Daily Byte: Tuesday, November 27, 2018

November 27, 2018 6:23 PM

UK’s FCA Doubles Unlicensed Crypto Investigations

The Telegraph is reporting that the UK’s Financial Conduct Authority (FCA) has doubled the number of inquiries it is conducting into unlicensed crypto financial services. The regulator indicated that it is now questioning 50 firms, an increase from the 24 firms it was tracking as of May.

The FCA has also received seven whistleblowing reports from concerned crypto employees this year, compared to none for the previous three years.

«The huge sums lost as a result of cryptocurrency prices falling this year will have triggered a rash of complaints to the FCA,» Andrew Jacobs, a partner at accounting firm Moore Stephens, told The Telegraph. «Now that prices have collapsed, fraud is likely to be exposed, with greater pressure coming to bear on the FCA to ensure that this market can operate transparently and fairly.»

This rise corresponds to an industry-wide increase in complaints filed with regulators. In August, Kenneth Blanco, director of the US Financial Crime Enforcement network (FinCEN), pointed out that his agency received more than 1,500 crypto-related complaints per month.

Buterin: Some Blockchain Appropriation Can Be Fruitless

In an interview published yesterday, Vitalik Buterin – the creator of Ethereum – suggested he is not a fan of the across-the-board corporate adoption of blockchain technology.

«Sometimes it’s for marketing hype,» Buterin said to Quartz about the trend of applying blockchain technology to industrial and logistic applications. «Sometimes it’s just people who are genuinely excited about blockchains and want the thing they’re personally excited about and their job to align more with each other, which is a totally legitimate, human thing to want to do. In some cases, I think it leads to a lot of wasted time.»

Many companies are looking at blockchain or distributed ledger technology as a way of improving efficiencies in their existing systems. Through the tokenization of data, many complicated data processes – like real-time inventory and procurement tracking – can be reduced to simple operations.

While Buterin argues that there may be a place for blockchain in such applications, he feels that the principal parties involved, particularly IBM, are more interested in expanding their intellectual property portfolio than the technology.

Buterin feels that cryptocurrency and payment processing remain the best applications of blockchain technology, although he concedes that there may be some promising non-financial application of blockchain on the market.

Nasdaq Is Full Speed Ahead with Bitcoin Futures, Despite Market Turbulence

Bloomberg is reporting that the stock exchange Nasdaq is moving ahead with plans to list bitcoin futures. This is even though bitcoin prices have cratered in recent weeks.

Following the listing of bitcoin future offerings by the CME Group and Cboe Global Markets, the Commodity Futures Trading Commission ruled that exchanges seeking to list crypto futures must go through a more rigorous review process. Nasdaq has been working with the CFTC to complete this review with the hope that the futures can be listed by the first quarter of 2019.

Separately, Nasdaq is working with the US Securities and Exchange Commission to win approval for a crypto-based exchange-traded fund. Competitor New York Stock Exchange – owned by Intercontinental Exchange Inc. – is seeking to launch its own bitcoin contracts on January 24.

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Frederick Reese is a politics and cryptocurrency reporter based in New York. He is also a former teacher, an early adopter of bitcoin and Litecoin, and an enthusiast of all things geeky and nerdy.

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