Your Cryptocurrency Newsletter for 13 August, 2020

If you are interested in cryptocurrencies, this newsletter is for you. [img]  [Learn more about RevenueStripe...](   [Learn more about RevenueStripe...]( [img]( [FeedBinary Newsletter]( [NetCents-Visa Credit Card a Cryptocurrency Breakthrough Allowing Merchants Seamless Transactions Backed by a Financial Giant]( In a breakthrough announcement in the cryptocurrency market, Vancouver based NetCents (CSE:NC) (FSE:26N) (OTCQB: NTTCF) announced a collaboration with Visa introducing the NetCents Visa credit card. The co-branded card enables crypto currency wallet holders and traders a real-time seamless purchasing power using crypto currencies for in-store and online transactions with the more than 40 million merchants that accept Visa worldwide. Its common knowledge that the biggest deterrents for merchants to accept cryptocurrency for retail and business transactions are volatility and liquidity. Last month NetCents took a dead aim on the volatility deterrent by securing an institutional credit facility totaling 1.4 billion USD to power merchant settlements. Announced on June 22, this development enables to NetCents to eliminate the high volatility risk for all of its merchants essentially acting as ‘market-maker’. As an added bonus the line of credit will allow NetCents to ‘float’ currency in the market over extended periods allowing the company to profit from arbitrage trading opportunities. The earnings from this arbitrage, according to NetCents founder and CEO, Clayton Moore will ultimately allow NetCents to reduce fees to its client base. Industry watchers and investors responded resoundingly positive to the news catapulting the stock from mid-June lows $0.50 to highs of $2.26 during the week of the announcement. This next catalyst, directly address the crypto liquidity and adaptability barriers could provide another surge to its recent high and beyond. “We’re allowing NetCents users to spend our cryptocurrency in real time, says Moore. “Unlike most of the crypto cards in the market, our is not just a pre-loaded or adjusted credit card, which is a simple integration. We’re modifying our instant settlement technologies and tethering them directly into our user wallets. There’s no need to go online and top up your card, so for all intents and purposes it works like a debit card but with the functionality of a credit card.” The irony, according to Moore, is that the whole process is transparent to the merchant. “The card works like any other credit card.” He points to how far the industry has evolved in such a short period. “Two years ago, you buy one bitcoin it would take you 16 hours to get a confirmation that you actually bought it. Here we are today enabling real time credit card cryptocurrency transactions all over the world.” Another key differentiating factor of the card is that the NetCents Visa enables its users to spend up to three separate cryptocurrencies on the card. Using any of its instant settlement clients such as Bitcoin, Lightcoin, Ethereum, BitCoin Cash and Ripple, the user will be able to pair to their credit card and will be asked at sign-up to rank them in priority order. “If they’re doing a $1,000 transaction, we can do partial settlement against all three coins in a single transaction.,” says Moore. “According to Visa they are not aware of anyone else doing that.” Additionally, since the coin stays in the user’s crypto wallet, there is no risk of financial loss caused by losing the physical card. Beyond the obvious branding benefits, the arrangement bodes well for NetCents, firstly for a wealth data and secondly NetCents now deals directly with Visa rather than through its other partnerships. One of the big problems with the credit card and merchant payment industry adoption is the limited dataset that the vendor has to work with. “What were going to get is unfettered access,” says Moore. “If there are no limiting factors on where you can spend your crypto currencies, where do users want to spend it? We’ll have all that first party data that we’ll be able segment into specific merchant, whether its United Airlines or Starbucks. We can now reach out to them directly, informing them we did $5 million in transactions via crypto that they were not aware of, and that was just a small percentage of users.” Should merchants be paying in attention? Just to bring you up to speed, there are approximately 5,392 cryptocurrencies being traded with a total market capitalisation of $201bn (as of April 22, 2020). As expected, the top ten make up more than 85% of that market with Bitcoin reigning supreme at 63%. The card is arriving on the scene at exactly the right time, research shows that crypto investors are increasingly becoming interested in seeking ways to transact with their crypto, rather than just hold them as a store of wealth. The market is maturing as well – there are about 50 million crypto wallets in use globally, and that number is increasing by 10 million wallets a year – any rally in crypto will cause the growth rate spike as well. After citing numerous transactions, NetCents can present its case to a now-trusting merchant who has much more confidence in bullet-proof crypto-transaction system. “At that point we convert them to sign up directly so you’re no longer dealing with interchange fees and chargebacks or fraud. We’ll open the vendor up to the entire cryptocurrency eco-system. We see it as a huge data play to not only drive the user adoption and become that bridge solution, but then be able to mine that data, whether its industry or merchant specific and do really targeted business development and do outreach to these merchants.” Enabling more users and targeting more merchants on a viral level (hate to use that word, however it fits here) can have a parabolic effect on a provider such as NetCents, who are ‘fast’ becoming a ‘long-time’ established cryptocurrency eco-system. Investors should keep an eye on NetCents as the Crypto Industry reaches maturity and is now becoming investment grade. Coinbase has been hinting at a $12 billion dollar IPO. This means that institutions are looking to have some crypto exposure in their portfolios – as it is one of the fastest growing market segments in the financial services industry. Legal Disclaimer/Disclosure: While all information is believed to be reliable, it is not guaranteed by us to be accurate. Individuals should assume that all information contained in our article is not trustworthy unless verified by their own independent research. Also, because events and circumstances frequently do not occur as expected, there will likely be differences between any predictions and actual results. Always consult a licensed investment professional before making any investment decision. Be extremely careful, investing in securities carries a high degree of risk; you may likely lose some or all of the investment. Furthermore, it is certainly possible for errors or omissions to take place regarding the profiled company, in communications, writing and/or editing. Nothing in this publication should be considered as personalized financial advice. We are not licensed under any securities laws to address your particular financial situation. No communication by our employees to you should be deemed as personalized financial advice. Please consult a licensed financial advisor before making any investment decision. This is a paid advertisement and is neither an offer nor recommendation to buy or sell any security. We hold no investment licenses and are thus neither licensed nor qualified to provide investment advice. The content in this article is not provided to any individual with a view toward their individual circumstances. Baystreet.ca has been paid a fee of five thousand dollars for NetCents Technology Inc. advertising from Financial Press. There may be 3rd parties who may have shares of NetCents Technology Inc. and may liquidate their shares which could have a negative effect on the price of the stock. This compensation constitutes a conflict of interest as to our ability to remain objective in our communication regarding the profiled company. 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[Read Full Story]( ------------------ [Following OCC Letter, Some US Banks Appear Open to Providing Crypto Services]( Major U.S. banks might be willing to support cryptocurrency services – with just a bit of additional guidance from the Office of the Comptroller of the Currency (OCC), their federal regulator. Multiple national banks responded to the OCC’s June “Advance Notice of Proposed Rulemaking” (ANPR), which asked the general public to weigh in before Aug. 3. on how cryptocurrencies and other fintech tools might be used in the financial sector. Notably, several banks, including U.S. Bank and PNC, indicated they might be interested in actually providing crypto custody and other services to customers. The responses by just under a dozen banks, among a total of 89 submissions from think tanks, policy advocates, crypto startups and other entities, represent one of the strongest signs yet that traditional financial institutions view the still-nascent crypto space as a legitimate asset class. The responses contrast sharply with an open letter sent to Acting Comptroller of the Currency Brian Brooks. The letter, which opposed a narrow payments charter for fintech companies, was signed by many of the same respondents and sent to the OCC on July 29. Fresh guidance from the OCC may help provide the necessary legal comfort for banks to provide crypto-native analogs to traditional bank services, wrote Juan Saurez, Coinbase’s vice president and general counsel for enterprise. “Although these services, such as borrowing, lending and remittances, are permissible activities for national banks, there remains some uncertainty as to whether the provision of these services using cryptocurrencies is authorized,” he said. Peter Najarian, chief revenue officer at BitGo, told CoinDesk the ANPR’s very existence is exciting, as it’s “a frankly inevitable step in the maturing of this ecosystem.” Clarifying treatment Dominic Venturo, chief digital officer at U.S. Bank National Association, perhaps went the furthest in his response, writing that the OCC and other banking regulators should issue guidance around the cryptocurrency market as well as the “expectations for services conducted on distributed ledger technology.” A lack of clear regulations might result in both banks and customers being unwilling to invest or use cryptocurrencies and similar digital assets, he wrote, with customers potentially being interested in investing in crypto, funding traditional financial products, using cryptos as payments, tokenizing physical assets. “U.S. Bank does not have a position on the role that cryptocurrency should undertake in the financial services sector, but merely seeks additional regulatory clarity to service the cryptocurrency market as it is currently structured or may be structured in the future,” he wrote. Specifically, he suggested the OCC differentiate between utility tokens, stablecoins and exchange tokens; clarify the requirements for providing custody services; cross-border restrictions; and “the extent consensus rules must be a part of a transaction.” PNC Bank’s head of technology and innovation, Steven Van Wyk, commented that the OCC should “continue to reinforce that national banks should take a risk-based approach” in reviewing new products, but should not have risk elimination as the ultimate goal. “All banking activities (including deposit-taking and lending) involve risk, and the implementation of new technologies … necessarily will involve some degree of risk,” Van Wyk wrote. “A supervision framework that is focused only on preventing risk will, almost by necessity, prevent responsible innovation and the implementation of new technologies by national banks.” User protections Financial institutions – and OCC rulemaking – should have some focus on consumer protections, several of the responses indicated. Banks might even need to be encouraged to use “privacy-enhancing cryptocurrency technologies,” wrote Peter Van Valkenburgh, Coin Center’s director of research. He said banks are obligated to both protect their customers’ privacy as well as surveil and report activities that may break the law. In his view, they can do this effectively with privacy coins and other tools. Banks can conduct know-your-customer checks and otherwise identify their users to comply with relevant laws before providing privacy services by using mixers or other tools to facilitate crypto transactions. “They should perform heightened due diligence on any payments their customers initiate or receive if either the amounts involved are substantial or a suspicious pattern of behavior has emerged with respect to several smaller transactions,” Van Valkenburgh wrote. Tina Woo, senior managing counsel for regulatory affairs at Mastercard, also suggested consumer protection rules by the OCC would be helpful, addressing both security and privacy concerns. The OCC should develop criteria for which “types of cryptocurrencies in which banks may transact,” she wrote, which address “core network principles” including protecting consumers and preventing money laundering or terrorist financing. “We believe cryptocurrencies and blockchain technology hold the potential to enhance operational resiliency, improve auditability, and enable new functionalities,” she wrote. ‘Based on confidence’ Not all submissions were positive: some expressed concern about relaxing regulations. Cornell Law School Professor Dan Awrey, Wharton Financial Institutions Center Senior Fellow James McAndrews and Columbia Law School Academic Fellow and Lecturer Lev Menand wrote the OCC’s ANPR has two major flaws: “an excessive focus” on finding ways to relax existing rules and “its narrow focus” in updating the regulatory framework for national banks and savings associations. Menand is an advocate for a digital dollar structure, and supported efforts to introduce a digital dollar in multiple congressional bills earlier this year. “Money and payment systems are based on confidence,” the three wrote. “In the case of the national banking system, this confidence stems from highly sophisticated regulatory frameworks that govern national banks. These regulatory frameworks include federal deposit insurance, access to central bank liquidity support and a special resolution regime.” In other words, individuals trust banks because of a strict regulatory regime that lets them deposit their funds secure in the knowledge their money is safeguarded. The ANPR notes that many new financial technologies exist because newly created institutions and platforms try to perform banking functions but aren’t regulated like traditional banks. The OCC should consider whether it makes more sense to strengthen regulations around non-bank financial institutions, which the letter refers to as “shadow payment systems.” New financial technology firms that sprung up in recent years, including stablecoin issuers and companies like PayPal, operate in a murky regulatory environment that requires far fewer protections than banks face. To resolve these concerns, the three said Congress could pass new laws requiring these startups hold insured deposits and deposits at commercial banks. Stablecoin issuers could be required to maintain either the sum total of U.S. dollars or the U.S. dollar equivalent of issued tokens at a bank. “The OCC should recommend that Congress enact new legislation to address the shortcomings in our existing regulatory framework. Such legislation can be quite simple,” they wrote. Third party help Banks don’t necessarily have to provide crypto services directly. BitGo, which has offered custody services for over a year, believes that banks should be able to tap sub-custodians to provide these services, Najarian said. This would relieve banks of the technological and resource burden that would come of having to directly build out their own services. Miller Whitehouse-Levine at the Blockchain Association told CoinDesk he agreed. The industry organization recommended letting third parties provide certain services for banks in its own response, he said. “The OCC permits banks to engage third parties to conduct what they consider to be critical bank activities,” he told CoinDesk. Visa Vice President for Global Regulatory Affairs Ky Tran-Trong wrote that the payment rail wants to be an intermediary for cryptocurrencies and its 61 million merchants. “Our objective is to enable digital currency users to spend from their digital currency balance using a Visa debit or prepaid credential anywhere Visa is accepted,” Tran-Trong said in the letter. R3, another third-party service provider, touted its integrations with SWIFT, Nasdaq and Deutsche Börse Group, noting these partnerships have allowed participants in financial transactions to monitor these transactions more efficiently than traditional tools provided for. In particular Nasdaq has launched a platform tapping R3 to help manage issuance and other services, wrote Isabelle Corbett, R3’s global head of government relations. Ongoing dialogue Kristin Boggiano, founder of the Digital Asset Regulatory and Legal Alliance and co-founder of trading platform CrossTower, told CoinDesk the OCC is in its initial stage of rulemaking, meaning this is the best time for the industry to express its concerns and make suggestions to the agency. “Once the broad policy has been etched, market participants and regulators will move to proposed rulemaking,” she said through a spokesperson. “At that stage, the ability to engage in dialogue about policy and the broad framework becomes more difficult. Thus, this is a critical time for market participants and regulators to jointly develop a framework in which all stakeholders are comfortable.” A wide range of industry participants appear to agree: Novi (the rebranded Facebook subsidiary Calibra), ConsenSys, Celo, Axos Bank, the American Bankers Association, Figure Technologies, Chamber of Digital Commerce, Silvergate Bank, Ripple Labs and other respondents all supported the idea that banks and savings institutions can safely handle crypto-related services with the right amount of regulation. The Blockchain Association’s Kristin Smith told CoinDesk it is important, as a first step, for any entity that has a stake in the crypto industry to ensure it weighs in with the OCC.. Visa’s Tran-Trong summed up his hope for the OCC’s ultimate rulemaking process by calling for new regulation that still allows for innovation: “We recognize that enterprise adoption of blockchain technology can improve several core functions in financial services by providing tamper evident and tamper resistant digital ledgers. However, absent further innovations, inherent challenges with respect to improving scalability, security and device usage, can limit consumer adoption and fail to meet regulatory standards,” he wrote. [Read Full Newsletter]( The post [Following OCC Letter, Some US Banks Appear Open to Providing Crypto Services]( appeared first on [Feed Binary](. [Read Full Story]( ------------------ [INSIGHT: Coinbase Could Become First-Ever Public U.S. Crypto Exchange]( Global cryptocurrency platform Coinbase is reportedly in talks with investment banks and law firms about going public, says Louis Lehot, founder of L2 Counsel. This would lend legitimacy to other companies building the cryptocurrency ecosystem and potentially pave the way for future IPOs. It’s considering using a direct listing, which is gaining in popularity, as private companies become less dependent on IPOs as a fundraising mechanism. Rumor has it Coinbase could be the first major player in the U.S. cryptocurrency industry to go public, and using the mechanism of a direct listing, instead of a traditional initial public offering. Popular American-based cryptocurrency trading platform Coinbase has rumored plans to pursue a public debut later this year, or early next year—making the company the latest mega-startup to approach the public markets. The company has not yet officially announced its plans to go public, but has reportedly been in talks with investment banks and has spoken with law firms, which would mark a significant milestone for the crypto market. Founded in 2012, Coinbase is one of—if not the—most well-known cryptocurrency platforms globally, with over 35 million users who trade virtual coins, including bitcoin, ethereum, and XRP. The New York Stock Exchange, BBVA, and former Citigroup Inc. CEO Vikram Pandit are among the San Francisco-based company’s many investors. Additionally, back in 2017, it was one of the top beneficiaries of the bitcoin BTC=BTSP boom, when the original cryptocurrency jumped from $1,000 to almost $20,000. For the last several years, cryptocurrency exchanges and related businesses have been in limbo in the U.S., as traditional banks have shunned the industry, and the Securities and Exchange Commission has issued regulatory guidance that many digital coins are securities, following up with enforcement actions when offerings of securities proceed without complying with securities regulations. A new stock market listing for Coinbase would lend legitimacy to other companies building the cryptocurrency ecosystem, and potentially pave the way for future IPOs. Direct Listing Might Be Pursued According to Reuters, Coinbase may pursue a direct listing for its shares, instead of a traditional initial public offering. A direct listing enables a company’s existing shares of common stock to trade publicly on a national securities exchange without formally pricing a new block of equity through underwriters following a traditional book-building process. In recent years, direct listings have become much more popular to achieve efficient pricing, as private companies became less dependent on IPOs as a fundraising mechanism. Driving this move to direct listings, some of Silicon Valley’s most elite entrepreneurs and venture capitalists have become disenchanted with the underpricing of IPOs, which sometimes force companies going public to leave tens or hundreds of millions of dollars on the table. This is because the customers of underwriters of traditional IPOs expect the IPO price to be discounted to true valuation to enable a first day bump in the post-IPO closing price of 20% or more. Today, Coinbase is archetypal for the sort of company that might consider a direct listing: it is wealthy, having raised over $500 million during its time as a private company, and has a significant brand and following. Coinbase’s most recent private financing of $300 million valued it at $8 billion, according to data published by Crunchbase. The direct listing process, contrary to the traditional book-building IPO, involves existing shareholders of a startup selling secondary shares to the public directly over a national securities exchange, instead of the issuer working with Wall Street underwriters to issue new blocks of shares, and those underwriters selling them on to their preferred accounts. Like other recent businesses that have pursued a direct listing, including Spotify and Slack, Coinbase has a similar profile, with a high valuation, significant cash reserves and a substantial customer following and brand. SEC Blessing Needed Coinbase co-founder Fred Ehrsam recently said the company is “spiritually” built to go public through a token offering, and many of its employees would be disappointed if it pursues a typical Wall Street IPO. However, any blockchain offering, even a hybrid one, would depend on the blessing of the SEC. And, that could perhaps be a hard bargain given the SEC’s recent enforcement actions against Telegram and other token issuers. The term “Coinbase effect” describes the price boost many cryptocurrencies have had as a result of being listed on Coinbase, which often occurs because Coinbase is the primary gateway to crypto for many buyers. So, given Coinbase’s status in the crypto industry, a successful IPO could create a ripple effect that boosts the price of Bitcoin, Ethereum, and others. On the other hand, if Coinbase fails, crypto prices could plummet dramatically. Additionally, Coinbase may take into account the state of the broader cryptocurrency market in deciding when to go public—as cryptocurrencies are known to be volatile, and prices and trading activities have been in a slump. Historically, Coinbase’s financial past has been opaque, with media reporting its 2017 revenue at around $1 billion, boosted by that year’s crypto-mania. In 2018, how Coinbase performed is less clear, although media reports described its diminishing performance alongside that of the currencies that it trades. The company’s S-1 filing will provide insight into the company’s historical financial performance, allowing the public to see how Coinbase fared during various crypto-booms and busts. Since being founded in 2012, Coinbase has raised a total of $547 million. In October 2018, its Series E round valued the company at $8 billion. As new companies like Compound and Kyber continue to use innovative methods to provide ownership of platforms to users, a direct listing could be a cost-efficient way for Coinbase to give users access to company shares. With public markets at an all-time high and valuations for tech stocks out-performing the broader indeces, it’s not surprising that valuable unicorns are getting ready for a run on the public markets. [Read Full Newsletter Here]( The post [INSIGHT: Coinbase Could Become First-Ever Public U.S. Crypto Exchange]( appeared first on [Feed Binary](. [Read Full Story]( ------------------ [Russia Backs Away From Total Cryptocurrency Ban]( Russia recently signed a new cryptocurrency law that while stopping short of the previous ban on cryptocurrencies, still imposed stringent restrictions on its use in as form of monetary currency. This followed an earlier regulatory filing that essentially associated any activities involving cryptocurrencies as criminal, and placed them under the lens of anti-money laundering regulations. Starting January 1st, 2021, cryptocurrencies will be allowed in Russia, though they will not be allowed to be used in exchange for any goods or services. There may be more regulation coming in upcoming sessions, but as of now, it seems that Russians can mine, trade cryptocurrencies for other cryptocurrencies on exchanges, and own cryptocurrencies without any legal issues — so long as they don’t spend it on other goods and services within the domestic economy. Russian banks will be allowed to open up cryptocurrency exchanges under the supervision of the central bank — and new digital currencies can be issued, but only again, under the control of the central bank. This represents a more liberal attitude than what some had predicted would be a near-total ban on cryptocurrency activity in Russia, and shows a more pragmatic attitude towards cryptocurrencies and their adoption in Russia. The story of the legislation surrounding Russia’s attitude to cryptocurrency is nuanced, but follows some common themes. Cryptocurrency is portrayed as “criminal” while blockchain is seen in a neutral-to-positive light. This echoes the Chinese state’s view on the binary nature between what are essentially two sides of the same coin: the blockchain, a public ledger upon which cryptocurrencies are built upon that is seen as an essential yet centralizing force to help governments accelerate the benefits of digitization — and cryptocurrencies, which are regarded as eroding domestic power and currency. Indeed, one of the strongest opponents of cryptocurrencies in Russia has been the central bank, which in September 2017, issued a letter warning of criminal acts associated with cryptocurrencies. This followed a 2014 letter where the central bank warned that cryptocurrencies could be used for money laundering and to support terrorism. The central bank came out and said that cryptocurrencies were more like gambling than any kind of investment recently and said that the government should do nothing to encourage citizens to use cryptocurrencies. In the background are Russia’s stringent new Internet regulations, Russia’s Sovereign Internet Bill. Russia’s Internet censor, and even satellite Internet providers are required to use ground relays that are regulated by the Russian state. In this way, Russia’s digital tools allow for a total surveillance state of digital activity. The new cryptocurrencies regulation borrows from a similar approach — a strong centralized government institution (in this case, the Bank of Russia) through which all transactions flow, and a begrudging acceptance of the pragmatic reality that many Russian citizens have adopted and used cryptocurrencies, from the dramatic rise of Russia-hosted ICOs, to Russia-based social media network VK considering its own cryptocurrency. In many ways, the story of cryptocurrencies follows some themes of Telegram overcoming censorship through popular adoption. Eventually, government officials started using Telegram to transmit messages themselves, and while Roscomnadzor set up multiple IP blocks — Telegram engineers worked around the clock to ensure that security, privacy and uptime were as guaranteed as possible under the circumstances. Finally, the Russian government bowed to the inevitable and used Telegram to transmit critical health information during the COVID-19 pandemic. Similarly, cryptocurrency protocols are built to be as resilient and are incentivized to be usable for many local contexts despite its global focus. Attempts to censor or control the flow of cryptocurrencies will be countered somewhat by their popular adoption and also by government projects seeking to use adjacent blockchain ideas to digitize and scale their control. It’s a bottoms-up way of articulating democratic principles in technology choices, which forces top-down approaches to moderate. This may just be another case of this. As cryptocurrency adoption continues proliferating in Russia, it seems to have stopped the decree of a total ban — for now. [Read Full Newsletter]( The post [Russia Backs Away From Total Cryptocurrency Ban]( appeared first on [Feed Binary](. [Read Full Story]( ------------------ You Might Like     [Learn more about RevenueStripe...]( ------------------ Connect with TheFeedBinary on Facebook and Twitter [fb](  [tw]( ------------------ You received this email because you operate or create content for a website/service and based on your website it seemed like this could be important information to you and your users. Want to change how you receive these emails? [Update your preferences]( or [Unsubscribe](