Weekly Wrap-Up and Headlines

From the Weekly Newsletter for October 5th, 2019.

This week saw the entirety of the Korea Blockchain Week 2019 festivities. Many great connections were made which TheNews.Asia will also benefit from in the near and distant future. Vitalik shared some words and nervous twitches, major investors hid in their VIP sections, and business cards were the currencies of choice in a realm with a deceptively rigid hierarchy.

National governments this week made some astounding yet altogether foundational steps forward for the adoption and implementation of blockchain technology into various facets of their workings. Uruguay announced a partnership with Aeternity in which the blockchain developer will create a Dapp and transparent database to verify votes and identities of
participants in elections. This is a use case that, has been largely under-explored. It may be because the funding isn’t there or that politicians are skittish to make such a change to a system that has been in place for so long.

South Korea will be using DLT to verify driver’s licenses in the country. This has implications in dozens of other applications as well, including rental cars and preventing underage purchases of privileged substances. It will also undoubtedly streamline a bloated bureaucracy and aid the efficiency of their relatively low-power police force.

Two US Congressmen stated that the Fed should be exploring their options in developing a US dollar digital currency. Hypothetically, if this became a reality, it would essentially put all the other USD stablecoins out of business on day one. Who would endure Tether’s questionable asset backings when the Fed’s US dollar coin is right there?

TrustToken, Intel, and JPM Team Up to Offer Revenue Shares

TrustToken, JP Morgan, and Intel have teamed up to launch a new stabletoken that allows revenue sharing for the institutions that use it. This is an interesting move because it incentivizes exchanges and OTC trading desks to use the new stablecoin rather than develop their own. Most large institutions have been opting to simply develop their own blockchain solution or stablecoin rather than utilizing a third-party’s despite the cost in time and financial resources, but that may change now that there is an immediate quantifiable benefit to taking one out of the box. Oh yeah, the revenue share is 50/50. Not too shabby.

SEC Slams Yet Another Crypto-related Company for Fraud

Longfin was ordered to pay the princely sum of about $6.8 million this week by the SDNY after a lengthy SEC investigation. Basically they lied about where their main base of operations was and misled people who received shares for free about how many principal shareholders there were. That sounds like SEC prosecutorial paydirt. They sold about $33 million shares of Longfin stock in unregistered transactions as well which, by our calculations, rounds out the hat trick of top crimes that the SEC take on with great relish. More notably, shares of Longfin stock have tumbled listlessly down to about 50 cents from their high of about $75. The bigger they are, the harder they fall. It would normally be a warning to others against such actions but that has yet to be the case with companies and their cryptocurrency offerings.

DLT = Less Bureaucracy in South Korea

Police in South Korea will soon have the ability to verify a driver’s license with a smartphone app. The potential use cases for something like this expand with just a modicum of thought put to it. No more illegally issued rental cars, no more illegally purchased alcohol and tobacco (which is a relevant issue in the country), no more drivers clogging the already-congested Seoul roadways without true state-issued licenses. There are already initiatives well underway to make voting be handled via blockchain, but further civic and municipal applications of a blockchain or DLT will ease some of the country’s bureaucratic hurdles that even native Koreans find baffling at times.

Congressmen Want a US dollar National Currency

Congressmen French Hill and Bill Foster called for, in very clear and undeniable terms, the USA to develop its own national digital currency. The formal letter sent to the Chairman of the Board of Governors for the Fed, Jerome Powell, is more of a call to action and exploration about what action the Fed has already taken on the topic of digital currencies. Halfway through the letter they state “It may become increasingly imperative that the [Fed] take up the project of developing a US dollar digital currency.” There is even a mention of Libra, which is further evidence that, whatever your thoughts on the project, it is definitely sparking an interest in digital currencies and digital assets.

Uruguay Implements DLT for Internal Voting System

Speaking of municipal use cases for blockchain, Uruguay is also taking a leading role on the practical end by adopting blockchain in its internal voting process. Part of the announcement included the statement that they wanted to add transparency and participation to its decision making process which makes perfect from here. Aeternity will be helping them implement the new program by developing a Dapp for country officials to use in elections and a technological system for validating user identities. Frankly Uruguay is too small a country to really make a global impact for such a use case, but it is a nice practical demo for the project.