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Rehashed - #1 Riding the Cryptocurrency Regulatory Wave

Estimated reading: 3 mins

Rehashed - #1 Riding the Cryptocurrency Regulatory Wave:

Thanks for joining us for the inaugural edition of Rehashed! We will be issuing a weekly column commenting on the latest news and developments within the cryptocurrency space.

2018: The year of regulation?

Globally, the space continues to be dominated by regulatory news as governments continue to navigate unchartered territory. U.S. transactions related to Venezuela's controversial Petro (the first state-backed cryptocurrency) have been officially banned by the Trump administration.

The world’s financial leaders struggled to agree on a common approach to cryptocurrency regulation at the G20 summit this past week, naming July as the first deadline for a unified stance on regulation.

The U.K. has just announced a cryptocurrency task force to help manage the risks associated with cryptocurrencies and to harness the potential benefits of such technology.

Locally, the Reserve Bank has remained relatively quiet on the subject. Acting Reserve Bank Governor Grant Spencer has reportedly indicated that there are no immediate plans to regulate cryptocurrencies because of their perceived limited effect on New Zealand’s financial stability. In the first official report on cryptocurrencies issued by the Reserve Bank in November last year, both benefits and risks of the technology were discussed. The report echoed a “watch and wait” sentiment. Across the ditch, the government appears to be making more of a concerted effort to regulate the space; the Australian Transaction and Analysis Centre (AUSTRAC) recently updated its AML Laws to require greater transparency and recording of cryptocurrencies.

Regardless of current sentiment, regulatory consistency will be welcome in a space that has been wildly disparate and often contradictory in its policing. It will be no trivial task; governments have a responsibility to foster innovation whilst protecting investor interests.

Big brother is watching...

Data ownership has been in the spotlight this week, with Facebook under fire over the Cambridge Analytica scandal which saw the political data company gain access to the personal information of over 50 million Facebook users.

Telegram, which remains on track for its $1.7 billion TON raise, has been ordered to give up its encryption keys by Russian regulators. The founder, Pavel Durov has asserted that Telegram stands for freedom and privacy and will not be giving up private data on its users. This will be an interesting story to watch unfold, as it may largely set a precedent for how other jurisdictions handle such issues.

This theme continued at the PwC Herald “Future of Money” Talks held in Auckland and Christchurch this past week, where Centrality CEO Aaron McDonald spoke about the importance of personal ownership of data and information. Headquartered in Auckland, Centrality is building a number of decentralised applications focussed on mass-market consumer adoption. They recently raised around $100 million through their token launch and have multiple local partnerships under their belt. As with many of the astronomical ICO raises we saw through 2017, it’s too early to speak on the project’s potential with any certainty, but it’s great to see Kiwi innovators vying for a seat at the table alongside other infrastructure builders like Consensys.

In the news

Following in Facebook’s footsteps, Google has announced that they are banning all cryptocurrency-related advertisements. Although the market took a hit, it’s a positive move for the long-term health of the space. Genuine projects will be more likely to prevail over heavily marketed spam that is prevalent throughout the space here

Would you put your kitten on the blockchain? Better question - do you want to breed kittens on the blockchain? CryptoKitties just raised US $12m in their pursuit to deliver non-fungible digital goods to the masses here

Google’s arm, Alphabet Technologies, is developing its own application of blockchain technology to differentiate its cloud services here

Jack Dorsey, CEO of Twitter & Square, expects bitcoin to be the world’s single currency in the future here

Identity securitization is an oft-quoted utility case for blockchain technology. To that end, Coca-Cola and the US State Department have launched a blockchain pilot project aiming to enforce worker rights here

Roberto Escobar, the brother of infamous drug kingpin Pablo Escobar, is launching his own cryptocurrency after claiming to have met Satoshi Nakamoto, the anonymous creator of Bitcoin. Check out the website here, it’s hilarious.

Bitcoin is touted as the world's first virtual currency, but that hasn’t stopped the Slovenian town of Kranj inaugurated the first physical monument honouring Bitcoin here

To close on the theme of data privacy, it’s been revealed that the NSA has been tracking bitcoin users. Does that mean the SIS is following suit? Check out the revelations from Edward Snowden here

Upcoming dates

March 28- AI-Day, Auckland NZ here

March 30 - Bittrex to remove 82 coin wallets.

Thanks for your company, stay tuned for next week’s edition of Rehashed.

Freddie Archibald

View next issue: Rehashed - #2 History Repeats (Even in Cryptocurrency)

About the author:

Capital markets to crypto convert. From Christchurch →  Boston → New York, Freddie became infatuated with the potential of the digital asset economy after randomly plucking a book on bitcoin off a New York library bookshelf in 2016. Her parents are thrilled that she is chasing magic money on the internet.

Disclaimer: The above references an opinion and is for informational purposes only. It is not intended to be financial or investment advice.

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