New Platform Converts Crypto to Fiat Without Know Your Customer Requirements

Crypto wallet MyEtherWallet in collaboration with crypto finance firm Bity have launched a platform for the conversion of crypto to fiat without going through KYC requirements.

Cryptocurrency wallet MyEtherWallet (MEW) in collaboration with crypto finance firm Bity are releasing a platform to convert cryptocurrency to fiat without Know Your Customer (KYC) requirements. MEW announced the news in a blog post published on Feb. 20.

Per the announcement, users of the MEW V5 wallet are now able to exchange up to 5,000 Swiss Francs ($4,995) worth Bitcoin (BTC) and Ethereum (ETH) to euros and Swiss francs without going through KYC requirements inside the wallet. Users can purportedly make the exchange from any part of the world.

KYC procedure enable organizations to verify the identity of their customers before or during dealing with them. Businesses can assess whether their clients are involved in illegal activities like money laundering or corruption.

To use so called “Exit-to-Fiat” option, customers have to choose the target digital and fiat currencies in the wallet dashboard. Users will further be asked to provide some personal data, including their phone number, banking details, official name of their bank account, and the billing address needed for compliance purposes.

Enhanced privacy and anonymity of cryptocurrencies have always been linked by the governments and regulators to illicit activities and the possibility of money laundering. Last month, the Cyberspace Administration of China (CAC) introduced new regulations for blockchain firms that are operating in the country.

The CAC guidelines require blockchain startups to allow authorities access to stored data, and to introduce registry procedures that would require ID card or mobile numbers from its users. Moreover, they will be obliged to oversee content and censor information that is prohibited under current Chinese law.

In April 2018, Amazon Technologies, Inc. received a patent for a streaming data marketplace that would permit the combining of multiple data sources, thereby enabling the real-time tracking of cryptocurrency transactions and the users involved. This would essentially lead to the de-anonymization of transactions involving Bitcoin, Ethereum or any other non-privacy cryptocurrency.

Unconfirmed: Telegram TON Network to Launch by October 2019 or Token Contracts Are Void

According to an apparent purchase agreement for Telegraph’s Gram tokens, the network must launch prior to October 31, 2019 in order for token purchase agreements to be valid.

Purchase agreements for messenger service Telegram’s Gram tokens will be terminated if the Telegram Open Network (TON) does not launch by October 31, 2019. An apparent purchase agreement with the said terms was obtained by Cointelegraph on Feb. 21.

The agreement details the legal niceties of Gram token purchases, outlining regulations for different jurisdictions in regard to the distribution of the tokens. Notably, it states that, should network not be released by October 31, 2019, the contract will be considered null and void.

While the document provides the name of the founder of the encrypted messenger Telegram, Pavel Durov, it is not yet been signed or dated. The document also lists the address for Harneys, a lawyer’s office in the British Virgin Islands, where Telegram is also registered.

According to the document, the company intends to create and release a new digital currency called “Grams” following the development and launch of a new blockchain platform, the TON Network.

Sources familiar with the matter recently told Cointelegraph that TON could launch as early as March 2019. Cointelegraph’s source emphasized that Durov was reluctant to confirm a specific date for TON’s release and that the March estimate remains subject to change.

According Russian media outlet The Bell, investors have been told that TON is 90 percent ready, but that delays are possible because of the “innovative nature of the development.”

As Cointelegraph previously reported, Pavel and Nikolai Durov filed a “Notice of Exempt Offering of Securities” with the U.S. Securities and Exchange Commission (SEC) on Feb. 13, 2018, reporting $850 million raised from 81 investors in the first round of their initial coin offering (ICO) for “the development of the TON Blockchain, the development and maintenance of Telegram Messenger.”

Later in March 2018, the Durov brothers revealed that they raised $850 million in the second round of their ICO from 94 investors. In October 2018, it was reported that Telegram would release a test version of theTON platform “this autumn.”

Report: Major European Derivatives Exchange to Launch Cryptocurrency Futures

Deutsche Boerse-operated derivatives exchange Eurex is reportedly planning to launch digital currency futures.

Eurex, a Germany-based derivatives exchange operated by Deutsche Boerse, is reportedly planning to launch futures contracts tied to digital assets, financial technologies-focused news outlet The Block reported on Feb. 21.

People familiar with the matter reportedly told the Block that Eurex is planning to launch futures contracts tied to such digital currencies as Bitcoin (BTC), Ethereum (ETH), and Ripple (XRP), having already had meetings with market-making companies to discuss the products.

Deutsche Boerse has reportedly been considering the introduction of digital currency futures since December, 2017. A spokesperson for the exchange then said that “we are thinking about futures, with which private investors and institutional investors can protect existing investments in Bitcoin or set for falling prices of the cyber currency.”

In September 2018, Deutsche Boerse established a “DLT, Crypto Assets and New Market Structures” unit, that would explore the disruptive potential the technology could have for financial market infrastructure, as well as the new products the exchange could develop to enhance its existing offerings.

Founded in 1998, Eurex is an international derivatives exchange operated by one of the world’s leading stock exchanges, Deutsche Boerse. Eurex Clearing reportedly manages a collateral pool of 49 billion euro ($55.5 billion) and clears trades valued at 12.46 trillion euro each month.

Last month, Deutsche Boerse announced that it was “making significant progress” on its blockchain-based securities lending platform, the launch of which is scheduled for the the first half of 2019. Per the press release from Deutsche Boerse, six banks to date had confirmed their plans to join the ​​securities lending platform, and have initiated “their connectivity processes.”

Commerzbank, Siemens and Continental Complete Blockchain Money Market Pilot

Three German banking and tech giants have completed a 100,000 euro money market security transaction based on the blockchain platform Corda.

German banking and financial services company Commerzbank and technology companies Continental and Siemens have jointly conducted a money market security transaction pilot using blockchain technology. Cointelegraph auf Deutsch reported on the development on Feb. 21.

Money market securities are short-terms assets that serve for financing companies and usually have a maturity of one year or less. Usually, the processing of a payment takes two days due to a clearing process.

The aforementioned parties “for the first time” conducted a blockchain-based money market security transaction worth 100,000 euro ($113,340) within a pilot project in January, where Continental acted as the issuer of the security, Commerzbank provided R3’s Corda-based blockchain platform, while Siemens subscribed to the money market security as an investor.

The blockchain-powered platform reportedly allowed the companies to improved flexibility, efficiency and transparency in the deal. Speaking about other benefits of the transaction, Peter Rathgeb, Corporate Treasurer at Siemens, said in a Feb. 21 press release:

“The significantly shorter throughput times and faster time-to-market show clear advantages of this technology [blockchain]. Key challenges include security and performance issues, as well as legal issues such as the need to create a consistent European standard and understanding of the law on blockchain-based transactions.”

In late 2018, Commerzbank in collaboration with French corporate and investment bank Natixis, and Dutch financial services firm Rabobank completed a live 100,000 euro ($113,340) commercial paper transaction on the Corda platform. Commerzbank developed the pilot framework, software and distributed ledger (DLT) network for the trade, and instructions on regulatory implications.

Previously, Siemens joined a scalable blockchain platform, the Energy Web Foundation (EWF), to promote the use of decentralized technologies in the energy sector. Siemens officials reportedly argued that blockchain technology will help increase interoperability in the area, linking consumers with energy producers and network operators.

Blockchain and the City: New York State as a “Tough” Model of Crypto Regulation

The financial capital of the world can afford to be picky — but does it stifle fintech innovation?

Recently the New York Department of Financial Services (NYDFS) granted statewide virtual currency licenses to two applicants: stock trading service Robinhood and cryptocurrency ATM operator LibertyX. The state’s regulatory regime, commonly known as BitLicense, imposes a set of strict disclosure and consumer-protection requirements on any business that offers cryptocurrency-related services to New York residents. Since the framework was introduced in 2015, only a handful of companies had their applications approved by the NYDFS: The elite club of BitLicense holders now counts just 16 entities, the two newcomers included.

The state has also demonstrated that it keeps close tabs on those who might be in violation of the compliance procedures: In September last year, the New York state attorney general’s office published a report that raised concerns over price manipulations that were possibly taking place on cryptocurrency exchanges, and referred three of them to the state’s financial regulator.

While many American states strive to appeal to crypto businesses by implementing lenient policies and easing red-tape pressures on industry startups, New York has championed a regulatory approach more rigorous than that of most nation-states. Many influential figures in crypto community are cross with what they perceive as a vast governmental overreach, yet there seems to be no shortage of firms still ready to take on the pains of obtaining the license. But in the big picture, is this type of regulatory climate that exists in the world’s financial capital beneficial for the crypto industry, mainstream adoption and the Empire State itself?

Reasons to comply

For any company somehow related to finance, the benefits of doing business in New York and with New York residents are obvious. The number of powerful financial institutions per square foot is staggering, the Wall Street money is just a glance away, and a consumer market of almost 20 million people is no small deal, either. This is especially true if you are a prominent player in the nascent fintech industry longing for mainstream adoption.

New York legislators in Albany are well aware of their jurisdiction’s unique position as a major financial hub, and have been long acting accordingly. Martin Weiss, founder of Weiss Research and Weiss Cryptocurrency Ratings, explained that the tendency for strict state-level regulation has a long history:

“Traditionally, Albany has been tougher than many other states in regulating — insurance, for example. They are the toughest state in regulating financial markets, too. They see themselves responsible for keeping the financial center.”

In the case of crypto, Weiss argued, New York’s centrality to the world’s financial system is a powerful enough factor to overcome the logic of crypto regulation applicable to almost any other territory:

“Cryptocurrencies are, in essence, borderless. Regulation, in order to catch up, would also have to be borderless, crossing not only state boundaries but also national boundaries. New York is in a unique situation because it regulates a major financial center, the largest in the world. So as long as all those corporations want to remain domiciled in New York, legislators in Albany do have a jurisdictional reach that sticks. In most places in the world, if you try to regulate cryptocurrencies, they’ll just move to another jurisdiction. That is bound to happen with most of cryptocurrency institutions. But that’s not the case with New York.”

Vigilant New York state authorities became concerned with Bitcoin regulation fairly early: Ben Lawsky, the state’s Superintendent of Financial Services, first sketched the contours of what would become BitLicense in July 2014. Regulations came into full effect almost a year after, forcing both existing and incoming players to either comply or quit.

Backlash

Hardly surprisingly, not everyone took the news well. During the summer of 2015, big names such as BitFinex and ShapeShift pulled out of the New York market; crypto exchange Kraken announced cessation of services to New York residents in a blog post that called BitLicense “a creature so foul, so cruel that not even Kraken possesses the courage or strength to face its nasty, big, pointy teeth.” Erik Voorhees and Jesse Powell, the bosses of ShapeShift and Kraken, respectively, remained BitLicense’s staunch critics, calling for the regulation’s repeal ever since.

Aside from decrying the redundancy of regulation, opponents often point out how the pace at which licenses get approved is dismally slow — it is not uncommon for a company to wait for three years to be approved, as it happened with Genesis Global Trading. This part of the process alone can put smaller companies at a disadvantage. As Kevin Hobbs, CEO of the blockchain consultancy Vanbex Group, told Cointelegraph:

“We believe that these strict regulations hinders cryptocurrency innovation in the Empire State. BitLicense is particularly restrictive for small companies to bear. Since only the largest companies possessing ample resources able to comply with the strict regulations. The BitLicense became effective in New York on June 24, 2015 but in the three years since then, only five crypto-related companies have been approved for a BitLicense in the state. Indeed, these one-size-fits-all regulations ultimately stifles innovation.”

Pushback from the more regulation-averse flank of crypto community has also received some political support: Larry Sharpe, a Libertarian Party candidate in the 2018 New York gubernatorial election, argued that the BitLicense regime serves to entrench the incumbent’s dominance in the market, and proposed to eliminate the licensing process. His bid in the November 2018 election, however, was unsuccessful.

Maybe it’s not that bad?

Those who are on board with the New York authorities’ rigorous policies toward cryptocurrency usually speak in the language of benefits to institutional and mainstream adoption. The idea is that the robust, large-scale crypto enterprises that prove capable of complying with the licensing requirements could draw the whole ecosystem closer to the core of the incumbent financial system that New York embodies. Robinhood, the recent addition to the pool of BitLicense holders, could definitely play this role. As Sky Guo, CEO of smart contract platform Cypherium, put it:

“A great part of Robinhood’s value to our space will be as a leader in quasi-institutional compliance. New York is the center of traditional finance, and the state’s licensing process — for good reason — prioritizes the integrity of its complex systems. For these reasons, Robinhood will be a great bridge between the two communities. Because Robinhood aims to open public access to traditional finance mechanisms, the company has a natural affinity for crypto projects and the DLT space in general.”

In addition to institutional-level shifts, Robinhood is poised to help the cause by adding a share of its regular stock users to the ranks of crypto community, notes Eric Ervin, CEO of Blockforce Capital:

“Long-time cryptocurrency believers may not be migrating over to the Robinhood crypto platform anytime soon due to its lack of certain features that are available on other crypto trading platforms. However, the increased trust instilled by the issuance of the BitLicense may be enough to convince current Robinhood users who are on the fence to give the service a try. Robinhood’s significant user base in the state of New York will open the door to new crypto investors.”

Finally, there are signs that the Empire State’s regulatory framework is evolving into something more flexible and dynamic. More companies have seen their applications for a crypto license approved in the last year than in the previous three.  A seemingly lighter version of the approval process is now applied to companies seeking permission to offer crypto custody. According to reports from inside the state legislature, a task force is being assembled to focus entirely on digital currency.

Guy Hirsch, Managing Director of trading platform eToro US, told Cointelegraph:

“We think that New York regulators are making a genuine effort to make the state competitive for the blockchain era. BitLicenses have been approved on a more regular basis recently. NYDFS have issued several novel approvals for crypto custody. They also have put together a very clear Q&A on their website that provides a coherent framework for companies to buy, sell, hold, and transmit cryptoassets in a compliant manner.

“A lot of us think that the financial services industry will run on a blockchain. If this assumption turns out to be true then New York, being the financial capital of the world, has a vested interest in making sure it remains as such in decades to come.”

New York has gravitated toward a tight regulatory model that, at least according to the majority of state representatives, fits its status of the global financial center the best. In the years to follow, this model will enter a competition with alternative conceptions of how to do it. Martin Weiss hopes that this competition will ultimately yield a uniform, globally enforced regulation:

“What you’ll find is various jurisdictions experimenting with regulation: Malta, UK, Russia, Belarus — some taking a much more liberal attitude, some taking stricter attitudes — and over time, the model that works the best will become the predominant model globally. We’ll hopefully see a global regulatory regime enforced by supranational organizations like the IMF [International Monetary Fund] or the BIS [Bank for International Settlements] or something like that. New York is establishing a tough model.”

Latin America’s Largest Investment Bank to Launch Its Own Security Token

Brazil-based Banco BTG Pactual SA has revealed its plans to release а security token, which could be purchased with Gemini Dollars or Ethereum.

Latin America’s largest investment bank Banco BTG Pactual SA is releasing its own blockchain-based security token, Bloomberg reported on Feb. 21.

The token dubbed “ReitBZ” — which will be backed by distressed real estate assets in Brazil —  will reportedly enable the bank to provide its real estate business to international investors at lower costs than with traditional means. ReitBZ will be perpetual, with the initial offering period of around 90 days, while proceeds will be reinvested in the distressed portfolio.

Andre Portilho, BTG’s partner responsible for the project, reportedly said that the bank began exploring the technology behind cryptocurrency several years ago, and said that “we thought Bitcoin (BTC) and other currencies were turning too volatile, but we saw an opportunity with this token to try something new —  but also with our skin in the game.” The bank reportedly expects to raise $15 million through an initial coin offering (ICO).

Investors will purportedly be able to buy ReitBZ via a special platform by using the Gemini Dollar (GUSD) stablecoin or Ethereum (ETH). The bank reportedly specified that investors will “receive periodical dividends from the recovery of the distressed assets, which will be handled by a BTG-owned company called Enforce.” The investments will not be hedged.

In September 2018, the largest brokerage in Brazil, Grupo XP, announced its plans to enter the crypto space by launching an exchange for Bitcoin and Ethereum called XDEX. Grupo XP CEO Guilherme Benchimol reportedly said that the company was pushed into the crypto business by the popularity of cryptocurrencies among investors. Three million Brazilians “have exposure” to Bitcoin, compared to only 600,000 that invest in the stock market.

Earlier today, Japan’s banking giant Mizuho Financial Group revealed that it will launch its own stablecoin for payments and remittance services on March 1. The coin will reportedly be managed by a dedicated mobile app, dubbed J-Coin Pay, using QR codes at checkout to complete retail payments, as well as fixed at a price of 1 yen (~$0.01) per unit.

What Is an STO, Explained

A closer look at STOs and how the process compares to the more familiar ICO and IPO.

What is an STO?

STO stands for security token offering.

Similar to an initial coin offering (ICO), an investor is issued with a crypto coin or token representing their investment. But unlike an ICO, a security token represents an investment contract into an underlying investment asset, such as stocks, bonds, funds and real estate investment trusts (REIT).

A security can be defined as a “fungible, negotiable financial instrument that holds some type of monetary value,” i.e., an investment product that is backed by a real-world asset such as a company or property.

A security token, therefore, represents the ownership information of the investment product, recorded on a blockchain. When you invest in traditional stocks, for example, ownership information is written on a document and issued as a digital certificate (e.g. a PDF). For STOs, it’s the same process, but recorded on a blockchain and issued as a token.

STOs can also be seen as a hybrid approach between cryptocurrency ICOs and the more traditional initial public offering (IPO) because of its overlap with both of these methods of investment fundraising.

How is an STO different from an ICO?

It is the same process, but the token characteristics are different.

STOs are asset-backed and comply with regulatory governance. Most ICOs, on the other hand, position their coins as a utility token that give users access to the native platform or decentralized applications (DApps). The purpose of the coin, they argue, is for usage and not for investment. As a result, ICO platforms circumvent certain legal frameworks and do not have to register or comply with the strict governance of regulatory bodies.

The barrier to entry for companies to launch an ICO is, therefore, much lower, as they do not have to do all the upfront compliance work. They are also able to sell their coins (i.e., raise funds) to the wider public.

It is much more difficult to launch an STO, as the intention is to offer an investment contract under securities law. Therefore, these platforms will have to do the upfront work of making sure they comply with the relevant regulations. They would typically also only be able to raise funds from accredited investors who have themselves passed certain requirements.

How is an STO different from an ICO?

How is an STO different from an IPO?

Again, it’s the same process, but STOs issue tokens on a blockchain while IPOs issue share certificates on traditional markets.

Although both are regulated offerings, IPOs are only used in private companies that want to go public. Through the IPO process, they raise funds by issuing shares to accredited investors.

With STOs, tokens that represent a share of an underlying asset are issued on the blockchain to accredited investors. These can be shares of a company but, because of tokenization, can really be of any asset that is expected to turn a profit, including a share in the ownership of a property, fine art, investment funds, etc.

STOs are also more cost-effective than IPOs. With IPOs, the companies would typically pay high brokerage and investment banking fees to get access to a deeper investor base. STOs would still need to pay lawyers and advisors, but they offer more direct access to the investment market and, therefore, typically won’t have to pay large fees to investment banks or brokerages. The post-offering administration for STOs is also less cumbersome and cheaper than with traditional IPOs.

How is an STO different from an IPO?

How are STOs defined and regulated around the world?

This will very much depend on the individual jurisdictions.

The Securities and Exchange Commission (SEC) in the United States is perhaps the most vocal on the issue of how a security token is defined, and whether or not certain utility tokens are, in fact, security tokens that should be regulated.

In their Decentralized Autonomous Organization (DOA) report in July 2017, the SEC concluded that the DAO ICO was, in fact, a security offering under the qualification of an investment contract.

According to the SEC, ICOs will be classified as a security if they fall under the definition of an investment contract, which was established by the Supreme Court and derived from a landmark case between the SEC and The Howey Company.

Now known as the Howey Test, it states that:

“An investment contract is (1) an investment of money (2) in a common enterprise (3) with a reasonable expectation of profits (4) to be derived from the entrepreneurial or managerial efforts of others.”

The DAO report also concluded that “the investment of ‘money’ need not take the form of cash.” and in a Senate hearing on Feb. 6, 2018, SEC Chairman Jay Clayton also said:

“I believe every ICO I’ve seen is a security.”

However, a bill that seeks to exempt digital tokens from securities law and taxes will be reintroduced to the U.S. Congress “soon,” according to a Feb. 14 tweet from U.S. Congressman Warren Davidson.

#TokenTaxonomyAct Thanks to all who have shared input. @RepDarrenSoto & I are excited about the revisions and look forward to reintroducing this bipartisan bill soon. We continue to inform our colleagues about the urgent need for light-touch regulatory certainty. #blockchain

— Warren Davidson (@WarrenDavidson) February 14, 2019

In January 2019, the United Kingdom’s Financial Conduct Authority (FCA) released a 50-page consultation paper called “Guidance on Cryptoassets.”

In it, the FCA distinguishes between three types of tokens:

  1. Exchange tokens — “These are not issued or backed by any central authority and are intended and designed to be used as a means of exchange.“ They fall outside the regulator’s governing perimeter.
  2. Utility tokens — “These tokens grant holders access to a current or prospective product or service but do not grant holders rights that are the same as those granted by Specified Investments.” They may be within perimeter if they meet the definition of “e-money.”
  3. Security tokens — “These are tokens with specific characteristics that mean they meet the definition of a Specified Investment like a share or a debt instrument.” They are fully under the scope of the FCA’s regulations, if they meet the definition of a “Specified Investment.”

Switzerland’s Financial Market Supervisory Authority (FINMA) released its ICO guidelines on Feb. 16, 2018, stating each case must be decided on its individual merits but, similar to the FCA, also categorized tokens into three groups:

  1. Payment tokens — “Tokens may in some cases only develop the necessary functionality and become accepted as a means of payment over a period of time.” FINMA will not treat such tokens as securities but will require compliance with Anti-Money Laundering (AML) regulations.
  2. Utility tokens — “Intended to provide digital access to an application or service.” These tokens do not qualify as securities if their sole purpose is only to confer digital access rights to an application or service, and if the utility token can already be used in this way at the point of issue.
  3. Asset tokens — “Represent assets such as participations in real physical underlyings, companies, or earnings streams, or an entitlement to dividends or interest payments.” FINMA regards asset tokens as securities, which means that there are securities law requirements for trading in such tokens.

Other jurisdictions that allow regulated STOs include Singapore, Estonia and Malta.

Are all governments open to the idea of STOs?

In short, no.

Many countries have banned STO’s (and cryptocurrency trading in general), including China, South Korea, Vietnam, Algeria, Morocco, Namibia, Zimbabwe, Bolivia, India, Lebanon, Nepal, Bangladesh and Pakistan.

While in other countries — like Thailand, for example — STO regulations are not as clear-cut, as governments are still undecided as to how it should be regulated. Thailand’s Securities and Exchange Commission (Thai SEC) concluded that Thai-related STOs launched in an international market break the law.

But in an article by the Bangkok Post, deputy secretary of the Thai SEC, Tipsuda Thavaramara, indicated that the commission still has to decide how STOs will be regulated and that, at the moment, it will be looked at on a case-by-case basis.

“At the moment, we have not decided whether STOs fall under the SEC Act or the Digital Asset Act, but it depends on the STOs conditions and the details in its white paper.”

What are the advantages of an STO?

We can look at it from both an ICO perspective as well as an IPO perspective.

Compared to an ICO, STOs are seen as lower risk because the securities laws that security tokens have to comply with often enforce transparency and accountability. A security token will also be backed by a real-world asset, which makes it a lot easier to assess whether or not the token is priced fairly in relation to the underlying asset. With pure utility tokens, it can be difficult to assess the true value of a token and whether or not it is priced fairly.

Compared to traditional IPOs, an STO is cheaper because of the removal of middlemen, such as banks and brokerages. Smart contracts reduce the reliance on lawyers, while the blockchain reduces the need for paperwork. This makes the whole process not only cheaper, but also faster.

Fractional ownership and the ability to trade 24/7 bring additional liquidity to the market, especially with traditionally illiquid assets, such as scarce paintings, property and collectibles.

In an email to business and financial news network CNBC, Dan Doney, co-founder and chief executive of fintech firm Securrency, said:

“The ability to trade around the clock, with a range of currencies, offers investors both convenience and liquidity.”

These same characteristics open up the market to smaller investors who wouldn’t normally have access to the more avant-garde types of assets.

Finally, it’s good for blockchain adoption in the long-run. STOs are legally compliant, which means they are perceived to be less of a risk and will encourage institutional investors to come on board.

The more institutional investors start to invest, the less volatile the market is likely to become and the further blockchain adoption will grow.

What are the advantages of an STO?

What are the main challenges with STOs?

Increased regulation is the biggest challenge STO platforms face.

This places a bigger administrative burden on them, as processes will have to be set up for custodianship, tracking ownership, exchange approvals, Know Your Customer (KYC), AML, etc. to make sure they comply with the relevant securities laws. And although the process is seen as cheaper than a traditional IPO, the additional upfront work does make it more costly and raise the barrier of entry compared to utility ICOs.

Furthermore, by removing some of the middlemen like banks, brokerages and lawyers, the responsibility of performing these functions now falls on the shoulders of the company, which further increases the administrative burden.

The regulations in certain jurisdictions might also limit who can invest in the STO, which reduces the overall investor pool.

UK Auction House to Sell Off $430K in Crypto Confiscated by Belgian Police

U.K. and Ireland-based Wilsons Auctions partners with Belgium government to sell $430,000 in cryptocurrencies seized during police operations.

United Kingdom and Ireland-based auction house Wilsons Auctions will host its first Bitcoin (BTC) auction in late February as per a contract with the Belgian Federal Government. The news was announced in a blog post from the firm on Feb. 18.

The auction is set to sell off a total amount of about $430,000 in cryptocurrencies, which had previously been seized by the Belgium’s police as a result of a drug trafficking case involving the use of Darknet.

The 24-hour online auction starts on Feb. 28 at 12 p.m. GMT and will finish on March 1. According to the press release, it will be open for an international audience.

Wilsons Auctions says it will split the total amount of crypto (315 coins) into several lots. According to the company hosting the event, the amount includes 104.99 each of BTC, Bitcoin Gold (BTG) and Bitcoin Cash (BCH). Bitcoin lots will range from 0.5 to 4 BTC each, while BTG and BCH ones will contain more of each coin.

Additionally, the company is going to sell some BTC at its Unreserved Government Auction in Belfast, Northern Ireland, on Feb. 28. The amount of the coins was not disclosed in the announcement.

Wilsons Auctions’ Head of Asset Recovery, Aidan Larkin, stated that the auction is ready to offer other governments and law enforcement agencies globally their trusted solution and support in selling seized cryptocurrencies.

Earlier this year, Wilsons Auctions held a Monero (XMR) auction with bidders in 69 countries worldwide. At the time, the auction sold 167.7 XRM seized by U.K. law enforcement.

As Cointelegraph previously explained, auctions are quite frequently used to sell seized crypto, with the United States being one of the first countries to approach the issue. The Finnish government also conducted a similar auction last year, selling around 2,000 BTC that had been seized in 2016.

UAE’s Largest Real Estate Firm Emaar Denies Reports That It Accepts Crypto: Bloomberg

Emaar Properties, the developer of the world’s tallest building, Burj Khalifa, has officially denied that it enabled crypto payments for property.

The United Arab Emirates’ (UAE) largest real estate development firm, Emaar Properties, has officially denied reports that it enabled crypto payments for property, Bloomberg reported on Feb. 20.

Known for developing the world’s tallest building, Burj Khalifa — located in Dubai — the firm told Bloomberg that it currently accepts only fiat currencies, such as UAE Dirhams (AED) or United States dollars as payment for property purchases. The publication cited an Emaar Properties spokesperson as providing the confirmation.

In the report, Bloomberg cited Australian crypto-focused website Micky as one of websites that initially reported that the real estate giant had started accepting crypto. According the original report on Feb. 19, Emaar Properties allegedly allowed clients to purchase property with major cryptocurrencies, such as Bitcoin (BTC) and Ethereum (ETH), through a broker in Switzerland.

Subsequently, the news was posted by multiple real estate-related accounts on Twitter, including UAE-based Premier Estates.

Recently, Japan’s financial regulator, the Financial Services Agency (FSA), denied reports that it was considering allowing Bitcoin exchange-traded funds (ETFs) to operate in the country, following a false report from Bloomberg.

Meanwhile, property development company New World Development recently announced a joint venture to launch a blockchain platform for digital authorization in real estate processes. The Bank of China has reportedly become the first bank to sign up to use the platform, aiming to reduce paperwork operations.

Crypto Markets Show Slight Decline, as Do Dow Jones Industrial and S&P 500

All of the top 20 coins by market cap are seeing red today, with total market capitalization around $133 billion.

Thursday, Feb. 21 —  cryptocurrency markets are slightly sliding down, with most major coins seeing some noticeable losses, according to CoinMarketCap.

Market visualization from Coin360

Market visualization from Coin360

The top cryptocurrency Bitcoin (BTC) is trading around $3,944, having lost just 1 percent on the day at press time. Bitcoin’s weekly and monthly gains are positive, at about 8.92 percent and 5.1 percent respectively.

Bitcoin 24-hour price chart. Source: CoinMarketCap

Bitcoin 24-hour price chart. Source: CoinMarketCap

Top altcoin Ethereum (ETH) is trading around $145.38 at press time, down around 1.42 percent over the past 24 hours. Earlier today, the coin saw an upswing to $149.26, after which has been reporting a gradual decline over the course of the day. On its weekly chart, ETH is up 19 percent.

Ethereum 7-day price chart. Source: CoinMarketCap

Ethereum 7-day price chart. Source: CoinMarketCap

Ripple (XRP) has dropped  by 2.54 percent on the day, and is trading at $0.319 at press time. Ripple has secured a weekly growth of around 5 percent, while over the month the altcoin has lost 3.15 percent.

Ripple 7-day price chart. Source: CoinMarketCap

Ripple 7-day price chart. Source: CoinMarketCap

The major losers among the top 20 coins over the day are NEO, Cardano (ADA), and Litecoin (LTC), which are down by 5.62 percent, 5.10 percent, and 4.15 percent respectively.

Total market capitalization of all digital currencies is around $133 billion, while at the beginning of the day the figure was around $135 billion.

Total market capitalization 7-day chart. Source: CoinMarketCap

Total market capitalization 7-day chart. Source: CoinMarketCap

Earlier today, Japanese banking giant Mizuho Financial Group announced it will launch a bespoke stablecoin for payments and remittance services on March 1. The currency will reportedly be managed by a dedicated mobile app, dubbed J-Coin Pay, using QR codes at checkout to complete retail payments, fixed at a price of 1 yen (~$0.01) per unit.

The Dow Jones Industrial Average has seen a decline by 141 points today, while the S&P 500 dropped by 0.47 percent, led lower by the energy and health care sectors. The Nasdaq Composite has also seen a decline on the day by around 0.5 percent.

Markets have been concerned over the talks between the United States and China that aim to address the two nations’ ongoing trade war. According to CNBC, the two countries have begun to draw up Memoranda of Understanding, and outline a deal to end the economic conflict.