Last Week In Crypto

"The hype for blockchain in China is massive. There's different ICOs [initial coin offerings] with pretty girls running around and DJs. But we're also serious about blockchain and the future. They're willing to try blockchain."

- Michael Yeung, executive director of operations at JBI (Chinese state-owned entity focused on blockchain research).

Headline News

Japan Leads The Way

After recognizing bitcoin and other digital currencies, the Japanese government continues to take steps to attract cryptocurrency startups and businesses. For one, Japan’s finance ministry has removed the tax levied on purchases of digital currencies. In a sign that regulation is working, 18 companies have applied for a license to operate a cryptocurrency exchange citing the guidelines put out by the government as a positive sign. Banks are stepping up as well - a consortium of Japanese banks with more than 50 members is testing blockchain technology as a way to transfer funds domestically.

Ethereum to Attempt a Big Switch

Vitalik Buterin, creator of ethereum, has released a rough implementation guide that reveals plans about shifting the ethereum network from a bitcoin-style proof-of-work system to a more hybrid version that includes an experimental proof-of-stake system called Casper. The plan means that ethereum will alternate between the two systems so that 1 out of every 100 blocks will be mined through proof-of-stake and the remaining 99 through proof-of-work. While this jump has been discussed in theory, this will be the first time it will be implemented on a live network. In other ethereum news, the United Nations will begin using the ethereum blockchain to distribute funds to thousands of refugees in Jordan. If successful, the UN plans to scale this trial up to the entire Jordanian refugee population.

Bitfinex Appoints an Auditor

Since the controversial Bitfinex hack, users of the exchange have demanded a complete audit of the company’s balance sheet to make sure that the exchange is solvent. In an announcement, Bitfinex stated that it has appointed Friedman LLP to conduct a comprehensive balance sheet audit. However, users continue to express doubt since Bitfinex also retracted a previous announcement in which it had declared Ledger Labs Inc. as the auditor - the exchange cites miscommunication between Ledger Labs and Bitfinex as the reason for retraction. Interestingly, newly appointed auditor, Friedman LLP is also the auditor of the publicly traded Bitcoin Investment Trust (GBTC).

More Billionaires Get Into Bitcoin

Software giant Atlassian’s co-founder and Australian tech billionaire, Mike Cannon-Brookes has hinted that he has been a long-time holder of bitcoin. In a series of tweets, the billionaire compared bitcoin investing to horse racing - “It will be worth a lot, or zero.” In other billionaire news, Chamath Palihapitiya, owner of the NBA team Golden State Warriors stated that Bitcoin is the ultimate insurance policy against autocracy. Other billionaire investors in bitcoin include - hedge fund investor Mike Novogratz who declared that 10% of his net worth was invested in bitcoin and ethereum, and angel investor Tim Draper who owns at least 2,000 BTC currently valued at $3.2 million.

Sidebar Stories

The World Bank has revealed plans to research how blockchain technology can help the nation of Kenya sell more government bonds. The Kenyan Government has introduced a new platform called ‘M-Akiba’ that lets Kenyan citizens buy government bonds exclusively through mobile phones. M-Akiba has already sold $1.1 million in bonds and plans to raise a further $47 million. The research project by the World Bank is seeking to find ways to support this activity through blockchain technology.

In April, Ethereum-based prediction market Gnosis held an token sale that raised eyebrows as well as $12 million. The sale, which concluded in just 15 minutes, saw 416,667 GNOs being sold for $30 per token. More recently, cryptocurrency exchanges Poloniex and Kraken announced that they have started trading GNO/BTC and GNO/ETH pairs.

Markets

Bitcoin - ↑ 15%

Week Open: $1,347
Week End: $1,548

Ethereum - ↑ 16%

Week Open: $83
Week End: $96

Footnote Stories

The team behind a new movie called “Braid” is using the ethereum blockchain to crowdfund the movie. Targeting a $1.25 million sale, the project will issue tokens to investors who will be paid back from the revenue generated by the movie. However, the project is seeking only non-US investors since the firm handling the sale (WeiFund) is not registered with the SEC.

US-based exchange Coinbase has added support for Litecoin. As previously, users were able to buy and sell bitcoin and ethereum through the service, starting this week they can also transact litecoin.

Worth Reading - Visual Capitalist’s infographic on how blockchain technology can change the stock markets