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Mongolia Partners With Stablecoin to Use Blockchain for Lending Services, Money Transfers

Mongolia’s capital city administration is set to replace utility bills and government subsidies with blockchain-based payment methods.

Mongolia’s capital city of Ulaanbaatar has partnered with a stablecoin company to release instant money transfer and lending services, Asia’s largest tech media platform e27 reported on Jan. 11.

Ulaanbaatar City’s administration has agreed to partner with a South Korean blockchain company, dubbed Terra, in order to eventually replace the current payment methods for utility bill and government subsidies with the Terra stablecoin, according to the publication.

The pilot program is scheduled to be launched within the next six months, and will start in the city of Ulaanbaatar’s Nalaikh District, with plans to expand throughout the whole city. The article also states that the program within the Mongolian capital will contain both peer-to-peer payments and mobile payments.

Terra is a stablecoin project co-founded by Daniel Shin, the creator of South Korean e-commerce marketplace Ticket Monster. The stablecoin project closed a $32 million funding round in August 2018, with participation from Binance Labs, OKEx and Huobi Capital, as well as Polychain Capital.

Back last fall, the Bank of Mongolia, the country’s central bank, had given permission to Mongolia’s largest mobile telecoms operator to issue its own digital currency, as Cointelegraph reported on Sep. 28.

Terra, the stablecoin project, had already partnered with South Korean messaging app giant KakaoTalk back in last November as well. The partnership is aimed at developing a blockchain-based payment system and creating a blockchain ecosystem that would allow a large number of people to use its services, Cointelegraph wrote on Nov. 14.

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Circle Reveals $24 Billion Cryptocurrency OTC Trading Volume in 2018

Goldman Sachs-funded cryptocurrency startup, Circle, recently released its list of accomplishments for the year 2018. The company says it executed over-the-counter (OTC) crypto trades to the tune of $24 billion in notional volume.

Circle Does $24 Billion in Cryptocurrency OTC Trading

Circle announced its 2018 achievements in a blog post published by the company on Thursday (January 3, 2019). Circle Trade, the OTC desk of the company, executed over 10,000 OTC trades worth $24 billion, it reveals.

Commenting further on the growth of the Circle Trade platform, the announcement notes:

Circle Trade has become a core liquidity provider to the entire crypto ecosystem — including miners, exchanges, project developers, and founders — and to the new crypto asset investor base of VCs, crypto funds, hedge funds, and family offices all around the world.

The figures published by Circle are indicative of the recent trend observed in the OTC arena. In December 2018, Bitcoinist reported a boom in Bitcoin OTC trading according to research by Diar. Other major players like Coinbase also show an increase in trading volumes during OTC hours.

The $24 billion notional trading might even indicate that Circle executed more OTC trades than Coinbase and Greyscale (GBTC) combined. Data from Diar showed Coinbases’s OTC volume at about $12 billion with $11 billion for GBTC.

A Couple of Acquisitions

The acquisition of Poloniex by Circle was arguably one of the significant developments that occurred in 2018. Back in February 2018, the company announced its acquisition of Poloniex, one of the largest cryptocurrency exchange platforms at the time.

According to Circle, it has made great efforts in improving the platform’s compliance standards. In May 2018, Bitcoinist reported on the uproar caused by new KYC requirements introduced at the time. Many legacy account holders felt the move broke several assurances provided by the company in late 2017.

For Circle, the steps taken have yielded fruit especially in the area of customer support. The blog post revealed a 99.5 percent decrease in the number of open tickets since the acquisition.

In 2018, the Goldman Sachs-backed Circle also acquired SeedInvest as part of its drive to become a regulated broker-dealer. With tightening regulations in the US crypto landscape, startups like Circle and Coinbase have been pursuing regulatory approval to expand their cryptocurrency product catalogs.

Stable Coin Launch and Company Growth

Circle also ventured into the stablecoin arena with the launch of USD Coin (USDC). This development led to the creation of the CENTRE consortium, a joint venture with San Francisco-based exchange giant, Coinbase.

According to the announcement, USDC is now the second-largest fiat collateralized stablecoin after Tether with a market capitalization more than $280 million. Multiple cryptocurrency exchange platforms also support the stablecoin.

2019 will be Circle’s sixth year in existence, and the company says that it wants to focus on capacity building for the industry regardless of market conditions. Circle says:

We see the future of the global economy as open, shared, inclusive, distributed, and powerful — not only for a few chosen gatekeepers but for all who connect.

What do you think about Circle’s 2018 figures despite a drop in overall prices? Let us know your thoughts in the comments below!

Image courtesy of Twitter (@zhusu) and Circle, Shutterstock

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Stablecoin Supremacy Battle Heats Up; Binance Lists USDC, Tether Below a Buck

Once up a time there was crypto and fiat. If you wanted to trade in altcoins you had to first buy Bitcoin. Tether changed all that when it came onto the scene on Bitfinex in 2015, today there are a slew of stablecoins all competing for supremacy.

USDC Listed on Binance

The controversy surrounding Tether coupled with its recent volatility has led to the birth of several similar dollar pegged stablecoins. Once has been created by Coinbase and partners at Circle, USD Coin. On Thursday USDC was granted a new realm of legitimacy when Binance, the world’s top crypto exchange by trade volume, announced that it would be listing new pairs.

According to the announcement Binance will be offering two new USDC pairs for Bitcoin and its own Binance Coin (BNB) as of November 17. To quash the auditing concerns that plagued Tether, the exchange added;

“Additionally, for increased transparency, USDC has engaged a top-ranking auditing firm to release monthly balance attestations of the corresponding USDC and USD balances held/issued.”

USD Coin is only a few months old but it is growing in power as an alternative to USDT. It still has a way to go though, with daily volume, according to Coinmarketcap, at $16 million, compared to $4.7 billion in Tether trade. However, with USDC available on Coinbase and now Binance, its usage is expected to grow rapidly especially when more trading pairs are introduced.

According to the company blog “Circle and Coinbase co-founded the CENTRE Consortium with the goal of establishing a standard for fiat on the internet and providing a governance framework and network for the global, mainstream adoption of fiat stablecoins.”

If complete transparency and audits are forthcoming it may not be long before USDC surpasses USDT however the centralization issue raises its head again when one company is holding all of the cards. This is especially true if Tether continues to show volatility and inability to maintain its dollar peg.

Tether in Turmoil

During the recent crypto rout Tether fell to $0.964 whereas USDC actually hit a peak of $1.06. The Gemini Exchange’s GUSD spiked at $1.18 according to CMC. At the time of writing USDC is still trading over a dollar and USDT is under it. Fortune has noted that if Tether collapses “it could deliver a shock to the crypto markets that makes this week’s wipeout look like a hiccup.”

The good news is that there are now several alternatives to Tether in addition to USD Coin, such as TrueUSD (TUSD), Gemini’s own GUSD, Maker DAO’s Dai, and the Paxos Standard Dollar (PAX). So traders are no longer tethered to Tether, go ahead and take your pick, some are even offering more than buck right now.

Image from Shutterstock

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Tether Announces Relationship With Deltec Bank in the Bahamas

On November 1st Tether said they have established a banking relationship with the Bahamas-based Deltec Bank & Trust Limited.

Tether Limited made a few notable announcements on Thursday, November 1st.

Early in the day on Twitter, the firm confirmed a new banking relationship with Deltec Bank & Trust Limited (Deltec), which has a headquarters in the Bahamas.

In a brief post, Tether wrote that Deltec carried out a “due diligence review of our company” before taking it on as a client. The post also came with an attachment to a letter penned by Deltec confirming the “portfolio cash value of your account with our bank was US$1,831,322,828,” at the close of business on October 31st.

As of press time, CoinMarketCap listed Tether’s circulating supply at 1,776,421,736 UST with a price of $0.98.

Letter Provided ‘Without Liability’

In the letter, Deltec was clear to note the letter with Tether’s portfolio cash value was “based on the information currently in our possession.”

The letter was just signed by “Deltec Bank & Trust Limited” with a quick scrawl, which attracted the attention of some commenters on Reddit.

A few people questioned why a person at the bank would not be willing to attach their name to the holdings report. Tether has been the focus of intense scrutiny and attention amid allegations it does not actually hold the dollar reserves it claims.

Tether asked law firm Freeh, Sporkin & Sullivan back earlier in the year to carry out a review of its holdings. The firm concluded Tether’s “unencumbered assets exceed the balance of fully-backed USD Tethers,” as of June 1st.

However, the law firm noted the review was not conducted with Generally Accepted Accounting Standards. Many question Tether’s holdings claims because they have so far been unwilling to undergo an audit.

Others point to a mid-October Tweet by Cameron Winklevoss, co-founder of the Gemini dollar, who wrote how it is not possible to carry out an audit on a stablecoin since “there is no financial report framework.” Winklevoss argued a 3rd party would have to just attest to the accuracy of an assertion about a 1:1 peg.

A Rigorous Review by Deltec

In the blog post, Tether said Deltec looked over compliance processes, policies, and other procedures, and carried out background checks of company officers, shareholders, and ultimate beneficiaries.

Tether wrote the review process occurred across several months and included an assessment “of our ability to maintain the USD-peg at any moment.”

The company said they are currently registered with the U.S. Treasury Department’s Financial Crimes Enforcement Network and is reviewed by Deltec “on an ongoing basis.”

What do you think of Tether’s new banking relationship? Let us know in the comments!

Image courtesy of Bitcoinist archives, Shutterstock, Twitter (@Tether_to, @whalepool).

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Bitcoin Trading at a $300 Premium on Bitfinex Amid Tether Decline

Speculation is rife that people are selling Tether in exchange for Bitcoin. This has led to Bitcoin trading at around a $300 premium on the Bitfinex exchange.

Those using the Bitfinex exchange are finding that Bitcoin is trading at roughly a $300 premium compared to other exchanges.

Many believe the price upswing is because traders who purchased the stablecoin Tether via the exchange are now looking to sell their holdings for Bitcoin (BTC) 00. Tether and Bitfinex share management.

According to Alex Micharlis of CoinSchedule, there are a growing amount of people who are looking to liquidate because of a belief that “Tether is going bust.”

$250 Million Tether Grant: Here we Go Again

Trouble With Tether

Tether has long been one of the most popular stablecoins on the market, but has also been embroiled in controversy amid questions about the validity of its one-to-one dollar reserves.

According to Bloomberg, analysts and investors have cast a wary eye on Tether because regular audit reports have not been published.

Both Tether and Bitfinex were issued a subpoena by the U.S. Commodity Futures Trading Commission (CTFC) last December.

The price of Tether dipped earlier in the week after a fresh round of questions were directed at Bitfinex concerning its financial health.

At the time, transactions on Binance implied a price of around 96 cents, while the stablecoin dropped all the way down to 85 cents on the Kraken exchange.

In an email to Bloomberg, Lex Sokolin of Autonomous Research LLP noted how

The collapse of such a player would certainly crunch pricing and liquidity, but perhaps also clean up the activity to be more reflective of real demand.

Bitfinex Fires Back

Over the last few weeks, Bitfinex has been the subject of a rash of rumors.

Some believed the exchange was totally insolvent, while others speculated it was unable to secure new banking support after ending a relationship with Noble Bank.

There is also speculation Noble Bank is on the hunt for a buyer since it is facing an unprofitable future.

On October 16thBitcoinist reported that the exchange said they would start a new policy of carrying out audits on all users, but did not give any information about what banking entity would service deposits.

Earlier in October, the exchange called out “watchful investigators” who were purportedly ready and waiting to see the collapse of the industry.

Company leadership maintains that Bitfinex was not insolvent through a blog post and asserted how

A constant stream of Medium articles claiming otherwise is not going to change this.

The post was largely responding to an October 6th report that alleged the exchange was bankrupt.

In response, Bitfinex linked to three cold wallets that contained cryptocurrency. They also said the funds were just a “small fraction” of reserves.

What do you think about the rumors surrounding Tether and Bitfinex? Let us know in the comments below!

Images courtesy of Bitcoinist archives