alt-text

2017/07/31 - Vol.1-No.1

User Activated Hard Fork Looms Upon Bitcoin Community

US Securities and Exchange Commission Report Raises Questions

New York Based LedgerX Granted Exchange License

EU Explores Possible Capital Controls For Troubled Banks

User Activated Hard Fork Looms Upon Bitcoin Community

At the heart of the scaling debate, the size of the block, currently at 1MB, has left the Bitcoin community roiling in a dispute that appears to be leading to a User Activated Hard Fork (UAHF) and splitting the currency into Bitcoin (BTC) and the proposed, Bitcoin Cash (BCH).

The community seemed to have reached a consensus after a large majority of miners had shown their support for Bitcoin Improvement Proposal (BIP) 91. The lock-in of BIP91 was the first step in signalling for Segregated Witness (SegWit) and allowing for the block size to increase to an 8MB limit under SegWit2x later in the year.

BIP91 was favoured over two other proposals; BIP141 and BIP148 that would have led to a User Activated Soft Fork (UASF). While BIP148 garnered little support, a UAHF was announced by a small group of miners splitting the community into two camps.

Exchanges and Wallets have responded by signalling whether or not they will but supporting the proposed currency (See Table).

by presenting a single point of failure, and since in most jurisdictions legal ownership rests with the transfer agents, true ownership can be obfuscated – in turn, this can violate rules that limit shareholdings.vulnerable to fraud, and centralized databases can suffer security breaches.

Legal ownership would be restored to investors and companies, and would be more transparent. Dividends and stock splits could be automated, reducing cost and error.

Also, a distributed ledger platform would remove the single point of failure risk, help make proxy voting more transparent and accurate and make it easier to manage cap tables as well as collateralisation.

There are disadvantages. Transparency, for one: not all investors want their positions to be visible. Error resolution is another: mistakes happen, and on an immutable ledger, how do you fix themThere are disadvantages. Transparency, for one: not all investors want their positions to be visible. Error resolution is another:

mistakes happen, and on an immutable ledger, how do you fix themThere are disadvantages. Transparency, for one: not all

That this milestone was reached in Delaware is significant.The state is 49th in the nation in terms of size and 45th in population, but it boasts two-thirds of US listed companies and 85% of IPOs. It has more registered legal entities than it has residents. This is due to its relatively flexible business legislation and tax framework, and to its reputation for being a standards bearer in corporate law.

What’s more, the recent amendment is part of a larger initiative to streamline corporate and governmental processes. The Delaware Blockchain Initiative, launched over a year ago, commits the state’s government to incorporating blockchain technology in the handling of official documents such as land titles, birth and death certificates, professional licenses, collateral claims and company filings.

So, here we have the US state with the largest concentration of registered corporations, and a reputation for supporting innovation, offering businesses the chance to test a new form of financing and governance.

While adoption will probably be slow, at least at first, the pace is likely to pick up as the benefits become even more apparent. Other jurisdictions could follow suit to avoid losing a chunk of their domiciled businesses. And the structure of financial markets could start to gradually, but fundamentally, change.

 

US Securities and Exchange Commission Report Raises Questions

The US Securities and Exchange Commission (SEC) released its report on the investigation of The Decentralised Autonomous Organisations (The DAO) Initial Coin Offering (ICO) that was exploited during its launch in April 2016 and that consequently lead to the hard fork of Ethereum.

While this may on the surface sound like a small modification, it is a big deal. Companies and exchangesaround the world have been investigating how distributed ledgers could help with issuance, execution and settlement (some have even issued shares on a blockchain). However, they have been doing so under a cloud of regulatory uncertainty, unsure of whether the stakeholders – including the relevant governing bodies – would allow the innovations to take hold.

For the first time, businesses will be able to experiment with new processes knowing they have the protection of the law.

This is likely to pave the way for the entire life cycle of a share – the issuance, custodianship, trading, shareholder communication and redemption – to be enacted on a blockchain. The result could be a reframing of the global securities network, one of the cornerstones of our modern capitalist economy.

The equity infrastructure used in most markets today evolved around paper-based issuance, and essentially has the same conceptual backbone as in the 17th century. Processes are complex, involving several steps, each with fees. Centralized clearing creates systemic risk by presenting a single point of failure, and since in most jurisdictions legal ownership rests with the transfer agents, true ownership can be obfuscated – in turn, this can violate rules that limit shareholdings.

Furthermore, a paper-based system – even a digitized one – is vulnerable to fraud, and centralized databases can suffer security breaches.

Settle for less

With a blockchain system, investors and issuers can interact directly with each other, in theory cutting out brokers, custodians and clearing houses, thus reducing transaction costs. Settlement can happen within hours instead of days, releasing funds and lowering carrying fees.

Legal ownership would be restored to investors and companies, and would be more transparent. Dividends and stock splits could be automated, reducing cost and error.

Also, a distributed ledger platform would remove the single point of failure risk, help make proxy voting more transparent and accurate and make it easier to manage cap tables as well as collateralisation.

That this milestone was reached in Delaware is significant.The state is 49th in the nation in terms of size and 45th in population, but it boasts two-thirds of US listed companies and 85% of IPOs. It has more registered legal entities than it has residents. This is due to its relatively flexible business legislation and tax framework, and to its reputation for being a standards bearer in corporate law.

What’s more, the recent amendment is part of a larger initiative to streamline corporate and governmental processes. The Delaware Blockchain Initiative, launched over a year ago, commits the state’s government to incorporating blockchain technology in the handling of official documents such as land titles, birth and death certificates, professional licenses, collateral claims and company filings.

So, here we have the US state with the largest concentration of registered corporations, and a reputation for supporting innovation, offering businesses the chance to test a new form of financing and governance.

While adoption will probably be slow, at least at first, the pace is likely to pick up as the benefits become even more apparent. Other jurisdictions could follow suit to avoid losing a chunk of their domiciled businesses. And the structure of financial markets could start to gradually, but fundamentally, change.

wdt_ID Table Test Hello Fiver
1 Row 2 3 4
2 Row 2 2 3 4
3 Row 3 2 3 4
4 Total 2 3 4

American Express
Buying Option On App Abra

Merrill Lynch Plots
Bitcoin's Path to Global Legitimacy

In a move that shouldn’t stun most BTC and cryptocurrency followers, Rothschild has purchased Bitcoin via the GBTC (Bitcoin Investment Trust) investment vehicle.

SEC articles signed on Friday indicate that Rothschild has diversified into cryptocurrencies, now owning $210,000 worth of GBTC.

The disclosure was published via Twitter:

In a report on Bitcoin, Merrill Lynch's commodity and derivatives strategist Francisco Blanch, has noted the similarities of digital currencies to gold but says it can take the next step up in money’s evolution if issues on safety, liquidity and return are addressed.

The report has looked at the history of trading commodities and how those gave rise to paper money, noting that Bitcoin could be the latest innovation that has seen people switch from salt to dollar notes.