Category Archive : Blockchain News

blockchain-based-fantasy-soccer-game-sorare-signs-on-paris-saint-germain

Blockchain-based fantasy soccer game Sorare signs on Paris Saint-Germain

PSG players Neymar and Kylian Mbappé, as well as club veterans like David Beckham, will be issued as collectible digital player cards on blockchain platform Sorare.

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Blockchain-based fantasy soccer game Sorare signs on Paris Saint-Germain

French soccer club Paris Saint-Germain hasn’t dropped the blockchain baton just yet, with the club now set to issue player collectibles as rare tokens.

PSG — which plays in the highest tier of French soccer —  had already partnered with blockchain platform Socios.com to launch its own “Fan Token Offering” in 2018. 

This week, the club has become the 100th soccer club to join the Ethereum blockchain-based fantasy soccer game Sorare platform.

PSG players Neymar and Kylian Mbappé, as well as club veterans like David Beckham, will be tokenized as limited edition digital player cards. The score of player cards will depend on their real-life performances in soccer league tables and the rarity of collectible cards is vouched for using blockchain technology.

News of the new partnership also coincides with Sorare’s official launch in the United States, which has become the game’s second-largest market worldwide. 

Speaking to Cointelegraph, a spokesperson for Sorare explained that the game had been in closed beta in the U.S. through to Dec. 2019 (invite-only), and open beta until its launch on Sept. 28.

Close to 60 million people play fantasy sports in the U.S., according to data from the Fantasy Sports and Gaming Association — making the market for blockchain entrants particularly attractive.

“We consider that with 100 clubs and three of the top 10 soccer clubs in the world — Juventus, PSG, Atletico Madrid — we’re now officially on track to start advertising the game as a full-on gaming experience,” the spokesperson said. 

Ahead of the U.S. launch, he noted that the game had “needed some fine-tuning, such as the scoring matrix and the progression within the game.”

Since its launch in March 2019, Sorare has generated $2 million in revenue from card sales across 60 countries. 

Nonfungible — a rankings site for blockchain games and issuers of collectible, non-fungible tokens (NFTs) — currently has Sorare ranked 5th. It reports $205,131 in 7-day volume as compared with $954,231 for the top-ranked game, Cryptokitties.

NFTs first came to prominence in 2017 with the launch of Cryptokitties, which, like Sorare, is based on the Ethereum blockchain. The NFT collectibles market was estimated to have hit $370 billion as of July 2020.

anonymous-donor-saves-openbazaar…-for-now

Anonymous donor saves OpenBazaar… for now

OpenBazaar received a temporary lifeline, but they aren’t out of the woods yet.

Anonymous donor saves OpenBazaar... for now

On September 25, OpenBazaar announced that their platform would likely shut down due to financial difficulties, stating that user growth and adoption had stalled.

According to a tweet published on Open Bazaar’s official Twitter account, a mysterious donor has since agreed to cover the cost of the marketplace’s operations through the end of the year.

While the exact amount of funding provided was not disclosed, OpenBazaar’s donation wallets have received over $13,000 as of publication. These funds came in the form of Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), and other crypto donations.

With its first beta released in 2014, OpenBazaar raised US$1 million in seed funding in less than a year with the help of Andreesen Horowitz, Union Square Ventures, and angel investor William Mougayar.

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ICO from 2017 expects October mainnet launch

This project is continuing to build momentum three years after their token sale.

ICO from 2017 expects October mainnet launch

After securing millions of dollars via an initial coin offering in 2017, decentralized data housing platform Filecoin now aims to launch its mainnet.

Filecoin will move over to its own blockchain in stages, rather than all at once, according to a Sept. 27 blog post.

“Launching a blockchain is an involved and lengthy process,” the post said. “Like many other networks (including Polkadot, NEAR, and others), Filecoin is taking a phased approach to launching mainnet, with different groups and communities onboarding onto the network over a period of time, leading up to Mainnet Liftoff.”

Currently heading into its initial stage, known as Mainnet Ignition, Filecoin explained the planned and spaced-out process essentially as a way for the project and its involved parties to line all their ducks in a row before moving onto the new network. 

Filecoin had forecast an Oct. 15 mainnet launch date, noting technical overwatch in the days following, confirming that all goes smoothly. The project will then host several commemorative events between Oct 19 and 23. 

Filecoin raised $257 million during its 2017 ICO, subsequently suffering a number of delays in its development and progress. Back in February 2020, the project released a schedule pointing toward a third quarter mainnet launch date.

crypto-regulations-in-the-united-kingdom:-are-we-there-yet?

Crypto regulations in the United Kingdom: Are we there yet?

Policymaking in the United Kingdom is typically reactionary, and this is no less true in the context of the crypto-asset industry. Reactionary policymaking means that the U.K.’s crypto regime is occasionally behind those of its competitors, which could ultimately cause the U.K. to become a less attractive place to conduct crypto-related business.

The former Chair of CryptoUK, Iqbal Gandham, pointed out in an April 2018 letter to the U.K. Parliament’s Treasury Committee that despite the fact that “the UK holds great potential to become a global leader in cryptocurrencies,” the “absence of regulatory direction” has stifled innovation in the industry.

Indeed, it was only last year that the Financial Conduct Authority published its final “Guidance on Cryptoassets” paper, and only this year did it announce that existing businesses carrying out crypto-related activity in the U.K. must register with the FCA and any new crypto businesses established after that date will not be able to operate unless they have successfully registered.

The new registration requirements were implemented following recent amendments to the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017, otherwise known as the MLRs. The explanatory note to the MLRs indicates that the purpose of the statutory instrument is to carry out the implementation of the European Commission’s Anti-Money Laundering Directive, or AMLD, which sets out to:

“Promote effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and other related threats to the integrity of the international financial system.”

Implementation of the new amendments saw the appointment of the FCA as the official regulatory body overseeing crypto-asset activity, giving it the responsibility of carrying out the purpose of the MLRs.

The obligation to register with the FCA does seem like a positive step toward providing more regulatory clarity in the U.K., but what happens beyond registration? And what can we learn from other jurisdictions?

Lessons from Japan?

Crypto-based businesses that are required to register with the FCA are subject to compliance with a broad range of ongoing obligations set under the MLRs. It is interesting to note, however, that reporting obligations under the instrument appear to be relatively vague — in contrast to the legislative position in Japan.

Following the Mt. Gox scandal in 2014, the Japanese government acted swiftly when it came to developing new regulations for the crypto industry. By 2017, the Payment Services Act, or PSA, was amended, not only to provide a legal definition of cryptocurrencies but also to carry out the imposition of statutory obligations on all crypto exchange businesses.

Implementation of the new regulations obliged crypto exchanges to register with a competent local finance bureau and gave rise to supervision obligations by the Japanese Financial Services Agency, or FSA. According to the PSA, crypto businesses must keep accounting records of all cryptocurrency transactions and annual reports must be submitted to the FSA.

While the MLRs appear to be slightly hazy on reporting rules for crypto businesses, the effect of the new amendments should, in theory, mean that firms engaging in crypto activities can now be defined as FCA-regulated entities. If this were indeed the case, it would not be unreasonable to suggest that FCA-registered crypto businesses should follow the already existing wide-ranging guidance available for FCA-regulated firms, which includes requirements to submit an annual financial crime report to the FCA and the obligation to report any suspicious activity.

It is crucial to note, however, that the operative word here is “guidance,” not a statutory obligation. Guidance is broadly open to interpretation and gives rise to questions about regulatory clarity, particularly when it comes to reporting obligations of crypto entities in the U.K.

The ambiguous position we find ourselves in becomes more concerning, especially as we are now seeing a rise in businesses participating in crypto-based activities. In fact, a key finding from the FCA’s 2020 crypto-asset consumer research is that crypto exchanges are key market participants in the space. Thus, it becomes increasingly important that such market participants have clarity around their compliance obligations, both generally and in the context of crypto exchanges.

Security or no security? That’s another question

The requirement for crypto-based businesses to register with the FCA is an indication that the U.K. is heading toward the right regulatory direction. However, registration really only scratches the surface, particularly when crypto exchanges are involved.

The FCA’s guidance on crypto assets identifies security tokens as one of three broad categories of virtual currencies. Security tokens are a class of crypto assets that may present with certain attributes, which means they provide certain rights and obligations comparable to those of financial instruments regulated by the Markets in Financial Instruments Directive, or MiFID. The current position in the U.K. is that if a crypto asset looks as if it has characteristics similar to a security, then it falls within the FCA’s regulatory parameter. If not, then it will be unregulated.

Before listing new tokens, crypto exchanges tend to require legal analysis to be carried out in order to determine whether those tokens are classed as securities. Generally, if a token isn’t legally classified as a security, then it gets given the green light for listing; if it does turn out to be a security, then a more cautious approach is taken. In any event, the degree of regulatory obligations attaching to a token will vary depending on its characteristics and is usually assessed on a case-by-case basis.

We might, however, see a shift in this approach sooner rather than later. Kraken subsidiary Crypto Facilities recently registered with the FCA to operate as a multilateral trading facility, claiming to be the first U.K.-based exchange to do so. As a licensed MTF, Crypto Facilities is subject to significantly more regulations. However, it has clearer reporting obligations to the FCA, which is a contrasting position to the ambiguous approach when it comes to those crypto exchanges that may not necessarily be offering crypto securities. Two other crypto exchanges operating in the country, Archax and Gemini, got licenses a month later.

Binance, for instance, is an FCA-registered exchange and is authorized to conduct a broad range of investment-related activities, but it doesn’t have a license to operate as an MTF. Both Crypto Facilities and Binance are top exchanges with a U.K. presence, but one of the main differences between the two entities is that one has clearer reporting obligations while the other does not.

Are the U.K. rules sufficient?

We have only this year seen the implementation of the new registration rules under the MLRs — a slow reaction in comparison with the three-year head start by Japanese regulators — and even then, reporting obligations for crypto businesses, particularly those exchanges not offering securities, remains unclear.

From what we’ve seen in Japan, regulators tend to act quickly and appear to be moving in close unison with new developments in the crypto market. Earlier this year, new amendments to the regulatory landscape were introduced, with the new rules implemented to effectively govern crypto custody service providers, as well as businesses dealing in crypto derivatives.

In 2019, the FCA proposed a ban on the sale of crypto derivatives to retail investors, explaining that such products could be capable of being classified as financial instruments pursuant to MiFID and, therefore, within its regulatory scope.

Now, nearing the end of 2020, there have been no announcements confirming whether there will indeed be a ban on the sale of crypto derivatives to retail consumers, with top exchanges like Binance still having the ability to provide such products to retail investors.

The FCA’s latest crypto consumer research found that most crypto exchange consumers in the U.K. tend to use non-U.K. based exchanges. And while the report does not directly attribute this to the ambiguous regulatory position in the U.K., having a clearer understanding of their obligations can only help U.K.-based crypto exchanges moving forward.

This article is for general information purposes and is not intended to be, and should not be taken as, legal advice.

The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Erika Federis is legal counsel at digital payments platform Wirex. She trained as a lawyer at a top 100 U.K. law firm and was first introduced to the blockchain and crypto arena during her training contract. Since discovering her passion for the space, Erika has written articles on issues surrounding the topic and continues to follow the development of cryptocurrency regulations across the globe.

consensys-wins-contract-for-thailand-hong-kong-cbdc-project

ConsenSys wins contract for Thailand-Hong Kong CBDC project

Following a successful research phase between the two central banks, Consensys will develop a proof-of-concept for cross-border interbank blockchain payments.

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ConsenSys wins contract for Thailand-Hong Kong CBDC project

Blockchain firm ConsenSys announced Sep. 25 that it had been awarded the contract for a cross-border payment project between Thailand and Hong Kong.

The company will lead the second implementation phase of Project Ithanon-Lionrock. The project is a joint initiative to create a cross-border central bank digital currency, or CBDC, payment network between banks in the two countries.

Initiated in May 2019 by the Hong Kong Monetary Authority, or HKMA, and the Bank of Thailand, or BOT, the project announced the results of its initial research phase back in January. This found that there was significant potential to use DLT technology to reduce intermediaries and settlement layers in the current cross-border transfer process.

The aim now is to build a proof-of-concept, setting up a cross-border corridor between Thailand’s Ithanon and Hong Kong’s Lionrock networks. This will of course also require a solution for seamless currency conversion between the Thai baht and Hong Kong dollar.

ConsenSys will use its enterprise Ethereum stack technologies, with a focus on prioritizing scalability, security, and interoperability.

The company has previous experience of developing CBDC payment networks, having been involved in both Singapore central bank’s Project Ubin, and the South African central bank’s Project Khokha.

More recently, ConsenSys was in the news after acquiring the JPMorgan-developed blockchain project, Quorum.

european-central-bank-execs-are-wrong-—-intentionally-or-unknowingly?

European central bank execs are wrong — Intentionally or unknowingly?

Recently, European central bank executives — Thomas Moser from Swiss National Bank and Martin Diehl from Deutsche Bundesbank — stated that central bank digital currencies don’t need a blockchain.

They expressed their opinions by saying that blockchains — especially public, or permissionless — make no sense for central bank digital currencies. The reason is that central banks are central parties; therefore, a blockchain, being a decentralized ledger, is not applicable. It is a pity, but the clerks seem to be unknowingly (or intentionally, who knows?) wrong in their conclusions to why and how blockchain technology can be used, especially with CBDCs.

There are two misconceptions widely spread in the general public. First, permissioned distributed ledger technologies are often erroneously called “a blockchain” because they have similar features. However, they are not fully decentralized, immutable and censorless, compared to permissionless blockchains (but we will not discuss this problem today).

The second is why we need blockchain technology and how it can be applied to real-world problems. It is time for the blockchain community to roll up its sleeves and start educating people, especially those who make decisions at state levels.

Any existing public blockchain can be used for a wide range of applications related to finance, property rights and copyrights, or anything that has an economic value and can be represented as a nonfungible token.

System architecture in two layers [Infographics]

First, there is the blockchain protocol with a cryptocurrency. At this level, we design nothing; we just accept it and use it as it is. It has all the necessary features to create the second layer: the application level and a transparent blockchain; it’s decentralized and immutable; it has its own cryptocurrency; and we can publish data on it.

Immutability and the ability to permanently store data, which users can insert in transactions, gave birth to everything we know beyond cryptocurrency: smart contracts, tokens, key-value entries and irrevocable records of arbitrary data. This is the application level. Here, we can design any interaction with any party, including central banks. And it absolutely does not contradict the nature of the technology because blockchain is a level of a decentralized public repository for transactions and data. With such a platform, both centralized banking and blockchain technology can coexist.

Let’s imagine a CBDC on a blockchain, for example, Bitcoin, Ethereum or any other ledger from the top 100 cryptocurrencies on CoinMarketCap (anything ranked lower should not be considered due to security concerns):

For example, Alice goes to a bank and gives a bag of cash, asking the clerk to issue tokens for the equivalent amount. Two transactions must happen on the blockchain. Alice creates her tokens (or colored coins), and in the transaction, she puts a reference to the bank’s transaction. The bank, in its transaction, confirms that Alice’s token represents money of that amount. Now, Alice has digital cash in her crypto wallet. She can exchange it into cryptocurrencies, other tokens, or buy anything else and use it as money as long as everybody trusts the bank. When other people go to the bank (or any other bank), they return previously acquired tokens in exchange for cash, which was first brought to the bank by Alice, and the tokens are then destroyed because they no longer represent value.

Why do we need the bank’s record? If Alice loses her private key, the bank will update its records and make it public that these tokens are no longer valid. The bank’s records are also needed to control money laundering and other unlawful activities. The tokens can be split and transferred many times to anyone. Here comes into play the rules: Know Your Customer, Anti-Money Laundering, counter-terrorism financing, etc. If Bob receives tokens from an unverified wallet and cannot prove the origin of the money, if there is a reason to believe that this money is involved in any illegal transaction, there will be no way he can cash it out. All transactions are transparent and traceable. The bank, through the prescribed lawful procedure, can trigger the transaction that will announce this money invalid. The coins will remain in Bob’s wallet, which he will still control, but they will turn into useless money.

Of course, this is a simplified scenario just to explain the general idea. The mature system will involve many elements: the cross-blockchain protocol to include many blockchains in the system to let users decide for themselves where they want to own their digital cash and transfer it from one blockchain to another. We will need another protocol layer of smart laws and digital authorities to publish patches to the banking protocol and to update the application level. We need this because in a situation where both private keys are lost — Alice’s and the bank’s — we need a third, which is the root address that belongs to the authorities in order to restore access or even to reset the whole system if something goes wrong.

But again, all this happens not in the blockchain protocol, but on the application level. We will also need to design protocols for digital identity and KYC, and it is better to look into the direction of new approaches: self-sovereign identity, decentralized identifiers and many other elements. And of course, instead of just having the bank and Alice involved, the central bank and the government must move in to interfere by applying their scenario.

Meanwhile, one thing remains the same. The blockchain that serves us as a pipeline to transfer value is, at the same time, an immutable repository as evidence of everything happening in the real world.

Conclusions

Through its native mechanism of transaction authentication by public and private key cryptography, blockchain technology allows users to perform transactions directly on a ledger, while in the centralized system, there is always a client-server architecture, and hence, a middleman; transactions are irrevocable and immutable, which no centralized technology is capable to ensure at a comparable level. Therefore, it is a reliable pipeline to transfer value.

Central banks and commercial banks perform multiple functions, and among them, blockchain technology can help to improve some of the most important ones to ensure a critical infrastructure.

The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Oleksii Konashevych is the author of Cross-Blockchain Protocol for Government Databases: The Technology for Public Registries and Smart Laws. He researched the use of blockchain technology for e-governance and e-democracy, and works on the tokenization of real estate titles, digital IDs, public registries and e-voting at the RMIT University. Oleksii co-authored a law on e-petitions in Ukraine, collaborating with the country’s presidential administration and serving as the manager of the nongovernmental e-Democracy Group from 2014 to 2016. In 2019, Oleksii participated in drafting a bill on Anti-Money Laundering and taxation for crypto assets in Ukraine.

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EY releases new tool for analyzing Bitcoin transactions and on-chain data

EY has added a new solution to its Blockchain Analyzer product suite.

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EY releases new tool for analyzing Bitcoin transactions and on-chain data

Big four accounting firm EY has launched a new solution for investigating on-chain data including Bitcoin (BTC) transactions. 

The new Explorer and Visualizer solution launched as a part of the EY Blockchain Analyzer product suite. According to an announcement on Sep. 27, the beta version is now available for free for individuals. 

EY also said that it will soon make the solution available as a service on its blockchain website.

Users will be able to utilize search functionalities along with its visualization technology. It will allow audit teams to explore and track on-chain data by searching for specific transactions, addresses and blocks. They may then analyze the gathered data to manage legal, compliance and fraud risks. 

EY global forensic and integrity services lead Andrew Gordon said that the Explorer and Visualizer solution will make financial reporting for blockchain-enabled transactions more convenient. It will help “highlight potential outliers including fraudulent red-flag activities,” he added.

Additionally, EY has launched a new procurement solution on its OpsChain platform — EY OpsChain Network Procurement — which will expectedly enable companies to privately and securely conduct end-to-end procurement activities on the Ethereum blockchain.

Currently available in free beta, the solution is said to move business processes from enterprise resource planning systems to shared blockchain-based smart contracts, allowing them to automatically track volumes and global expenditure. The solution is also expected to help buyers and sellers have parity and work with globally agreed terms and pricing.

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Most crypto exchanges are vulnerable by design, says ByBit CEO

Crypto exchange security is once again in the news after hackers breached KuCoin. But this shouldn’t surprise people as exchanges are vulnerable by design, according to ByBit CEO Ben Zhou. 

Zhou told Cointelegraph that exchanges act as a single point of failure. As a centralized web application, exchanges are susceptible to the same security issues as all other websites. 

Security becomes even more important as investors and traders are increasingly taking exchanges to task to protect funds. 

The vast majority of crypto exchange servers and storage networks, Zhou said, keep digital currencies in hot wallets. If hot wallets are not properly protected, then this opens them up to theft. Zhou thinks that a cold wallet system is more secure since hot wallets are connected to the internet, making them more vulnerable to hacking. Cold wallets, on the other hand, are not connected online. The only downside is not being able to make large withdrawals from an exchange immediately.

According to Zhou, investing in security should be one of the highest priorities on an exchange platform’s agenda, especially if it operates online. To combat potential hacking threats, exchanges also need to better address vulnerable areas and apply multiple security layers for penetration testing. 

Any security system should also protect information across all points of interaction. This means protecting user data from account registration, login, trading, and any information exchange with the platform. Zhou added that:

“This can be accomplished by applying best practices for application lifecycle management, hiring knowledgeable and reputable security consultants for penetration testing and running bounty programs within the white hat community to identify any potential vulnerabilities.” 

Zhou also recommends cryptocurrency exchanges work with reputable security firms to carry out security audits, apply strict management processes, and invest in zero-trust architecture. Zero-trust architecture requires verification for anyone accessing a service to prevent any potential data breaches both internally and externally. 

He said there are several bespoke security solutions from third-party vendors that exchanges can use but noted these could also be developed in-house.

Zhou revealed that ByBit invested considerable resources in developing and enhancing its own security protocols and solutions. They have implemented a multi-signature cold wallet system to protect the safety of users’ funds. ​

When it comes to combating potential hacking threats, ByBit organized and conducted multiple red alert scenarios and bounty programs with the white hat hacker community. This is to ensure there are no system vulnerabilities. Zhou added that: 

“Even when it comes to withdrawals, we subject any requests to at least three layers of risk-control verifications. Crypto asset consolidation among cold wallets follows the strictest policy, including physical environment security, system security, encryption techniques, operation authentication, monitoring and audit.” 

As Cointelegraph previously reported, the recent crypto twitter hack was a wake-up call for centralized platforms to address online security issues. 

americans-don’t-want-to-give-up-their-paper-money,-but-they-should

Americans don’t want to give up their paper money, but they should

The recent health scare surrounding the COVID-19 outbreak seems to have accelerated the move toward a cashless society, with cashless payment spiking in concert with viral cases.

Yet, our findings in a Genesis Mining study called “Perceptions and Understanding of Money 2020” indicate that a significant majority of Americans are not psyched about parting with their paper money on a permanent basis.

To be more specific, we found that 60% of respondents are opposed to the idea of paper money being replaced with “digital-only money.” This could be a “devil-you-know” versus a “devil-you-don’t-know” situation where familiarity with paper money is the driving force behind the wariness of giving it up. This is understandable, but if resisting change were humans’ driving principle, then progress of any kind would be impossible.

It is possible that better acquaintance with the advantages of digital transactions could change the minds of those willing to have their minds changed.

It is also possible that the movement toward a cashless society is a non-Democratic issue — that is, it could be inevitable, depending on who wishes to see a cashless society emerge. Embracing the benefits of digital money could ease our transition into a new financial frontier.

COVID-19 has accelerated the cashless revolution

The U.S. news outlet Axios cites several figures and facts indicating that increased health-consciousness amid the global pandemic has accelerated the migration toward a cashless society. Its findings include that:

  • People in various nations are wary of physical money, which they see as a potential conduit for viral transmission.
  • 63% of consumers report using cash less often than they did before the pandemic.
  • Payment for goods and services through apps and websites, rather than with physical money, has increased.

Of course, we must consider the fact that quarantine measures have prevented many from accessing ATMs, paying for goods and services in person, or engaging in activities where they might normally use cash. In some sense, the increase in cashless payments has not been completely reflective of voluntary consumer attitudes. It may, however, be habit-forming.

The idea that your dollars and coins are dirtier than you would like to consider is — unlike the coronavirus — not novel. A 2017 study found that a collection of bills circulating around New York City contained various bacteria and viruses.

Many people’s aversion to unnecessary risk has been illustrated by widespread willingness to wear masks, quarantine and take other health-conscious precautions. Foregoing physical money in favor of primarily-digital payments could be increasingly viewed as yet another way to protect oneself from possible viral infection.

The benefits of going cashless

Even before “COVID-19” became a universally-recognized term, advocates for digital payments were touting the perks of completely or largely-cashless societies. We’ve already touched on the potential health benefits of eschewing dirty cash for cleaner forms of payment.

In addition to health benefits, the advantages of cashlessness — among others — may include:

  • A greater difficulty for muggers and thieves to rob you of your physical money.
  • A greater ability to trace illegal activity that could be more easily perpetrated by laundering cash through businesses, banks and other means without a trace.
  • Commerce-related perks, which Visa notes include faster transactions (on average), less hassle for customers who would otherwise have to procure, store, count and dole out cash, and the fact that customers are statistically more likely to spend more at a business using a card rather than cash.
  • Ease of currency exchange.

Some forms of digital payments may also provide greater security. Security standards used to protect cryptocurrency wallets are being adopted for other purposes, as Big Four audit firm Deloitte noted, and the further adoption of such practices could further bolster asset protection in a cashless society.

The move toward cashlessness falls in line with the general shift toward global uniformity, for better or worse. Some note that uniformity itself is not necessarily a net positive — one of several critiques of emerging cashless societies.

Critiques of going cashless

It would be unfair to pose the prospective benefits of going cashless without mentioning known drawbacks and still-unfounded critiques of the cashless concept.

For one, there is the notion that moving all nations and individual cultures toward a universal standard of exchange is akin to whitewashing. There is something to be said about coming home from a vacation with a paper bill or coin that you had never before seen or held as a keepsake of your trip. Losing the uniqueness of different currencies is a fair concern, to be certain. But is it a greater loss than the potential benefits of cashlessness?

The answer to that question may vary, depending on your values and beliefs. Other critiques of taking societies cashless include:

  • The elimination of cash will be followed by the imposition of ubiquitous transaction fees for businesses and consumers, which, without the alternative option to pay with cash, may be unavoidable and costly over time.
  • Cashlessness represents a greater trend toward limited choice and autonomy.
  • A reduction in cash services will eliminate a substantial swath of jobs that revolve around cash processing, issuance and management.
  • Less cash and more easily-traceable digital transactions mean less privacy.

These are not illegitimate concerns, and there is a debate to be had. Alleviating these concerns with robust security measures and good faith will be necessary to make a fully cashless society work as it should.

Conclusion

With proper oversight and security, the move toward cashless payment mechanisms could provide numerous benefits, and cryptocurrency-level security may be an integral feature of the move toward cashlessness.

There are certainly kinks to be worked out and concerns to be addressed, but the age of COVID-19 has further reinforced that a shift toward all-cashless payments may be not only beneficial but more necessary than many previously realized.

The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Marco Streng is the CEO and a co-founder of Genesis Group and Genesis Mining — one of the largest crypto mining companies in the world. Prior to co-founding Genesis in 2013 and becoming an impassioned advocate for blockchain technology and cryptocurrencies, Marco studied mathematics at the Ludwig-Maximilian University of Munich.

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DeFi hype has just begun says Neo founder

DeFi is the word on everybody’s lips.

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DeFi hype has just begun says Neo founder

The hype around DeFi is not fading away and is only just beginning, said Neo founder Da Hongfei, during a live stream on China’s Hub on Sept. 25.

Da said DeFi created a process in just a few years that traditional finance took hundreds of years to perfect. DeFi projects are now experimenting with all sorts of financial products and services. He added that:

“Lending and borrowing, decentralized exchanges, insurance and all kinds of derivatives are on the rise in DeFi. The initial stage DeFi infrastructure has a solid good start, and now it is time to see more and more applications to be built and innovated on DeFi.”

According to Da, DeFi has brought numerous new possibilities in the financial arena, including creating a new type of asset that allows users to access cash at any time. DeFi, Da said, will have a significant impact on future economic life. He predicts people will not need banks in the future as they turn towards DeFi services. And this scenario may already be happening. Using China as an example, Da said:

“Chinese people have done this more or less, probably dealing with banks, dealing with Alipay and WeChat, at least doing this kind of financial behavior without going to the bank.”

Da, and Binance co-founder He Yi, revealed in the live stream that Neo and Binance are actively looking into DeFi applications. One such application is Flamingo, an interoperable, full-stack DeFi protocol built on the Neo blockchain. It allows users to participate as traders, stakers, and liquidity providers. Binance has announced it listed Flamingo on its launch pool on Sept. 23. Both are also looking to build DeFi infrastructure further.

As Cointelegraph previously reported, China’s state-endorsed public blockchain is looking into building a regulatory compliance platform that can bridge global DeFi applications and government regulations.