The Weekly Hash – November 4 – 8

This digest is prepared for informative purposes only and does not represent an investment recommendation or investment advice. Please see our full disclaimer at the bottom for more information.

See below all the important happenings this week in the world of crypto, presented by the experts at Kraken: 

  1. HRMC: UK Updates Crypto Tax Guidance for Businesses
  2. CoinDesk: Microsoft Unveils Platform for Minting Enterprise-Ready Crypto Tokens
  3. Bloomberg: Lone Bitcoin Whale Likely Fueled 2017 Price Surge, Study Says
  4. DX.Exchange: Nasdaq-Powered Crypto Platform DX.Exchange Shuts Down; On Lookout for Merger or Acquisition
  5. iHare: Founder Of Zimbabwean ”Bitcoins Company” Golix.. Claims To Have “Lost” Password As His Crypto-Exchange Fails To Process Customer Withdrawals Worth Millions
  6. CoinDesk: Trial Back on After Craig Wright Breaks Bitcoin Settlement Agreement
  7. Global Times: China Launches Blockchain-Based Smart City Identification System
  8. Kraken: Nano (NANO) Trading Starts November 6!
  9. Stellar Development Foundation: Stellar Foundation Burns Half the Supply of XLM
  10. CoinDesk: The ‘Bitcoin Rich List’ Has Grown 30% in the Last Year, But Why?
  11. CoinDesk: US Federal Reserve Hiring Retail Payments Manager to Research Digital Currencies
  12. Business Insider: Coca-Cola Bottlers and SAP are Scaling a Major Blockchain Project Poised to Remake a $21B a Year Supply Chain Operation
  13. Cointelegraph: President Erdogan—Turkey to Finish Testing Digital Lira in 2020
  14. The Block: Huobi to freeze all US user accounts on Nov. 13
  15. Reuters: Hong Kong Regulator Sets Out Rules for Crypto Exchanges to Get Licenses
  16. Chosun: North Korea Laundered Money Through Blockchain Firm in Hong Kong
  17. NBD: Chinese Government Decides to Not Eliminate Crypto Mining Industry in a New Final Plan
  18. HKMA: China Signs Agreement With Hong Kong Central Bank for Blockchain Push
  19. CoinDesk: IBM Ethical Mineral Sourcing Blockchain to Debut in Spring
  20. SEC: SEC Division of Enforcement Publishes Annual Report for Fiscal Year 2019
  21. Reuters: China’s Digital Currency Will Kick Off ‘Horse Race’—Central Bank Official
  22. EJ Insight: HKMA Studying Risks and Benefits of Having Own Digital Currency
  23. Silvergate: Silvergate Announces Pricing of Initial Public Offering of Common Stock
  24. The Block: Bitmain’s Ousted Co-Founder Micree Zhan Says He Will Take Legal Action to Return to the Firm
  25. The Block: Evaluating Exchanges Based on the Liquidity of its Bitcoin Pairs (Quick Take)
  26. Tether: Tether Response to Flawed Paper by Griffin and Shams
  27. DHS: DHS Awards $182K for Cross-Border Oil Import Tracking Using Blockchain
  28. AMB Crypto: China’s CBDC may affect dollar’s global reserve currency status—Kraken CEO
  29. Ripple: Swell 2019—MoneyGram CEO Says 10% of Transactions Between Mexico and U.S. Use On-Demand Liquidity
  30. The Block: Chinese Tech Giant Tencent Granted Hong Kong License to Open ‘Virtual Bank’
  31. Standard Chartered: Standard Chartered Joins Enterprise Ethereum Alliance
  32. VeChain: VeChain, Together with ASI Group and DNV GL, Announced the First Cross-Continental Logistics And Trades Solution Based on Public Blockchain for Food & Beverage Industry On The 2nd CIIE
  1. HRMC: UK Updates Crypto Tax Guidance for Businesses
    • Her Majesty’s Revenue and Customs (HMRC), the UK’s tax authority, issued crypto tax guidance for businesses that deal with “exchange tokens,” which it defines as DLT-based tokens “intended to be used as a method of payment and encompasses ‘cryptocurrencies’ like bitcoin”; exchange tokens are taxonomically separated from security tokens and utility tokens
    • Exchange token transfers are subject to stamp tax if they meet the definition of ‘stock or marketable securities’ or ‘chargeable securities,’ which is considered on a case-by-case basis; however, HMRC’s view is that existing exchange tokens wouldn’t likely meet this criteria, largely exempting them from stamp taxes with the exception of tokens used in debt txs
    • Businesses must keep records of crypto txs in GBP, the valuation methodology for these txs, and the amount spent on each type of exchange token
    • Corporations engaged in trading exchange tokens (e.g., selling goods/services for crypto or mining) are liable for tax payments; the type of tax paid – CGT, corporation tax, income tax, national insurance contributions, stamp taxes or VAT – depend on who is involved in the business, the activities it carries out, and one’s own circumstances
    • Most mining activities constitute a taxable event as a form of trade, and if mined coins aren’t traded then they’re considered miscellaneous income and carry their own tax burden; notably, at-home mining isn’t a taxable event, “Using a home computer while it has spare capacity to mine tokens would not normally amount to a trade … to mine tokens for an expected net profit would probably constitute trading activity”
    • Corporate token holdings are considered taxable events at disposal, incurring both CGT and corporation tax
    • Similar exchange tokens can be pooled for ease of calculation, “If a person owns bitcoin, ether and litecoin, they would have three pools and each one would have its own ‘pooled allowable cost’ associated with it. This pooled allowable cost changes as more tokens of that particular type are acquired and disposed of”
    • Employees can be paid in crypto under the new tax laws, but employers can’t use crypto for pension funds since HMRC doesn’t view crypto as currency, but a commodity
    • Guidance on both securities and utilities will be addressed in the future
    • Link to coverage by The Block & CoinDesk
  2. CoinDesk: Microsoft Unveils Platform for Minting Enterprise-Ready Crypto Tokens
    • Microsoft’s Principal Architect Marley‌ ‌Gray said the firm wants building blockchain tokens to be as easy as plugging in a printer, “You can go and buy a printer or any type of device [now] and just plug it in and it works. It’s the same analogy here for tokens and that is what we are building in Azure” 
    • Azure allows businesses to choose from a growing set of token templates that conform to the Token Taxonomy Initiative (TTI), a standards push and enterprise consortium led by Gray
    • There have been a number of TTI-compliant tokens built for uses like loyalty rewards, to incentivize software teams to meet stated goals, and to act as a traditional financial instruments like a line of credit 
    • Gray added, “We are creating a platform in the cloud where any token within the TTI framework can snap into place. So you can build applications where you want to use tokens with, for example, Dynamics, SAP, applications in the [Microsoft] Office suite or some other business automation process” 
    • The platform is being released alongside a host of example tokens, such as the Hyperledger Fabric FabToken built by IBM, Santander’s BOND token, as well as a REWARD token from Intel and ConsenSys—all of which aren’t yet in commercial production, but all the specs are available to download
    • Gray, who is also the chair of the TTI, noted that Azure Blockchain Tokens aren’t just “a Microsoft thing,” since it includes IBM, R3, and Digital Asset as partners
    • Gray said there should be “portability” of these token types across clouds and networks depending on whatever infrastructure people need, “The industry has suffered from an IBM versus Microsoft thing, Hyperledger versus ethereum, and so on. We are trying to break down those barriers”2
  3. Bloomberg: Lone Bitcoin Whale Likely Fueled 2017 Price Surge, Study Says
    • University of Texas Professor John Griffin and Ohio State University’s Amin Shams claim that just one entity on Bitfinex could be responsible for the infamous 2017 bull run, “Our results suggest instead of thousands of investors moving the price of Bitcoin, it’s just one large one […] Years from now, people will be surprised to learn investors handed over billions to people they didn’t know and who faced little oversight”
    • This hypothesis is based partly on the theory that new USDT are created without the USD to back them and then are used to buy BTC, leading to rising prices, “This pattern is only present in periods following printing of Tether, driven by a single large account holder, and not observed by other exchanges. Simulations show that these patterns are highly unlikely to be due to chance. This one large player or entity either exhibited clairvoyant market timing or exerted an extremely large price impact on Bitcoin that is not observed in aggregate flows from other smaller traders”
    • The authors examined USDT & BTC TXS from Mar. 1, 2017 to Mar. 31, 2018, concluding that BTC purchases on Bitfinex increased whenever BTC’s value fell by certain increments
    • Tether GC Stuart Hoegner rejected the claims, stating that the paper is “foundationally flawed” because it’s based on an insufficient data set and was probably published to back a “parasitic lawsuit”
    • Hoegner added, “Macroeconomic experts and stakeholders in the cryptocurrency ecosystem understand that it is the global rise of digital currency that has driven the markets and demand for Tether”
    • Link to coverage by Cointelegraph & The Block
  4. DX.Exchange: Nasdaq-Powered Crypto Platform DX.Exchange Shuts Down; On Lookout for Merger or Acquisition
    • Nine months after its launch, Nasdaq-powered DX.Exchange is temporarily ceasing operations as they pursue a merger or acquisition because “the costs of providing the required level of security, support and technology is not economically feasible on our own”
    • The Estonia-registered exchange has blocked all deposits, suspended trading, and asked users to withdraw funds by Nov. 15
    • If a merger or acquisition doesn’t take place in a timely manner, the exchange could stop operations permanently
    • It’s unclear what happens to DX.Exchange staff, which is in the range of 51-200 according to LinkedIn, but it is known that Daniel Skowronski is still CEO of the firm
    • Link to coverage by The Block
  5. iHare: Founder Of Zimbabwean ”Bitcoins Company” Golix.. Claims To Have “Lost” Password As His Crypto-Exchange Fails To Process Customer Withdrawals Worth Millions
    • Golix Founder and CEO Tawanda Kembo lost the password for a cold wallet back in May 2018 which had 33 BTC (+$250,000), “The timing of the lost password seems rather convenient as it occured [sic] at a time when the majority of its customers where trying to retrieve their coins and withdraw their money from the exchange […] after the financial regulators at the Reserve Bank of Zimbabwe (RBZ) ordered the exchange to be shut down for violating regulatory issues”
    • Golix tried to battle the regulators but lost and was forced to withdraw their court challenge; Golix is now being sued by the regulators for the legal costs incurred during the litigation
    • A former Golix employee revealed that the majority of customers who kept their coins on the exchange were not refunded
    • During this period of heavy scrutiny, Golix launched the GLX ICO to raise money to launch other exchanges in South Africa, Kenya and Uganda
    • Golix didn’t reveal how much was raised in the ICO, but some reports claim the firm raised between $2-$10M; Golix has yet to launch any exchanges and has stopped responding to customers
    • Link to Cointelegraph’s report
  6. CoinDesk: Trial Back on After Craig Wright Breaks Bitcoin Settlement Agreement
    • Self-proclaimed creator of Bitcoin Craig Wright attested that he can’t finance his court 500,000 BTC (~$4.6B) settlement negotiated with the Kleiman estate, and with the agreement broken, trial motions are now back on
    • Velvel Freedman, member of the prosecution and partner at Roche Freedman, said, “These discussions began at Craig’s request and due to the fact that Craig represented he had the means to finance a settlement” 
    • The trial date is set for March 30, 2020
  7. Global Times: China Launches Blockchain-Based Smart City Identification System
    • China launched an independently-developed, blockchain-based ID system for smart cities to improve connectivity and data sharing between these cities
    • The system was developed by three institutes in the city of Shijiazhuang and will assign a unique, global digital ID to nationwide smart cities
    • Zhang Chao, director of the Zhongguancun Industry & Info Research Institute of Two-dimensional Code Technology, one of the system’s developers, said the system will be “independently distributed and managed by China, with a unified distribution rule, a resolution of distributed storage and tamper-resistant code”
    • According to Deloitte, China had ~500 smart city pilots, the highest in the world, as of last year
    • Link to coverage by The Block
  8. Kraken: Nano (NANO) Trading Starts November 6!
    • Nano (NANO) will be listed on Kraken starting Nov. 6
    • Trading pairs include NANO/USD, NANO/EUR, NANO/XBT, and NANO/ETH
    • NANO will be available on Kraken, Kraken Pro, and our OTC desk, but won’t be available (yet) on Kraken Futures and for Margin Trading
  9. Stellar Development Foundation: Stellar Foundation Burns Half the Supply of XLM
    • The Stellar Development Foundation (SDF) burned 55B XLM (~$4.5B), ~50% of the 105B total supply (20B circulating); XLM total supply is now 50B (~$4B)
    • SDF CEO Denelle Dixon said, “We didn’t start by wanting to burn. We started by asking, ‘What do we need?’ As much as we wanted to use the lumens that we held, it was very hard to get them into the market”; the foundation instead decided it was better to project how much it could actually use over a 10-year period and calibrate to that number, “To derive a plan from an arbitrary number serves no purpose”
    • Dixon added that she couldn’t anticipate how the crypto market might react, “I don’t know. I really just don’t have a sense at all of what the market response is. From my standpoint, it’s how the ecosystem feels about it. We got a lot of positive response from the ecosystem because we are rightsizing what the foundation has and the foundation holds”
    • The SDF now controls 30B XLM (~$2.4B), divided into several buckets: 12B XLM in the direct development fund (formerly called “operations”) to support the organization; 2B XLM in “ecosystem support” (1B for currency support, and 1B for infrastructure grants); 10B XLM to make investments (2B XLM for new products, and 8B XLM in its enterprise fund); and 6B XLM for user acquisition (2B for marketing stellar and 4B for in-app promotions)
    • XLM supply is fixed now because the community of token holders voted to discontinue inflation on Oct. 28, and the “SDF will not burn any additional lumens” 
    • Link to coverage by CoinDesk
  10. CoinDesk: The ‘Bitcoin Rich List’ Has Grown 30% in the Last Year, But Why?
    • According to Coin Metrics & BitInfoCharts, the non-exchange adjusted Bitcoin Rich List (i.e., the # of addresses holding +1,000 BTC) has grown +30% since Sept. 2018, possibly reflecting an influx of high-net-worth investors; 2,148 addresses contain +1,000 BTC ($9.4M or more), amounting to just 0.01% of all BTC addresses
    • Investor and analyst Willy Woo believes the growth is mainly due to increased investor participation in the market, “The two options are we have high-net-worth investors coming in or it could be cold storage practice at the exchanges and custody solutions. The latter explanation cannot be ruled out, but it does not coincide with other data we have on the timing of when supply increased at these entities. For now, I’m going with the first explanation”
    • On the other hand, Trader Alex Kruger contended, “It’s mostly the exchanges … both the amount of BTC held in exchanges and the number of exchanges/custodians have been growing,” adding that BTC on-chain volume has been relatively flat since Sept. 2018
    • Messari Director of Product Qiao Wang claimed the possible reason for the rise could be the distribution of ownership over time, “In the beginning it was Satoshi, then a few early miners, who owned all the bitcoin. But over time their share decreased and other people entered the market”
    • With exchange addresses taken out of the equation, the list still grew by almost 30% to +2,100 addresses
  11. CoinDesk: US Federal Reserve Hiring Retail Payments Manager to Research Digital Currencies
    • The U.S. Fed is hiring a manager to oversee its traditional payments section, while adding new responsibilities to the role including researching how to integrate digital currencies, stablecoins and DLT
    • The Washington, DC-based role would manage the Fed’s Retail Payments Section, overseeing check and ACH services, facilitating research in retail payments innovation, addressing policy and regulatory issues concerning retail payment systems, and “facilitating and contributing to innovations research including digital currencies, stable coins, distributed ledger technologies, and broadly financial/digital innovation in retail payments”
    • The candidate would also represent the Board of Governors views with other Board divisions, reserve banks and gov’t agencies
    • The hire, who is eligible to receive a salary of up to $250,700, will ostensibly be the first HR investment made by the Fed towards integrating DLT into its existing systems
  12. Business Insider: Coca-Cola Bottlers and SAP are Scaling a Major Blockchain Project Poised to Remake a $21B a Year Supply Chain Operation
    • Coke One North America (CONA), the tech firm that manages IT operations for the 70 franchises that work with Coca-Cola, is using SAP’s blockchain to improve the complex production process and supply chain efficiency
    • CONA Senior Manager Andrei Semenov said, ”There are a number of transactions that are cross-companies and multi-party that are inefficient, they go through intermediaries, they are very slow. And we felt that we could improve this and save some money”
    • The pilot initially began with two bottlers – Coca-Cola United and C.C. Clark – and is now being scaled across all franchises, aiming to reduce order reconciliation duration from 50 to a few days
    • Since some firms are hesitant to share sensitive data, CONA and SAP went to each member franchise and negotiated what data they were comfortable broadcasting, “There was a negotiation and discussion, getting to a consensus of what data we wanted to share. We started with a huge list of data attributes and we narrowed it down to the list that everybody agreed on”
    • Semenov added that since all the franchises involved were overseen by the same entity, the discussions were easier than they might be in the future with a company the size of Walmart or Target, “Right now, there’s tons of blockchain networks available, private networks and public networks. At some point, we’re going to get to a stable and scalable network”
    • Link to coverage by Cointelegrah
  13. Cointelegraph: President Erdogan—Turkey to Finish Testing Digital Lira in 2020
    • Turkey’s President Recep Tayyip Erdogan announced that the gov’t should finish testing the national central bank digital currency (CBDC), the digital lira, by EOY 2020
    • Within the pilots, the gov’t plans to develop a software platform for instant payments based on the digital lira
    • The document reads, “The main objective is to establish a financial sector with a strong institutional structure that can respond to the financing needs of the real sector at a low cost, offer different financial instruments to a wide investor base through reliable institutions and support Istanbul’s goal of becoming an attractive global financial center”
  14. The Block: Huobi to freeze all US user accounts on Nov. 13
    • Huobi Global will freeze all U.S. user accounts starting Nov. 13 
    • U.S. users are advised to return their borrowed funds in margin trading and withdraw all assets from the platform, and those who purchased Huobi’s pre-paid cards will be refunded in USDT
  15. Reuters: Hong Kong Regulator Sets Out Rules for Crypto Exchanges to Get Licenses
    • Hong Kong’s (HK) Securities and Futures Commission (SFC) published new rules that crypto exchanges must follow should they seek to acquire an operating license for security token trading, which draw on the standards the SFC expects for conventional securities brokers
    • SFC CEO Ashley Alder said crypto exchanges had largely escaped regulation hitherto because most of the cryptoassets traded on their platforms weren’t technically securities, “After an in-depth examination of their unique technical and operational features, we concluded that some could be regulated by us”
    • Exchanges must provide services to professional investors only, have an insurance policy to protect clients, and use an external market surveillance mechanism in order to be licensed
    • Crypto exchanges don’t need an SFC license to operate if they don’t trade any products defined as a security (e.g., BTC)
    • Alder warned investors about purchasing BTC futures in HK, adding that exchanges allowing trading of such products “may well be conducting an illegal activity”
    • Link to SFC policy statements & SFC framework
  16. Chosun: North Korea Laundered Money Through Blockchain Firm in Hong Kong
    • The UN is investigating North Korea (NK) under suspicion of using a Hong Kong-based, shipping and logistics blockchain firm, dubbed Marine China, to launder money and evade int’l sanctions
    • Julian Kim (under the alias Tony Walker), the owner and sole investor in Marine China, ostensibly appointed another person as head of the firm and attempted to withdraw money several times from banks in Singapore
    • The laundering scheme, which also involved another undisclosed individual linked to the firm, allegedly circulated the crypto that NK stole last year through +5,000 txs in multiple countries to obfuscate its source
    • A NK-based hacker use a method of called “spear-phishing” to select a target and launch precision attacks, which was used in 2016 to hack into the computer network of a bank in Bangladesh; 17 countries in total have become targets of NK spear-phishing over the last three years and the damage totals ~$2B
  17. NBD: Chinese Government Decides to Not Eliminate Crypto Mining Industry in a New Final Plan
    • Following the release of the Chinese government’s “Industrial Structure Adjustment Guidance Catalogue,” which is effective Jan. 1, crypto mining is no longer among the list of industries to be eliminated 
    • The catalogue is meant to guide investment direction, gov’t management of investment projects, and the formulation and implementation of fiscal, tax, credit, and land
  18. HKMA: China Signs Agreement With Hong Kong Central Bank for Blockchain Push
    • The Hong Kong Monetary Authority (HKMA) signed a MoU with a subsidiary of the People’s Bank of China (PBoC) to trial a blockchain-based trade finance platform starting in 1Q2020, linking two existing projects: the HKMA’s blockchain-based eTradeConnect and the PBoC’s Trade Finance Platform
    • The partners will be represented by subsidiaries of HK Interbank Clearing Limited and the Institute of Digital Currency of the PBoC, “Once the connection has successfully been established, it will provide firms in both places with more convenient trade finance services and enable banks in Hong Kong to expedite the expansion of their trade finance business”
    • Link to coverage by Cointelegraph
  19. CoinDesk: IBM Ethical Mineral Sourcing Blockchain to Debut in Spring
    • Volvo has joined Ford, Volkswagon, and LG in their plans to track cobalt during its refining process come next year
    • The Responsible Sourcing Blockchain Network (RSBN), an int’l consortium built on Hyperledger Fabric, successfully completed a pilot to protect against exploitative mining practices, in which the firms sent 1.5 tons of Congolese cobalt across three different continents over five months of refinement; the success of this trial clears the way for the project to become operational in spring 2020
    • RSBN’s auditors, RCS Global Group, testified that the pilot met OECD sourcing standards from its start in a Congolese mine, through its refinement in South Korea and ultimately to its target: an American Ford Motor Company plant
    • RCS’ CEO Dr. Nicholas Garrett stated that RSBN hopes to improve global ethical supply chains and will build off the lessons learned, “We’ve reached significant new milestones as we’ve moved beyond testing, proving the merits of this coupled technology and assurance model can extend to a wide range of participants across every tier of the supply chain and to other minerals”
    • RSBN plans to add more battery minerals to its tracking platform, which have hitherto been developed by Korean chemical giant LG Chem, including lithium, nickel, tungsten, tantalum, tin and gold
    • Link to Volvo’s press release
  20. SEC: SEC Division of Enforcement Publishes Annual Report for Fiscal Year 2019
    • In 2019 the SEC collected +$4.3B in disgorgement and penalties and returned ~$1.2B to harmed investors
    • The regulator brought 862 enforcement actions in 2019, including issuer disclosure, accounting violations,  auditor misconduct, investment advisory issues, securities offerings, market manipulation, insider trading and broker-dealer misconduct
    • EOS parent firm, Block.One, agreed to a $24M settlement after allegedly raising $4B; Airfox, Paragon Coin, ICO Rating, and Sia parent firm Nebulous also settled charges with the SEC in the 2019 fiscal year—Kik is currently being sued by the SEC over its KIN ICO
  21. Reuters: China’s Digital Currency Will Kick Off ‘Horse Race’—Central Bank Official
    • Mu Changchun, Head of Digital Currency Research Institute at the People’s Bank of China (PBoC), said China’s digital currency will be designed to substitute existing coins and paper money, adding that its holders won’t receive interest payments; therefore, the digital currency won’t have implications for inflation or monetary policy
    • The digital currency will initially be issued to commercial banks and other institutions who will then resend it to the general public
    • Mu added, “During the research period, and also the issuance period there will be a horse race approach. The front runner will take the whole market – who is more efficient, who can provide a better service to the public – they can survive in the future”
  22. EJ Insight: HKMA Studying Risks and Benefits of Having Own Digital Currency
    • The Hong Kong Monetary Authority (HKMA) and Bank of Thailand (BoT) are scheduled to release their joint research report by 1Q2020 after having researched the use cases of a central bank digital currency (CBDC),  “The two authorities are conducting a joint research project named Project LionRock-Inthanon to study the application of CBDC to cross-border payments, with a view to facilitating payment-versus-payment (PvP) among banks in Hong Kong and Thailand”
    • The HKMA and BoT have also been separately researching a wholesale CBDC via their LionRock and Inthanon initiatives, respectively
    • HKMA Senior Executive Director Edmond Lau said that the central bank is focused on the institutional side of digital currency and doesn’t see a need to issue it to retail users; the HKMA will use the CBDC for domestic interbank payments, corporate payments at the wholesale level, and securities settlement
    • The BoT is working on Inthanon since Aug. 2018, while the HKMA has been working on LionRock since 2017
  23. Silvergate: Silvergate Announces Pricing of Initial Public Offering of Common Stock
    • Crypto-friendly Silvergate Bank (SI) went public today on the NYSE today after pricing it’s 3.33M share offering at $12.00 per share just yesterday
    • Of the shares offered, 824,605 of which were offered by Silvergate and 2.5M by selling shareholders, who have also granted the underwriters a 30-day option to purchase up to an additional 499,999 shares of its common stock
    • As of September 2019, the bank serves +750 crypto businesses, including exchanges, investors and others, a noteworthy step up relative to the 542 clients it reported in Mar. 2019
    • While the bank saw its client base grow between Nov. 2018 and Mar. 2019, AUM fell from ~$1.6B to $1.5B in 4Q2018, but has since bounced back to $1.55B
    • Link to coverage by CoinDesk
  24. The Block: Bitmain’s Ousted Co-Founder Micree Zhan Says He Will Take Legal Action to Return to the Firm
    • Bitmain co-founder Micree Zhan, who was abruptly ousted from the company last week by fellow co-founder Jihan Wu, posted an open letter to Bitmain employees saying he will “return to the company as soon as possible through legal methods”
    • Zhan alleged that he was removed from the firm without his consent while on a business trip, “I have never thought that as a person focusing on technology and product, I have to start thinking from legal perspectives. It was embarrassing that as a Bitmain co-founder, the biggest shareholder, and a registered legal representative, I got ousted without any knowledge in this coup while on a business trip […] I didn’t realize until then that those scenes in TV shows, where you get stabbed on your back by those partners you trusted and ‘brothers’ you fought together with, can really happen in real life”
    • He added, “We want to achieve the goal of 90% market share of bitcoin miner manufacturing market! Our AI business can achieve a qualitative breakthrough of about 100 million yuan [~$14.25M] in revenue in 2019, and can expect 1 billion yuan [~$143M] in 2020″
  25. The Block: Evaluating Exchanges Based on the Liquidity of its Bitcoin Pairs (Quick Take)
    • When looking at 1% orderbook depth of the top 15 largest exchanges, Binance has the most liquid BTC/USD (or USD-based stablecoin) pairs with combined orders of $6.54M, followed by Coinbase ($5.81M), Bitfinex ($5.47M), Kraken ($4.99M) and Bitstamp ($4.39M)
    • At 10% depth, Bitfinex has the most liquid pair with combined orders of $47.5M, followed by Bitstamp ($30.8M), Coinbase ($28.5M) and Kraken ($24.3M)
    • Of the top 15 exchanges, Bitfinex, Coinbase, Kraken, Bitstamp, and Binance have the most liquid BTC pairs
  26. Tether: Tether Response to Flawed Paper by Griffin and Shams
    • Tether responded to an updated version of “a flawed paper” written by John Griffin and Amin Shams, which claimed that a single address on Bitfinex was responsible for causing the BTC bull market in 2017
    • Tether said the authors admit they don’t have accurate data on the timing of txs or capital flow across exchanges, rendering them incapable of establishing a valid sequence of events through which the alleged manipulation could’ve happened
    • The stablecoin issuer reiterated that USDT is fully backed by reserves, “all Tether tokens are fully backed by reserves and are issued pursuant to market demand, and not for the purpose of controlling the pricing of crypto assets”
  27. DHS: DHS Awards $182K for Cross-Border Oil Import Tracking Using Blockchain
    • U.S. Customs and Border Protection, a federal agency of the Department of Homeland Security (DHS), plans to track oil and natural gas imports from Canada leveraging blockchain
    • The DHS’ R&D unit, The Science and Technology Directorate (S&T), awarded $182,700 to Toronto-based Mavennet Systems to adapt its oil and gas industry blockchain security tech for the initiative
    • S&T’s SVIP Technical Director Anil John said, “Accurately tracking the evidence of oil flow through pipelines and refinement between the U.S. and Canada and attributing oil imports with the accurate composition and country of origin are of great interest to U.S. Customs and Border Protection (CBP). Mavennet’s platform could provide this digital auditability while ensuring broad interoperability by supporting emerging World Wide Web Consortium standards such as decentralized identifiers and verifiable credentials”
    • Canada – the fourth-largest producer of oil worldwide – exported 3.5M barrels of crude oil per day to the U.S. in 2018, or 96% of all Canadian crude oil exports, according to Natural Resources Canada
    • Link to coverage by The Block
  28. AMB Crypto: China’s CBDC may affect dollar’s global reserve currency status—Kraken CEO
    • In a segment of Crypto Trader with Ran Neuner, Kraken CEO Jesse Powell said he believes that if China launches a central bank digital currency (CBDC) it could force the U.S.’ hand to respond, “The U.S [dollar] is the world’s reserve currency. You know the dollar is the world reserve currency so there’s a lot to lose if you lose that position, you could see things like hyperinflation in the country. Right? So there’s a lot at stake”
    • Powell added that U.S. crypto markets interest was still growing, but only amassed 20% of Kraken’s business; however, despite being a smaller fraction of business, ~80% of Kraken’s compliance and legal resources went into meeting regulatory concerns in the U.S.
    • Powell concluded that it is still worthwhile to purse U.S. crypto markets because Kraken sees the market growing in the future, adding that the exchange can help “shape the policy” in the country
  29. Ripple: Swell 2019—MoneyGram CEO Says 10% of Transactions Between Mexico and U.S. Use On-Demand Liquidity
    • Less than six months after MoneyGram announced plans to implement On-Demand Liquidity (ODL) through RippleNet, MoneyGram Chairman and CEO Alex Holmes said the firm is currently moving 10% of its tx volume through ODL between the U.S. and Mexican borders and plans to expand into four more corridors by EOY
    • Holmes added, “We’re able to settle billions of dollars in seconds. The magic really comes from pairing MoneyGram transactions with Ripple’s ODL”
  30. The Block: Chinese Tech Giant Tencent Granted Hong Kong License to Open ‘Virtual Bank’
    • Chinese tech giant Tencent received a license from the Hong Kong authority to open a “virtual bank”
    • Tencent’s blockchain business manager Weige Cai said the firm is forming a team dedicated to building the bank, although details of the bank are unclear
  31. Standard Chartered: Standard Chartered Joins Enterprise Ethereum Alliance
    • British multinational banking giant Standard Chartered, with +$685B in total assets, joined the Enterprise Ethereum Alliance to collaborate with other industry leaders to strengthen blockchain research and application in the banking sector
    • Standard Chartered views blockchain as “central to banking and commerce in the digital era, so transactions can be verified, secure and processed in real time”
  32. VeChain: VeChain, Together with ASI Group and DNV GL, Announced the First Cross-Continental Logistics And Trades Solution Based on Public Blockchain for Food & Beverage Industry On The 2nd CIIE
    • VeChain unveiled a new blockchain tracking system, Foodgates, for the food and beverage industry; the project includes partnerships with food certification group DNV GL and supply chain specialist ASI Group on the project
    • VeChain COO Kevin Feng commented, “The immutability of public blockchain coupled with verifiable information makes this solution really unique”
    • Link to coverage by Cointelegraph

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