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Following Chilean exchange Buda’s decision to fight their banking blockade, the CEO has questioned these banks’ decision making.

Earlier this week, a group of cryptocurrency exchanges in Chile applied to the courts to fight the decision of banks to shut down their bank accounts. The exchanges, including Buda, Orionx, and CryptoMarket (CryptoMKT), state that the banking system in Chile is taking matters into their own hands and that they are “killing the entire industry.”

Banks Itau Corpbanca and Scotiabank announced the closure of the bank accounts of BUDA and CryptoMKT on March 19. A week later, the state-owned Banco del Estado de Chile followed the move by confirming the closure of the accounts of all three cryptocurrency exchanges.

Now, as the exchanges wait for their case to be heard, with some news set to emerge on April 20, according to BUDA’s co-founder and CEO Guillermo Torrealba. The exchanges are left puzzling as to why the banks feel they have the power to deny access to a new wave of technology.

Situation in Chile

Speaking to Cointelegraph, Torrealba outlines the cryptocurrency situation in Chile as precarious, and that the entire open and liberal feeling on this technology is not all as it seems:

“Chile is showing its "B" side, that of being an extremely conservative country, even though we make huge efforts for the world to see us as liberals.”

Torrealba explained that despite the outcry in the media, and even across Twitter, banks are refusing to respond or open their closed accounts. Moreover, according to Torrealba the banks, who seemingly have a large share of power in the country, are making the cryptocurrency environment worse than Ecuador, Bolivia or China:

“The banks have shown their darkest side. Restricting a whole country to access a technology just because they didn't like it. This is even worse than Ecuador, Bolivia or China's case, where the government was the one that took the initiative. Because you could judge the decision of a government, because, at the end of the day these players represent the people, and people are free to take whatever path they feel is right.”

Banks ruling over regulators

The issue for Torrealba is that the banks, by closing these accounts and effectively stopping the running of cryptocurrency exchanges, are slowing and prohibiting the progress of cryptocurrency in the country. There is no rule, law, or legislation against digital currency in Chile, yet the banks are operating like stern regulators.

“In Chile the story is different” Torrealba said. “There hasn't been one regulator, legislator or government official saying that cryptocurrencies aren’t legal, it was just the decision of a very powerful sector of the economy: the banking industry.”

The reason that Torrealba is up in arms about this decision, and is going as far as to get the courts involved, is that he feels as if there has been a restriction on economic liberties.

“So why is this fight important? Because of economic liberty. But not even liberty from an abusive government, but liberty from a corrupt and overpowered financial industry which is protecting itself in the most archaic and prehistoric way: denying a technology in the most open and overly bold way they could find. [The banks are] so openly abusive that everyone agrees that what they're doing is illegal but that isn't enough for them to stop. They're just too big to need to tread carefully, or to act inside the regulatory frame.”

Of course, Torrealba is directly affected by this banking blockade, and for that reason, has every reason to feel the way he does. His justifications may well be emotive, and perhaps inflammatory, however, he is not alone in thinking what he does.

Outsider reactions

There was a slew of reactions from Twitter users both inside and outside of Chile, with the general idea of banks setting the boundaries of cryptocurrency usage clearly getting under the skin of a number users.

Chile's state owned bank, Banco Estado, closes down all Chilean #crypto #exchanges accounts. What the fuck!? How much more damage will financial institutions make to #innovation and their own clients?#blockchain #cryptocurrency #crypto@CryptoMKT @Cointelegraph @BudaPuntoCom

— Eduardo Hernández (@TheCryptoCEO) March 30, 2018

Apparently all Chilean banks will cut ties with crypto companies https://t.co/mA2fo2ux3r This would be a huge negative blow to Chile's reputation as a rational, innovation-friendly, free market economy @budapuntocom @AbifChile @BancoEstado @sbif

— Ted Rogers (@tedmrogers) April 10, 2018

So disappointing to see leading Chilean bank @BancoEstado close #crypto client accounts. Chile is 1 of the leading regional economies but these actions stifle innovation. Support @budapuntocom!

— Sam Trautwein (@Xad_2002) April 10, 2018

But it was not only those reactionary tweets that found this move as odd. Barry Silbert, CEO and founder of Digital Currency Group, tweeted directly to the banks imploring them to change their decision.

This is very disappointing, @itauchile @scotiabank @BancoEstado

Please reverse your decision and support innovation, financial inclusion and help build a more efficient financial system for the people of Chile https://t.co/HmECjo7BTd

— Barry Silbert (@barrysilbert) April 13, 2018

Arthur Gervais, a Blockchain professor at Imperial College London and co-founder of Liquidity.Network also agrees with Torrealba about this being a degradation of fundamental rights. Professor Gervais told Cointelegraph:

“Traditional finance intermediaries are likely to experience a fundamental shift in their business models, which understandably creates tensions. The attempt, however, to censor decentralized technology, is not only likely to fail and a fundamental deprivation of human rights, but it'll further empower and motivate those that develop novel Blockchain technology.”

Ongoing, and precedent setting

It will be interesting to see what comes of this case, and if the exchanges are successful. Cointelegraph will continue to update the story as and when news becomes available.

If the defence of cryptocurrencies as a right for people to access in terms of its technological aspects is successful, it could lead to a lot of fightback from others who are seeing their cryptocurrency businesses being unfairly limited.

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Thai SEC tech consultant admits the necessity of reconsidering the country’s digital asset tax framework introduced in late March.

Thailand’s Securities and Exchange Commission (Thai SEC) and Thai Fintech Association

technology consultant Bhume Bhumiratana, along with members of the local crypto community, have urged financial authorities to reconsider the country’s cryptocurrency tax framework, local news outlet Bangkok Post reported Tuesday, April 17.

According to Thailand’s proposed crypto tax framework released in late March, the value added tax (VAT) for cryptocurrency trades would be 7 percent, while returns would be subject to a capital gains tax of 15 percent.  

Bhumiratana expressed concern over the introduced crypto tax law’s treatment of tokens sold in Initial Coin Offerings (ICO). He stated that tax collection from ICO-issued tokens should be considered differently from digital assets in general “because digital tokens differ in terms of asset value." The SEC consultant stated:

"It is hoped that the Finance Ministry and the Revenue Department will consider issuing another law to delay the implementation of digital asset tax."

As reported by Bangkok Post, the introduction of the digital asset tax has provoked a strong negative reaction among local cryptocurrency business owners and enthusiasts, particularly among ICO issuers.

Thuntee Sukchotrat, CEO at JIBEX cryptocurrency exchange, explained that the rights of investors should be approached with “financial and investment literacy” to allow local startups to raise funds from the Thai market. Otherwise, according to Sukchotrat, Thailand “will lose good ICO transactions to other markets."

Thailand’s government has taken an uncertain stance regarding cryptocurrency regulations previously, especially in terms of ICOs. In February, Thai crypto exchange Thai Digital Asset Exchange (TDAX) paused ICO registrations awaiting the release of regulatory framework from the Thai SEC.

Also in February, the central Bank of Thailand asked all banks in the country to stay away from cryptocurrency, advising the banks to ban customers from using credit and debit card to make crypto purchases, pending regulatory clarity. However, Thai Finance Minister Apisak Tantivorawong stated on Feb. 7 that the Thai government will not ban crypto trading, but will develop a crypto regulatory framework, as it is reportedly in the process of doing since last month.

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The second quarter of 2018 could spell a fresh “bull market” across cryptocurrency, Saxo Bank analysts have determined.

Major Danish bank Saxo Bank continued its optimism regarding cryptocurrency growth in 2018 in its latest Quarterly Outlook, published April 18.

Eyeing what he describes as “springboards for a cryptocurrency bull market in Q2” this year, analyst Jacob Pouncey from the bank’s SaxoStrats in-house team of strategists queried whether crypto-assets were “entering a new cycle.”

“Historically, many of the blue chip cryptocurrencies have seen price increases in the face of global uncertainty and risk-off events such as Brexit, the election of President Trump, and the North Korean missile tests,” he wrote, continuing:  

“The inflow of institutional capital to the cryptocurrency market due to the increase in regulation and investor protection could lead cryptocurrencies to a positive quarter.”

Saxo Bank is well-known for its price predictions for Bitcoin in particular. In 2016, when Bitcoin was trading between $450 and $950, analysts forecast prices hitting $2,100 the following year, something at the time it included in a list of  “outrageous predictions.”

Last December meanwhile, it warned BTC/USD could fall to $1,000 in 2018, while fellow analyst Kay Van-Petersen nevertheless went on record to predict $100,000 per bitcoin by the start of 2019.

Discussing whether motivating factors could end the downward trend seen throughout Q1 meanwhile, Pouncey suggested it would soon be right to call time on the cryptocurrency bear market. He concluded:

“In my opinion, we will eventually see the end of the current, negative cryptocurrency cycle, as many of the weak hands have been shaken out by the bear market and the remaining investors are on the ready to latch onto any good news after the bad start this year.”

Recently a wave of Wall Street talent and money have been moving into the crypto space. Yesterday, April 18, Coinbase announced that hedge fund Och-Ziff Capital Management exec Alesia Haas was joining them as CFO. Also this week, former Goldman Sachs executive Breanne Madigan joined major crypto wallet Blockchain.com as the head of institutional sales and strategy. Yesterday, US-based stablecoin project Basis revealed that it had raised $133 million in funding from major VC names, including Bain Capital Ventures and Andreessen Horowitz.

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A UK Member of Parliament has delivered a speech about the “monumental impact” he believes Blockchain will have on people’s lives.

British Conservative Member of Parliament (MP) Matt Hancock has delivered a speech about the “monumental impact” he believes Blockchain will have on people’s lives, speaking at a conference today, April 19.

The UK government published a transcript of the speech on the gov.uk website, which was delivered at the Law Society as part of the London Blockchain Conference today.

Hancock singled out three “vast areas of public life” which he anticipates the “exceptional” potential of Blockchain technology will transform: the financial sector, government services, and laws and regulation.

He began with recent UK steps to encourage Fintech innovation and growth, including the Financial Conduct Authority (FCA)’s new global Fintech regulatory sandbox, the Cryptoassets Taskforce jointly established by the UK Treasury, the FCA and the Bank of England, and the UK government’s publication of a robust Fintech strategy.

The MP went on to emphasize that Blockchain technology “could help us solve some of the great global social challenges of our time,” mentioning the World Food Programme Ethereum Blockchain aid initiative, which has transferred vouchers based on cryptocurrencies to 10,000 refugees in Syria, enabling them to buy food without “the need for cash, credit cards or paper.”

According to Hancock, the UK government has already invested £10 mln in support of Blockchain projects for the solar energy sector, clean water provision, electoral systems, and charitable giving.

Without mentioning the EU’s looming General Data Protection Regulation (GDPR) legislation or recent newsworthy data breaches explicitly, he affirmed Blockchain’s potential to give users of government services access to and control over their personal data.

In a nudge to “regulatory barriers” to technological innovation, he said the UK government “want[s] our regulators to be alert and responsive” and “supportive” of new technology where it is obviously beneficial. The MP concluded:

“Blockchain poses real and searching questions…What role do nation states have when setting frameworks for these decentralised, cross-border systems? And how do we address the challenges of smart contracts, when computer coding needs specificity and the law often needs interpretation?”

Cointelegraph recently published an analysis of the UK’s overall regulatory stance towards cryptocurrencies and Fintech, arguing it has gone a step further to foster industry growth as compared with the US.

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From biggest ICO to Russia’s ban: recap story of Telegram

Telegram has been called the “cryptocurrency world’s preferred messaging app” by many media outlets including Forbes, and more than 84 percent of Blockchain-based projects have an active Telegram community.

For over 48 hours now, Telegram has been under a ban by internet service providers in Russia. This was triggered by Telegram’s refusal to give encryption keys to Russian security agencies.

Telegram’s founder, Pavel Durov, said that they have not seen a significant drop in user engagement since the beginning of the ban. In fact, users have bypassed the ban by using VPNs. Durov has said that he will be giving Bitcoin grants worth millions of dollars to individuals and companies running VPNs, calling this the “Digital Resistance”.

Telegram launch, founders and users

Telegram was founded in 2013 by brothers Nikolai and Pavel Durov from Russia. Previously, they notably founded the “Russian Facebook” called VKontakte. In 2014, however, they sold and left the company due to a clash with the government regarding users’ privacy and freedom of speech.

Telegram already had 100 million monthly active users by February 2016. It was recently announced that this number has now reached 200 million.

Based on data from Tokenmarket, Telegram has more ICO discussion groups than any other messaging application as shown by the graph below from Telegram’s ICO white paper.

Image source: Telegram’s ICO white paper, page 12

The number of Telegram followers of a crypto project as well as the rate of growth of the community has been used as a metric for success by investors. Some projects even reach the limit of 50,000 followers and they create a second group.

The Telegram Open Network (TON) will be the launch pad for “The Open Network” and in 2021 the “Telegram” name will be dropped, as clearly stated in the white paper.

“By 2021 the initial TON vision and architecture will have been implemented and deployed. TON will then let go of the “Telegram” element in its name and become ‘The Open Network’.”

Telegram ICO goals, funding rounds and amount raised

In the white paper Telegram identifies several challenges for mainstream adoption of Blockchain technology and cryptocurrencies: scalability, complexity for the average user and availability of goods and services that can be bought or sold with cryptocurrencies.

Given that Telegram could not find any existing Blockchain platform that would allow taking cryptocurrencies mainstream in 2018, they decided to develop the required Blockchain platform themselves.

So far, Telegram has conducted two pre-ICO rounds of 850 mln dollars each for a total of 1.7 bln dollars raised, although the number of investors for each round was under 100. A third pre-ICO round may be considered and, if Telegram decides to do an ICO, they could raise a record amount of up to $2.6 bln.

The development team will keep 4 percent of the tokens with a four-year vesting period while 52 percent will be for the TON Reserve and 44 percent for investors. It is expected that investors will receive the TON tokens (Grams) in Q4 2018.

It is also worth noting that some prominent investors in the crypto space have actually decided not to invest in this project, as pointed out in some articles.

TON vs others

So far, some of the largest ICOs have been Filecoin ($257 mln), Tezos ($232 mln) and Polkadot ($145 mln). The TON technical white paper provided a comparison table with some projects.

Image source: Telegram’s ICO technical white paper, page 74

According to the white paper, TON positions itself as a “5th Generation” Blockchain. Telegram’s plan with this ICO is obviously to build a Blockchain platform similar to Polkadot, and not just a better app. Telegram’s user base could help to launch this new Blockchain platform with its 200 million current active monthly users.

Polkadot, which appears in the table as a 4th Generation Blockchain along with EOS and Cosmos, raised a total of $145 mln while TON has already raised $1.7 bln in the two pre-ICO rounds. It will be extremely interesting to see which innovations TON will develop with this huge amount of money.

Russian ban

Currently based in Dubai, the Telegram team is under pressure since Russia’s Federal Security Services (FSB) is ordering them to hand over the encryption keys.

Telegram has appealed the decision but, given that Telegram’s founders were forced to sell their previous company after losing a legal battle with the Russian government, the situation is very concerning. The main benefit that Telegram offers to its users is privacy and security; if they give the encryption keys away, users’ private information would then be compromised.

Moreover, Russia isn’t alone in demanding access to encrypted messages. Iran also asked Telegram in recent months for information and requested the blocking of several channels. Iran’s Interior Minister Abdolreza Rahmani Fazli said the misuse of social networks such as Telegram by some individuals was "causing violence and fear" and that "such behavior will be smashed". Durov responded to Iran on Twitter:

Iranian authorities are blocking access to Telegram for the majority of Iranians after our public refusal to shut down https://t.co/9E4kXZYcP9 and other peacefully protesting channels.

— Pavel Durov (@durov) December 31, 2017

Recently it was announced that Russia will finally ban Telegram messenger over the encryption dispute. Russia accounts for only about 7 percent of the Telegram user base, but it could be important to Durov because it is his country and because it constitutes a precedent of a real battle for the freedom of expression.

However, given Telegram’s importance to the crypto community as the preferred messaging app, its active user base of over 200 million, and also its use as a metric of success by investors, it is likely that banning Telegram would not be an easy task even for Russia.

Telegram’s founder Durov confirmed the ban from Russia recently on his official Telegram channel, as well as the importance of VPNs:

“Despite the ban, we haven’t seen a significant drop in user engagement so far, since Russians tend to bypass the ban with VPNs and proxies. We also have been relying on third-party cloud services to remain partly available for our users there.

To support internet freedoms in Russia and elsewhere I started giving out bitcoin grants to individuals and companies who run socks5 proxies and VPN. I am happy to donate millions of dollars this year to this cause, and hope that other people will follow. I called this Digital Resistance – a decentralized movement standing for digital freedoms and progress globally.”

How to circumvent the block

There are different methods of circumventing the block:

Proxies

Proxies are the first option, which give users anonymity by hiding their IP addresses. However, they do not protect the data by encryption from the Internet Service Providers (ISPs).

VPNs

VPNs offer this data protection from ISPs to users. The possible problem with traditional VPNs is that users are shifting their trust from their ISP to a centralized VPN. These VPNs have users’ information that they could give to a government or a law enforcement agency if requested.

dVPNs

This is why decentralized VPNs (dVPNs) are the next step for users’ anonymity and data protection. Decentralized VPNs are using Blockchain technology and are backed by renowned investors such as Sequoia, Andreessen Horowitz, and Tim Draper’s DFJ.

While Russia and Iran are trying to ban Telegram, they could face strong resistance from the users who might start using services such as decentralized VPNs.

Furthermore, the huge amount of funds raised by Telegram in their two pre-ICO rounds means that they have a lot of resources to improve their services and to protect themselves from attempts to obtain the encryption keys or to ban the app.

Digital resistance

Telegram plays a key role in the crypto community and beyond in ensuring the security and privacy of its users. Even Edward Snowden, who previously criticized Telegram’s security model, now supports Telegram’s resistance and its leadership against the Russian government’s limiting actions.

I have criticized @telegram's security model in the past, but @Durov's response to the Russian government's totalitarian demand for backdoor access to private communications—refusal and resistance—is the only moral response, and shows real leadership. https://t.co/KtZDpu33wh

— Edward Snowden (@Snowden) April 17, 2018

These bans might actually help attract more people from the crypto community as the messenger improves its efforts to keep users’ information anonymous and secure.

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Mastercard continues to denounce cryptocurrencies while aggressively exploring and developing Blockchain based systems.

Blockchain technology has shaken up the financial world by providing a system for transactions that does not need a central authority, bank or third party payment system.This very reason has made many traditional financial institutions unsupportive of the new technology, as over time it could make their systems obsolete.

Enter Mastercard, the global banking card provider. The company has been somewhat bipolar in their stance towards cryptocurrencies and Blockchain technology over the past few years. The card provider has held virtual currencies at a distance and CEO Ajay Banga took a stern stance in 2017, labelling cryptocurrencies as ‘junk’ in October.

Banga is adamant that digital currencies need to be issued by governments before his company provides any support. As he told the India Times, “non-government mandated currency is junk.”

Alongside the likes of Visa, Mastercard have maintained this skeptical approach to Bitcoin and other cryptocurrencies from as early as 2014. A video produced by Mastercard, narrated by South East Asia CEO Matthew Driver, hammered on about a lack of trust and transparency with cryptocurrencies:  

“If its an anonymous transaction, that sounds like a suspicious transaction, why does somebody need to be anonymous?”

Driver’s statements centred around the perception that cryptocurrencies were used for nefarious purposes given the anonymity of encrypted, peer-to-peer transactions provided by various cryptocurrency Blockchains.

That particular video makes no attempt to explain the value of distributed ledger technology (DLT) or cryptocurrencies and effectively suggests that anyone using virtual currencies to make transaction are trying to hide their tracks, for whatever reason.

Furthermore he sings praises of Mastercard’s efforts, but negates to mention the fees they charge or some of the lawsuits they’ve been embroiled in, including a $6 bln settlement to retailers in America for having overcharged transaction fees alongside Visa in 2012.

Nevertheless, the promotional material was just that, an advert to promote Mastercard’s services while trying to discredit Bitcoin and cryptocurrencies, which were starting to gain popularity at the time.

No to cryptocurrencies, yes to Blockchain

Fast-forward to 2018 and not much has changed in the company’s policy towards cryptocurrencies. In March, Mastercard’s Asia-Pacific co-president Ari Sarker said the company is open to supporting national virtual currencies launched and operated by central banks.

Echoing Driver’s words from their 2012 advert, Sarker denounced the support of anonymous cryptocurrency - only state-issued virtual currencies will be considered:

“So long as it’s backed by a regulator and the value …  it is not anonymous, it is meeting all the regulatory requirements, I think that would be of greater interest for us to explore.”  

While Mastercard steer clear of Bitcoin and cryptocurrencies, they’ve been slogging away developing their own DLT-based offerings of the past 12 months. All in all, it’s believed that Mastercard Labs have filed over 30 patents for Blockchain and cryptocurrency related projects.

Blockchain powered B2B and instant

In November 2017, Mastercard filed a patent for a Blockchain-based payment system. It promises to deliver instantaneous to merchants, fast-tracking the cumbersome verification of payments from customers to card issuers which can take days to process.

Just a month prior to that, Mastercard launched it’s DLT-based business-to-business payments system. Making use of the security and transparency provided by Blockchain technology, Mastercard launched a product that they believe is “is safe, secure, auditable and easy to scale.”

As Accenture estimated in January 2017, banks could save up to 30 percent on infrastructure costs if they adopt Blockchain technology. It’s probable these cost savings are a driving factor behind Mastercard’s aggressive moves to adopt and implement Blockchain solutions to several parts of its business.

ID and credential verification

This is again evident in Mastercard’s most recent patent filed in the United States, published on April 12. The company laid out plans to launch a system for identity and credential protection and verification powered by Blockchain technology.

It is a solution that intends to prevent fabrication of proof of identity and credentials - by storing identification and credentials data in an immutable database. The details are outlined here, but it is essentially a semi-private ledger solution that will only allow authorised nodes to submit and update this type of data.

Bitcoin pilot program in Japan

While Mastercard has firmly opposed Bitcoin as currency, Sarker also told the Financial Times that the company was running a Bitcoin pilot program in Japan.

The program allows Bitcoin holders to cash out onto a Mastercard - using Know Your Customer and Anti-Money Laundering components. Even so, Sarker made it clear that it was not a trading operation on the Mastercard network.

He also said they’re dipping a ‘toe in the water’ and were ‘cognisant of the reputational risk’. Ironically, a lot of Mastercard customers could well be interested in such a service.

Baying for Blockchain

Furthermore, Mastercard seem to be scrambling to hire the best Blockchain minds in the business to continue the development of their payment processing.

On April 12 Irish Tech News reported that Mastercard has 175 new positions to fill at its Dublin offices. Among the news roles, Mastercard are looking for Blockchain specialists, software engineers, data scientists, cloud infrastructure specialists and information security specialists. All of these new positions form the makings of a Blockchain development team.

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The fast pace makes crypto trading fun, but not completely unpredictable.

In our Expert Takes, opinion leaders from inside and outside the crypto industry express their views, share their experience and give professional advice. Expert Takes cover everything from Blockchain technology and ICO funding to taxation, regulation, and cryptocurrency adoption by different sectors of the economy.

If you would like to contribute an Expert Take, please email your ideas and CV to george@cointelegraph.com.

The cryptocurrency market acts like TV stuck in fast forward. It mirrors traditional market booms and busts but with breakneck speeds that feel more like horse betting than stock trading. The fast pace makes trading fun, addictive and heart wrenching, but it is not completely unpredictable.

Cryptocurrency markets adhere to a psychology of disruptive technology. What is interesting is that Blockchain companies have managed to condense preceding market trends from a few decades to a few years. According to research published by Morgan Stanley, Bitcoin and other respective cryptocurrencies are behaving a lot like how the Nasdaq did during the dot-com bubble but at 15 times the speed.

So, what is next for the cryptocurrency market?

The general consensus is consolidation

Charles Hoskinson, Cardano founder and Ethereum co-founder, called it in early January. Amid the initial slip of the altcoin market, Hoskinson saw what many market analysts now confirm – a saturated market that was not able to sustain rising competition and diminishing interest.

During an interview with CNBC, Hoskinson stated: “What's going to occur is a lot of these ventures that don't have strong fundamentals, don't have good tech, or just unrealistic projects, they will eventually run into some major wall they can't quite overcome.”

The enterprise cloud market may be a good indicator of what we can expect next. Think of Blockchain companies like Ethereum, Cardano and Stellar as platforms that parallel big enterprise cloud platforms like Salesforce, Microsoft and Oracle in the early 2000s.

In the beginning of ‘cloud’, the aforementioned pioneers created platforms based on the novel concept of remote server access. After ‘cloud’ reached mainstream adoption, it sparked a mania of cloud application creation – not unlike the utility token mania we’ve seen with ERC20 (Ethereum’s Token Standard Interface). Once the cloud ecosystem was saturated with tools and applications, companies began to eat one another. Larger platforms created networks of native applications blended with APIs that enabled companies to adopt other successful cloud tools. However, weaker technologies in the cloud ecosystem were either eclipsed and killed by competition, or they were purchased by other companies that wanted to absorb their technology, patents and innovation.

If the Blockchain ecosystem continues to model the disruption of the cloud ecosystem, but at 15 times the speed, we are likely to see an abbreviated cycle of this consolidation.

Take a look at some of the most recent mergers and acquisitions:

At the moment, mergers and acquisitions are relatively low-key and not particularly tied to platforms. However, once platforms have solidified their core products toward the end of the year, we can anticipate more consolidation around collaborative Blockchain ecosystems.

For good measure, look at those companies who are now developing or exploring their own Distributed Ledger Technology (DLT). You’ll notice some familiar cloud names. If current Blockchain platforms do not start consuming markets soon, you can bet the giants like IBM, Oracle, Microsoft or Accenture will start feasting.

What does that mean for the original Blockchain trailblazers, newcomers and ICOs? For the top-tier Blockchain platforms

Consolidation is a critical test of any platforms merit. Only the best platforms will survive, and typically those platforms will have the most robust ecosystem of applications. Today, many platforms are making bids to capture the initial coin offering (ICO) business and further integrations with utility and currency tokens. A clean interface, strategic partnerships and high adaptability will distinguish the top competition.

For the funded, but early stage cryptocurrency companies

Having money in the bank does not make a company bulletproof. The next year will test 2017 to early 2018 ICO companies’ ability to deliver on their promised products. As stated by Hoskinson, those with weak fundamentals will likely collapse. Still, those who have a strong product may face issues with marketing and brand prominence. Every funded company should plan to both improve their product and build a strong network of supporters.

Blockchain is a grow or die industry. Companies should either prepare to have an exit strategy through acquisition, or have a build, buy, and partner itinerary to continue growing.

For ICO and Pre-ICO companies

ICO fundraising has increased in popularity, but also in competition. Where some big names are thriving, others are finding it harder to hit their goals. For March, out of the total $3 bln in ICO funds raised, more than half went to the top three fundraisers - Telegram, Petro and Dragon Coin. The scraps were divided among the 86 runner-ups. At the moment, with diminished cryptocurrency hysteria, investors are making more measured bets. That means there is less easy money on the table. Fewer ICOs are reaching their fundraising goals. As a result, many projects are hibernating, operating on a more exaggerated timeline, or failing outright.

Companies that are starting their ICO process should focus on a clear go-to-market message that stands out. They should also plan to operate lean with less than 25 percent of funding going to salary expenses. They need to seek out support early and often from partners, venture capitalists and others in the cryptocurrency community that have an active presence on exchanges and familiarity with established brands. 

Contrary to most public noise, the consolidation of the Blockchain market is extremely healthy

Consolidation reflects a more mature market that is cleaning up its ‘wild west’ image. In the next few months, the established champions will help galvanize public adoption. A leaner ecosystem will yield more targeted projects that appeal to businesses and individuals. This will hopefully kill off scam projects and ‘pump and dump’ currencies.  

Look for acquisitions and partnerships to dominate as platforms look to build ecosystems with a combination of utility and currency tokens.

The views and interpretations in this article are those of the author and do not necessarily represent the views of Cointelegraph.com.

Ben Noble is a founding partner of MarketBlok, a marketing and PR company for Blockchain technologies. Prior to his cryptocurrency work, Ben was an accomplished marketing professional for cloud-based services.

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Crypto hedge fund CEO Dan Morehead says $6.5k is as low BTC’s bear market will go, adding the coin is “highly likely” to exceed $20k within a year.

Dan Morehead, CEO of Blockchain-focused hedge fund Pantera Capital, named Bitcoin’s (BTC) bottom price and predicted BTC would go past its record high within a year in an interview on CNBC’s Fast Money Wednesday, April 18.

Morehead, whose company returned 25,000 percent in 2017 when Bitcoin hit $20,000, said that $6,500 was the low for the recent bear market, and presented it as an investment opportunity, if anything:

"Something that's growing that fast hardly ever gets below its 200-day moving average. When it does, it's a very good time to buy […] you don't get that opportunity very often.”

Earlier this week, Morehead published a letter on Pantera’s official blog in which he added that Bitcoin is “highly likely to have exceeded $20,000 within a year […] a wall of institutional money will drive the markets much higher.”

In his blog, Morehead cited U.S. federal income tax returns being due this week as one reason for recent momentum to sell off BTC, keeping markets down, an explanation that directly echoes that made by Fundstrat’s Tom Lee earlier this month.

However, he also noted that markets didn’t react negatively to news recently of the US Securities and Exchange Commission (SEC) busting two high profile scam ICOs – he names one of the ICOs as that backed by Floyd Mayweather. Morehead writes:

“When the markets go up on bad news, that’s a great sign, because it basically means you’ve reached peak negativity, where you’ve reached at least a midterm bottom. Provided that nothing drastically changes over the course of the next few months on the regulation side, I think that we’ve seen the brunt of the market’s negative reaction to it.”

Morehead’s bullish predictions align him with other investment tycoons such as Lee, who often provides bullish predictions of Bitcoin’s price, most recently forecasting that Bitcoin is likely to hit $25,000 by year’s end. Last week, venture capitalist and Bitcoin bull Tim Draper said in a speech that he sees Bitcoin hitting a whopping $250,000 by 2022.

Cointelegraph recently published an overview and analysis of Bitcoin price predictions from major investors and economists, ranging from $100 to $100,000.

According to CNBC, Pantera currently has about $800 million in assets under management. Bitcoin is currently trading around $8,270 at press time, up 1.7 percent on the day.

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World’s 4th largest exchange Huobi has announced plans to open an office in London.

Beijing-born crypto exchange Huobi has announced that it is planning to open an office in London, as it continues its expansion overseas, Finance Magnates reported April 18.

Explaining he vice president of Huobi Group, Peng Hu, told reporters:

“Not Malta, not Switzerland. Absolutely London, more precisely Britain, is the entry point for the European market for us. Soon we will have an office here.”

Financial Magnates further reports that Chern Chung, Huobi’s senior business development manager for Europe, explained that the exchange “wants to have a presence” in the city because “our statistics show that London is the most active trading scene across all of Europe.”

The choice of London sends a clear message, according to Chung, that the exchange wants to “go mainstream” by being compliant with relevant regulations. He told reporters, “[w]e are not afraid of regulation nor are we escaping regulation.”

Huobi is currently the world’s fourth largest crypto-exchange by trade volume, according to data from CoinMarketCap, trading about $1.2 billion in the past 24 hours to press time. Huobi group launched its Huobi Pro Global exchange, headquartered in Singapore, after the Chinese government banned ICOs and domestic crypto-fiat exchanges in September 2017.

Arguably, a robust and transparent regulatory climate that has crypto-particular guidelines – rather than shirking regulation altogether – is what the major international crypto-exchanges are now after. In late March, Binance, the world’s largest cryptocurrency exchange by volume, announced it was opening its headquarters in Malta, which has been proactive in providing legal and regulatory frameworks for Blockchain and virtual currencies.  

Huobi Pro opened a South Korean subsidiary on on March 30, and unveiled plans earlier this year to open an office in San Francisco.

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Cointelegraph by Connor Blenkinsop - 8h ago

The sharing economy is still in its infancy and fragmented, but Blockchain may have the potential to fuel its growing popularity.

What is the sharing economy?

Put simply, this is where individuals share items or services, usually on the internet.

Even if you haven’t heard the term, you’ll know about the phenomenon.

Through countless apps and websites, it’s possible to rent things by the day or the week – even by the hour. Occasionally it’s free, but usually there’s a fee.

For those doing the borrowing, it can bring considerable savings when compared to buying a brand-new item that might only need to be used once.

Meanwhile, for individuals who are willing to share their stuff, the concept can help them make a decent side income – boosting their usual earnings.

As well as traditional rental firms, several tech-savvy companies have launched platforms to facilitate sharing between individuals.

Given the sharing economy is still in its infancy, most of us have little awareness about the plethora of companies already in this industry. The accommodation app Airbnb and ride-hailing service Uber are two of the biggest and best-known players, and both are now mainstays in cities worldwide.

What can be shared?

The sharing economy’s potential extends far beyond cars and spare rooms.

Hundreds, if not thousands, of platforms have launched in recent years. If there’s something you want to borrow or lease, the odds are there’s a way of doing it.

You can share someone’s garden if you live in a bustling city, strike up job shares, team up with other travelers to share a tour, swap books, and even take someone’s dog out for the day. Social dining and borrowing DIY tools is also possible.

It seems that current businesses have barely scratched the surface of what’s achievable, too, as new ideas are emerging all the time.

So I can borrow a car… or a dog. What are the advantages?

For starters, it could prove more environmentally friendly.

Think about it: instead of 10 people owning a car that they only need to use occasionally, they can share someone else’s whenever required. Certain concepts such as car sharing, where colleagues hitch a ride together, can dramatically reduce CO2 emissions.

The shift in emphasis from ownership can also make life more affordable. Instead of splashing out on expensive possessions, you can use a fraction of this cash to borrow someone else’s and put the rest towards experiences.

It can also bring communities together – especially in the dog-sharing example we mentioned earlier. If you love pets but can’t have one yourself, striking up a relationship with a dog owner and their furry friend can help you meet new people. Better still, you can enjoy occasional walks in the park without the responsibilities of looking after a pet full time.

Aren’t there downsides to letting someone borrow your dog?

For people with assets to share, trust can be an issue.

Allowing someone to borrow your car or the beloved family dog can be a stretch if you’ve only just met them.

The sharing economy is addressing this by using rating systems which show the experiences borrowers and lenders have had in the past – providing peace of mind. Disputes can also be raised if an item is returned broken, or not returned at all. However, encouraging a culture of sharing might take a little time yet.

One frustration for customers at the moment is the fragmentation of the sharing economy, which means you need to register and generate a login for every service you want to use.

Meanwhile, those hiring out their spare rooms, cars and other assets can be charged high transaction fees by the platforms that make these transactions possible.

How big is the sharing economy?

The statistics are staggering.

According to Statista, 44.8 mln adults in the US used the sharing economy in 2016. This is set to almost double to 86.5 mln by 2021.

Research by Conde Nast Traveler shows Airbnb had racked up 200 mln bookings by 2016. Uber says it has 75 mln customers and 3 mln drivers worldwide – and together, they completed 4 bln trips in 2017 alone. And these numbers cover just two well-known companies.

PricewaterhouseCoopers says the sharing economy has grown at “breakneck speed,” with its research concluding that this growth is sustainable. By 2025, it estimates transactions across just five sectors of this sprawling industry will be worth almost €570 bln in Europe alone (that’s about $705 bln.)

Let me guess… Blockchain could shake up the sharing economy?

That’s right. Some entrepreneurs believe this technology could eliminate the problems which are holding back the sharing economy.

This is because a Blockchain ledger could make transactions more secure and difficult to tamper with – enabling in-depth details about assets, and who is using them, to be stored on a universal database.

Smart contracts could also eliminate the need for sharing economy platforms that serve as middlemen, driving down commission fees.

Blockchain start-ups such as ShareRing want to reduce fragmentation in the sharing economy by making it possible to rent and lease virtually any asset on one platform – with customers being able to borrow anything through a single account and pay someone instantly through a dedicated cryptocurrency. The company also wants to remove borders, meaning it would be effortless to use whether you were in Hong Kong or Havana, London or Louisiana.

Disclaimer. Cointelegraph does not endorse any content or product on this page. While we aim at providing you all important information that we could obtain, readers should do their own research before taking any actions related to the company and carry full responsibility for their decisions, nor this article can be considered as an investment advice.

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