09

Dec. ’18

Venezuela Expects High Inflation Rate – Cryptosoft to Rescue?

Despite the country’s own crypto currency Petro and the efforts of President Nicolás Maduro, Venezuela’s economy looks very bleak. Analysts expect an inflation rate of one million percent by the end of the year – higher than in the Weimar Republic.

Can Cryptosoft and other crypto currencies help save the country’s economy?

A Reddit user answers cryptosoft questions. In South American Venezuela, the cryptosoft situation is anything but rosy. Already at the beginning of the year, the International Monetary Fund predicted an inflation rate of 13,000 percent. But that’s not all – the United States of America already imposed a trade embargo on Venezuela last year.

Then the Venezuelan president had the apparently rescuing idea: his own crypto currency had to be found. Without further ado, Nicolás Marduro issued the Petro. According to official figures, each petroleum should be covered with a barrel of oil, and the country and its ICO flushed 735 million US dollars into the state coffers in the preliminary round. However, this was never confirmed – neither the revenue from the funds nor the coverage of the petroleum with the oil reserves. On the contrary, doubts arose as to whether the whole story was not about cooperation with Russia in order to wipe one out of the USA.

The milky coffee index

The Café con leche Index: A latte costs one million bolivar in Venezuela.
Petroleum, oil and the USA or not: Venezuela’s economy continues to go downhill. As Bloomberg reports, the inflation rate will rise to 1,000,000 percent by the end of the year – the country’s hyperinflation is higher than in the Weimar Republic. Bloomberg uses the “Cafe con Leche” index for clarification. According to the index, the price of a latte is currently over one million bolivar [as of 24 July, and could be significantly higher by now].

So while the government continues to print worthless banknotes the population is wondering how to escape the misery. How can you keep your wages (if you have one) and buy some a day later without the price dropping dramatically? Similar to Zimbabwe, Bitcoin and other crypto currencies can help here. In spite of the high price fluctuations, the Bitcoin cash exchange rate promises a certain stability that can far outdo the national currency. In a Reddit Ask me Anything (AMA), a Venezuelan Bitcoin Cash user describes the current situation in Venezuela:

“I believe that the younger population still in the country […] needs Bitcoin Cash to support their families. I would say that 40 percent of the population has access to the Internet. About 30 percent of Venezuelans, but especially people under 35, use crypto currencies in my country. Students, whether they study economics or medicine, use crypto currencies to attend courses.”

As Bibi489 further explains, Venezuelans use crypto currencies primarily to preserve value.

But also in some cases to pay with them:

“They [crypto currencies] are used to store value. But there are also companies that accept crypto currencies. […] But you have to exchange crypto currencies to get food, gasoline or cash […] – only for money you need for the bus, the bank or taxes.”

First change, then pay: Crypto currencies as a store of value
It also addresses the lack of acceptance of petroleum:

“[…] One could buy Petros… But: Who would do this? So I’d rather not buy them. I think that’s the only thing you can buy directly with crypto currencies at the moment. I think there is a hairdresser in Caracas who accepts Bitcoin Cash. And in Carabobo there are still a few small shops. When I trade [crypto currencies] in Bolivar, I mainly buy food, soap, clothes and try to invest in education […]”.

Another problem besides the inflation rate is the country’s lack of technical infrastructure. First and foremost, there is a lack of a comprehensive Internet so that more people have access to crypto currencies and thus have a way of protecting their salaries from inflation:

“The Internet is a privilege in Venezuela. This is mainly due to the fact that cables are stolen and it takes a very long time until there are new ones again.

The Bitcoin cash rate is currently 861 US dollars. This is a monthly A

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30

Nov. ’18

Michael Luckow against Matthias Woestmann and the news spy

On 22 June this year, a lawsuit was filed: Trado GmbH, represented by Michael Luckow, took legal action against Quadrat Capital, represented by Matthias Woestmann, CEO of Envion. Trado GmbH stated that it had organised and technically handled the ICO of Envion AG itself. “Envion AG” is only a “legal shell” or a “legally necessary vehicle for the ICO”. After all, Envion was suspected of being merely a letterbox company in the Swiss train.

The problem of the news spy

The increase in the news spy number of tokens not mentioned in the white paper led to a considerable loss in value of the news spy. To this end, verbraucherschutz.tv reports:

“According to the CLLB law firm, the additional tokens not prospected in the white paper lead to a considerable loss in value of the EVN token, as the issue proceeds from the ICO were “distributed” over a larger number of EVN tokens. In addition, the voices of those investors from the ICO who declare that they did not participate in Envion AG’s ICO are increasing, if they had known that in addition to the number of EVN tokens shown in the white paper, further tokens are being produced.

The accusation was that the prospectus had been fraudulent. The investors therefore did not know that the painting of Envion AG was only for the facade, but that other people were acting in the background:

“Thus the investors would have believed to invest with Envion AG in a respectable company. On closer inspection, however, it turns out that all of the key people for the ICO are employed by Trado GmbH in Berlin. Its de facto managing director is Michael Luckow and this is registered in the Berlin debtor register,” he said.

reports verbraucherschutz.tv elsewhere. As it now looks, there is a solution (not necessarily satisfactory for investors) to the problem: the liquidation of Envion AG.

Liquidation – an ICO dissolves

Both sides now accuse each other of not having handed over the corresponding ICO data to an auditor. Under Swiss law, this lack of organs now leads to liquidation. Accordingly, it is now said in a medium post of Trado GmbH:

“According to this decision, Envion AG should be liquidated because Matthias Woestmann, Chairman of the Board of Directors of Envion AG, had not remedied a shortage of executive bodies and had not appointed a statutory auditor (Wirtschaftsprüfer) despite the extension of the deadline.

Envion AG is then obliged to dissolve. According to Swiss law, the company remains legally capable and able to act without restriction during the liquidation period. However, their powers are limited to the extent that they may only take actions that are in the sense of liquidation. So: repay the money to the investors. Should a repayments in crypto currencies follow, that leads due to the current Bitcoin course however to substantial disadvantages for investors. Thus the Zurich Tagesanzeiger reports:

“The problem is that the prices of crypto currencies have plummeted. Envion has invested most of its investors’ capital in relatively stable dollars. If the money is returned to investors at a lower rate in crypto currencies, a double-digit million amount would be left behind”.

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14

Nov. ’18

Russia’s Finance Ministry wants to ban Bitcoin formula, not the blockchain

HOME PAGE POLITICS REGULATION RUSSIA MINISTRY OF FINANCE WANTS BITCOIN, NOT TO BAN THE BLOCKCHAIN
Even though the subject of Bitcoin regulation is and remains a big issue around the globe, there is probably no other country in the world that lets the Bitcoin community speculate as much as Russia.

For more than a year now, the Russian Ministry of Finance has been speaking out against an alternative currency to the state-issued ruble. Just a few weeks ago, Deputy Finance Minister Alexey Moiseev announced that the Ministry is currently working on a bill to make the exchange of digital currencies into Russian rubles subject to a prison sentence of up to four years.

However, in addition to the statements, the government’s position on the digital currency remains unclear. In an interview with CoinDesk, Moiseev said that Bitcoin and Blockchain technology must be treated differently:

We believe that Bitcoin formula will be very important for different Internet applications in the future

However, Moiseev also pointed out Bitcoin formula risks. By and large, he was somewhat less aggressive than the Treasury itself. “We appreciate the potential of blockchain technology for the e-commerce industry and therefore the technology itself should continue to be allowed and promoted. The handling of Bitcoin formula itself, on the other hand, and viewed as a currency should continue to be viewed critically. Integration into the banking system or exchanging Bitcoin for roubles can be very dangerous”.

Moiseev cited money laundering and terrorist financing as reasons for an urgently needed regulation of Bitcoin. But since Russia is likely to regard the exchange of Bitcoin for roubles as a criminal act, Moiseev sees no danger for the national currency.

Bitcoin and terrorism

Since the first birth of Bitcoin, regulators have been looking for ways to best regulate the digital currency. The state of New York, for example, developed a new legal framework to regulate the digital currency especially for Bitcoin. Most other countries and states in the USA are currently trying to amend current laws and thus make them applicable to Bitcoin.

Many governmental organizations are afraid that Bitcoin could be used by cybercriminals or that it would simplify the financing of terrorist attacks. Especially now, after the attacks in Paris, the authorities are sensitized.

Moiseev also has the topic of terrorist financing on his screen. He says Bitcoin could make the country’s financial system more vulnerable to abuse:

“We are very concerned about current developments, as we have created a good system of protection against money laundering and anti-terror financing in the conventional banking system. We are very concerned that with the legalization of the Bitcoin/Rubel exchange, we could open this window further for criminals”.

But Russia is also observing how other countries are proceeding with Bitcoin’s regulation:

“We are watching exactly how other countries regulate digital currencies and how they deal with the problems of money laundering and terrorist financing,” Moiseev said.

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29

Oct. ’18

What are ethical ICOs in the Bitcoin secret?

Fraudsters have given the term ICO a bad aftertaste with scam projects. While investors fear not to see their money again, honest ICO owners are struggling not to be put into the scam drawer. The ICO hype clearly seems to be over. But a UK-based crypto company believes that ICOs can still be an excellent source of money – if they comply with certain ethical principles.

As BTC-ECHO reported in May of this year, many ICOs are frauds who smell the fast money. Only eight percent of all ICOs are successful and are listed on crypto exchanges. Only recently, Civil was surprised when the Blockchain project had to announce the failure of its crowdfunding campaign – it had not been able to reach the soft cap. Accordingly, the company had to pay the investors back their money. Since this “money-back guarantee in the event of failure” is currently the only protection for investors, ICOs are anything but secure.

Bitcoin secret in a new light

As Crypto Briefing reported on 19 October, the British holding company Investx intends to give Bitcoin secret a different connotation and set new ethical standards with its own offering. The INX token is intended to enable the purchase of dividend shares in private companies. The main focus here is on opening up SME investments to a broader range of investors, including private investors. The British Financial Conduct Authority (FCA) has already given its Bitcoin secret approval.

The planned public sale of its utility token INX is to follow strict principles. With the creation of a reserve fund and a sustainable token supply, the company wants to reduce the risk for investors. In this context, David Atkinson, Director of Holochain (HOT), advised Investx on the development of the ethical ICO.

What is an ethical ICO?

Atkinson firmly believes that public sales will restore confidence in the market. His own company Holochain promises a “more humane Internet” on the website, the ICO was developed ethically correct. Peter Edgar, CEO of Investx, asked Atkinson for support in the development of the INX ICO when he became aware of these promises.

Atkinson believes that an ICO is ethical if the token sold has a real value based on a real need. To do this, the white paper must contain the future purpose of the token and explain exactly how it would benefit its owners. He explains:

“It’s up to the projects to clearly present their product and show that there is a demand for what they build. With Investx, for example, they need to be able to show that there are private buyers who want to use the blockchain to buy dividend shares in private companies.”

Since the INX tokens are useful because they facilitate the purchase of shares, Atkinson recognizes them as ethical. The special benefit is the saving of legal costs. It also avoids the time delays normally associated with the purchase of dividend shares.

It is well known that it is very difficult to strip off a bad image. However, the approach that Holochain and Investx pursue with their ethical ICOs promises in the long term to have the potential to improve the reputation of this crypto crowdfunding strategy. The motto is still not to blindly invest in promising projects, but to carry out detailed research in advance. The criteria for ethical ICOs can be quite helpful thereby.

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23

Oct. ’18

What are ethical ICOs?

Fraudsters have given the term ICO a bad aftertaste with scam projects. While investors fear not to see their money again, honest ICO owners are struggling not to be put into the scam drawer. The ICO hype clearly seems to be over. But a UK-based crypto company believes that ICOs can still be an excellent source of money – if they comply with certain ethical principles.

As BTC-ECHO reported in May of this year, many ICOs are frauds who smell the fast money. Only eight percent of all ICOs are successful and are listed on crypto exchanges. Only recently, Civil was surprised when the Blockchain project had to announce the failure of its crowdfunding campaign – it had not been able to reach the soft cap. Accordingly, the company had to pay the investors back their money. Since this “money-back guarantee in the event of failure” is currently the only protection for investors, ICOs are anything but secure.

ICOs in a new light

As Crypto Briefing reported on 19 October, the British holding company Investx intends to give ICOs a different connotation and set new ethical standards with its own offering. The INX token is intended to enable the purchase of dividend shares in private companies. The main focus here is on opening up SME investments to a broader range of investors, including private investors. The British Financial Conduct Authority (FCA) has already given its approval.

The planned public sale of its utility token INX is to follow strict principles. With the creation of a reserve fund and a sustainable token supply, the company wants to reduce the risk for investors. In this context, David Atkinson, Director of Holochain (HOT), advised Investx on the development of the ethical ICO.

What is an ethical ICO?

Atkinson firmly believes that public sales will restore confidence in the market. His own company Holochain promises a “more humane Internet” on the website, the ICO was developed ethically correct. Peter Edgar, CEO of Investx, asked Atkinson for support in the development of the INX ICO when he became aware of these promises.

Atkinson believes that an ICO is ethical if the token sold has a real value based on a real need. To do this, the white paper must contain the future purpose of the token and explain exactly how it would benefit its owners. He explains:

“It’s up to the projects to clearly present their product and show that there is a demand for what they build. With Investx, for example, they need to be able to show that there are private buyers who want to use the blockchain to buy dividend shares in private companies.”

Since the INX tokens are useful because they facilitate the purchase of shares, Atkinson recognizes them as ethical. The special benefit is the saving of legal costs. It also avoids the time delays normally associated with the purchase of dividend shares.

It is well known that it is very difficult to strip off a bad image. However, the approach that Holochain and Investx pursue with their ethical ICOs promises in the long term to have the potential to improve the reputation of this crypto crowdfunding strategy. The motto is still not to blindly invest in promising projects, but to carry out detailed research in advance. The criteria for ethical ICOs can be quite helpful thereby.

Posted by . Categories: Blockchain. Leave a comment