DNotes 2.0 - Staking, CRISP Interest, DNotes Pay

[Dyna]

Reuters etc are reporting that South Korea are banning ICOs.

http://www.reuters.com/article/us-southkorea-bitcoin/south-korea-bans-raising-money-through-initial-coin-offerings-idUSKCN1C408N

ICO is a great tool to raise start-up capital from around the world with relatively little efforts of time and other resources. It often comes with deep discount for early participants and almost instant "exit strategy" if one chooses to cash-in. Unfortunately, this has been turning out to be a power-grab - well a quick cash grab - a very attractive tool for bad actors. It is becoming a serious problem for our industry; likely to cause a regulatory over-reach including out right ban of ICOs as in the case of China and now Korea.

[1713291580]

1713291580

[1713291580]

1713291580

[1713291580]

1713291580

[GetBABB]

https://s22.postimg.org/gvcxmbstd/kr_MHp_Fplp_Ew_ZPGBi_OXMBdasvw2_EEqi_GD91_OF32uh8qg.jpg


There are a lot of kinks to work out and yes, "blockchain" is the buzzword of the year, but I believe that it will be the solid cryptocurrencies that finally provide this economic inclusion that the traditional banks have so far failed to deliver.


Two billion people lack access to a bank account. Here are 3 ways blockchain can help them

https://www.weforum.org/agenda/2017/06/3-ways-blockchain-can-accelerate-financial-inclusion/

You might be interested in what BABB is proposing in terms of reducing economic inclusion? It's a story of why we no longer need to rely on banks, and how BABB is going to make it happen, from its founder Rushd Averroes.

[DNotes]

There are a lot of kinks to work out and yes, "blockchain" is the buzzword of the year, but I believe that it will be the solid cryptocurrencies that finally provide this economic inclusion that the traditional banks have so far failed to deliver.


Two billion people lack access to a bank account. Here are 3 ways blockchain can help them

https://www.weforum.org/agenda/2017/06/3-ways-blockchain-can-accelerate-financial-inclusion/

You might be interested in what BABB is proposing in terms of reducing economic inclusion? It's a story of why we no longer need to rely on banks, and how BABB is going to make it happen, from its founder Rushd Averroes.

Thanks GetBABB, DNotes has some similar goals for the future. We will look into it and follow your updates and we wish you the best of luck.

[DCEBrief]

Japanese Banks May Launch New Digital Currency Called J-Coin

https://dcebrief.com/japanese-banks-may-launch-new-digital-currency-called-j-coin/

[Chase]

Let's hope the SEC continues to focus on fraudulent activities only, allowing the reputable projects to grow and better the world.


Press Release  -  SEC Exposes Two Initial Coin Offerings Purportedly Backed by Real Estate and Diamonds

https://www.sec.gov/news/press-release/2017-185-0

[TimMarsh]

Let's hope the SEC continues to focus on fraudulent activities only, allowing the reputable projects to grow and better the world.


Press Release  -  SEC Exposes Two Initial Coin Offerings Purportedly Backed by Real Estate and Diamonds

https://www.sec.gov/news/press-release/2017-185-0

It's really rather sad though isn't it? Clearly Zaslavskiy was not being honest by selling a product that was of no value. I'm glad that the SEC is taking action and agree with Chase that it would be great to see SEC continue on this path.

But I feel like anyone investing in tokens based on real estate value, without checking what real estate is owned already, and then hoping to make money on the increased value of said real estate, is not undertaking due diligence. I don't think anyone who bought into the real estate ICO would be satisfied with a 1%–4% increase in value annually. But that is what history tells us is the most we should expect, and that is little more than inflation or bank investments offer.
http://www.investopedia.com/articles/mortages-real-estate/11/the-truth-about-the-real-estate-market.asp
http://www.nytimes.com/imagepages/2006/08/26/weekinreview/27leon_graph2.html
https://michaelbluejay.com/house/appreciation.html

Instead, I'm certain that they were hoping that a token with some real-world value attached to it would be very successful and quickly appreciate in value. But that notion just illustrates how poorly "real-world value" is understood. If US$100 million was raised in ICO, and if the ICO consortium invested all of that money in real estate purchases that didn't require legal fees, agent fees, taxes or any other normal real estate transaction cost, the consortium would own US$100 million worth of real estate. Then, if the token sold at ICO for US$1 was offered on exchanges for US$1.10, it would take a fool to buy it because the only person who would buy it from them in turn would be a greater fool. The token can never be worth more than the real estate purchased, plus real estates increase in market value, minus the sales cost.

So it is hard to feel sorry for anyone who bought a token representing real estate, and hoping to earn anything above an averaged real estate investment. And doing so in an unregulated ICO framework is less secure than some person setting up a ledger down the pub on the back of a beer coaster, asking for people to write him US$10,000 checks that he'll buy some shared property with, but refuses to tell you his name or show you identification.

I don't like people with insufficient earnings being blocked from investing in securities, or the government taking on a parental role. But when this level of foolishness is abundant enough for ICOs to foster a booming market, I almost understand the need for these controls. I'd rather see the efforts go into teaching basic mathematics though.

[Chase]

Let's hope the SEC continues to focus on fraudulent activities only, allowing the reputable projects to grow and better the world.


Press Release  -  SEC Exposes Two Initial Coin Offerings Purportedly Backed by Real Estate and Diamonds

https://www.sec.gov/news/press-release/2017-185-0

It's really rather sad though isn't it? Clearly Zaslavskiy was not being honest by selling a product that was of no value. I'm glad that the SEC is taking action and agree with Chase that it would be great to see SEC continue on this path.

But I feel like anyone investing in tokens based on real estate value, without checking what real estate is owned already, and then hoping to make money on the increased value of said real estate, is not undertaking due diligence. I don't think anyone who bought into the real estate ICO would be satisfied with a 1%–4% increase in value annually. But that is what history tells us is the most we should expect, and that is little more than inflation or bank investments offer.
http://www.investopedia.com/articles/mortages-real-estate/11/the-truth-about-the-real-estate-market.asp
http://www.nytimes.com/imagepages/2006/08/26/weekinreview/27leon_graph2.html
https://michaelbluejay.com/house/appreciation.html

Instead, I'm certain that they were hoping that a token with some real-world value attached to it would be very successful and quickly appreciate in value. But that notion just illustrates how poorly "real-world value" is understood. If US$100 million was raised in ICO, and if the ICO consortium invested all of that money in real estate purchases that didn't require legal fees, agent fees, taxes or any other normal real estate transaction cost, the consortium would own US$100 million worth of real estate. Then, if the token sold at ICO for US$1 was offered on exchanges for US$1.10, it would take a fool to buy it because the only person who would buy it from them in turn would be a greater fool. The token can never be worth more than the real estate purchased, plus real estates increase in market value, minus the sales cost.

So it is hard to feel sorry for anyone who bought a token representing real estate, and hoping to earn anything above an averaged real estate investment. And doing so in an unregulated ICO framework is less secure than some person setting up a ledger down the pub on the back of a beer coaster, asking for people to write him US$10,000 checks that he'll buy some shared property with, but refuses to tell you his name or show you identification.

I don't like people with insufficient earnings being blocked from investing in securities, or the government taking on a parental role. But when this level of foolishness is abundant enough for ICOs to foster a booming market, I almost understand the need for these controls. I'd rather see the efforts go into teaching basic mathematics though.

There will always be greed and foolishness in investing from people who should know better. The really sad part in my opinion, is that the majority of people don't have the basic knowledge to even grasp the concept of due diligence, how to accomplish it, or why it is necessary. You are right in improving math skills, and everyone should have the opportunity to become financially literate (and literate), but understanding the complexities of real estate investment 'schemes' of any kind are likely out of the realm of comprehension for most of them, with or without education. Not offering some form of protection for these people leaves me feeling like we are no better than some of the world's wealthiest 1%, that got to where they are on the backs of innocent people.

[Dyna]

Let's hope the SEC continues to focus on fraudulent activities only, allowing the reputable projects to grow and better the world.


Press Release  -  SEC Exposes Two Initial Coin Offerings Purportedly Backed by Real Estate and Diamonds

https://www.sec.gov/news/press-release/2017-185-0

It's really rather sad though isn't it? Clearly Zaslavskiy was not being honest by selling a product that was of no value. I'm glad that the SEC is taking action and agree with Chase that it would be great to see SEC continue on this path.

But I feel like anyone investing in tokens based on real estate value, without checking what real estate is owned already, and then hoping to make money on the increased value of said real estate, is not undertaking due diligence. I don't think anyone who bought into the real estate ICO would be satisfied with a 1%–4% increase in value annually. But that is what history tells us is the most we should expect, and that is little more than inflation or bank investments offer.
http://www.investopedia.com/articles/mortages-real-estate/11/the-truth-about-the-real-estate-market.asp
http://www.nytimes.com/imagepages/2006/08/26/weekinreview/27leon_graph2.html
https://michaelbluejay.com/house/appreciation.html

Instead, I'm certain that they were hoping that a token with some real-world value attached to it would be very successful and quickly appreciate in value. But that notion just illustrates how poorly "real-world value" is understood. If US$100 million was raised in ICO, and if the ICO consortium invested all of that money in real estate purchases that didn't require legal fees, agent fees, taxes or any other normal real estate transaction cost, the consortium would own US$100 million worth of real estate. Then, if the token sold at ICO for US$1 was offered on exchanges for US$1.10, it would take a fool to buy it because the only person who would buy it from them in turn would be a greater fool. The token can never be worth more than the real estate purchased, plus real estates increase in market value, minus the sales cost.

So it is hard to feel sorry for anyone who bought a token representing real estate, and hoping to earn anything above an averaged real estate investment. And doing so in an unregulated ICO framework is less secure than some person setting up a ledger down the pub on the back of a beer coaster, asking for people to write him US$10,000 checks that he'll buy some shared property with, but refuses to tell you his name or show you identification.

I don't like people with insufficient earnings being blocked from investing in securities, or the government taking on a parental role. But when this level of foolishness is abundant enough for ICOs to foster a booming market, I almost understand the need for these controls. I'd rather see the efforts go into teaching basic mathematics though.

There will always be greed and foolishness in investing from people who should know better. The really sad part in my opinion, is that the majority of people don't have the basic knowledge to even grasp the concept of due diligence, how to accomplish it, or why it is necessary. You are right in improving math skills, and everyone should have the opportunity to become financially literate (and literate), but understanding the complexities of real estate investment 'schemes' of any kind are likely out of the realm of comprehension for most of them, with or without education. Not offering some form of protection for these people leaves me feeling like we are no better than some of the world's wealthiest 1%, that got to where they are on the backs of innocent people.

The cleaning up of fraudulent activities is a good thing for our industry. Being ignorant or failure to do sufficient due diligent and consequently being cheated because of the swindler’s false claims and misrepresentations is not a crime. The same applies to our inherent greed and fear. Unfortunately, the laws of the land must seek to protect consumers irrespective of their sophistication or ignorance.

So, I would expect that the crack down on fraudulent activities to continue and that it would lead to more regulations and better legal guidance. I just hope that this will not lead to regulatory over-reach or so burdensome that it stifles innovations. The potential good our industry can bring about to mankind will out-weight any growing pains.

For our part, DNotes must continue to help in educating the general public and lead as a role model in doing the right things that benefit others as we strive for our own success. There is nothing wrong for being successful, including wealth accumulation. I just don't like it done at the expense of others.

[DNotes]

Let's hope the SEC continues to focus on fraudulent activities only, allowing the reputable projects to grow and better the world.


Press Release  -  SEC Exposes Two Initial Coin Offerings Purportedly Backed by Real Estate and Diamonds

https://www.sec.gov/news/press-release/2017-185-0

It's really rather sad though isn't it? Clearly Zaslavskiy was not being honest by selling a product that was of no value. I'm glad that the SEC is taking action and agree with Chase that it would be great to see SEC continue on this path.

But I feel like anyone investing in tokens based on real estate value, without checking what real estate is owned already, and then hoping to make money on the increased value of said real estate, is not undertaking due diligence. I don't think anyone who bought into the real estate ICO would be satisfied with a 1%–4% increase in value annually. But that is what history tells us is the most we should expect, and that is little more than inflation or bank investments offer.
http://www.investopedia.com/articles/mortages-real-estate/11/the-truth-about-the-real-estate-market.asp
http://www.nytimes.com/imagepages/2006/08/26/weekinreview/27leon_graph2.html
https://michaelbluejay.com/house/appreciation.html

Instead, I'm certain that they were hoping that a token with some real-world value attached to it would be very successful and quickly appreciate in value. But that notion just illustrates how poorly "real-world value" is understood. If US$100 million was raised in ICO, and if the ICO consortium invested all of that money in real estate purchases that didn't require legal fees, agent fees, taxes or any other normal real estate transaction cost, the consortium would own US$100 million worth of real estate. Then, if the token sold at ICO for US$1 was offered on exchanges for US$1.10, it would take a fool to buy it because the only person who would buy it from them in turn would be a greater fool. The token can never be worth more than the real estate purchased, plus real estates increase in market value, minus the sales cost.

So it is hard to feel sorry for anyone who bought a token representing real estate, and hoping to earn anything above an averaged real estate investment. And doing so in an unregulated ICO framework is less secure than some person setting up a ledger down the pub on the back of a beer coaster, asking for people to write him US$10,000 checks that he'll buy some shared property with, but refuses to tell you his name or show you identification.

I don't like people with insufficient earnings being blocked from investing in securities, or the government taking on a parental role. But when this level of foolishness is abundant enough for ICOs to foster a booming market, I almost understand the need for these controls. I'd rather see the efforts go into teaching basic mathematics though.

There will always be greed and foolishness in investing from people who should know better. The really sad part in my opinion, is that the majority of people don't have the basic knowledge to even grasp the concept of due diligence, how to accomplish it, or why it is necessary. You are right in improving math skills, and everyone should have the opportunity to become financially literate (and literate), but understanding the complexities of real estate investment 'schemes' of any kind are likely out of the realm of comprehension for most of them, with or without education. Not offering some form of protection for these people leaves me feeling like we are no better than some of the world's wealthiest 1%, that got to where they are on the backs of innocent people.

The cleaning up of fraudulent activities is a good thing for our industry. Being ignorant or failure to do sufficient due diligent and consequently being cheated because of the swindler’s false claims and misrepresentations is not a crime. The same applies to our inherent greed and fear. Unfortunately, the laws of the land must seek to protect consumers irrespective of their sophistication or ignorance.

So, I would expect that the crack down on fraudulent activities to continue and that it would lead to more regulations and better legal guidance. I just hope that this will not lead to regulatory over-reach or so burdensome that it stifles innovations. The potential good our industry can bring about to mankind will out-weight any growing pains.

For our part, DNotes must continue to help in educating the general public and lead as a role model in doing the right things that benefit others as we strive for our own success. There is nothing wrong for being successful, including wealth accumulation. I just don't like it done at the expense of others.

Glad to see the fraudulent claims are being investigated. It will do a lot of good in helping clean up our industry.

TimMarsh, I'm glad you raised that point. I can see if you wanted to invest in real estate and only had a small amount of money to invest, or not enough to actually purchase real estate, it might make sense... But I believe there are already stocks you can purchase as a real estate investment. Without a lot of information available (or any), I can't see why one wouldn't go with the established investments.

[DCEBrief]

Japan Registers 11 Exchanges, as South Korea Bans ICOs

https://dcebrief.com/japan-registers-11-exchanges-as-south-korea-bans-icos/

[Dyna]

It has been a while since I last came across an industry article that I can agree with on most points. Here is a rare one:

One day “digital currencies might give existing currencies “a run for their money.”

“Digital currencies will not replace the current currencies anytime soon.”

"Digital Currencies are Still in Their Infancy."

Digital currencies are "too volatile, too risky, too energy intensive and because the underlying technologies are not yet scalable
central bankers should not ignore the technology or underestimate it."

No doubt, our industry will continue to have issues that create doubt and fear. It is typical of industries at their infancy; granted that we have been getting a large share of it. Our job at DNotes is to address those issues and other challenges objectively at the right time. We have no doubt, that when the dust settled, DNotes will stand out as the shinning star.
We are strategically positioned to be a major player with a large Internet foot-print for people to verify and research on. Here is a good place to start: https://bitcointalk.org/index.php?topic=1924858.0

IMF Chief Lagarde Tells Central Bankers: “Not Wise to Dismiss Virtual Currencies”

Christine Lagarde, head of the IMF, warns central bankers that bitcoin is rising. She has told them not to discount digital currencies, because they are gaining more adoption and traction. Lagarde addressed this issue in a conference Friday in London. She said digital currencies might give existing currencies “a run for their money.”

Read the full story: : https://news.bitcoin.com/imf-chief-lagarde-tells-central-bankers-not-wise-to-dismiss-virtual-currencies/

[Chase]

It has been a while since I last came across an industry article that I can agree with on most points. Here is a rare one:

One day “digital currencies might give existing currencies “a run for their money.”

“Digital currencies will not replace the current currencies anytime soon.”

"Digital Currencies are Still in Their Infancy."

Digital currencies are "too volatile, too risky, too energy intensive and because the underlying technologies are not yet scalable
central bankers should not ignore the technology or underestimate it."

No doubt, our industry will continue to have issues that create doubt and fear. It is typical of industries at their infancy; granted that we have been getting a large share of it. Our job at DNotes is to address those issues and other challenges objectively at the right time. We have no doubt, that when the dust settled, DNotes will stand out as the shinning star.
We are strategically positioned to be a major player with a large Internet foot-print for people to verify and research on. Here is a good place to start: https://bitcointalk.org/index.php?topic=1924858.0

IMF Chief Lagarde Tells Central Bankers: “Not Wise to Dismiss Virtual Currencies”

Christine Lagarde, head of the IMF, warns central bankers that bitcoin is rising. She has told them not to discount digital currencies, because they are gaining more adoption and traction. Lagarde addressed this issue in a conference Friday in London. She said digital currencies might give existing currencies “a run for their money.”

Read the full story: : https://news.bitcoin.com/imf-chief-lagarde-tells-central-bankers-not-wise-to-dismiss-virtual-currencies/

I agree, it is a great article.

Notice how she never mentions anything about central bankers/governments clamping down on, or banning digital currencies, but rather advises them to be "open to fresh ideas and new demands, as economies evolve”. Some of her statements are so close to what has been stated by you and the rest of the DNotes team, it almost looks like she may be on our side. 

Digital currencies are "too volatile, too risky, too energy intensive and because the underlying technologies are not yet scalable central bankers should not ignore the technology or underestimate it." This is really interesting, and I wonder how closely the energy intensiveness of POW is being watched by large institutions? Do they feel any of the current cryptocurrencies are potentially scalable? One can be sure that DNotes 2.0, in addressing all these issues, will be studied very carefully.

[Dyna]

It has been a while since I last came across an industry article that I can agree with on most points. Here is a rare one:

One day “digital currencies might give existing currencies “a run for their money.”

“Digital currencies will not replace the current currencies anytime soon.”

"Digital Currencies are Still in Their Infancy."

Digital currencies are "too volatile, too risky, too energy intensive and because the underlying technologies are not yet scalable
central bankers should not ignore the technology or underestimate it."

No doubt, our industry will continue to have issues that create doubt and fear. It is typical of industries at their infancy; granted that we have been getting a large share of it. Our job at DNotes is to address those issues and other challenges objectively at the right time. We have no doubt, that when the dust settled, DNotes will stand out as the shinning star.
We are strategically positioned to be a major player with a large Internet foot-print for people to verify and research on. Here is a good place to start: https://bitcointalk.org/index.php?topic=1924858.0

IMF Chief Lagarde Tells Central Bankers: “Not Wise to Dismiss Virtual Currencies”

Christine Lagarde, head of the IMF, warns central bankers that bitcoin is rising. She has told them not to discount digital currencies, because they are gaining more adoption and traction. Lagarde addressed this issue in a conference Friday in London. She said digital currencies might give existing currencies “a run for their money.”

Read the full story: : https://news.bitcoin.com/imf-chief-lagarde-tells-central-bankers-not-wise-to-dismiss-virtual-currencies/

I agree, it is a great article.

Notice how she never mentions anything about central bankers/governments clamping down on, or banning digital currencies, but rather advises them to be "open to fresh ideas and new demands, as economies evolve”. Some of her statements are so close to what has been stated by you and the rest of the DNotes team, it almost looks like she may be on our side. 

Digital currencies are "too volatile, too risky, too energy intensive and because the underlying technologies are not yet scalable central bankers should not ignore the technology or underestimate it." This is really interesting, and I wonder how closely the energy intensiveness of POW is being watched by large institutions? Do they feel any of the current cryptocurrencies are potentially scalable? One can be sure that DNotes 2.0, in addressing all these issues, will be studied very carefully.

Thanks, Chase.

DNotes’ guiding principles to success is to ensure that our vision and key missions are articulated in a clear, consistent, and cohesive manner that others can understand. Our mindset and messaging remained the same since day one.

Our vision is to build DNotes as the trusted digital currency accessible for everyone worldwide to participate irrespective of their financial standings; thereby leading to mass acceptance as a supplement to fiat currency in global commerce. Our long list of missions is well expressed throughout our ecosystems systems and beyond.

I trust that over time, we do gain mind-share - winning over more people to think like us. Our industry needs a lot more supporters committed to the long-term with unwavering trust that digital currency is the future of money and when utilized responsibly can benefit our world.

[Millibetting]

 Really disappointing to hold these coins long-term, and miss a swap because you can't read every thread all the time...

[Dyna]

Really disappointing to hold these coins long-term, and miss a swap because you can't read every thread all the time...

Don't worry, Millibetting. You did not miss the swap. The launch of DNotes 2.0 has been delayed.

[Chase]

I agree with the author that the exchanges (as they currently stand) are a major foundational weakness in the industry.

What bothers me about this article is this misleading statement:

"Digital-currency cases now account for three-quarters of the time the Federal Bureau of Investigation devotes fighting money laundering, it revealed at a recent Morgan Stanley event. The law enforcement agency also said that most ransom payments are now demanded in Bitcoin or one of its rivals."

1) The statement made by the FBI makes it sounds like digital currency accounts for 75% of money laundering proceeds.

2) If they are spending that much time focusing on digital currency related cases, it is because they were told to do so.

3) We know from previous research, that it is cash and complex (usually offshore) financial schemes that facilitate most money laundering.

4) Morgan Stanley was their audience...


Digital Currencies Are Growing on Faltering Foundations  -  https://www.nytimes.com/2017/09/29/business/dealbook/bitcoin-ether-cryptocurrencies.html

[TeeGee]

I agree with the author that the exchanges (as they currently stand) are a major foundational weakness in the industry.

What bothers me about this article is this misleading statement:

"Digital-currency cases now account for three-quarters of the time the Federal Bureau of Investigation devotes fighting money laundering, it revealed at a recent Morgan Stanley event. The law enforcement agency also said that most ransom payments are now demanded in Bitcoin or one of its rivals."

1) The statement made by the FBI makes it sounds like digital currency accounts for 75% of money laundering proceeds.

2) If they are spending that much time focusing on digital currency related cases, it is because they were told to do so.

3) We know from previous research, that it is cash and complex (usually offshore) financial schemes that facilitate most money laundering.

4) Morgan Stanley was their audience...


Digital Currencies Are Growing on Faltering Foundations  -  https://www.nytimes.com/2017/09/29/business/dealbook/bitcoin-ether-cryptocurrencies.html

That is indeed misleading Chase. There have been recent cases of large banks laundering massive amounts of money for Mexican drug cartels, and enemies of the USA, in clear breach of US banking laws and those regarding engagement with the enemy.

I don't think that given the current size of crypto that the market is large enough to come anywhere near that -- if the FBI is spending that much of its resources investigating crypto money laundering, it is because they were told to, and likely because there is a political motivation in disseminating that type of message. The fact that many ransoms are being demanded in crypto is unfortunate, and not surprising. It is also likely another reason that compliant cryptocurrencies could rise to the forefront over time by market capitalization, as more businesses and governments get involved with, and sanction their use. At that juncture, professional investors will be gnawing at their teeth to get involved in the rare professionally operated ventures in this space, like DNotes.

[TimMarsh]

I agree with the author that the exchanges (as they currently stand) are a major foundational weakness in the industry.

What bothers me about this article is this misleading statement:

"Digital-currency cases now account for three-quarters of the time the Federal Bureau of Investigation devotes fighting money laundering, it revealed at a recent Morgan Stanley event. The law enforcement agency also said that most ransom payments are now demanded in Bitcoin or one of its rivals."

1) The statement made by the FBI makes it sounds like digital currency accounts for 75% of money laundering proceeds.

2) If they are spending that much time focusing on digital currency related cases, it is because they were told to do so.

3) We know from previous research, that it is cash and complex (usually offshore) financial schemes that facilitate most money laundering.

4) Morgan Stanley was their audience...


Digital Currencies Are Growing on Faltering Foundations  -  https://www.nytimes.com/2017/09/29/business/dealbook/bitcoin-ether-cryptocurrencies.html

That is indeed misleading Chase. There have been recent cases of large banks laundering massive amounts of money for Mexican drug cartels, and enemies of the USA, in clear breach of US banking laws and those regarding engagement with the enemy.

I don't think that given the current size of crypto that the market is large enough to come anywhere near that -- if the FBI is spending that much of its resources investigating crypto money laundering, it is because they were told to, and likely because there is a political motivation in disseminating that type of message. The fact that many ransoms are being demanded in crypto is unfortunate, and not surprising. It is also likely another reason that compliant cryptocurrencies could rise to the forefront over time by market capitalization, as more businesses and governments get involved with, and sanction their use.

It probably isn't even true that FBI is spending more resources investigating crypto money laundering. It would just be too irresponsible and absurd. The total capitalisation of all cryptocurrencies is an insignificant fraction of all money laundering according to the IMF. So yes, I agree that the statement is likely to be politically motivated.

"The World Bank and the International Monetary Fund (IMF) estimate the volume of money laundering to be between three and five percent of GDP, equivalent to approximately US$2.2 trillion to US$3.7 trillion annually."
https://www.infosys.com/industries/cards-and-payments/resources/Documents/money-transfer-industry-2016.pdf

This does not surprise me. Those with power like to retain it, so are always in favour of stability and maintaining the status quo. So when a new form of money comes along, the basis of their power faces the threat of disruptive technology. What does surprise me is Christine Lagarde's position on it. Of course, getting to where she is I expected her to be savvy and have her finger on the fintech pulse. But to publicly promote a reasonable or even positive image about the future of cryptocurrencies was unexpected.

I would have expected the IMF to be more reactive and want to put out the cryptocurrency fire, before it burned away their position of power. But, maybe they are smarter than that. Change is inevitable, and if you are fortunate enough to see it coming, then it makes sense to spend your energy re-positioning yourself rather than fighting it. Just how the IMF might consolidate their power in a world where both fiat and cryptocurrency are traded in similar proportions I don't know. And maybe they don't know either, but are at least trying to move in the right direction.

Christine Lagarde, head of the IMF, warns central bankers that bitcoin is rising. She has told them not to discount digital currencies, because they are gaining more adoption and traction. Lagarde addressed this issue in a conference Friday in London. She said digital currencies might give existing currencies “a run for their money.”

Read the full story: : https://news.bitcoin.com/imf-chief-lagarde-tells-central-bankers-not-wise-to-dismiss-virtual-currencies/

And related to both of these is the crack down on fraudulent ICOs. I agree that it is certainly a positive thing, and feel proud to be contributing to a group that recognise we all can be fools and that does not mean we don't deserve help or even protection where it is warranted. But it is interesting that the SEC is choosing to minimise damage early. It would have surprised my cynical side less if the damage was allowed to get so far out of control, that future government attempts to limit and control the use of cryptocurrencies would be seen by the public as well overdue, rather than government over-reach.

So while China plays its hand, Korea follows in its way, and Japan registers exchanges making the Eastern approach to cryptocurrencies seem divided, it looks like the Western attitude is swinging slowly around to somewhere between tolerant and positive.

[Dyna]

I agree with the author that the exchanges (as they currently stand) are a major foundational weakness in the industry.

What bothers me about this article is this misleading statement:

"Digital-currency cases now account for three-quarters of the time the Federal Bureau of Investigation devotes fighting money laundering, it revealed at a recent Morgan Stanley event. The law enforcement agency also said that most ransom payments are now demanded in Bitcoin or one of its rivals."

1) The statement made by the FBI makes it sounds like digital currency accounts for 75% of money laundering proceeds.

2) If they are spending that much time focusing on digital currency related cases, it is because they were told to do so.

3) We know from previous research, that it is cash and complex (usually offshore) financial schemes that facilitate most money laundering.

4) Morgan Stanley was their audience...


Digital Currencies Are Growing on Faltering Foundations  -  https://www.nytimes.com/2017/09/29/business/dealbook/bitcoin-ether-cryptocurrencies.html

That is indeed misleading Chase. There have been recent cases of large banks laundering massive amounts of money for Mexican drug cartels, and enemies of the USA, in clear breach of US banking laws and those regarding engagement with the enemy.

I don't think that given the current size of crypto that the market is large enough to come anywhere near that -- if the FBI is spending that much of its resources investigating crypto money laundering, it is because they were told to, and likely because there is a political motivation in disseminating that type of message. The fact that many ransoms are being demanded in crypto is unfortunate, and not surprising. It is also likely another reason that compliant cryptocurrencies could rise to the forefront over time by market capitalization, as more businesses and governments get involved with, and sanction their use.

It probably isn't even true that FBI is spending more resources investigating crypto money laundering. It would just be too irresponsible and absurd. The total capitalisation of all cryptocurrencies is an insignificant fraction of all money laundering according to the IMF. So yes, I agree that the statement is likely to be politically motivated.

"The World Bank and the International Monetary Fund (IMF) estimate the volume of money laundering to be between three and five percent of GDP, equivalent to approximately US$2.2 trillion to US$3.7 trillion annually."
https://www.infosys.com/industries/cards-and-payments/resources/Documents/money-transfer-industry-2016.pdf

This does not surprise me. Those with power like to retain it, so are always in favour of stability and maintaining the status quo. So when a new form of money comes along, the basis of their power faces the threat of disruptive technology. What does surprise me is Christine Lagarde's position on it. Of course, getting to where she is I expected her to be savvy and have her finger on the fintech pulse. But to publicly promote a reasonable or even positive image about the future of cryptocurrencies was unexpected.

I would have expected the IMF to be more reactive and want to put out the cryptocurrency fire, before it burned away their position of power. But, maybe they are smarter than that. Change is inevitable, and if you are fortunate enough to see it coming, then it makes sense to spend your energy re-positioning yourself rather than fighting it. Just how the IMF might consolidate their power in a world where both fiat and cryptocurrency are traded in similar proportions I don't know. And maybe they don't know either, but are at least trying to move in the right direction.

Christine Lagarde, head of the IMF, warns central bankers that bitcoin is rising. She has told them not to discount digital currencies, because they are gaining more adoption and traction. Lagarde addressed this issue in a conference Friday in London. She said digital currencies might give existing currencies “a run for their money.”

Read the full story: : https://news.bitcoin.com/imf-chief-lagarde-tells-central-bankers-not-wise-to-dismiss-virtual-currencies/

And related to both of these is the crack down on fraudulent ICOs. I agree that it is certainly a positive thing, and feel proud to be contributing to a group that recognise we all can be fools and that does not mean we don't deserve help or even protection where it is warranted. But it is interesting that the SEC is choosing to minimise damage early. It would have surprised my cynical side less if the damage was allowed to get so far out of control, that future government attempts to limit and control the use of cryptocurrencies would be seen by the public as well overdue, rather than government over-reach.

So while China plays its hand, Korea follows in its way, and Japan registers exchanges making the Eastern approach to cryptocurrencies seem divided, it looks like the Western attitude is swinging slowly around to somewhere between tolerant and positive.

No matter how we look at it, this industry has been quite dramatic - something the news media gravitate to. Unfortunately, at times, facts are misrepresented or stretched to the breaking points as in the case of: "Digital-currency cases now account for three-quarters of the time the Federal Bureau of Investigation devotes fighting money laundering."  I don’t see how that could be accurate or a fair representation.

At such earl stage, the public, perhaps including law enforcement, lacks good knowledge and understanding of the technology and the industry. I trust that it will evolve and get better. We need to do better in educating others with the best intention because we believe that we are at the beginning of a technology revolution that can benefit a lot of people.

[TimMarsh]

We need to do better in educating others with the best intention because we believe that we are at the beginning of a technology revolution that can benefit a lot of people.

Alan, you so often speak my thoughts for me. And I completely agree that education is the solution. I tend to think education is the solution to almost all problems. That is probably because I think the vast majority of people are good, and want the best for others as well as themselves. And I see most problems in the world coming from bad decisions, rather than bad intentions. For me the best solution to avoid bad decisions is learning how to think, and having all the relevant information. Hence, education is the foundation of all long term solutions.

After education has done its work, of course I see systems as the ultimate structure to build on the foundation of education. That way, we don't have to think through the same problems over again, and we can experiment and tweak our decisions in a framework that yields meaningful and repeatable results. I am glad DNotes Global Inc. puts such effort into education and is sharing knowledge through the Four Pillars to Business Success program. I respect people for their intentions, but I admire them for their results. You're definitely moving quickly in the right direction.