South Africa to Start Tracking All Cryptocurrency Transactions in 2019

cryptocurrency

Owning bitcoin in South Africa just got a little harder, or at least it will do by the end of quarter one this year. According to a consultation paper published yesterday by the South African Reserve Bank (SARB), some hefty new regulation surrounding and exchanges and ATMs is about to be enforced.


South African Regulators Are Cracking Down on Bitcoin

The paper points to the several problems that cryptocurrencies present that spur the need to develop a proper regulatory response. Among these, it states that crypto assets may have a serious impact on the financial sector in the country. And that they present too many opportunities for “regulatory arbitrage.” Furthermore:

Crypto assets do not fit neatly within the current regulatory framework

This means, they argue, that they must draft new legislation, particularly at a time of growing interest from the public.

The paper also points to other problems with cryptocurrency, including the rising number of scams and hacks.

Currently, none of the consultation paper’s proposed approaches to regulating Bitcoin 00 have been enforced. The paper is still open to public comment until Feb 15.

The Intergovernmental FinTech Working Group (IFWG)

The IFWG formed a group to create this consultation paper. The group, called the Crypto Assets Regulatory Working Group, includes members from the SARB and the Treasury. Its aim is to forge a way forward for the regulation of cryptocurrency in South Africa.

South African Reserve Bank Planning to Test Cryptocurrrency Regulations

Traditional financial institutions and the country’s Reserve bank are laying the way forward for crypto’s future here. It’s hardly surprising then, that owning bitcoin in South Africa is about to get a whole lot harder.

Within the paper, the group acknowledges the possible advantages of cryptocurrency within the South African market, such as:

Customers purchasing crypto assets could seek to diversify their investment portfolio to an asset class that is not necessarily related to specific country risk.

However, the paper weighs more heavily on the problems of leaving cryptocurrency unregulated. This is hardly surprising when you consider the members that comprise the group.

Although the potential benefits of crypto assets that are related to lower transactional costs, greater speed and enhanced security of transactions are often touted, actual use cases thus far are yet to demonstrate that crypto assets payments are consistently faster, safer and cheaper than existing options.

Moreover, they go on to reiterate the ease with which Bitcoin can assist in criminal activities such as money laundering. They would. These are bankers after all.

Bitcoin-ing in South Africa Will Get Harder by End of Q1

The paper is currently in a draft version and nothing is set in stone yet, however:

The regulatory authorities will specify the way forward through a policy instrument such as a guidance note or position paper aimed for the first quarter of 2019.

The Crypto Assets Regulatory Working Group believes that regulation should not be delayed any further and that a clear approach is necessary.

Some of the main actions that will be taken are regarding the monitoring of cryptocurrency transactions.

This will focus heavily on AML/KYC and ensure that cryptocurrency exchanges, custodial services, and Bitcoin ATMs comply with existing South African financial security legislation.

They will also need to register with the IFWG and comply with AML/CFT (combating the financing of terrorism) conditions of the Financial Intelligence Centre Act.

Moreover, service providers will need to monitor user transactions, particularly large ones that may signal terrorist activity. Any service providers that fail to comply with these requirements will have sanctions imposed upon them.

Congratulations, South Africa, you’re starting to catch up to China.

What do you think of the proposed measures to regulate Bitcoin in South Africa? Share below!


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Source: Blockchain

Yellow Vests in France Planning a Bank Run to Collapse the Euro

yellow vest Paris Protests euro bitcoin

If ever anyone wished they could turn back the clock it would be wildly unpopular and “elitist” French President Macron. His decision to raise fuel tariffs in November has mushroomed and his country has succumbed to a wave of protests and violence the likes not seen since the 1960s. The yellow vests are everywhere and beyond causing chaos on the streets, it seems they’re now turning against the banks.


What’s Going On in France?

So far in Paris, demonstrators have fist-fought with riot police, cars have been set alight, and monuments damaged. While the number of protestors has fallen slightly, their proliferation has not.

According to this Facebook page, Yellow Vest protesters are now planning another demonstration outside the Rothschild Bank of Lyon on January 9.

Rothschild de Lyon

Rothschild de Lyon Yellow Vest Protest

Reports are also starting to abound that the infamous protestors are now planning a “bank run.” They are calling on all French citizens to withdraw their euros from the banks.

French banks hold an estimated one-quarter or less of all the funds that would be required should French citizens take such an action. A bank run like this has the potential to paralyze the country and even collapse the euro.

How Did the Yellow Vests Start?

It started back in November after an unpopular decision by the French government to raise fuel prices. This is something that historically doesn’t go down well with the French.

Thousands of protestors took to the streets, many donning yellow vests (gilets jaunes). They set out to demonstrate their discontent by smashing windows, buildings, monuments, and disrupting traffic.

While President Macron did make some economic concessions in December to try to appease protestors, the measures failed to placate an increasingly angry mob. They’ve come to realize that it’s not simply fuel prices that are upsetting them, forming one of the largest anti-government movements since 1968.

Their grievances go way beyond a hike in fuel prices to inflation rates in general, untapped money printing eroding their wealth, and the elitist policies of Macron.

These protests have been some of the most violent in recent times with fires even starting on the prestigious Boulevard Saint Germain in Paris last Saturday.

Images of French boxer punching down a riot policeman have also been rife on social media. And the spokesman for the ministry of the government was even rammed with a forklift.

You really don’t want to piss off the French.

What’s Happened Since?

The government’s reaction has been swift and severe. It will do little to warm the people further to the right-wing regime they feel they are up against.

French Prime Minister Edouard Philippe announced plans to punish people who hold unsanctioned protests. He said that the government will create new legislation to ban protestors from wearing masks at rallies and support:

new law punishing those who do not respect the requirement to declare [protests], those who take part in unauthorized demonstrations and those who arrive at demonstrations wearing face masks.

Known troublemakers will also be prevented from attending the events, just as football hooligans are denied entry to a stadium. The problem with this, however, is that unlike a planned event at a football stadium, the French authorities can’t stop people who aren’t buying tickets or events organized on social media.

And this hasn’t served to stop the riots.

In fact, the movement has gathered momentum, with some seven weeks of protests held every weekend of some kind in different cities across France. As many as 80,000 security forces will be deployed on the streets for the next expected wave of protests that are not limited to Paris.

Other key cities, such as Lyon, Rouen, and Caen, are seeing protests on the weekends causing further disruption. More than 1,400 people have been injured with six people dead so far.

What Does this Have to do with Bitcoin?

Bitcoin fanatics have rallied behind the yellow vests after some of them were seen with signs on their backs saying “Buy Bitcoin.”

paris protests buy bitcoin

The truth is that of the thousands of yellow vests, probably only a handful of them support, understand, or are even aware of Bitcoin. However, this handful is a potentially powerful and growing army.

The French protestors may not be armed with guns and guillotines. But they have a more powerful weapon at hand: knowledge.

Yesterday, Bitcoinist reported that street art in Paris depicting yellow vests in protest and a woman raising the French flag high had a hidden bitcoin prize inside it.

Spreading the word about bitcoin through art, protests, and private meetings are working. It’s attracting the eyes of millions of people in France and around the world.

Protest Outside the Rothschild Bank of Lyon

The yellow vests have so far organized their protests largely on social media. According to the Facebook event mentioned above, some 300 have confirmed and more than 3,000 are interested in attending the protest at the Rothschild Bank of Lyon tomorrow.

The significance of this runs way back to the country’s 40-year-old grievance with France’s private banking system. The French government borrows from them and is forced to repay with high-interest, plunging the country into further debt.

A Possible Run on Banks

The word is spreading throughout social media about a possible run on banks. French boxer Nicolle Maxime has taken to YouTube incentivizing supporters to withdraw their funds from the banks.

Other news sites such as the Daily Crusader are also talking about the significance of this move. This could paralyze the country, collapse the banking system in France, and even cause a collapse in the euro. The ambitious publication notes:

This is potentially exciting news for the bitcoin and cryptocurrency community as a sudden surge of fresh cash could be about to hit the markets…

It may be too soon to celebrate an upswing in bitcoin price 00 just yet. After all, just because the French withdraw their euros does not mean that they will invest them in bitcoin.

However, with the word spreading and the French being somewhat an incubator for innovative bitcoin startups, selling bitcoins from tobacco shops and the increasing yellow vest movement–perhaps what’s bad for the euro could be good for bitcoin.

Max Keiser also said:

If every French person converted 20% of their bank deposits into Bitcoin… French banks and the government would collapse and a lot of bloodshed could be avoided.

It will be interesting to see what–if anything–emerges from this for Bitcoin. Can the Yellow Vests spread awareness for a currency not controlled by central authorities and governments? Let’s hope so, and also for an imminent end to the violence.

Will the yellow vest protest pose a threat to the Euro? Share your thoughts below!


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Source: Blockchain

Coinbase President Says Institutions With Short-Term View Shouldn’t Touch Crypto

It hasn’t been the best of Christmases for the stock markets and let’s face it, Santa hasn’t exactly gone overboard when it comes to crypto. However, according to a CNBC Fast Money interview with Coinbase President Asiff Hirji, it hasn’t been all bad.


A Year of Innovation

When asked what happened to crypto in 2018 after such promise and expectation this time last year, Hirji reminded CNBC that Coinbase warned investors to be cautious.

In fact, in 2017, just when Bitcoin fans were starting to think all their Christmases had come at once, the world’s most regulated exchange dealt a cold blast of reality harsher than a Russian winter reinforcing that prices may be overinflated.

However, he went on to say that there had never been more innovation or institutional buy-in of crypto as there was in 2018, despite the fact that trading volumes were down. 

Not for the Faint Hearted

When asked about the BTC price 00 impact and its effect on his business, Hirji began to dance around the issue like any good president saying that years ago, Bitcoin was the only thing that mattered. Then along came Ethereum, and now there are around 3,000 to 4,000 cryptocurrencies out there but that:

There are probably 200 or so that matter.

Despite dealing a harsh hand to the flailing 2,800 cryptos or so that don’t make the grade, he said:

You should assume that (Coinbase) will over the course of time add all the cryptocurrencies that matter in as many geographies as we are allowed to add them.

He affirmed that he was full of expectations for the year ahead and that this was the start of the next great wave in crypto.

What Happened in 2018?

When asked why 2018 failed to deliver the institutional investor boost that everyone hoped would happen, Himji responded that buy-in was at an all-time high:

We’ve had hundreds of institutions onboard onto our custodian platform.

San Francisco

He added that they needed a valid venue to trade on and a qualified custodian to store with, as well as liquidity, and that Coinbase has the most compliant and regulated solution out there. 

Despite the dreadful year of 2018 for retail investors, 2019 would continue to be a good year for institutions going into crypto, he argued.

The Coinbase IPO?

When quizzed about a possible IPO for Coinbase and how its valuation must be affected by the lower prices, he recalled when the company was valued at $8 billion earlier this year, reinforcing that none of the investors were then betting on the price of the asset “today, tomorrow or even a year from now.”

“If that’s your time horizon, as an institutional investor, you shouldn’t be touching this [cryptocurrencies].

But, if you have a long-term constructive view of where crypto is going, we’re [Coinbase is] the best-leveraged bet on crypto that you can find.

Himji did admit, however, that the company’s revenue was directly tied to trading volume and that trading volume was way down, concluding:

We have a long way to go before we do an IPO.

What do you think about the Coinbase president’s comments on investing in crypto? Share your thoughts below!


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Source: Blockchain

Peter McCormack Tells How He Turned $32K Into $1.2M and ‘Back to Pretty Much Zero’

bitcoin price

In an informative, entertaining, comical, and bitterly poignant tweet yesterday, What Bitcoin Did podcast host Peter McCormack explains how he amassed–and lost–his crypto fortune over the last two years.


From $32K to Millionaire and Back

He starts the Twitter post saying:

So here is a thread on how I turned $32,000 into $1.2m and back to pretty much zero (once taxes are paid). Just note, I am not bitter or salty in any way at all, the last 2 years have been an amazing ride – travelled the world, been wealthy, been poor.

Peter’s story isn’t all that uncommon, although perhaps not everyone is as candid over the irrational and irresponsible behavior that led to them losing their fortunes.

Peter McCormack

Like many invested in the space, Peter saw potential first of all in Bitcoin back in 2016. At the time his own advertising business was folding and he decided to take a risk. All he had left was $32,000. He sunk every penny into BTC and ETH.

Right Time, Right Place

Peter hopped on the crypto train at the right time and place. It didn’t take him long before he expanded his portfolio into a plethora of other altcoins. He admits to having no trading experience and not properly conducting his research. He just got caught up in the crypto momentum and hype that so many others did, saying:

As it started to go up I diversified into everything, Monero, Dash, this that, any crap – even Ripplecoin. Everything just kept going up.

By the summer of 2017, his profits had reached half a million dollars. But, he admits, that’s when he started to get greedy. Instead of religiously taking out 25% of his profits as he had previously done, he reinvested it all closing the year with a fortune of $1.2 million.

When my balance was high I went crazy: new clothes, first-class flights, giving money away to family, charity, laughed at $25k lost on Confido… the list is endless.

Then it All Started to Go Wrong

You can pretty much guess how the story ends from here. As the markets started to spiral, Peter failed to react, convinced that it would all recover. He was so heavily invested in crypto at this point and had only known it go up and up.

bitcoin cash crash bitcoin sv

He was making five sources of income, from trading, mining, a mining pool, his podcast, and consulting. He wasn’t going to abandon the space.

As the market started to crash I just ignored it, kept thinking it would come back, it crashed like 4 times in 2017. But it didn’t. Mining is what busted me most:

– 70 S9s
– 70 DragonMints

The above with setup was like $300k.

Despite losing money on mining, he couldn’t pull the plug and was stuck with paying fixed data center fees. “Each month digging into my BTC to pay the bills,” he says.

At his peak, Peter had 150 BTC. But as the prices started to slide and the various altcoins and shitcoins he’d invested in start to crash out and plummet, his holdings had soon dwindled to about 80 BTC and dropping.

Basically greed and over ambition have destroyed what could have been life-changing money. After I pay my tax bill pretty much all is gone.

Peter McCormack Has a Silver Lining to His Story

Peter admits to having to sell more of his bitcoins than he would have liked due to the responsibilities of being a father. He also hasn’t lost everything since he still makes a modest income from his podcast.

And he has some advice for other crypto HODLers and traders out there:

If there is another bull run and you make a bunch of cash then remember to take profits. Don’t overstretch yourself. People say don’t invest what you can’t afford to lose, well don’t keep in Crypto profits which will change your life.

He ends his thread with an edit that puts the whole crazy journey into context and pounds home the message that there’s more to life than obsessing over wealth.

In the last 5 years I have lost a marriage (after 3 months), lost my Mum (cancer) and nearly died from a drug overdose. Rich or broke, the money made little difference to happiness.

What do you think of McCormack’s experience and lesson learned? Share your thoughts below!


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The post Peter McCormack Tells How He Turned $32K Into $1.2M and ‘Back to Pretty Much Zero’ appeared first on Bitcoinist.com.

Source: Blockchain

25% of Pantera Capital ICO Projects May Have to Refund Investors

Pantera Capital

Crypto hedge fund Pantera Capital says that as much as one-quarter of the projects its ICO fund invested in may be in violation of US securities laws after the SEC decision. 


Things keep going from bad to worse for US blockchain companies that held ICOs without registering with the SEC. One of crypto’s largest hedge funds Pantera Capital told Bloomberg that around 25 percent of the digital currency projects in its portfolio may have to refund the money.

While the California-based Pantera Capital believes that the majority of its investments will be unaffected by the SEC ruling, at least one-quarter of them have an undecided fate at the current moment. There is the distinct possibility that these projects could be in violation of securities laws — and that’s not a good place to be.

What Did the SEC Say?

In an announcement on Nov 16, the US Securities and Exchange Commission (SEC) stated that two startups, Paragon Coin and AirFox, had raised millions of dollars’ worth of funds by issuing tokens that did not comply with US securities laws as they were issued to non-accredited investors.

In order to get on the right side of the law, it seems, any startup in the same position has a pretty clear path ahead of them. Pay the penalty, offer a refund, and register with the SEC. Sounds pretty simple right? Except that these blockchain startups raised funds to build products and teams and much of the funding has already been spent.

After these two ICOs set a precedent warning last month, shockwaves of panic were felt throughout the crypto community. It became clear that many startups that held ICOs could soon find themselves in the same boat. If they did not register with the SEC and they sold tokens indiscriminately to everyday people rather than accredited investors, their doors would certainly be knocked on.

STOs are Sexy

This has all but seen the death of the ICO in the United States where companies are moving toward STOs that are approved by the SEC but may be cost-prohibitive to startups.

Pantera’s co-chief investment officers Joey Krug and Dan Morehead stated in a newsletter on Thursday:

While we believe the vast majority of the projects in our portfolio should not be affected, approximately 25 percent of our fund’s capital is invested in projects with liquid tokens that sold to U.S. investors without using regulation D or regulation S.

They continued to elaborate:

If any of these projects are deemed to be securities, the SEC’s position could adversely affect them. Of these projects, about a third (approximately 10 percent of the portfolio) are live and functional and, while they could technically continue without further development, ending development would hinder their progress.

What do you think about the news that upwards of a quarter of Pantera Capital’s ICO projects may need to refund investors? Let us know your thoughts in the comments below!


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Source: Blockchain