Monday, February 8, 2016

EoC, WEF, HFT and Rubics cube....Netflix and Qantas


Another week and another barrage of blockchain papers. This week piccie from http://bitsonblocks.net/

This week Euroclear come out with their paper. The Citi Digital Money paper also available online after being formally presented.

Also included are links to the Davos papers (World Economic Forum). Some of them, like the future of jobs are nothing new, just confirm what we arleady know (we hardly know what the job specs will be in 10 years time).

A couple of HFT stories. Interesting to read Aquis taking order handling action. Also liked the work of the Tradebot guys in using technology to solve the rubics cube. For those that like management, I very much enjoyed the Netflix insights. New found respect for their culture (assuming it endures). And a magic safety video from Qantas for all those frequent fliers.

Have a great week all.

S

www.clearingandsettlement.blogspot.com


Blockchain (DLT)

Blockchain in Capital Markets
(24 pages)

Releasing the flow of digital money: Hitting the tipping point of adoption.https://www.citibank.com/icg/sa/digital_symposium/

Davos: World Economic Forum Tackles Fintech
http://deloitte.wsj.com/cio/2016/02/03/davos-world-economic-forum-tackles-fintech/
Nice piccie. (p12)
Nice presentation (178 pages)

http://www3.weforum.org/docs/WEF_The_future__of_financial_services.pdf

Jump to pages 44 and 45 of the roundup.
This introduces the reports released at Davos.
http://www3.weforum.org/docs/WEF_AM16_Report.pdf

such as the future of jobs...
http://www3.weforum.org/docs/WEF_FOJ_Executive_Summary_Jobs.pdf

Goldman and IBM join Digital Asset Holdings funding round
Goldman Sachs and IBM have jumped aboard Digital Asset Holdings' recent investment round, taking the blockchain startup's haul to more than $60 million.
https://www.finextra.com/news/fullstory.aspx?newsitemid=28415
Love this comment:
...if the tool of the month is a hammer, everything around you looks like a nail....

Bank of America loads up on blockchain patents
Bank of America is in the process of filing 20 new blockchain-related patents, adding to the 15 it has already submitted to the US Patent and Trademark Office (USPTO).
.....describing the potential commercial application of its patents as "very unclear", Beasant said: "(It's) very important in the intellectual property world to reserve our spot even before we know what the commercial application might be."...
https://www.finextra.com/news/fullstory.aspx?newsitemid=28401
I just don't see how 'very unclear' patents can be enforceable.
Rather disappointing GS 'esk behaviour from mother Merrill.

Smart Securities Trading Platform Symbiont Raises $7 Million
https://bitcoinmagazine.com/articles/smart-securities-trading-platform-symbiont-raises-million-1452613323

Blockchain: Catalyst for Massive Change Across Industries
http://blogs.wsj.com/cio/2016/02/02/blockchain-catalyst-for-massive-change-across-industries/#

CIO Explainer: What Is Blockchain?

Kynetix appoints exchange industry pioneer to drive Commodity Blockchain Consortium
https://www.ctrmcenter.com/news/vendor-news/kynetix-appoints-exchange-industry-pioneer-drive-commodity-blockchain-consortium/



Markets

Aquis Exchange to ban predatory high-speed trading
“This is absolutely not against HFT,” said Haynes


Olathe co-workers build a superfast Rubik’s Cube robot for a Guinness World Record attempt
(They work together at Tradebot Systems.)
http://www.kansascity.com/news/business/technology/article57328688.html

BNP Paribas to simplify its wealth management structure

LSE Said to Hire Morgan Stanley's Ross to Run Derivatives Venue: CurveGlobal
(previously Project Rita)
http://finance.yahoo.com/news/lse-said-hire-morgan-stanleys-111825144.html

BBA calls on European Commission to ensure financial regulation supports competition and growth
(80 pages!)
https://www.bba.org.uk/news/press-releases/bba-calls-on-european-commission-to-ensure-financial-regulation-supports-competition-and-growth/#.VrPmr4_XLIU

AFME responds to Commission’s call for evidence
Equity primary markets and trading report: Q4 2015

AFME publish first pan-European SME guide
All at: www.afme.eu/

Stuff



THE WOMAN WHO CREATED NETFLIX'S ENVIABLE COMPANY CULTURE

Here's to the Crazy Ones, Think Different
Apple Confidential - Steve Jobs on "Think Different" - Internal Meeting Sept. 23, 1997
1997. Steve Jobs in shorts, relaxed, during internal meeting with Apple executives and managers, just a few weeks after his return to Apple, speaks briefly about planned changes in company (pipeline, products, distribution changes) and then presents first informations about planned "Think Different" campaign, now legendary and iconic... Samples of TV commercial, outdoor, posters, and press ads.
https://www.youtube.com/watch?v=9GMQhOm-Dqo&feature=youtu.be


Don't Touch That Dial! By Vaughan Bell
Worries about information overload are as old as information itself.
A respected Swiss scientist, Conrad Gessner, might have been the first to raise the alarm about the effects of information overload. In a landmark book, he described how the modern world overwhelmed people with data and that this overabundance was both "confusing and harmful" to the mind. It's worth noting that Gessner, for his part, never once used e-mail and was completely ignorant about computers. That's not because he was a technophobe but because he died in 1565.
Socrates famously warned against writing because it would "create forgetfulness in the learners' souls, because they will not use their memories." He also advised that children can't distinguish fantasy from reality, so parents should only allow them to hear wholesome allegories and not "improper" tales, lest their development go astray.
As literacy became essential and schools were widely introduced, an 1883 article in the weekly medical journal the Sanitarian argued that schools "exhaust the children's brains and nervous systems with complex and multiple studies, and ruin their bodies by protracted imprisonment." Meanwhile, excessive study was considered a leading cause of madness by the medical community.

Why Luxembourg wants to mine asteroids
Later this year, Nasa’s Osiris-Rex mission will attempt to return a 60g sample from an asteroid to Earth at a pricetag of around $1bn.
http://www.telegraph.co.uk/finance/newsbysector/industry/mining/12137693/asteroid-mining-luxembourg-space-plan-esa.html

Qantas Safety Video
Published on 2 Feb 2016. Airbas A380 version
https://www.youtube.com/watch?v=fhbXFHrDmTg


Education
“Ideally, what should be said to every child, repeatedly, throughout his or her school life is something like this: 'You are in the process of being indoctrinated. We have not yet evolved a system of education that is not a system of indoctrination. We are sorry, but it is the best we can do. What you are being taught here is an amalgam of current prejudice and the choices of this particular culture. The slightest look at history will show how impermanent these must be. You are being taught by people who have been able to accommodate themselves to a regime of thought laid down by their predecessors. It is a self-perpetuating system. Those of you who are more robust and individual than others will be encouraged to leave and find ways of educating yourself — educating your own judgements. Those that stay must remember, always, and all the time, that they are being moulded and patterned to fit into the narrow and particular needs of this particular society.”
― Doris Lessing, The Golden Notebook








Monday, February 1, 2016

Complex change, Citi DigiMoney, Imperial College....Aussie Day and farewell Chi-X (as we knew it).


The piccie is one sent to me by my brother. It resonates with me for 2 reasons. One is the practicalities of the diagram (some versions label 'treadmill' as 'false starts', but having lived the dream(s) I think treadmill far more appropriate). The other is that it shows for transformational projects to succeed there are combinations of dependencies. I don't think management nees to be added to the mix (already covered in skills and resources) but I do think there is space for an emotional intelligence dependency. You can have skills, resources and incentives but if the people mix is wrong....it won't fly. Maybe a purist catches this under resources...but to me resources is just bandwidth. It is the synthesis that is critical.


I also attended the Citi Digital Money Symposium. I was very impressed by the pedigree of the speakers. I was also very impressed with the practical and theoretical work of Imperial College's Cryptocurrency Research and Engineering department. http://www.imperial.ac.uk/cryptocurrency
Even the BBC is covering Blockchain these days....
https://www.cryptocoinsnews.com/bbcs-click-blockchain-documentary/
(Includes more coverage from IC's Prof. William Knottenbelt)

Yet another white paper out last week: this one from DTCC.

Happy, belated, Australia Day and farewell to Chi-X. The last of the constituent parts have found a new home. CXE to BATS, CXC to Nasdaq, CXA and CXJ etal to Flowers.

Have a great week all!

S
www.clearingandsettlement.blogspot.com


Blockchain


New DTCC White Paper Calls for Leveraging Distributed Ledger Technology to Solve Certain Long-Standing Operational Challenges
The paper, titled “Embracing Disruption – Tapping the Potential of Distributed Ledgers to Improve the Post-Trade Landscape,” notes that while today’s financial market infrastructures have a proven track record of providing stability, reliability and certainty, they are often quite complex, siloed and not equipped for 24/7/365 processing. DTCC believes a secure distributed ledger, with complete and traceable transaction history for a set of assets that is shared and accessible only between trusted parties, could provide significant operational improvements as well as further mitigate risk and reduce post-trade costs.


Accenture Report:
Top 10 Challenges for Investment Banks 2016
The impact of digital technology on investment banking
** Challenge 4 is. of course, Blockchain technology.

Microsoft to Offer Ethereum-Based Services on Azure
The software giant has formed a partnership with Brooklyn-based Consensys, a startup that is building products and services for Ethereum, an alternative platform to bitcoin. Through the partnership, customers of Azure, Microsoft’s cloud-based business service, will have access to tools that will allow them to experiment with and build products that can digitize and automate a plethora of operations, from securities trading to cross-border payments to corporate accounting, and offer them to their own customers.
Vitalik Buterin, a 21-year old programmer and writer, launched Ethereum this summer as a platform for what are called smart contracts. While bitcoin was designed with the single purpose of exchanging digital currency, Ethereum has broader goals. Ethereum’s mandate is to provide businesses with a platform on which products and services can be built that simplify various business functions and cut out the need for third parties. Anything that can be digitized, cryptocurrencies, derivatives trading, securities trading and settlement, even property titles, is a potential service on Ethereum.



Microsoft Bets That Bitcoin-Style Blockchains Will Be Big Business
Microsoft Positions Itself as the Perfect Home for Bitcoin-Style Blockchains | MIT Technology Review
Microsoft wants financial companies to host their blockchain software inside Azure. It has recently struck partnerships with several startups working on blockchain software for banks and other big corporations.



Markets


JC Flowers buys Chi-X
Stock exchange Chi-X Australia along with Chi-X Japan and Chi-Tech Hong Kong have been sold for an undisclosed amount to global private equity house JC Flowers & Co
Chi-X Global owned Chi-X Australia, but the ultimate owners were Nomura's Instinet, and minority owners UBS, Bank of America Merrill Lynch, GETCO LLC, Goldman Sachs, Morgan Stanley, and Quantlab Group LP. 

http://www.smh.com.au/business/banking-and-finance/jc-flowers-buys-chix-for-undisclosed-amount-20160125-gmddic.html#ixzz3yFolJgri 



Regulation / Banking

Correspondent central banking model (CCBM)
Procedures for Eurosystem counterparties
Update effective as of 25 January 2016 https://www.ecb.europa.eu/paym/coll/ccbm/html/index.en.html
** This is a nice updated explanation of the CCBM model.

FESE Response to ESMA on indirect clearing arrangements under EMIR and MiFIR

Belgium gets cold feet on financial transaction tax
The European Commission proposed taxing financial services in 2011, in the wake of the financial crisis. Lacking unanimous approval, an “enhanced cooperation” group of 11 countries agreed to push the project: France, Germany, Italy, Portugal, Spain, Greece, Belgium, Slovenia, Slovakia, Estonia and Austria. Estonia has since withdrawn, arguing that the costs associated with the tax would be higher than the revenues.
Some other countries in the group, such as Slovenia, now appeared reluctant too and the withdrawal of two or more countries would sink the proposal, since EU rules require at least nine countries to back such a procedure.

Too big to behave?
European Bank Resolution: Making it work!
From the start of 2016, new rules for bank resolution are in place – as spelled out in the Bank Recovery and Resolution Directive (BRRD) – across the EU, and a new authority (the Single Resolution Board, or SRB) is fully operational for resolving all banks in the eurozone.
The implementation issues of the new regime are enormous. Banks need to develop recovery plans, and authorities need to create resolution plans as well as set the minimum required amount of own funds and eligible liabilities (MREL) for each bank. But given the diversity in bank structures and instruments at EU and global level, this will be a formidable challenge, above all with respect to internationally active banks.



News

BBC2 to broadcast final moments of assisted suicide campaigner
How To Die: Simon’s Choice was filmed over last few months of Simon Binner’s life following motor neurone disease diagnosis
http://www.theguardian.com/media/2016/jan/26/bbc2-assisted-suicide-simon-binner-motor-neurone-disease
...and a poignant LinkedIn profile..
https://uk.linkedin.com/in/simon-binner-b068b378


Happy Australia Day!
Australia Day 2016: 'Epic' water slide video goes viral

http://www.brisbanetimes.com.au/queensland/australia-day-2016-epic-water-slide-video-goes-viral-20160127-gmewvc.html#ixzz3yR86lwBw

Friday, January 22, 2016

Bitcoin developers, Healthy BTC?, DA and ASX, UK science office report, ISITC


Now Mike Hearn has left Bitcoin and that exposes Number 1 of those problems. Bitcoin code relies on the goodwill of developers. The 'Hearn' effect is just another reason why I favour permissioned networks. Those like minded souls, that are permitted, driven by a common commercial cause, have an ownership and governance structure that focuses users on maintaining the best code base.
Bitcoin's problems, to my way of thinking, continue. Latency remains an issue...which is in part driven by block size, which needs to be increased (Bitcoin XT is the reason cited for Hearns departure). Without an increase in block size transaction fees will continue to rise...and this kills another aspect of Bitcoin - it's relevance as a medium for micro-payments.
The biggest conceptual problem for me with Bitcoin are its Green credentials. It's carbon footprint is just hideous. Right now a lot of that carbon is in China. Access to cheap electricity...plus a falling Bitcoin price...I think will result in fewer miners...which then raises the issue of concentration risk (in what should be a distributed network).
Bitcoin sure has some growing pains ahead! What do I feel? Block sizes must increase (to defray transaction costs) and mining needs to become 'cheaper', greener and more transparent (environmental arbitrage which is all taking place behind China's great firewall).

Credit to Dan Page for the piccie. I have a lot of respect for graphic artists who convert concepts in images. I liked this one.

What an interesting couple of weeks for Digital Asset. From being reported at the end of last year as struggling and now they raise 50myn. I'm sure this is just around a tweaking of some of the commercials and having ASX come on board as a 'use case'. 

I'll be attending the inaugural ISITC Blockchain working group meeting on the 4th of Feb. I look forward to catching up with people at this event. If you'd like to attend, I'll see what I can do, however I'll need 48hrs notice (security reasons).

Whatever your leisure - may it be a pleasure!

S
www.clearingandsettlement.blogspot.com


Blockchain

Distributed Ledger Technology: beyond block chain A report by the UK Government Chief Scientific Adviser
Press Release:
Paper:
*** Just been reading this and it looks like they lifted my analogy with the Irish electricity market.

JPMorgan: 'aggressively' investing in blockchain tech and robotics.
A note sent to employees by Daniel Pinto, head of JPMorgan's Corporate and Investment Bank, shows that the lender wants to ensure its $9 billion (£6 billion) investment in technology continues in 2016. Blockchain, big data, and robotics are the focus for JPM. Working groups are also being pushed to develop "market-leading platforms," with no detail on what they might be.
http://www.businessinsider.com/exclusive-jpmorgan-employee-note-confirms-aggressiveinvestment-in-block-chain-technology-and-robotics-2015-12

UBS Blockchain Partner Clearmatics Taps Investors for Funds
http://www.bloomberg.com/news/articles/2015-11-18/ubs-blockchain-partner-clearmatics-raises-funds-for-digital-coin

Artists, designers and innovators show how the data explosion is transforming our world.
03 Dec 2015 — 28 Feb 2016
I plan to attend this. I expect it to be more thought provoking in the way the different people visualise things rather than 'educational'.
http://bigbangdata.somersethouse.org.uk/

The Linux Foundation, announced a new collaborative effort to advance the popular blockchain technology. The project will develop an enterprise grade, open source distributed ledger framework and free developers to focus on building robust, industry-specific applications, platforms and hardware systems to support business transactions.
Early commitments to this work come from Accenture, ANZ Bank, Cisco, CLS, Credits, Deutsche Börse, Digital Asset Holdings, DTCC, Fujitsu Limited, IC3, IBM, Intel, J.P. Morgan, London Stock Exchange Group, Mitsubishi UFJ Financial Group (MUFG), R3, State Street, SWIFT, VMware and Wells Fargo.


R3 connects 11 banks to distributed ledger using Ethereum and Microsoft Azure
The R3-managed private peer-to-peer distributed ledger connected Barclays, BMO Financial Group, Credit Suisse, Commonwealth Bank of Australia, HSBC, Natixis, Royal Bank of Scotland, TD Bank, UBS, UniCredit and Wells Fargo.
Participants were able to explore the technology's potential to execute financial transactions instantaneously across the global private network. The banks simulated exchanging value, represented by tokenised assets on the distributed ledger without the need for a centralised third party, said R3 in a statement.

Blockchain standards builder R3 has opened its doors to non-bank financial services firms including funds, exchanges, clearing houses, standards bodies and infrastructure companies, from early in 2016.
R3 also announced the addition of another 12 banks, taking the total to 42 who have pledged their financial and technical support since launching in September.
The latest bank additions are: BMO Financial Group, Danske Bank, Intesa Sanpaolo, Natixis, Nomura, Northern Trust, OP Financial Group, Banco Santander, Scotiabank, Sumitomo Mitsui Banking Corporation, US Bancorp and Westpac Banking Corporation. R3 said the initial window for admittance of new bank members is now closed.


Imogen Heap shows how smart music contracts work using Ethereum.
"We are going to aim to try and do things in an automated fashion. And so we have these things called smart contracts. These are essentially code; rules written into code which determine what happens when money comes in or when certain actions take place.
"And so we have things here called policies. These are things that the artist might decide on; the terms under which they are willing to allow their music to be used.
"So in the case of just the stems, for example, you could say, I'm happy for them to be downloaded for non-commercial use for $45. If you want to use it in a commercial record then I'll give you 50% of the rights and the recording but I still own the song.
"This is pre-known to everybody, recorded on the blockchain meaning it's transparent and visible to everybody. And when you enact these policies by buying music, this happens automatically – everybody knows who is getting paid and how much.

Digital Asset Closes Funding Round Exceeding $50 Million From Thirteen Global Financial Leaders
Digital Asset Holdings, LLC, a developer of Distributed Ledger Technology for the financial services industry, today announced that it has raised more than $50 million in funding from a broad range of leading firms from all corners of the international financial ecosystem consisting of ABN AMRO, Accenture, ASX Limited, BNP Paribas, Broadridge Financial Solutions, Inc., Citi, CME Ventures, Deutsche Börse Group, ICAP, J.P. Morgan, Santander InnoVentures, The Depository Trust & Clearing Corporation (DTCC) and The PNC Financial Services Group, Inc.
http://www.reuters.com/article/digital-asset-funding-idUSnPn15MvTr+8a+PRN20160121

A buzzy bitcoin startup led by Blythe Masters is reportedly struggling to raise funding

ASX Limited (ASX) today announced that it has selected US-based firm Digital Asset Holdings, LLC (Digital Asset) to develop solutions for the Australian market utilising Distributed Ledger Technology.


Bitcoin

Hike Hearn leaves Bitcoin.
The resolution of the Bitcoin experiment

How to measure the health of Bitcoin? (as per Tim Swanson)
1. Number of Transactions per Day:

2. Number of Bitcoin Days Destroyed (this measures the 'age' of Bitcoins moving across the network. A low BDD represents recently used coins changing hands...a high BDD represents 'old' coins 're-entering' (or being released) back into circulation...a bit like G'ma pulling an old 50 quid note out from under the mattress that she'd been saving for a rainy day....or like someone panicking and selling out of all their Bitcoin positions)

3. Total Transaction Fees

4. Total Output Volume. (this measures the total value of all Bitcoins changing hands on a day - which is a slight overstatement as it also 'double counts' any change being returned to a sender). 

Regulation

The importance of client money...
(CASS, CASS resolution Pack and CMAR)
FCA fines Bank of New York Mellon 126 million pounds
[April '15]
http://uk.reuters.com/article/uk-bank-of-ny-melln-britain-fine-idUKKBN0N60VF20150415
FCA Policy statement on Resolution Pack.
http://www.fca.org.uk/your-fca/documents/policy-statements/fsa-ps126


Ghost Writing

The Challenge of Change
(Ghost article I wrote on the tripple whammy of MiFID, EMIR and Basel III)

Wednesday, December 16, 2015

The response to Daesh and UK vote for Syrian airstrikes

How to respond to Deash? This question has been preying on my mind a lot since the events in Paris. Most recently the UK has voted to bomb Syria. As much as I abhor the cowardly acts of terrorists I don't feel that dropping bombs, in haste, is the right answer.

Some things that annoy me:


1. Democratic Process and debate.
In my humble opinion Westminster and democracy work best when full and frank debate is encouraged and supported by fact. I've never been a labour voter (I lean to the right based on economically sustainable principles) but I must say I whole heartedly admire Jeremy Corbyn, the current opposition leader. As he set out to do, I think he has made every endeavor to bring respectability and quality of debate back into 'the house'. On the war front, all he has asked for is the voice of reason, what difference will it make, if we start bombing people (and assets) now? I think David Cameron's response to this reasonable question with the rhetoric "We cannot let that man inflict his security-threatening, terrorist-sympathising, Britain-hating ideology on the country we love" does himself, his party and the political process a great dis-service. I don't know if i'd call it an attempt at bullying, but shouting is most certainly not informed debate.

2. Deselection hypocrisy.
I was glad the vote was a 'free' one. People could act in line with their conscience (and their electorate) rather than on pure party political lines. Government works because we elect people to represent our views - obviously we can't please all the people all the time, but ideally the majority. Some labour MPs, that voted to drop bombs, then cried that they were being bullied with the threat of de-selection. Well, if you don't want to be de-selected, vote in a manner that your constituents have empowered you for. I fear some of these people forget the station of their office is to serve and represent their constituents. I think it is farcical that they run crying to the police with talk of bullying whilst at the same time throwing incendiary devices at others. Man up and face up! In the event of any war vote I would like to see a Member (or more) of Parliament (selected at random, including the PM, that's why we have deputies) to be sent to the front to provide accurate reports of the effectiveness of any campaign. I think this would greatly help to focus the mind. 

3. We should help our NATO friends.
Absolutely! Of course all nations should do their bit. Terrorist atrocities can simply not be ignored. But sometimes a friend gives you wise counsel...not just telling you what you want to hear and recklessly charging around the corner with you. Britain is still great at many things. Apparently 60% of all high resolution reconnaissance comes from UK sorties. The UK is already in the air above Syria and doing good and valuable work. They can continue to do this...just without dropping bombs. Why doesn't the UK aspire to be a center of excellence for reconnaissance? This can still make a hugely valuable contribution to the global response to Daesh. Likewise, there is also much debate about the 70 thousand 'loosely' aligned ground troops. UK academia has plenty of understanding of the fabric that makes up the Middle East. Why not charge them with the responsibility for reporting on the alignments or 'pre-conditions' to talking between all these factions. Surely understanding them is better than bombing them. (Russia won't talk to Turkey, Turkey won't talk to the Kurds, factions won't talk to factions etc, etc.)

4. Terms of Reference.
Once their is a clear definition of what is acceptable intervention, then this intervention should be followed to conclusion. I'd like to see a clear distinction between bombing assets and bombing people. (Another thing about war that troubles me is the division of life and assets. The rank and file that make the 'Forces' what they are risk their lives. In the inevitable reconstruction process it is investors that reap the reconstruction dividend. All too often, these 2 circles do not overlap). 

5. The refugee crisis.
No one flees their home without reason. I dare say many Syrians would prefer to be 'at home' (who risks the lives of their children?) The fact that Europe is besieged with immigrants surely spells out that things are not right at home. I imagine bombs and the risk to life is one reason why people are fleeing. I don't understand how dropping more bombs alleviates the refugee crisis. I guess some will say maybe their needs to be some 'short term, regime change' pain, but to date in the Middle East we've seen nothing short term.

6. Parents.
Every soldier, every civilian and even every terrorist has a parent. That is potentially at lot of pain and anguish. Considering the human cost, i just feel there has to be a better way than greeting people with a fist.

Rant over. Back to Clearing and Settlement and the Blockchain.


S


In defence of Jeremy Corbyn
Naive he may be, but he’s consistent – and at least he’s thinking about the future
http://new.spectator.co.uk/2015/11/jeremy-corbyn-is-more-sensible-about-syria-than-david-cameron/

"Daesh hates being referred to by this term and what they don't like has an instinctive appeal to me."
http://i100.independent.co.uk/article/why-isis-will-hate-it-if-we-start-calling-them-daesh--bkC822p_zl

Friday, November 27, 2015

Blockchain Hype Curve, Gold, IoM...I want a Raspberry Pi not a mince one.

Where has November gone? Home straight to Xmas now and my favorite turning point, the Winter Solstice (Dec 22). I don't mind the cold...but I love watching the days grow longer.
(and hey, early evenings lend themselves to Xmas lights).

As ever the hype around FinTech rages. (see Accenture report of 14byn investment). In my slides I also include one from CB insights which shows who's jumping in when.

After looking at Bitcoin I wanted to check out other cryptocurrencies. There are 630+ of them with market caps all the way down to zero (well they use a ? on their website). I wonder, would anybody be interested in C&S coins? Worth a browse if you thought there was only one cryptocurrency: http://coinmarketcap.com/.

As promised I've also posted my slides from C&S conference:
This prompted me to update a few of the other tabs. If you notice any links not working or have other comments you'd like to make, more than happy to take them on board.

Also happy to pick up any threads if you think I've missed anything or if you'd like a more relevant explanation. Skipped MiFID this week so plan to catch up on that next week.

Have a great week-end one and all. Whatever your pleasure, enjoy your leisure!

Scott.

Blockchain


Interpreting Technology Hype
When new technologies make bold promises, how do you discern the hype from what's commercially viable? And when will such claims pay off, if at all? Gartner Hype Cycles provide a graphic representation of the maturity and adoption of technologies and applications, and how they are potentially relevant to solving real business problems and exploiting new opportunitieshttp://www.gartner.com/technology/research/methodologies/hype-cycle.jsp

Global investment in fintech ventures tripled to $12.21 billion in 2014

KYNETIX LAUNCHES BLOCKCHAIN CONSORTIUM FOR COMMODITIES MARKETS
UK-based Kynetix, a firm that deals in commodity post-trade technology platforms has launched a consortium focusing on integrating blockchain technology into commodities post-trades and mainstream financial services.

In a permissioned blockchain transactions are validated and processed by those who are already recognised by the ledger i.e. they have been authorised in advance and their identity is known. Their vote counts proportionally against everyone else’s, based on the specific rules of the ledger. 
There is much debate about whether permissioned blockchains are true blockchains. The purists believe that you cannot have a true blockchain without the bitcoin permissionless model which incentivises miners to do the verification work.
*** For Financial Services I believe it will be the 'permissioned' blockchain model that will prevail. At times I interchange this with 'consortium' blockchain (as a medium between the private and public extremes).

Global Arena Holding Comments On Nasdaq's Linq
Global Arena Holding, Inc. (the "Company") (OTC PINK: GAHC), a blockchain technology acquisition and development company, provides investors with commentary on Nasdaq's latest announcement regarding their new blockchain exchange, Nasdaq Linq.
The Company trades on the OTC Pink Sheets under the ticker symbol GAHC. The Company has been publicly traded since 2011 and holds a number of interests, including Global Elections Services, Inc., GAHI Acquisition Corp., and the Blockchain Technologies Corporation, Inc. The Company focuses on acquiring technologies, patents and companies having the ability to leverage the blockchain crypto technology.
http://www.marketwired.com/press-release/global-arena-holding-comments-on-nasdaqs-linq-otc-pink-gahc-2069756.htm
Note: GAHC has now acquired 100% of BTC, as in Blockchain Technologies Corporation (as opposed to Bitcoin!)

ASX considers blockchain for clearing and settlement

ASX AND THE PERTH MINT TO DEVELOP PRECIOUS METALS DERIVATIVES PRODUCTS
ASX proposes to distribute the new derivatives products to customers around the world using its 24-hour, globally connected network. The Perth Mint will provide physical precious metals and its world-class secure storage facilities in support of this. The first product is expected to be launched in the second half of 2016.

Microsoft launches cloud-based blockchain platform with Brooklyn start-up
Blockchain technology is not limited to bitcoin -- it can be used to secure and validate the exchange of any data.
One such company is Ethereum, which has built a fully programmeable blockchain. Technology giant Microsoft is using it for the blockchain platform.
The platform will be available to banks and insurance companies that are already using Microsoft's cloud-based Azure platform.

THE UK’S 25 HOTTEST NEW FINTECH STARTUPS

Bitcoin


How many crypto currencies are there? At least 623 at the last count.
Good summary of currencies and their market caps here:

Some Crypo Links to the current Top 5 (by market cap)

So, you'd like to try your hand at mining.
Which are the most profitable coins to mine?
Good summary here:

The Earliest Bitcoins....Rai stones of the Yap.

Free Bitcoins?

ISLE OF MAN TO CREATE CRYPTOCURRENCY BUSINESSES REGISTER
The Isle of Man Government's Department of Economic Development is looking to create a stand-alone register of Island-based digital currency businesses. In order to do so, they are using the protocol of a local block chain service provider, Pythia Limited.
*** Note. Pythia is the parent company of Credits.
http://www.credits.vision/

No place on the planet has welcomed digital currencies as warmly as the Isle of Man.
Rational Group, which owns the websites PokerStars and Full Tilt Poker.
Pythia, a Manx startup he founded that provides off-the-shelf software customers can use to create and run their own customized blockchains.
CoinCorner, a bitcoin exchange, on the island in 2014
TGBEX, sells physical bitcoins or—rather, as his lawyer always reminds him to clarify, lest he be classified as a foreign exchange operator—“decorative, metal novelty tokens.”
EVA Plexus, which created a protocol for storing data on the bitcoin blockchain.
Electricity is plentiful and reliable—as are the island’s ultrasecure, resilient data centers. And then there’s the island’s tax structure: no corporate tax; no capital gains or dividend taxes; and low rates of personal taxation, topping off at 20 percent

BITCOIN BANK NEXTBANK HALTS PUBLIC CROWDFUNDING PROCESS
The world’s first Bitcoin bank NextBank has confirmed that they have received $1.4 million in funding for 4% of the company from 2 venture capitalists from Europe this week. NextBank has previously received $0.95 million in private VC investment bringing the total investment capital to 2.35 million USD.
NextBank’s main goal is still to provide advanced banking services for Bitcoin and cryptocurrency clients around the world. NextBank accounts will be able to support 75+ currencies and precious metals. The modern Bitcoin bank will also offer global Debit Cards, accounts denominated in both fiat such as USD and various cryptocurrencies, SWIFT transfers, an escrow service, currency exchange, and much more.

https://nb.vu

BITCOIN TRADING PLATFORM ECOIN.EU LAUNCHES INSTANT BANK TRANSFER FOR EUROPEAN CUSTOMERS
On November 01, 2015 eCoin.eu together with Online Bank Transfer launched an instant funds deposit service for customers registered in Germany, Austria, France, Italy and Spain. Every customer from the above-mentioned countries possessing an e-Coin account can instantly transfer money from their local bank account and buy any cryptocurrency including Bitcoin.
eCoin.eu is a transparent trading service provider managed by Wallet Capital Group Inc. The company is registered in Panama under Offshore financial Operational Notice. eCoin.eu was founded in 2014.

Westpac VC invests in Bitcoin player Coinbase
In a deal that will put Westpac Banking Corp in the box seat as cryptocurrencies develop, the bank's venture capital fund, Reinventure Group, has invested in Coinbase, one of the world's pre-eminent Bitcoin companies.
In the first deal involving an Australian bank and a Bitcoin company, it is understood that Reinventure joined a $US75 million raising Coinbase conducted earlier this year, which also won support by some of the world's largest venture capital firms, the New York Stock Exchange and former Citigroup CEO Vikram Pandit.

Are bitcoin and the banks worth it or a waste of time?
The bank's (CBA) Ripple experiment is a long-term play. At this stage CBA, like everyone else, does not know whether Ripple, or bitcoin for that matter, will become dominant protocols that change the orthodoxy on how payments are sent and received. It might be that cryptocurrency volume continues to wane and the hype goes nowhere. But CBA does not want to be left on the sidelines if demand for cryptocurrencies takes off. It joins a handful of other early adopters elsewhere in the world – Germany's Fidor became the first bank to integrate Ripple's protocol into its payments infrastructure, with two US banks, CBW Bank and Cross River Bank, following suit four months later.

http://www.afr.com/technology/are-bitcoin-and-the-banks-worth-it-or-a-waste-of-time-20150604-ghh9n8#ixzz3sedSeFOF

Fidor Becomes First Bank to Use Ripple Payment Protocol
San Francisco-based decentralized payment network provider Ripple Labs has announced that German Internet direct bank Fidor is now using the Ripple protocol as part of its transaction infrastructure
.
http://www.coindesk.com/fidor-becomes-first-bank-to-use-ripple-payment-protocol/


Submission to the Inquiry into Digital Currency
The Reserve Bank of Australia has prepared this Submission for the Senate Economics References Committee’s inquiry into Digital Currency. The Bank recognises that the concept of a decentralised ledger is an innovation with potentially broad applications for a modern economy, and that digital currencies represent an interesting development in the payments and financial system landscape. Accordingly, the Bank takes an interest in digital currencies and monitors developments in this area.
Bitcoin Group
Hash Power to the Final Hour

(I love the strap line)

DigitalBTC
15 Jun 2014
DigitalBTC Makes History With Australian Stock Market Debut
DigitalBTC, which began as a mining operation but also engages in bitcoin trading and is developing retail and consumer applications 

http://www.coindesk.com/digitalbtc-makes-history-australian-stock-market-debut/
29 Sep 2015
DigitalBTC Bows Out of Bitcoin Mining Race 


Regulation

Financial benchmarks: Commission welcomes agreement on new rules to prevent manipulation
The agreement will improve the governance of such benchmarks produced and used in the EU in financial instruments such as bonds, shares, futures and swaps.
The Regulation will contribute to the accuracy and integrity of benchmarks used in financial instruments and financial contracts by:
– ensuring that benchmark administrators are subject to prior authorisation and supervision depending on the type of benchmark (e.g. commodity or interest-rate benchmarks);
– improving their governance (e.g. management of conflicts of interest) and requiring greater transparency on how a benchmark is produced;
– ensuring the appropriate supervision of critical benchmarks, such as EURIBOR/LIBOR, the failure of which might create risks for market participants and for the functioning and integrity of markets.

Stuff

Raspberry Pi Rolls Out $5 Computer
Ten thousand units of the device, about the size of a money clip, were being given away free in the U.K., packaged up with the December issue of The MagPie, Raspberry Pi’s magazine, which hit newsstands Thursday.

http://blogs.wsj.com/digits/2015/11/26/raspberry-pi-rolls-out-5-computer/?mod=trending_now_1

Alibaba Brought in $1 Billion During the First 8 Minutes of China's Black Friday
On Singles Day, the company alone made more money than every American online retailer makes on the weekend after Thanksgiving.
http://www.theatlantic.com/business/archive/2015/11/singles-day-alibaba-black-friday/415431/

YouTube Music Opens After a Year in Beta
YouTube Music, a longtime work in progress, is now available to iPhone and Android phone owners.
The app is Google parent Alphabet Inc.’s second built to rival Spotify, Apple Music, Tidal, Pandora and other streaming music apps out there. But YouTube Music differentiates itself by focusing on music videos and the enthusiastic, though not always pitch-perfect, amateur recordings that YouTube is known for.
http://blogs.wsj.com/digits/2015/11/12/youtube-music-opens-after-a-year-in-beta/?mod=WSJ_TechWSJD_NeedToKnow

Unicorn is a term in the investment industry, and in particular the venture capital industry, which denotes a start-up company whose valuation has exceeded (the somewhat arbitrary) $1 billion dollars.
Full graphic of Unicorns here:
https://cbi-blog.s3.amazonaws.com/blog/wp-content/uploads/2015/10/overcrowded-unicorns-v2.png