Complex Made Simple

3 developments that shake and shape the crypto world

Brought to you by Toshi Times

Development No.1: No more ICO Scams

Scams have been part and parcel of the crypto world since ICOs really took off in 2017 – the word “BitConnect” has basically become a byword for crypto scamming.

Vietnamese start-up Modern Tech raised $660 million in April 2018 through their Pincoin and iFan token and platform, before disappearing without a trace, and Plexcoin and Centratech raised similar high amounts.

“Tackling Scams”

Speaking in Prague on October 30th, at the annual Ethereum developer conference, Devcon 4,  Fabian Vogelsteller, dubbed “the godfather of Ethereum”, who was central to bringing the ERC-20 model to the Ethereum network, proposed an adapted version of the ICO model which would allow investors to withdraw funding at any time during project development.

This RICO (Reversible Initial Coin Offering) model would use Ethereum smart contract programming to allow investors to “reverse their funding commitment.”

Vogelsteller explained: “You are able to withdraw the funds you committed at any point of time and you do this by simply sending back your tokens.”

He conceded that some form of base capital would need to be secured from investors outside of the ICO in order to maintain stability in funding.

“No more risks”

Adoption of this model would remove the risk of relying on the word of start-ups to make good on their promises after money has been handed over, and would force delivery on such promises or face failure.

Testing for the RICO model will begin on Vogelsteller’s own start-up, a fashion and design blockchain called Lukso.

Read: Would you pay $63 million for a pizza? One foolish guy did

Development No.2: Microsoft blockchains with Nasdaq 

In an official blog post, software giant Microsoft has announced it will be partnering Nasdaq stock exchange to integrate its Azure blockchain technology into Nasdaq Financial Framework (NFF). The new joint venture will take advantage of Azure blockchain platform, which will allow to easier match buyers with sellers, manage deliveries and settlement of payments and transactions. Reportedly, Azure will allow NFF clients to use a number of blockchains through one interface. No prior blockchain-specific knowledge will be needed for the organizations using NFF, which is critical as the nascent industry is pushing for real-world use cases and broader adoption.

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“The blockchain-powered tech will make things easier”

Tom Fay, Senior Vice President of Enterprise Architecture at Nasdaq welcomed the new venture, claiming that, “With multiple blockchains in use by various industry participants, we believe that the combination of NFF and Microsoft’s blockchain technology can remove some of the project complexities that exist in this realm. Additionally, as more industries move towards capital markets technology and structures, we see the potential for blockchain to provide value in a secure, frictionless and instantaneous matching of buyers and sellers.”

Read: Ethereum is down but surely not out: It’s just too smart

“Nasdaq and distributed ledger”

Nasdaq has been at the forefront of implementing blockchain technology in its operations. Earlier this year, the global stock exchange operator announced of trialing a blockchain application which would effectively handle margin calls. Back in April, Adena Friedman, CEO of the company, claimed that the financial services giant would consider opening a crypto exchange if a clear legal framework would be introduced by the US regulators.

The firm has also pushed for widespread digital currency adoption, reportedly hosting a meeting in Chicago this summer with a number of crypto and traditional finance companies. Nasdaq has also been exploring the development of a security token platform and has contacted numerous blockchain companies for advice on the matter.

Meanwhile, Microsoft has teamed up with the “Big Four” auditing firm Ernst & Young to use blockchain in managing copyrights and royalties. The upcoming platform will use Azure and the Quorum blockchain protocol.

Read: Ripple sets eyes on Dubai’s expat remittances

Development No.3: Warren Buffet’s 360-degree turn, now a believer in cryptos 

Berkshire Hathaway, the multinational holding company headed by legendary investor Warren Buffet, has reportedly invested $600 million in fintech payments. According to a report from the Wall Street Journal, the investment is focused on payment services in upcoming markets.

These investments in mobile payments clash somewhat with Buffett’s aversion to fintech investments. He has previously referred to cryptocurrencies as ”rat poison squared”, and claimed that Bitcoin is neither a cryptocurrency nor a way of investing. Moreover, he argued that Bitcoin has ”entered bubble territory” in October of 2017, stating that it was ”about to implode”.

Berkshire Hathaway has supposedly participated in Brazil’s fourth-largest payment processor StoneCo’s IPO. This is in addition to a $300 million stake in the parent company to ”Paytm”, one of Indian’s most major mobile payment services.