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Prediction Startup Numerai Raises $11 Million in ICO

U.S. prediction market startup and hedge fund Numerai raised $11 million in an ICO to launch its Erasure project.

American prediction market startup and hedge fund Numerai (NMR) has raised $11 million in an initial coin offering (ICO) to launch its project Erasure, Numerai tweeted on March 21.

Introduced in late 2016, Numeraire network provides a blockchain and cryptographic token-based ecosystem for incentivizing anonymous data scientists to create predictive models. Based on the Ethereum (ETH) blockchain, Numeraire tokens are used in trading market predictions on the startup’s platform.

Numerai founder Richard Craib said that the funds from the recent ICO will be mostly spent on hiring engineers for Erasure, the decentralized unit of Numerai’s marketplace, Coindesk reports.

Announced in October 2018,Erasure is reportedly scheduled to launch later in 2019. Once launched, Erasure will allow users to sell their predictions to any investment fund in the public network via the peer-to-peer InterPlanetary File System (IPFS), and directly connect their crypto wallets to the Ethereum-based marketplace, Craib told Coindesk.

While Numerai-based prediction models are mostly focused on traditional assets at the current stage, the launch of Erasure will enable predictions on any asset, Craib added.

The ICO round was reportedly led by VC and private equity firm Placeholder, and crypto investment company Paradigm, founded by Coinbase co-founder Fred Ehrsam.

Following the news, the price of the Nomeraire token jumped almost 19 percent, trading at $5.77 at press time, according to data from CoinMarketCap. The token is exposed to traders on five crypto markets: Bittrex, UPbit, Poloniex, DDEX, and IDEX, and has a market capitalization of $7.7 million.

Recently, Binance Launchpad, the token platform of major global crypto exchange Binance, completed a $4 million sale of Celer Network (CELR) tokens in under 20 minutes.

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Report: Number of Blockchain and Cryptocurrency Lobbies Tripled in 2018

Lobbying on blockchain and crypto has reportedly grown on K Street, having tripled over the past year.

The number of lobbies working on blockchain technology issues in Washington D.C. tripled in 2018, politics-oriented news outlet Politico reported on March 18.

The number of entities lobbying on digital currencies and blockchain reportedly grew almost thrice in the course of the past year, reaching 33 projects in the fourth quarter of 2018 compared to 12 in the same period of 2017.

Jerry Brito — executive director at the non-profit organization Coin Center that works with Reps. Warren Davidson (R-Ohio) and Darren Soto (D-Fla.), both known for their cryptocurrency-friendly attitude — reportedly suggested that the growth is driven by securities regulation.

In January, Soto stated that most cryptocurrencies should not be regulated under the country’s securities regulator. According to Soto, crypto should be overseen by the Commodities and Futures Trading Commission and Federal Trade Commission — rather than classed as securities under the Securities and Exchange Commission’s charge.

Blockchain companies purportedly face more difficulties when it comes to the technology’s deployment outside digital currencies. According to lobbyist Dina Ellis Rochkind, blockchain firms are still in the early stages of winning allies in Congress. Izzy Klein from Ripple-backed Klein/Johnson Group, which lobbies for the Securing America’s Internet of Value Coalition, said:

“I think that when you have a new technology and new platforms in older and heavily regulated spaces, you need as many legitimate voices and boots on the ground that you can get.”

Last year, major industry leaders such crypto exchange Coinbase, technology startup Protocol Labs, as well as the Digital Currency Group and Polychain Capital, formed the “first” lobbying group representing the blockchain industry in Washington D.C. The Blockchain Association will purportedly represent entrepreneurs and investors who are engaged in blockchain-based projects.

Recently, Rep. Kevin McCarthy, the current Republican Minority Leader in the United States House of Representatives, said that blockchain can make the Congress a more efficient and transparent place. McCarthy stated:

“Blockchain is changing and revolutionizing the security of the financial industry. Why would we wait around and why wouldn’t we institute blockchain on our own, to be able to check the technology but also the transparency of our own legislative process?”

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Hodler’s Digest, March 4–10: Top Stories, Price Movements, Quotes and FUD of the Week

In major news this week, university students seem to be making a profit mining crypto, and Jack Dorsey buys $10,000 of BTC a week.

Top Stories This Week

Research: ‘Free’ Electricity for Students Makes College Campuses Major Crypto Miners

According to research from tech conglomerate Cisco, college campuses are the second-largest crypto miners across industry verticals. The researchers investigated crypto mining activities across a variety of industries, finding that university campuses are ranked the second-biggest miners of digital currency at 22 percent, with the energy and utilities sector in first at around 34 percent. According to the research, the increasing mining difficulty for many cryptocurrency means that a higher amount electricity is needed, making it profitable for students to mine since the university pays their electricity costs.

‘Coffee for Bakkt’? Starbucks Equity Deal Will See Crypto-Based Payments, Source Claims

An unconfirmed report about Starbucks’ partnership with United States digital asset platform Bakkt this week has revealed that the coffee giant will allegedly accept Bitcoin-based payments after an equity deal. Starbucks had become a founding partners in Bakkt when it was revealed in August 2018, but had shut down rumors that it would be accepting BTC for coffees. Now, an unnamed source has said that the chain will accept Bitcoin through Bakkt’s software, but it will instantly convert the crypto into fiat, so that Starbucks will never actually hold any cryptocurrency.

Crypto Lending Company BlockFi Launches Crypto Accounts With Bitcoin and Ethereum Support

BlockFi, a crypto wealth management and lending firm, has launched new cryptocurrency accounts supporting both Ethereum (ETH) and Bitcoin (BTC), with 6 percent annual interest paid monthly in crypto. According to this week’s announcement, the interest earned in the BlockFi accounts compounds monthly, with results in an annual percentage yield of 6.2 percent. As well, the accounts are not entirely newly created, as they have been in private beta since the beginning of 2019 and reportedly already hold more than $10 billion in assets. The accounts are custodied at the Gemini Trust Company (Gemini  – the custodian of the crypto exchange lead by the Winklevoss Twins), which is regulated by the New York State Department of Financial Services.

Twitter CEO Jack Dorsey Alludes to Spending $10,000 a Week on Bitcoin

Jack Dorsey, the CEO of both Twitter and Square, hinted in a podcast interview this week that he has been spending $10,000 per week on Bitcoin. When talking about the idea of “Stacking Sat Saturday” —  a trend where users buy $25 in BTC every week to both promote and show crypto adoption — Dorsey noted that “[he] saw that [Stacking Sat Saturday] on Twitter […]”. “I would have participated but I have already exceeded my limit on CashApp. I can’t purchase anymore,” – he said. Since the maximum weekly buy limit on Square’s CashApp is $10,000, Dorsey’s statement implies that he spent $10,000 on cryptocurrency, probably Bitcoin, in one week. Dorsey further noted that he will be able to join the Stacking Sat Saturday next week.

Coinbase CEO: Ex-Hacking Team Neutrino Members Will Transition out of Company Roles

This week, co-founder and CEO of major United States crypto exchange and wallet Coinbase Brian Armstrong said that all staff at Neutrino with prior connections to controversial software firm Hacking Team will transition out of their new roles at Coinbase. The major crypto exchange had experienced backlash after announcing the acquisition after it came to light that several Neutrino members had worked with Hacking Team, which has been accused of selling tracking software to authoritarian regimes. Armstrong acknowledged in his statement that Coinbase did not properly evaluate the team from the perspective of their mission.

Winners and Losers

The crypto markets have seen a relatively stable week, with Bitcoin trading at $3,932, Ethereum at $136 and Ripple at $0.31. Total market cap is around $133 billion.

The top three altcoin gainers of the week are Indorse Token, ICE ROCK MINING and 4NEW. The top three altcoin losers of the week are dietbitcoin, Freicoin and ILCoin.

For more info on crypto prices, make sure to read Cointelegraph’s market analysis.

Most Memorable Quotations

“If that functionality Create2 had existed at the time, there wouldn’t have been a vulnerability, basically.”

Jutta Steiner, Parity CEO, speaking about the Parity multisig freeze

“The Morgan Creek Digital team will fly to meet them [Kroger team] and get them hooked up with the Lightning Network nationwide.”

Anthony Pompliano, Morgan Creek Digital founder, tweeting to Kroger after one of its retail chains stopped accepting Visa

 

“Cryptocurrencies are a great idea, but the world is not ready for them yet.”

Eugene Kaspersky, the CEO of cybersecurity giant Kaspersky
 

“Let’s think about this. [JPM] announced the JPM Coin for institutional customers. If you give them a dollar as deposit, they’ll give you a JPM Coin, that you then can move in the JPM ledger. Wait a minute, just use the dollar! I really don’t understand […] what problem that solves.”

Brad Garlinghouse, Ripple (XRP) CEO, talking about the JPM Coin

 

“I don’t think this will turn out to be a complete delusion.”

Niall Ferguson, British economic and financial historian, talking about crypto

 

“Cryptocurrency as a technology has absolutely no basis for success, and the mother of all bubbles is now bust.”

Nouriel Roubini, economist and cryptocurrency critic

FUD of the Week

Bloomberg: Crypto Companies Still Run Into Trouble Opening Bank Accounts

A Bloomberg report this week found the companies in the cryptocurrency industry are still having trouble opening bank accounts. According to various companies cited, banks are reluctant to grant accounts to those working in the crypto industry because “it’s a massive compliance headache that they don’t want to put the resources in to solve.’’ Giving some examples, Bloomberg referred to crypto payment processor BitPay specifically having trouble opening accounts. Bloomberg also quoted Silvergate Bank’s November 2019 IPO filing that noted that crypto businesses have as much as $40 billion to deposit.

NEM Foundation Releases Restructuring Plan Amid Financial Difficulties

The NEM Foundation released a financial and organizational plan for restructuring this week, in the wake of previous news that the foundation was running low on its native XEM tokens. According to the announcement, the foundation intends to set up a transformation task force in order to work on short term goals, like the development of weekly and monthly reporting structures, as well as scorecards for grading employee performance. The foundation also noted that they have hired SDK developers in order to fund the expansion of its current SDKs to include Python, PHP and Unity in addition to the current Javascript and Java.

US District Attorney Charges OneCoin Founders With ‘Billions’ in Alleged Fraud

The founders of an international cryptocurrency pyramid scheme have been charged with fraud by the U.S. Attorney Office of the Southern District of New York. The two leaders of OneCoin, Konstantin Ignatov and his sister Ruja Ignatova, were arrested this week in Los Angeles under the charges of wire and securities fraud, as well as money laundering, as part of their business that reportedly lured investors into spending billions of dollars on a fraudulent cryptocurrency. The U.S. investigation reportedly found that OneCoin generated almost $4 billion in sale revenue in the fourth quarter of 2014 and the third quarter of 2016, with profits of around $2.5 billion.

Best Cointelegraph Features

Unpacking Schnorr Signatures: Blockstream’s MuSig to Improve Bitcoin Transactions?

As any major changes to Bitcoin’s protocol are always met with controversy and discussion in the crypto community, Cointelegraph examines in this analysis the potential benefits of Blockstream’s new Schnorr-based multisignature scheme on the Bitcoin blockchain.

The SEC’s Guidelines and Statements Show That It’s Slowly Learning to Accept ICOs

United States Securities and Exchange Commission (SEC) has had a varied approach to cryptocurrencies, with much debate about their classifications as securities. However, there are signs that the securities regulator is becoming more accepting of ICOs. In this analysis, Cointelegraph looks at how the SEC’s position on ICOs has changed.

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Kraken Expands Its Team With Five New High Level Hires

Crypto exchange Kraken is making a group of new high level appointments, expanding its team by five members.

United States-based cryptocurrency exchange Kraken is expanding its team with new high level hires, according to the company’s blog post published on March 7.

In the post, Kraken announced five new appointments to its team. The new appointments will see Matt Mason as Chief Marketing Officer, Steve Hunt as Vice-President of Engineering, Nelson Minier as Head of OTC Sales and Trading, Bob Zagotta as Head of Business Operations and Strategy, and Mary Beth Buchanan as General Counsel.

Prior to joining Kraken, Mason was employed by Sony Pictures as Studio Head at a secretive innovation lab focused on game mechanics. Mason also served as head of marketing and Chief Content Officer at BitTorrent Inc., and has experience in the music and advertising industries.

Hunt has an over 20 years experience in the leading of engineering teams in the construction of algorithmic trading networks across major global financial markets at such companies as Jump Trading and Goldman Sachs. Minier has also a 20 year experience in managing trading desks at such firms as Credit Suisse, JPMorgan Chase, Citibank, and others.

Zagotta, meanwhile, has experience in developing and launching new businesses. He is joining Kraken from CME Group where he served as Senior Managing Director of Strategy and Execution. Buchanan’s legal career spans over 30 years, having worked at such organizations as Bryan Cave LLP, the United Nations and the U.S. Department of Justice.

Last month, Kraken acquired United Kingdom-based cryptocurrency exchange and futures provider Crypto Facilities, which is fully regulated by the U.K.’s Financial Conduct Authority, giving Kraken a major foothold in the European market.

Following the acquisition, trading volumes on Crypto Facilities significantly increased. Sui Chung, head of cryptocurrency pricing products at Crypto Facilities, told Cointelegraph that the company’s average daily trading volume was around $7 million per day in January. However, following the acquisition announcement, it increased to $32 million per day in February, reaching up to $110 million one day that month.

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Survey: Half of Millennial Investors Trust Crypto Exchanges More Than Stock Exchanges

A new survey from investment platform eToro has revealed that 43 percent of millennial traders trust traditional stock exchanges less than crypto exchanges.

Nearly half of millennial traders have more trust in digital currency exchanges than in United States (U.S.) stock market exchanges. Data regarding millennial investment attitudes was collected in a new study from investment platform eToro and published on Feb. 19.

Per the report, 43 percent of the surveyed millenial online traders demonstrate less trust in the traditional stock market, while having more faith in cryptocurrency exchanges. 93 percent of millennial cryptocurrency traders reportedly said that they would invest more in digital currency if traditional financial institutions proposed such an option. At the same time, 71 percent of millennials that do not trade cryptocurrency said that they would begin if it were offered by conventional institutions.

Managing Director of eToro U.S., Guy Hirsch, said that the market is now witnessing a generation shift in trust from traditional stock exchanges to digital currency ones. “Immutability is native to blockchains and that makes real-time audit to be sensible and cost-effective and that is why millennials and Gen X perceive crypto exchanges as less likely to be subject to manipulation and less likely to be a place where bad actors get rewarded with taxpayer money,” Hirsch explained.

45 percent of the respondents expressed interest in allocating cryptocurrency in their 401(k) retirement savings plans, and 74 percent of digital currency traders would like to receive that option from their 401(k) plan providers.

The research was conducted by market research and strategy firm Provoke Insights on behalf of eToro in September 2018. Throughout the course of the study, the company surveyed 1,000 online investors from ages 20 to 65. The company notes that the margin of error is around 3 percent.

Research published last November revealed that cryptocurrency investing is most popular among millennials earning from $75,000 to $99,999 annually. The survey collected responses from over 1,000 Americans between ages 18 and 80. Almost 40 percent of respondents cited peer influence as a main reason for investing in crypto, and over 35 percent have reportedly been lured into the crypto market by the “Fear of Missing Out.”