The Week: Bitcoin Sees Big Gains, Coinbase Expands and SEC Issues New Framework

After weeks of accumulation, digital assets saw massive gains over the past week, where the total crypto market cap rose by 23% from $145bn to $183bn. The spike, initiated by Bitcoin, which saw a price jump of 15.3% on Tuesday morning after a large, anonymous buyer placed a $100 million algorithmic order, spread across exchanges Coinbase, Kraken and Bitstamp. The orders were placed in increments of 7,000 BTC at a time and triggered a flurry of subsequent trading volume in the cryptocurrency markets. The move has liquidated $500m of short-sellers on BitMEX alone. Bitcoin is now trading above its 50, 100 and 200 daily moving averages for the first time in nearly fifteen months.

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Crypto Market News

China is Leading World in Blockchain Projects

China is reportedly leading the world in the number of blockchain projects underway. According to Blockdata, there are currently 263 projects in China, which account for 25% of the global total.

Coinbase Expands into Cross-Border Payments

Customers of the major US-based crypto exchange Coinbase can now transfer funds to any user with a Coinbase account around the globe, using XRP or stablecoin USDCoin, without a fee. Users are now able to send and receive funds instantly and convert them into local currency.

PayPal Enters Blockchain Space

Online payments firm PayPal has acquired a stake in Cambridge Blockchain, the start- up which helps financial institutions and other companies manage sensitive data using blockchain technology. An undisclosed investment in the blockchain start-up is the first of its kind for PayPal, and as PayPal’s spokesperson noted, they hope this investment will allow them to “explore potential collaborations to leverage blockchain technology”.

BC Group Launches Insured Crypto Custody for Asian Investors

Hong Kong-based trading and asset management firm Branding China Group (BC Group) is launching an insured custody service for Asian cryptocurrency investors.

Binance Announces Singapore Expansion

Binance has announced its expansion to Singapore, where it plans to set up a fiat-to- crypto exchange with support for the Singaporean Dollar.

Last Week in Funding

Blockchain start-up Harmony raised $18m in pre-sale; crypto start-up Celo raised $30m in a round led by a16z and Polychain; crypto exchange Liquid claims Unicorn status after Series C fundraise; 0(1) Labs raised $15m from Coinbase Ventures, Paradigm and others for Coda Protocol

Security Token News

Templum Partners with MIH to Launch Digital Securities Exchange

STO provider Templum has partnered with the parent company of three exchanges, Miami International Holdings (MIH), to launch a digital securities exchange.

Tokeny and DLA Piper Form Digital Securities Alliance

Luxembourg-based digital securities start-up Tokeny has announced the creation of Digital Securities Alliance, together with law firm DLA Piper, in order to establish a compliant infrastructure for institutional involvement.

Number of STOs Increased by 130% in Q1 2019

According to a report from Inwara, the number of security token offerings increased by 130% in the first quarter of 2019 (47 STOs).

Regulatory News

Pakistan Introduces Crypto Regulation

The Government of Pakistan will introduce Electronic Money Institutions (EMI) regulations based on the recommendations of the Financial Action Task Force, a France-based intergovernmental organisation which develops policies for combating money laundering and anti-terrorism threats.

Malta’s Financial Regulator Approves First 14 Crypto Assets Agents

Five months after the Virtual Financial Assets Act (VFA) was adopted by Maltese government, the Malta Financial Services Authority (MFSA) has approved the first 14 crypto assets agents. Initially, over 250 applications were filed, from which only 28 succeeded to apply and 14 were eventually approved. The approved agents are obliged to evaluate their customers’ business plans and ensure they are properly prepared before submitting an application to the MFSA. Moreover, the agents have to perform due diligence with their clients, checking whether they comply with AML and counter-terrorism financing guidelines.

SEC Issues First No-Action Letter Clearing ICO Token Sale

The SEC has issued a first no-action letter to a business-travel start-up Turnkey Jet Inc., by clearing their tokens for ICO sale. The regulatory approval is contingent upon certain conditions:

• Token-generated funds cannot be used to develop the company’s platform

• Technology (such as its app).

• The tokens will be immediately useful.

• The TKJ tokens will remain at a fixed price of one U.S. dollar.

• The tokens can only be used for air charter services.

• Repurchases will only be made at a discount to the token.

• TurnKey Jet will not represent the tokens as having profit potential.

SEC Issues Token Investment Framework

The SEC’s Strategic Hub for Innovation and Financial Technology (FinHub) has published a framework for analysing whether digital assets which are offered or sold are in fact securities. According to the SEC, “the framework is not intended to be an exhaustive overview of the law, but rather, an analytical tool to help market participants assess whether the federal securities laws apply to the offer, sale, or resale of a particular digital asset.”