahead. He tweeted:
However, according to one crypto research expert, Garlinghouse has every reason to be critical of the JPM Coin. With the JPM Coin targeting Ripple’s – and by extension XRP’s – core market, it’s no surprise that Garlinghouse is so critical. This is according to Tom Shaughnessy, the CEO at New York-based crypto research firm, Delphi Digital.
Ripple may have enrolled 100 banks on its platforms, but in JP Morgan, it has a formidable competitor. The bank moves $6 trillion every day on its wholesale payments platforms. Even a fraction of these would be miles ahead of the amount transacted on Ripple’s network.
Speaking to Bloomberg, Shaughnessy stated:
This is a huge slap in the face for Ripple. Ripple’s target market is cross-border payments and remittances and now JPMorgan’s effort is a direct threat.
Shaughnessy isn’t the only one who believes that the JPM Coin is a direct threat to Ripple and XRP. Travis Kling, the founder of Ikigai Asset Management also believes that Ripple Labs should be very worried. The seasoned crypto investor explained:
JPM’s project is much more evolutionary than revolutionary — it is utilizing a private, permissioned blockchain technology called Quorum, which is much closer to a Google Sheet than a Bitcoin. The project is clearly competing directly with Ripple Labs and their centralized cryptocurrency XRP.
Garlinghouse pointed to an article he wrote on his LinkedIn page in 2016. In the article, he explained that a centralized bank coin would go against Satoshi Nakamoto’s vision. Banks are competitive and as such, they’d never settle on one digital currency to use, he reasoned. We’d, therefore, end up with hundreds of bank coins which would add more chaos to the industry.
The result would be an even more fragmented currency landscape than what we have today. If banks of different digital asset groups want to settle trades with one another, they’ll have to make markets between their unique digital assets or trade between their digital assets and a common fiat currency. What a mess!
A Progressive Outlook
And while Garlinghouse is quick to criticize the centralization of crypto, XRP has been constantly criticized for the same exact thing. Ripple Labs, which Garlinghouse leads, has been accused of having a whole lot of influence on XRP.
Away from the JPM Coin vs. Ripple narrative, there are many who view JP Morgan’s move as very positive. While it’s not everything the crypto world would have wanted, at least a banking giant has recognized that the future belongs to digital currencies. It could also be the first step in the infiltration of the tightly knit finance industry by cryptocurrencies.
Unocoin Becomes Second Exchange to Launch Nomination Feature for its Users
It turns out that Crypto-Kanoon’s initiative to raise the demand for nomination feature in crypto exchanges is paying some handsome dividends to the entire cryptocurrency community. Within a few days of initiative’s launch a huge number of cryptocurrency enthusiasts voiced their support for the feature, and one Indian exchange (namely PocketBits) also became globally the first exchange to launch this feature. Now it looks like other exchanges are also coming ahead to follow the suit, as Unocoin has also launched the feature.
That’s right. Unocoin has become the second cryptocurrency exchange to launch this feature of nomination. The feature was announced yesterday evening, and users can register their nominees by using the website of Unocoin exchange. Detailed instructions regarding where can one find the feature were not provided by the company, so you’ll have to find the feature yourself.You asked it, We built it!
Now you can add nominee details for your Unocoin account. @cryptokanoon #Unocoin#Nominee #crypto #CryptoNews #CryptoTwitter pic.twitter.com/LMUh5HV6X5
— Unocoin (@Unocoin) February 14, 2019
Other exchanges, however, are still remaining to launch the feature. BitBns, WazirX, and Coindelta have still not launched nomination feature on their respective platforms. Cryptocurrency exchanges are the only businesses in the finance industry which don’t provide the ability to nominate someone, and therefore it’s imperative to make this change immediately. Now it will be interesting to see how long the other exchanges in India take to launch this feature when two of their competitors have launched it already.
Nvidia Says Crypto Drop-Off Helped Drive ‘Disappointing’ Fourth Quarter
U.S.-based graphics card maker Nvidia has said the downturn in sales to cryptocurrency miners drove a “disappointing” fourth quarter.
In its latest financial report, published Thursday, the firm said for Q4, ending Jan. 27, it made revenue of $2.21 billion, down 24 percent from $2.91 billion in the same quarter last year, and down 31 percent from $3.18 billion in the previous quarter.
The firm said it is still feeling the effects of a drop-off in the crypto mining market, with an excess of inventory it had struggled to sell.
Nvidia founder and CEO Jensen Huang commented:
“This was a turbulent close to what had been a great year. The combination of post-crypto excess channel inventory and recent deteriorating end-market conditions drove a disappointing quarter.”
In an earnings call on Feb. 10, Colette Kress, the firm’s executive vice president and CFO, added that the issue had caused the firm to reduce shipments in order to allow excess inventory to be sold. She added that inventory is expected to normalize in Q1 in line with its forecast.
The report also provides revenue numbers for the last full year.
Inventory issues aside, Nvidia said it made record revenue for the year of $11.72 billion, up 21 percent from the year prior. It also saw record yearly revenue from its gaming, datacenter, professional visualization and automotive segments.
“Despite this setback, NVIDIA’s fundamental position and the markets we serve are strong,” Huang said. “The accelerated computing platform we pioneered is central to some of world’s most important and fastest growing industries – from artificial intelligence to autonomous vehicles to robotics. We fully expect to return to sustained growth.”