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BitGo Announces New Settlement System for Institutional Clients

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Blockchain security company BitGo is launching a new service for institutional clients: a clearing and settlements system that operates off-chain.

BitGo announced this new service in a press release on May 14, 2019, describing some of the features that this new system will have. Assets “never need to leave custody,” according to the announcement, and “counterparty risk is minimized” with BitGo acting as custodian for both sides of any deal.

BitGo expects its in-house clearing and settlements service to make arranging such deals more convenient. For example, all funds up for negotiation will remain in cold storage until after an agreement is signed, so that the risks of fraud by either party or outside actors is minimized. Additionally, investors do not need to break up their balance sheets by parking assets at every exchange with which they wish to trade.

This new service has evidently been in the works for quite some time. In September 2018, BitGo first received the go-ahead from regulators to act as a qualified custodian for digital assets, a necessary prerequisite for this plan. At the time, BitGo Chief Compliance Officer Shahla Ali told Bitcoin Magazine that the company intended to offer storage for assets “designed for institutional customers.” The press release announcing the new service specifically mentions that it is only available to these types of client.

The off-chain clearing and settlements service is the first publicly announced project specific to the BitGo Trust Company.

It is unclear whether or not the service will ever open up to a wider variety of investors. Currently, the service is only available to “OTC desks, single dealer platforms, exchanges, asset managers and broker-dealers,” according to the press release, and this may be the extent of BitGo’s plans.

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Twitter CEO Dorsey: Square Crypto Begins ‘Inevitable’ Bitcoin Mass Adoption

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By CCN: Square, the $32.7 billion mobile payment company founded by Twitter’s Jack Dorsey, is one step closer to launching its long-awaited crypto project. The company claimed last night that bitcoin mass adoption is “inevitable” and it is close to making its first hire.

Everything we know about Square Crypto so far

In March 2019, Square CEO Jack Dorsey announced his company would hire three or four developers and a designer to work on the open-source Bitcoin ecosystem.

Many Bitcoin developers are volunteers, but Dorsey wants to fund the growth of Bitcoin directly through Square Crypto.

Square already has a stake in the cryptocurrency world. Its Cash App allows users to buy and sell bitcoin, a feature that pulled in $65 million revenue for the company last year. Square is the first and only publicly traded company to support bitcoin purchases.

Square Crypto will focus on what’s best for the crypto community

Dorsey claims the Square Crypto initiative is not a commercial pursuit, but an attempt to give back to the bitcoin community. 

“Last week I was considering my hack week project, and asked @brockm: “what is the most impactful thing we could do for the bitcoin community?” His answer was simple: “pay people to make the broader crypto ecosystem better.” This resonated with me immediately, so we’re doing it.”

Dorsey began meeting with potential developers in April after ‘Crypto Twitter’ threw out suggestions. Among the candidates suggested were various Bitcoin Core developers and members of the BTCPayServer. Although the new recruits will report directly to Dorsey, he maintains that their purpose is to improve the bitcoin ecosystem, not make money for Square.

“These folks will focus entirely on what’s best for the crypto community and individual economic empowerment, not on Square’s commercial interests. All resulting work will be open and free.”

Lightning Network integration?

The bitcoin community has speculated that Square Crypto will work on integrating the Lightning Network, a second-layer protocol designed for instantaneous bitcoin payments.

Dorsey invested $2.5 million in Lightning Labs, a startup developing on the Lightning Network. He also took part in the Lightning Network “torch” experiment, passing a micro-amount of bitcoin to Lightning Labs co-founder Elizabeth Stark. 

Better design and user experience for bitcoin?

Exact details of the Square Crypto project have been closely guarded, but one common theme is accelerating design and UX. Dorsey will hire one full-time designer to focus on UX and the official Square Crypto Twitter account said that “mass adoption is impossible without great design.”

Dorsey himself said that design is an underfunded part of the crypto ecosystem, and crucial introducing people to the technology.

Dorsey going all-in on bitcoin?

In the last year, Dorsey has ramped up his engagement with bitcoin and cryptocurrencies. He appeared on the Joe Rogan podcast saying that he’s a huge fan of bitcoin.

“The internet deserves a native currency; it will have a native currency. I don’t know if it will be Bitcoin or not. Hope it will be.”

Since then he revealed he was maxing out the Cash App bitcoin buying limit, effectively spending $10,000 a week on cryptocurrency. As for Square Crypto, the project’s Twitter account has reminded everyone to dial down their expectations. Big things are coming, it says, but it will take time.

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Institutional Investors are Already Turning to Crypto: Should You Fear Missing Out?

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Two public pensions from Fairfax County, Virginia’s Police Officer’s Retirement System and Employees’ Retirement System, have invested in Morgan Creek’s new $40 million crypto fund.

Anthony Pompliano, a Morgan Creek basic spouse, stated that it’s the first case through which public pensions have invested within the cryptocurrency marketplace.

Apart from the 2 pensions, the fund is claimed to be financed by way of a school endowment, a medical institution, an insurance coverage corporate, and a personal basis. It raised a complete of $40 million.

Fairfax County Police Officer’s Retirement System leader funding officer Katherine Molnar stated:

“Blockchain technology is being applied in unique and compelling ways across multiple industries. We feel it is important to be opportunistic and are excited to participate in this emerging opportunity, due to the attractive asymmetric return profile that it represents.”

Crucial First Step Towards Institutionalization of Crypto

The vast majority of the crypto neighborhood has spoke back undoubtedly to the high-profile deal secured by way of Morgan Creek.

But some traders have puzzled the $40 million determine and anticipated the fund to be better given the involvement of public pensions.

However, the volume of capital concerned within the huge deal of Morgan Creek is of much less significance.

The deal resulted in the doorway of the primary workforce of public pensions into the cryptocurrency sector.

Public pensions are known for his or her conservative and wary way in making an investment. Due to the loss of correctly regulated funding automobiles and relied on custodians within the cryptocurrency area, establishments were reluctant in opposition to making an investment within the asset elegance prior to now a number of years.

The Morgan Creek deal has proven that institutional traders are opening as much as the cryptocurrency sector and are starting to turn into extra happy with the asset elegance.

Pompliano stated:

“The belief is this gives them great exposure to what we believe are some of the best risk-mitigated opportunities in a nascent industry. You can take a small amount of capital, you can put it in a nascent industry, you can manage your risk correctly but also get exposure to true innovation.”

Since past due 2018, probably the most biggest monetary establishments within the U.S. marketplace within the likes of Fidelity, ICE, and Nasdaq have persevered to toughen the infrastructure supporting cryptocurrencies as an asset elegance.

The lively involvement of well known establishments within the crypto area can have fueled the boldness of different institutional traders within the conventional monetary sector.

Could it Lead to an Influx of Institutions?

In mid-2018, Mike Novogratz, a billionaire investor and a former Goldman Sachs spouse, stated that after a number of institutional traders are dedicated to the cryptocurrency sector, extra establishments will FOMO (concern of lacking out) into the marketplace.

“It won’t go there ($20 trillion) right away. What is going to happen is, one of these intrepid pension funds, somebody who is a market leader, is going to say, you know what? We’ve got custody, Goldman Sachs is involved, Bloomberg has an index I can track my performance against, and they’re going to buy. And all of the sudden, the second guy buys. The same FOMO that you saw in retail [will be demonstrated by institutional investors],” Novogratz said.

In the long term, the newly established cryptocurrency fund of Morgan Creek may just set the root that can toughen the following wave of institutional traders within the cryptocurrency marketplace.

The deal comes 14 months within the worst undergo marketplace within the 10-year historical past of the cryptocurrency marketplace, which has proved that establishments aren’t eager about the cost of virtual belongings however quite at the state of infrastructure that may care for an influx of enormous capital into the marketplace.

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Laos Central Bank Spreads Warning Risks Regarding Buying, Selling and Use of Cryptocurrencies

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Laos Central Bank Spreads Warning Risks Regarding Buying, Selling and Use of Cryptocurrencies

Laos Central Bank Spreads Warning Risks Regarding Buying, Selling and Use of Cryptocurrencies

South East Asian countries have generally done well to regulate crypto creating one of the most friendly crypto geographical regions in the world. However, doesn’t seem to be following their neighboring countries.

The Bank of the Lao PDR, which is the central bank of Laos, has warned commercial banks, businesses, and members of the public not to buy, sell or use cryptocurrency for money transactions as this practice is illegal.

They did so after they learned that cryptocurrencies such as Bitcoin, Ethereum and Litecoin have been advertised for use on social media despite the fact that the central bank has banned the use of these currencies.

Some groups are advertising the purchase, sale, and use of cryptocurrencies for money transactions through commercial banks, enticed by claims that this will generate income in some way – a claim that the authorities say is untrue.

This warning is similar to the crypto ban in India issued by their central regulators, the RBI. On March 29th, the Supreme Court of India was supposed to pass judgment on crypto. This was after a long string of delays and reevaluation.

However, like the previous hearing dates even this was a disappointment with the Supreme Court shutting down the trial in less than 2 minutes. Now the hearing date is postponed to July 2019 essentially giving the burden to the next elected government.

Notably, in October of 2018, published a notice cautioning the public against cryptocurrency trading and their usage in payments. They said the public is warned against the use of “unregulated” cryptocurrencies.

Addressed to merchants, traders and residents, the notice also urged citizens to research and understand any digital assets. The notice warned against the purchase and sale, or trading of digital assets, talking up the risks in crypto-related investments.

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This Painfully Boring CNBC Crypto Debate Is Bullish as Hell for Bitcoin

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By CCN: If you’re looking for reasons behind bitcoin’s recent price surge, this video tells the whole story.

Because it’s so completely dull.

The two established analysts with decades of trading experience talk about bitcoin with maturity and logic. They make a strong case for allocating portfolio funds to crypto, and no-one mentioned bubbles or scams.

The way people talk about bitcoin is changing, especially on mainstream finance outlets. It’s evolving. Bitcoin is a social movement as much a technical one, so the way it’s talked about among traditional investors is incredibly important to its future.

This interview isn’t provocative or controversial. It’s downright boring. And that’s bullish as hell.

Bitcoin’s narrative has changed. It’s a legitimate asset class now

The Futures Now interview was a mature and sensible debate between GRZ Energy’s Anthony Grisanti and Equity Armor Investment’s Brian Sutland. Both have decades of experience on the futures and options markets.

They each recommended a small allocation to bitcoin as a portfolio hedge. They talked about bitcoin like any other asset class. It was discussed in the same breath as gold and currencies without any scorn.

Both shrugged off bitcoin’s volatility and no-one mentioned bubbles or scams or crime. They spoke of bitcoin as a legitimate part of the trading ecosystem.

Bitcoin should be 5-10% of your portfolio

Grisanti advocated that traders allocate 5-10 percent of their portfolio to bitcoin. 

“Usually in a portfolio, gold is about 5-10% of the portfolio so there’s nothing wrong with saying bitcoin couldn’t be 5-10% of a portfolio right now.”

It echoes Grayscale’s campaign for investor’s to #DropGold and replace it with bitcoin in your portfolio.

Sutland agreed, claiming that a small allocation could provide a strong hedge against geopolitical threats and fiat currency weakness.

“If you size it appropriately in your portfolio, a couple percent holdings, that can be a hedge against political turmoil or just fiat currencies deteriorating.”

Although he admitted that 80 percent swings are still a threat and no-one should go all-in on cryptocurrencies.

“I would not move all my money into bitcoin as a safe haven, so you’re right about that. But a fraction of somebody’s portfolio when they’re worried about what’s going on in the world; as long as you size it appropriately.”

What next for the bitcoin price?

Grisanti was a little more bearish on the short-term prospects of bitcoin. He expects a pullback to the $7,000 range after the strong move upwards.

“The market’s had a nice run but I think it consolidates a little bit. I’m looking to sell at $8,000… and I’m looking for a move back down to $7,000 and I think consolidation for this market is actually very healthy, very good for it. I’ve noticed over the last few sessions that the volumes have come back down a little bit. And to me that means that the market does want to consolidate. That you’re not getting the buyers coming into the market with the strength that they did a couple of weeks ago.”

bitcoin price chart

Bitcoin’s run to $8,000 should trigger a pullback to the $7,000 range, according to Grisanti. Source: CoinMarketCap

It’s an intelligent and reasoned analysis of bitcoin’s potential movements, which is refreshing to see on mainstream financial news outlets.

Sutland struck a more bullish tone, especially as a long-term prospect:

“I do think bitcoin is still in play. I think it’s becoming the alternative play to gold if you’re looking for a safe haven right now. The transactions you see are ticking up. It’s much easier to move money around using that rather than a bar of gold or even gold futures. I think bitcoin futures are becoming more and more in play. And so for that reason I think there’s still legs to the upside in the long-term.”

“From scam to sexy”

As CCN reported, research discovered that the language around bitcoin has changed for the positive. Not only are more academics talking about cryptocurrency, they’re understanding it better:

“[The research] further noted that scholars are enhancing the quality of their discourse when they review the cryptocurrency in research papers, public conversations, and debates.”

This is the real bull case for bitcoin. Bitcoin is a social movement and it’s slowly converting the most influential financial minds on the planet. If that’s not bullish, I don’t know what is. 

Click here for a real-time bitcoin price chart.

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Central Bank of Russia Expects Crypto Draft Bill to Be Adopted in Spring 2019

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The central bank of Russia believes that the draft bill on crypto regulation is prepared enough to be adopted in the spring of 2019, local news agency TASS reports on May 22.

Olga Skorobogatova, first deputy governor of the Russian central bank, has stated that the bank expects the crypto bill, “On Digital Financial Assets” (DFA), to be adopted during the spring session in 2019 in accordance with the order of the country’s president, Vladimir Putin.

Speaking at a recent meeting of the Parliament, Skorobogatova argued that the DFA, as well as a draft law on crowdfunding and other crypto-related bills, are at a “sufficiently high degree of preparedness” to be adopted during the session.

The official has also emphasized that all those draft laws are “crucial for the country and will allow for the implementation of new projects.” Conversely, Russian prime minister and former president Dmitry Medvedev had recently stated that crypto regulation is not a priority for the Russian authorities because cryptos “have lost their popularity.”

Yesterday, the Chairman of the Russian Parliament’s Committee on Financial Market revealed that Russian authorities had to delay the second reading of the DAF due to an order from the Financial Action Task Force on Money Laundering (FATF).

While the FATF obligated Russia to legislate major industry terms such as “cryptocurrencies” and “bitcoin (BTC),” Russia’s central bank was reportedly influencing the lawmakers to avoid including some of the terminology in the bill.

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