The Jamaica Stock Exchange (JSE) is planning to list security tokens as tradeable assets for clients. The JSE’s Canadian technology partner Blockstation announced last week that the two firms have completed the first stage of a 60-day live cryptocurrency trading pilot. Marlene Street Forrest, the JSE’s managing director said the trial has been “very smooth” so far and that the exchange is “quite happy” with the results. She continued: “We are looking forward to moving to the next stage of the pilot which would eventually include the listing of security tokens.” The first stage of the pilot saw participation from regulated broker-dealers, market makers and the Jamaica Central Securities Depository (JCSD). The ultimate objective of the pilot is to “demonstrate the complete lifecycle of the digital asset ecosystem,” according to the announcement. That included setting up the platform, managing participants and conducting trading. The JCSD managed the clearing, settlement and custody of cash and cryptocurrencies, and oversaw compliance reporting and reconciliation across participants. The JSE partnered with Blockstation back in August 2018 to create the new digital assets trading platform. Forrest told CoinDesk at the time: “The end game at the end of the day is to trade tokens, the end game is smart contracts, the end game is to provide that area of the market that would like this product, to start to do so in a secure manner.” An increasing number of platforms have been moving to offer trading in security tokens in recent weeks. Just yesterday, crypto startups Zilliqa and MaiCoin partnered to build a centralized security token exchange called Hg Exchange in Singapore. The platform aims to ultimately tokenize shares of big-name private companies, including AirBnb, Uber and SpaceX. Last week, European blockchain startup Currency.com launched a trading platform for tokenized securities, allowing investors to directly trade and invest in financial instruments using cryptocurrencies. And, earlier this month, Estonia-based crypto startup DX.Exchange launched a trading platform allowing clients to purchase crypto tokens representing shares in different tech firms listed on Nasdaq. Jamaica flag image via Shutterstock
The Daily In this edition of The Daily, the Polish financial watchdog has authorized two crypto companies to operate as payment service providers and a bank in the Netherlands now offers crypto storage to its clients. Also, recently leaked images show the long-awaited Samsung S10 may indeed come with a cryptocurrency wallet. Also read: Huobi Downsizes, New OTC Desk to Launch in US Poland Grants Licenses to Coinquista and Bitclude The Polish Financial Supervision Authority, Komisja Nadzoru Finansowego (KNF), has licensed two crypto startups as payment providers. The companies, Coinquista and Bitclude, offer a number of services related to cryptocurrency such as digital asset exchange platforms and crypto wallets. Although the license does not explicitly mention these products, the regulator explained that the two startups will be able to provide a variety of payment services and solutions for customers in Poland, Finance Magnates reported. That includes accepting cash deposits and withdrawals. Furthermore, Coinquista and Bitclude will be authorized to process payment transactions, transfer funds, and execute direct debits. Under their licenses, the crypto companies will also be allowed to use payment cards and issue payment instruments. According to Coinquista CEO Ireneusz Pukin, KNF‘s decision to register his company as a payment service provider proves the exchange can run legal business in Poland. Pukin also believes the move is an indication that the financial watchdog is not against activities such as those Coinquista is associated with. In the past year, authorities in Poland took steps to regulate certain aspects of the crypto space without banning cryptocurrencies and related operations. In November, amendments to the country’s income tax regulations were introduced to incorporate the taxation of profits from crypto transactions. ABN Amro Introduces Crypto Storage Service ABN Amro, a bank based in the Netherlands, has recently launched its storage infrastructure for digital assets. The financial institution announced that 500 clients have already subscribed for the new service, which is still in testing mode. According to the bank, its platform ensures secure storage for the private keys of users’ crypto wallets. ABN Amro also provides guarantees for digital assets worth up to €6,000 (~$6,800) that are kept with the bank. The crypto storage solution is integrated with ABN Amro’s online banking interface used by its clients for regular…
Number-one ranked cryptocurrency exchange Binance has announced it had launched its over-the-counter (OTC) trading desks for larger transactions, according to a Jan. 23 blog post. The new tool, simply known as Binance OTC, offers services geared to users performing trades worth at least 20 BTC ($71,000). “Our OTC desk allows Binance users to trade larger amounts of many cryptocurrencies listed on the exchange, with transactions being settled via their Binance accounts,” officials explained in the post. The move makes Binance the latest major cryptocurrency exchange to launch OTC services, following hot on the heels of United States exchange Bittrex last week. In December, meanwhile, crypto finance firm Circle revealed its extant OTC desk had handled payments worth around $24 billion in 2018. At the time, cryptocurrency news and research publication Diar further found that an increasing number of major investors had begun to favor OTC over traditional trading methods. “Institutional cryptocurrency trading on traditional exchanges have lost ground in volumes as Bitcoin is being welcomed into major outfit portfolios this year, with more slated to come online in 2019,” the publication summarized. A Cointelegraph analysis has found that OTC could play host to a battle among industry players to woo institutional funds this year.
The cryptocurrency markets remain unfazed after an ETF withdrawal announcement on Wednesday did little to affect bitcoin’s price. The Cboe BZX exchange has withdrawn a proposed rule change that would have otherwise paved the way for an ever-elusive bitcoin exchange-traded fund (ETF) backed by VanEck and SolidX. The announcement, however, did little to spur investors into selling, who so far have held their ground at the day’s close, leaving others to speculate that the events of the day were already priced in days before. Daily chart The daily chart shows stagnation for the entire trading session with a small $80 range bound candlestick providing evidence of little interest in the bitcoin and crypto market in the last 24 hours. Total growing volume has dropped significantly in recent weeks and is typically quite low during unsettled periods. Low volume also reflects a lack of confidence that usually leads to long periods of consolidation and sideways momentum, similar to the one bitcoin is currently experiencing after a disappointing start to 2019. The relative strength index (RSI), used to judge momentum of a given trend shows a gradual shift to low interest once more as it dipped on the news and is resting below established RSI resistances of 54.9 at 43.10 (bullish above 55). An $800 price range has also trapped momentum for a period of 36 days now raising concerns over its ability to hold current price levels for any sustainable period which would eventuate in another sell-off toward the $3,000 weekly target. View The crypto markets appear unfazed by the latest announcement of proposed rule change withdrawal that would have otherwise made it easier to obtain an ETF for VanEck and SolidX. Total volume has been falling week-to-week with the exception of Dec. 10 and Dec. 31 underscoring the current period of consolidation. Price action has been trapped within an $800 range while other relatable news appears to have been having little impact on price as of late. Disclosure: The author holds no cryptocurrency at the time of writing. ETF Image via shutterstock
With bitcoin (BTC) showing resilience to negative news flow, a strong bullish move is looking increasingly likely. On Wednesday, the Chicago Board Options Exchange’s (CBOE) BZX equity exchange withdrew its request for a rule change by the U.S. Securities and Exchange Commission (SEC) that would have allowed it to list a bitcoin exchange-traded fund (ETF) backed by VanEck and SolidX. The market narrative with respect to the ETF is that its approval could trigger the next bull run in the leading cryptocurrency by market value. Moreover, in the past, markets have responded negatively to delays or rejections in ETF approval. The latest ETF withdrawal, however, has barely moved the needle for BTC’s price. The cryptocurrency continues to trade in a sideways manner above the crucial support at $3,500. The calm response to the bearish news could be considered a sign of seller exhaustion – more so, as the primary trend is still bearish. As a result, the cryptocurrency could soon end the 14-day-long consolidation with a bullish breakout. Further, the Cboe ETF – first filed with the SEC in June 2018 – had experienced several delays in the past. As a result, the bar of expectation was set low and was likely priced in by traders. As of writing, BTC is changing hands at $3,540 on Bitstamp, representing a 0.70 percent drop on a 24-hour basis. Daily chart On the daily chart, BTC has created a descending triangle, which comprises a horizontal line connecting a strong support level and a falling trendline representing lower highs. A UTC close above the upper edge of the triangle, currently at $3,630, would confirm the breakout and could yield a rally to the psychological resistance of $4,000. The odds of the bull breakout look good, as the ETF news failed to embolden the bears and gold is feeling the pull of gravity (as discussed yesterday, BTC and gold look to be inversely related). View BTC’s defense of $3,500 amid the bearish news flow likely indicates seller exhaustion. As a result, the prospects of cryptocurrency witnessing a triangle breakout on the daily chart are high. A bull breakout, if confirmed, would expose resistance lined up at $4,000. A triangle breakdown – i.e. a close below $3,470 – would validate the…
Star Xu, founder of exchange services provider OKCoin and the world’s second-largest crypto exchange OKEx, has bought a controlling share in a Hong Kong Stock Exchange-listed firm for around $60 million. The deal was disclosed by the acquired firm, LEAP Holdings Group, on Jan. 23. Following the deal’s completion on Jan. 14., OKCoin’s parent firm OKC Holdings Corp. became the controlling shareholder in LEAP Holdings — a Caymans Island-incorporated construction engineering firm, which is listed on the Hong Kong Stock Exchange (HKEX). Having purchased roughly 3.2 billion shares at HK$0.15 (~$0.02) apiece — at a total cost of $483,890,536 (~$61.6 million) — OKC Holdings Corp. owns 60.49 percent of Leap Holdings’ stock, with the same percentage of voting rights. Xu notably owns the majority stake in OKC Holdings (52.32 percent) via his two wholly-owned firms, StarXu Capital and OKEM Services Company. OKC Holdings Corp.’s acquisition has the apparent hallmarks of being a reverse takeover — also known as a reverse initial public offering (IPO), or backdoor listing. The route allows a privately held company to purchase a publicly traded company — thereby bypassing at least some of the bureaucratic scrutiny involved in the process of going public, including regulatory issues and due diligence. Upon completion of the deal, the buyer gains automatic inclusion on the relevant stock exchange. Other crypto industry firms to have opted for a reverse takeover include crypto exchange Huobi — which acquired controlling stock interest in an HKEX-listed electronics firm last summer — and Mike Novogratz, who opted for the route in order to secure a listing on Toronto’s TSX Venture Exchange for his crypto-focused merchant bank Galaxy Digital. As reported, OKEx launched a new crypto derivative product in late December, dubbed “Perpetual Swap,” which allows users to speculate on the future value of BTC/USD, with up to 100x leverage. This month, the exchange added seven new trading pairs for its perpetual swap contracts, including Ethereum (ETH), Litecoin (LTC) and Ripple (XRP). OKEx is currently the world’s second-largest crypto exchange by adjusted daily trade volumes, seeing about $382 million in trades on the day to press time.
New comments from the chief executive of the Hong Kong Stock Exchange (HKEX) may have dampened the hopes of several cryptocurrency mining giants that have filed for initial public offerings (IPOs). According to a report from Tencent’s news portal Finance.QQ on Thursday, HKEX CEO Charles Li Xiaojia said that companies seeking to list on the stock exchange must have a “sustainable” business model. While Li did not talk about specific company applications, he answered in general about HKEX listing requirements in a response to a question on the crypto miner IPO filings from the news source. Three top crypto mining companies, Bitmain, Canaan and Ebang, have all filed to list on the HKEX, but none has received approval to date. Li said that, if a company has made billions of dollars through one business, then suddenly says it will do some other business without demonstrating past performance, it could mean that the company’s first business model is “not sustainable.” If so, the question for the HKEX is, “Can you still do this business, can you make this money?” The HKEX will “adhere to the principle of market adaptability” when reviewing companies’ IPO applications, including those of crypto miners, he added. Bitmain filed its IPO application with the HKEX in September of last year, while Canaan and Ebang filed in May and June, respectively. There have already been signs that the HKEX is reluctant to approve Bitmain’s IPO, however. Last month, a person involved in the talks told CoinDesk that the exchange is “very hesitant to actually approve these bitcoin mining companies because the industry is so volatile.” Ebang, on the other hand, refiled its draft IPO prospectus last month, but stated in the filing that it saw “significant decreases” in revenue and gross profit in Q3 2018. With the delays, Canaan is now reportedly considering an IPO in the U.S., which could launch in the first half of this year in New York, although the process is still in its early stages. HKEX image via Shutterstock
Mingxing “Star” Xu, the founder of cryptocurrency exchange OKCoin, has become the largest individual shareholder of a public company listed in Hong Kong via a $60 million acquisition. LEAP Holdings Group, the construction engineering firm acquired, announced the competed deal on Wednesday. OKC Holdings Corp, the parent company of OKCoin, purchased about 3.2 billion shares of the company for HK$0.15 (around $0.02) per share to achieve the takeover, it said. OKC Holdings is now the largest shareholder of LEAP Holdings, owning 60.49 percent of its stock and having the same percentage of voting rights. As a result, the exchange is a step closer to a possible back-door listing on the Hong Kong Stock Exchange (HKEX). Xu holds the majority stake in OKC Holdings with 52.32 percent ownership through two firms StarXu Capital and OKEM Services Company. Other notable shareholders of OKC Holdings include Gang Mai, who holds 5.08 percent stake via Vlab Capital, and Bo Feng of Ceyun Ventures holding 9.86 percent through Golden Status Ventures. Mai also has another joint fund called Venturelab jointly created with the U.S.-based venture capitalist Tim Draper. Jing Shi, daughter of Chinese billionaire entrepreneur Yuzhu Shi, also invested in OKC Holdings and owns 13 percent. OKC Holdings initially filed for the application with the HKEX on Jan. 10 to buy the controlling stake in LEAP Holdings Group, with the deal closing in just two weeks. Crypto exchanges are increasingly looking to opt for a reverse-merger route to become publicly listed companies, rather than going for the conventional IPO route which is a lengthy and complex process. Just yesterday, the holding company of South Korea’s Bithumb exchange signed a binding letter of intent agreement with U.S.-listed investment firm Blockchain Industries for a reverse merger. And, last August, Singapore-based crypto exchange Huobi took a similar step, acquiring 66.26 percent of a HKEX-listed firm called Pantronics Holdings for around $70 million. Billionaire investor Michael Novogratz also chose the reverse takeover route in July 2018, merging his crypto merchant bank, Galaxy Digital, with Toronto-listed shell company Bradmer Pharmaceuticals to become publicly listed in Canada. Hong Kong image via Shutterstock
The head of the Hong Kong Stock Exchange (HKEX) has addressed queries about initial public offering (IPO) listings amid confusion over Bitcoin mining giant Bitmain’s application. English-language newspaper South China Morning Post (SCMP) reported the comments on Jan. 24. Speaking at the ongoing World Economic Forum (WEF) in Davos, Switzerland, HKEX CEO Charles Li Xiaojia said that it was important IPO candidates were consistent about their business offerings. “If a company made billions of US dollars through Business A, but suddenly said it will do Business B without showing any performance, or said Business B is better, then I don’t think the Business A featured in their application will be sustainable,” the SCMP quoted him as saying. Xiaojia continued: “Besides, if regulators were hands off [on Business A] in the past but will regulate it in the future, will you be able to continue the business and still make money from it?” Xiaojia did not comment on Bitmain specifically, while journalists had mentioned the company by name when asking for clarification. Having made the majority of its revenue from mining hardware sales in the first half of last year, Bitmain has faced reported layoffs and lawsuits, as the downtrend in Bitcoin (BTC) prices made mining considerably less profitable. Bitmain also announced plans in May 2018 to turn towards the area of artificial intelligence (AI) against the background of Chinese scrutiny of the crypto industry. Bitmain had planned to conduct an IPO in Hong Kong throughout the latter half of 2018. After financial performance figures suggested the company was in trouble, however, rumors began surfacing that regulators were also not prepared to let a cryptocurrency IPO pass. Another mining entity, Canaan Creative, let similar Hong Kong plans lapse in November, but has since said it is looking to complete the process in New York.
Security When an individual first joins the cryptocurrency economy and obtains their first bitcoins, at times the process can be daunting. Most veterans will often tell newcomers that they need to secure their coin’s private keys in order to enjoy sovereign ownership. However, most people are not taught how to keep their 12-24 word seed phrase in another useful way by utilizing a method called “Shamir’s Secret.” Also Read: Money Transmitter License Not Required for Crypto Businesses in Pennsylvania Learning Shamir’s Secret Most people within the cryptocurrency community will emphasize that securing your own private keys is the best way to hold cryptocurrencies. The reason for this is because when any funds are kept with a third party such as an exchange or a custodial wallet, the keys are not in the owner’s control. This means that if the exchange or wallet provider gets hacked and funds are stolen, the coins you hold on an exchange can be stolen from you and some exchange hack victims never get restitution. However, cryptocurrency owners who secure their own private keys by maintaining a specific computer file or use a 12-24 word mnemonic phrase still open themselves up to physical vectors. There are lots of people who create a new crypto wallet every single day and they typically write down the 12-24 word phrase on a piece of paper and hide it. But this means anyone with knowledge of the exact location of someone’s mnemonic phrase tied to their digital assets could theoretically steal the funds. Seed phrases should be written down in a secure location by yourself. Think about it, if a piece of paper or another object with a written mnemonic phrase is searched for by malicious actors, finding the 12-24 words might not be so difficult. In fact, people who don’t hold cryptocurrencies most likely don’t keep random phrases hidden with their belongings. Most ordinary people, who know nothing about digital assets storage, would not understand why a person would have a bunch of random words tucked under the mattress. But bitcoiners do keep mnemonic phrases and have a seed written down on paper or another object. These hidden words stored in one physical location can still be compromised by thieves, damaged by the elements, and…