Palladium, Bittrex Launch World’s First Initial Convertible Coin Offering (ICCO) In Crypto-Friendly Malta

  • Maltese blockchain firm Palladium launched its Initial Convertible Coin Offering (ICCO), a proposed improvement on the current ICO model.
  • Crypto exchange Bittrex will reportedly help Palladium develop its own cryptocurrency exchange.

An “ICO 2.0 Model” has reportedly been developed by Bittrex and Maltese blockchain firm Palladium. The newly proposed ICO model is called the Initial Convertible Coin Offering (ICCO) and will “give investors peace of mind and a stake in the future of virtual currencies.” The ICCO model incorporates certain ideas from the older and more established crowdfunding method known as initial public offerings (IPOs), according to Bittrex’s official blog post.

The blog further notes that ICCOs borrow some basic ideas from the widely-used ICO model and are also regulated by the Maltese Financial Services Authority (MFSA). Additionally, Bittrex’s communications team states that each token issued through this new method is referred to as a “convertible warrant” and will be “subject to stringent EU rules”. Investors who purchase tokens issued through the ICCO model will reportedly be able to exchange them for shares in Palladium “three years after the issue date.”

“Bridging The Gap Between Traditional Financial Services And Crypto”

Palladium founder Paolo Catalfamo believes that this initiative will “bridge the gap between traditional financial services and cryptocurrencies.” He added that the Palladium platform could be instrumental in creating “more than 100 job opportunities.” Professor Catalfamo’s comments came during the project’s launch at the Malta Stock Exchange, Valletta where he also stated that ICCOs and their supporting regulatory framework would make it easier for businesses to adopt cryptocurrencies.

The professor went on to describe Malta’s efforts to regulate crypto and blockchain related activities as “comprehensive” while noting that the island country also has “a dedicated blockchain unit at the MFSA.” Per the Palladium founder, this type of “vibrant environment” is conducive to the ongoing development and advancement of his company’s business.

Regulated Framework For Crypto And Blockchain Companies

Catalfamo further stated that his company’s ICCO model will provide institutional investors a properly regulated framework for crypto and blockchain related investment opportunities. He thinks that “the lack of regulation has kept [institutional investors] waiting on the sidelines.” However, he says that his firm will help attract more institutional clients to the crypto industry by offering them “regulation-compliant, multi-asset accounts to manage fiat and crypto currencies.”

Palladium’s crowdfunding campaign plans to raise €150 million in order to acquire “a controlling interest” in one of Europe’s financial institutions and launch its own regulated cryptocurrency exchange through a partnership with esports betting platform Unikrn and Bittrex. The funds raised will also be used to create a blockchain network for the “clearing and settlement” of digital assets. Additionally, the blockchain startup will reportedly invest part of the proceeds in various financial services and other blockchain-related projects “complementing Palladium’s business.”

Notably, Malta has now become well-known for its crypto-friendly environment due to large cryptocurrency exchanges such as OKEx and Binance shifting their headquarters from China over to the European island nation. The launch of Palladium and Bittrex’s joint crypto project was attended by Malta’s Prime Minister Joseph Muscat, MFSA CEO Joseph Cuschieri, and the island’s Financial Services Parliamentary Secretary Silvio Schembri.

Bank of England Governor Recommends Replacing Dollar With 'Libra-Like' Digital Currency

  • BOE Governor Mark Carney proposed replacing the US dollar with a libra-like digital currency as the global reserve. 
  • Called for a dramatic shift in policy to address the changing economic landscape. 

Bank of England Governor Mark Carney has made a radical recommendation for central banks that the U.S. dollar be replaced with a Libra-like digital reserve currency. 

Replacing the Dollar

Speaking at the Federal Reserve’s annual Jackson Hole Symposium on Aug. 23, Carney called for a dramatic shift in global monetary policy that would see central banks taking a greater interest in digital currencies such as Facebook’s forthcoming libra. 

The BOE Governor’s proposal would replace the U.S. dollar as the world’s reserve currency with a digital alternative. While it was unclear if Carney was actually suggesting that libra could be used to fill the void, his intent was to spur interest in a fiat alternative for global reserves. 

Carney argued that proactively replacing the dollar with a digital coin substitute would be preferable to allowing another national currency usurp its status--such as the Chinese renminbi. 

He pointed to the global economic uncertainty in part being generated by deteriorating U.S. trade relations, 

The combination of heightened economic policy uncertainty, outright protectionism and concerns that further, negative shocks could not be adequately offset because of limited policy space is exacerbating the disinflationary bias in the global economy.

He continued, 

When change comes, it shouldn’t be to swap one currency hegemon for another. Any unipolar system is unsuited to a multi-polar world. We would do well to think through every opportunity, including those presented by new technologies, to create a more balanced and effective system.

Cryptocurrencies Gaining Prominence

The introduction of a non-fiat currency could have the effect of devaluing the dollar, and most national currencies, which could be one way for central banks to introduce inflation to erode away the record levels of debt accumulating globally. 

Some have speculated that an alternative asset such as gold could be used as an intermediate. However Carney, who announced several months ago he would be stepping down as Governor of the BOE, has shown a route to fiat alternatives which includes the creation of digital currencies.

He lauded the technology for its efficiency in payments and cross-border transactions, 

The most high profile of these has been Libra – a new payments infrastructure based on an international stablecoin fully backed by reserve assets in a basket of currencies including the US dollar, the euro, and sterling. It could be exchanged between users on messaging platforms and with participating retailers.

While Carney’s suggestion to replace the U.S. dollar is one of the most radical proposals yet, it does give insight into the global trend in central banks to pursue digital currencies as an alternative to their outdated fiat counterparts.