According to a new report by Elliptic, a firm that tracks movements of funds on the digital ledgers that underpin cryptocurrencies, growth in the use of DeFi over the past two years has been staggering. In fact, the total capital locked in DeFi services has grown by over 1,700% to $247 billion in the past year alone. While the figures are promising signs for investors, the reality is, the losses are also high.

CRYPTO SCAMS: WIN SOME, LOSE SOME

Aaron Raj | 24 November, 2021

Elliptic’s report shows that the same openness and innovation that makes DeFi so powerful also brings with it new risks. As the underlying technology is still in its early days, hackers have been able to compromise it to steal users’ funds. At the same time, the deep pools of liquidity have allowed criminals to launder the proceeds of crimes such as ransomware and fraud.

This is part of a broader trend in the exploitation of decentralized technologies for illicit purposes, which Elliptic refers to as DeCrime. The report highlighted that DeFi users and investors have suffered more than $12 billion in losses due to theft and fraud. These losses are accelerating, with losses totaling $10.5 billion in 2021 to date, up from $1.5 billion in 2020.

(Photo by JOE RAEDLE / GETTY IMAGES NORTH AMERICA / Getty Images via AFP)

For Gunnar Jaerv, co-founder and COO of First Digital Trust (FDT), a Hong Kong-based trust and custodian, it’s no surprise that the need for crypto regulations has increased given that DeFi crime has risen quite significantly in the past year.

With a TVL of $104 billion in DeFi, this space has grown to be more lucrative and attractive to not just investors but criminals as well. Crypto regulations are inevitable and necessary to help protect investors.

“We have seen through natural selection that as the crypto industry matures, it is the companies that comply with security regulations that thrive. For those who refuse to comply, they are not only putting themselves at risk but their consumers at risk too. Crypto companies can minimize data leaks by implementing proper security infrastructures such as network firewalls and vulnerability scanning,” explained Gunnar.

Meanwhile, Antoni Trenchev, Co-Founder of Nexo, the leading regulated financial institution for digital assets, believes the noise around DeCrime growing is not 100% on point. He felt that it’s being measured mostly based on how much funds have been stolen. While the rise is concerning, Anotoni pointed out that the scaling of the decentralized finance industry isn’t being taken into account. Proportionally to how much money is now in DeFi, DeCrime hasn’t actually risen as drastically as suggested.

“Since October 2020, the total value locked in DeFi has grown 40 times to over $250 billion. Simultaneously, the funds funneled away through illicit activity in late 2020 amounted to roughly $1.5 billion, while this year, it increased to a little over $10 billion. The roughly 10x DeCrime increase is about four times smaller than the growth of DeFi’s TVL, so it may not necessarily be that this subset of crime is on the rise but that the losses are simply larger because there are far more funds locked in DeFi to steal,” said Antoni.

Antoni also reiterated that the solution wouldn’t be to abstain from DeFi, though. He felt that the opposite needs to happen, which is to keep innovating to create a safer space.

The post DeFi ecosystems report US$ 10.5 billion losses in 2021 appeared first on Tech Wire Asia.

But this could soon change thanks to a new study that found nearly half of Australians would be open to using cryptocurrencies if they were made legal tender. The survey conducted by Saxo Markets found that 50% of the population is interested in using cryptocurrency and believe it will become an accepted form of currency in the near future. 

COMMONWEALTH BANK OF AUSTRALIA NOW PROVIDES CRYPTO TRADING SERVICES

Aaron Raj | 8 November, 2021

This represents a significant increase from the 38% recorded last year, with respondents aged 18 to 34 most likely to use digital currency (63%). 

 In October 2021, Australia had the third-highest rate of cryptocurrency ownership. The country has expressed a recent desire to compete against the UK, US, and Singapore in the cryptocurrency sector. 

According to Australian Senator Andrew Bragg, Australia can become a significant leader in digital assets. 

Despite the growth in crypto popularity, only 11% of people surveyed stated they thought they understood what “Crypto” means. 21% of males believed they fully understood the term, whereas 7% answered the same. Perhaps unsurprisingly, only 5% of people aged 65 and over fully understood the term “Crypto”, but on the other hand, the number of 25 to 34-year-olds that understood was almost 4x higher (19%).  

Accommodating Crypto adoption 

(Photo by MARIO TAMA / GETTY IMAGES NORTH AMERICA / Getty Images via AFP)

Cryptocurrencies have grown in popularity over the years, particularly among traders. In Australia, cryptocurrencies such as Bitcoin and Ethereum are becoming increasingly common in mainstream society. 

According to survey data, 38% of Australians have heard of Bitcoin, and 12% have heard of Ethereum. Meanwhile, only 8% of Australians said they had heard of Dogecoin, 6% of Binance Coin, and 2% acknowledged they knew of Cardano. This data is interesting as the virtual currency has a market cap of around USD60 billion.

Australia has been attracting crypto investors for years now, and it is a hotspot for investment and innovation, with more businesses accepting crypto payments than ever before. But there’s one area where it lags behind the rest of the world: regulation.

The Senate’s Committee on Australia published a report stating that the country needs to introduce new regulations for digital asset miners to be “competitive with Singapore, the UK and the US. This includes tax discounts and a licensing regime for crypto exchanges, 

The report also stated that due to its high risks, many of Australia’s top financial institutions have not engaged with the cryptocurrency sector, despite its huge growth in the past year. It also calls for clarity on rules about when banks can refuse to deal with a business customer involved in cryptocurrency.

Australia is struggling to keep pace with the growth in the digital asset economy. This covers blockchain-based security tokens, crypto exchanges, and non-fungible tokens, or “NFTs”, which offer ownership of online properties.

A dramatic increase in trading since early 2020 has been reported by The Australian Taxation Office. This was when Covid-19 lockdowns sparked a flurry of online investment activity, the report said, sending prices of some cryptocurrencies to record levels.

The post More Australians are open to crypto adoption appeared first on Tech Wire Asia.

Just 12 years into its existence, the Bitcoin network today already processes more dollar value than PayPal, a 23-year-old American digital payments company. Impressive as it is, experts reckon that the network could even outstrip credit card giant Mastercard in the number of dollar transactions value processed, as early as 2026.

In a recent report by market intelligence platform for blockchain and other distributed ledger technology, Blockdata, it was stated that the Bitcoin network processed about US$489 billion per quarter in 2021, which is greater than Paypal’s US$302 billion. 

Titled “When might the Bitcoin network process volumes like Mastercard and Visa?” the report said that after just 12 years in existence, Bitcoin processes about 27% of Mastercard’s US$1.8 trillion per quarter, and 15% of Visa’s US$3.2 trillion. “If Bitcoin were to increase its value transferred per transaction today by 260%, it would be processing an equivalent volume to Mastercard on a daily basis,” it added.

Among the three factors that could see the Bitcoin network rise to the level of the two credit card giants in terms of total volume processed according to Blockdata is; the total number of transactions, the average amount of Bitcoin sent per transaction, and the rise of the price of Bitcoin.

BITCOIN VS BLOCKCHAIN: WHAT IS THE DIFFERENCE, EXACTLY?

Dashveenjit Kaur | 26 April, 2021

The report however could not find current data indicating that the average amount of Bitcoin sent per transaction is on an upswing. While it is inevitable that the trend could change in the future, a rise in price to US$245,000 at the current volume would also bring Bitcoin to match Mastercard by 2026, Blockdata said.

Notwithstanding Bitcoin’s yearly average price, which if placed into consideration, could take as long as 2060 before the network is able to match that of Mastercard. Nevertheless, the report concluded Bitcoin has performed admirably well for a network that began a little over a decade ago.

In comparison to other cryptocurrency in the market though, Bitcoin has shown a steady rise in value over the years. At this point, there are many experts who believe Bitcoin is on its way to passing the US$100,000 mark, with no certainty on when it could actually happen, given its volatile nature. 

Overall, there are a growing number of companies across a plethora of industries who are embracing cryptocurrencies, allowing customers to use them as an official method of payment for goods and services. Visa, Mastercard and PayPal are one of them.

The post Bitcoin now processes more dollar value than PayPal appeared first on Tech Wire Asia.

Even in Australia, a country where crypto-assets continue to see immense activity, the Commonwealth Bank of Australia announced that they will enable crypto trading services on the bank’s app for customers.

CRYPTO PAYMENTS BECOMING A TREND AMONG SINGAPOREANS

Aaron Raj | 1 November, 2021

Mastercard has also announced that it is partnering with three Asian crypto companies to launch bitcoin payment cards. They include Hong Kong’s crypto finance firm Amber Group, Thailand’s crypto exchange Bitkub and Australia’s trading platform, Coinjar.

The partnership intends to introduce cryptocurrency-linked credit, debit, and prepaid cards for both individuals and businesses across the Asia Pacific. Cardholders will be able to instantly convert bitcoin and other digital currencies into fiat currencies, which can then be spent online or offline with any of the merchants that accept Mastercard payments.

Yet, despite the increased usage and demand for crypto assets management platforms and such, Binance, which is the world’s largest crypto trading exchange has been banned in some countries in Southeast Asia. In fact, China has also announced a complete halt to crypto trading and has begun cracking down on privately mined cryptocurrencies.

The Monetary Authority of Singapore (MAS) also warned of sharp speculative wings and potential risks for retail investors who invest in cryptocurrencies. Speaking at the Singapore Fintech Festival, Ravi Menon, managing director of MAS said the Singapore central bank “frowns on cryptocurrencies or tokens as an investment asset for retail investors”.

Interestingly though, according to the Crypto Asset Management Market 2021-2025, the global crypto asset management market size is projected to grow to US$1.2 billion by 2026, with the APAC region expected to provide significant growth opportunities for vendors operating in the cryptocurrency management market during the forecast period.

(Photo by Ozan KOSE / AFP)

The report highlighted that rapid advancements in the network infrastructure, cloud computing, economic growth, and stable geopolitical system have provided a platform for the growth of solution providers in the APAC region.

Also, mobile apps created for exchanging cryptocurrencies have been making things easier for asset traders and miners. There have been several stock market apps that now feature cryptocurrency apps which not only allow to have total control over the digital assets but trade with them. When powered by blockchain, these cryptocurrencies can be used for all sorts of payments and transactions.

The report also showed that electronic wallet apps tend to store digital assets and money allowing the user to spend on transactions involving blockchain technology. These digital asset tracker apps are trying hard to provide updated information about the rates, trades, market dynamics, and a portfolio of various cryptocurrencies. Examples of crypto asset management providers include Coinbase, Gemini, and Crypto Finance, Vo1t, and BitGo.

Buying, selling, and trading crypto assets

As such, Ripple, a provider of enterprise blockchain and crypto solutions, will be launching its Ripple Liquidity Hub in 2022. Currently available in preview mode, the solution will allow customers to seamlessly access crypto assets from a variety of global venues, including market makers, exchanges, OTC desks, and in the future decentralized venues. The product will support turn-key integration and smart order routing to source digital assets at optimized prices giving customers the ability to easily buy, sell, and hold crypto assets.

For nearly two years Ripple has leveraged Liquidity Hub for internal liquidity management as part of its On-Demand Liquidity product, powering millions of transactions, worth billions of dollars. Now Ripple will make the product available for its hundreds of customers globally, as well as any financial institutions, banks, fintech, or corporates who need support preparing for an inevitable crypto-first world.

“We understand firsthand the need for easy and efficient liquidity management – and as such, we’ve received questions from our customers who require solutions that can be a one-stop-shop to buy, sell and hold crypto assets. The combination of Ripple’s crypto DNA and long history working with financial institutions makes us uniquely positioned to address this problem for our customers as they prepare for a tokenized future,” said RippleNet GM Asheesh Birla.

Unlike existing solutions available, Liquidity Hub is designed for enterprise customers and their unique needs through easy onboarding by offering a streamlined API for accessing digital assets from a breadth of liquidity pools. There will also be optimized pricing for a breadth of digital assets, enabling enterprises to provide their customers with the best price from a variety of liquidity venues. Enterprises won’t be required to pre-fund accounts for Liquidity Hub and can receive access to working capital through Ripple to fund their business operations.

Ripple’s first partner of the alpha product is Coinme, the largest licensed cryptocurrency cash network in the U.S., with thousands of locations across the country. Initially, Coinme will utilize the underlying technology platform of Liquidity Hub, with plans to unlock additional functionality as it becomes available.   

The post The Ripple effect for crypto assets appeared first on Tech Wire Asia.

The global values of cryptocurrencies including Bitcoin have massively fluctuated over the past year partly due to Chinese regulations, which have sought to prevent speculation and money laundering.

Just hours after the announcement, short of crashing, the crypto market went into a flummox, wiping hundreds of billions off its collective value.

According to Forbes, the value of the world’s cryptocurrencies tanked to a low of about US$1.8 trillion by 7:15 a.m. EDT last week, “falling roughly 9% and losing US$188 billion in market value within just three hours of China’s announcement, according to crypto-data website CoinMarketCap.”

China’s attack on cryptocurrency

“Virtual currency-related business activities are illegal financial activities,” the People’s Bank of China (PBOC) said in an online statement Friday, adding that offenders would be “investigated for criminal liability in accordance with the law.”

The final notice bans all related financial activities involving cryptocurrencies, such as trading crypto, selling tokens, transactions involving virtual currency derivatives, and “illegal fundraising”.

GOLDMAN SACHS U-TURNS ON CRYPTOCURRENCY AS AN ASSET CLASS

Jamilah Lim | 3 June, 2021

Bitcoin, which had already been falling before the announcement, sank by as much as 8.9 percent to US$41,019 in European afternoon trading before recovering slightly later in the day.

The central bank said that in recent years trading of Bitcoin and other virtual currencies had become “widespread, disrupting economic and financial order, giving rise to money laundering, illegal fund-raising, fraud, pyramid schemes, and other illegal and criminal activities.”

This was “seriously endangering the safety of people’s assets,” the PBOC said.

Not the first time China’s targeted cryptocurrency

Crypto creation and trading have been illegal in China since 2019, although further crackdowns this year by Beijing warned banks to halt related transactions and closed much of the country’s vast network of bitcoin miners.

Friday’s statement by the central bank cemented China’s cryptocurrency stance, crushing any smidgen of hope for any form of crypto activity.

Bitcoin, the world’s largest digital currency, and other cryptos cannot be traced by a country’s central bank, making them difficult to regulate.

Analysts say China fears the proliferation of illicit investments and fundraising from cryptocurrency in the world’s second-biggest economy, which also has strict rules around the outflow of capital.

The crypto crackdown also opens the gates for China to introduce its own digital currency, which has already gone through multiple pilots, allowing the central government to monitor transactions.

In June, Chinese officials said more than 1,000 people had been arrested for using the profits from crime to buy cryptocurrencies.

AUSTRALIAN NEOBANK VOLT WORLD’S FIRST TO PARTNER CRYPTO EXCHANGE BTC MARKETS

Jamilah Lim | 8 September, 2021

Several key Chinese provinces have banned the operation of cryptocurrency mines since the start of this year, with one region accounting for eight percent of the computing power needed to run the global blockchain — a set of online ledgers to record bitcoin transactions.

Bitcoin values tumbled in May on the back of a warning by Beijing to investors against speculative trading in cryptocurrencies.

How large an impact will this have?

The aggressive stance by the Chinese government over the years has made the country hostile to crypto players who have been slowly backing out. The latest was in June this year, where Tiger Brokers and Futu completely bypassed China in its expansion.

“China’s ban on all cryptocurrency trading activity will have some short-term impact on currency valuation, but long-term implications are likely to be muted,” said Ganesh Viswanath Natraj, Assistant Professor of Finance at Warwick Business School.

“This ban will result in the migration of crypto investment opportunities to other hubs in Asia, such as Singapore’s launch of the DBS digital currency exchange earlier this month,” he added.

With additional reporting by Agence France-Presse

The post China’s latest ruling quashes all hope of cryptocurrency activity in the country appeared first on Tech Wire Asia.

This partnership will allow BTCM’s customers the ability to access integrated banking capabilities offered by Volt. This would initially be through access to a corporate cash management account with real-time notifications and payment automation.

Volt’s BaaS (banking as a service) platform, according to the neobank, will provide customers with speed, stability, and confidence when investing in digital assets.

Neobank Volt’s offering to corporate crypto customers

In the coming months, BTCM will invite its customers to open Volt bank accounts, allowing customers an improved, real-time trading experience with greater security. 

As a result, instead of depositing into BTCM trust accounts, BTCM customers will use their own Volt accounts embedded within the BTCM environment. 

The total of all deposits in Volt accounts are covered by protection of up to a maximum of $250,000 per account holder under the Financial Claims Scheme by the Australian government.

Volt believes the partnership demonstrates how BaaS can provide much-needed innovation and access to banking solutions for fintechs and their customers, and improve competition in Australian banking.

Australian Crypto trends

According to comparison site Finder’s Annual Cryptocurrency Report, it was found that 31% of Gen Z Australians own some form of crypto.

Independent research commissioned by Australian cryptocurrency and digital assets exchange BTC Markets has also revealed that more Australians now invest in cryptocurrencies like Bitcoin, than precious metals like gold and silver.

Additionally, approximately 17% of Australians own a cumulative AU$7 billion worth of cryptocurrency, with the average investor owning AU$2078 in assets. A further 13% say that they intend to purchase such digital assets within the next year. 

According to Finder’s cryptocurrency expert James Edwards, Gen Z’s behaviour concerning cryptocurrency is a sign that traditional finance is slowly being phased out — a pretty bold prediction for its future.

“If the pace of education continues to grow, combined with easier access to cryptocurrencies, we should expect to see it as a dominant financial industry by the end of the decade, especially among younger generations who have never had meaningful access to traditional finance.”

Cryptocurrency isn’t new nor banned in Australia — the government has taken proactive steps to regulate cryptocurrency, providing a clear operational framework for crypto businesses going forward.

For example, the Australian Transaction Reports and Analysis Centre (AUSTRAC) announced the implementation of more robust cryptocurrency exchange regulations in 2018. 

Those crypto regulations require exchanges operating in Australia to register with AUSTRAC, in compliance with the AML/CTF 2006 Part 6A – Digital Currency Exchange Register.

Australian neobanks and crypto 

Whilst a majority of Australians have not heard of a neobank (also known as online-only banks), they are steadily increasing in popularity. 

However, earlier this year, Australia’s banking watchdog, the Australian Prudential Regulation Authority (APRA), initiated stricter requirements for companies seeking banking licenses and increased scrutiny of new entrants in the market, highlighting concerns around “neobanks”. 

Volt is Australia’s first neobank, which obtained an unrestricted Authorised Deposit-Taking Institution (ADI) license in 2019. Volt is currently the only independently owned retail neobank with an unrestricted ADI license in Australia. 

Andrew Clouston, Volt Chief Customer & Partnerships Officer said that businesses are increasingly seeking to deepen their relationship with customers so as to cut down on “friction” with processing payments. 

“We’ve been particularly interested to see digital currencies grow in popularity, credibility, and security over the past few years. We believe BTC Markets and Volt are primed to deliver safe and secure banking access to support Australians seeking to trade in digital assets.

 “As Volt continues to scale with BaaS partners such as Railspay, AFG, Australian Mortgage, and QPay, we’re seeing rapidly-growing demand for scalable banking solutions that can be delivered seamlessly within the ecosystem of fintechs.”, he added.

Clouston is of the belief that innovative partnerships such as this one with BTCM are “further testament to the way neobanks like Volt will lead the future of Australian banking, providing integrated financial services and better outcomes for Aussie consumers.”

Australian banks and digital currencies

Despite the increasing popularity of crypto in Australia, coupled with tighter regulations, traditional Australian banks have been rather intransigent in their stance on having services for cryptocurrencies. In fact, a recent Senate inquiry was carried out, where traditional Australian banks were accused of “de-banking” cryptocurrency operators by denying them core banking services.

According to a report by the Sydney Morning Herald, challengers to Australia’s big banks have accused the major lenders of being too cautious towards cryptocurrencies and stifling innovation by denying the fintech sector vital services.

Additionally, fintechs have claimed that this practice is widespread, “with local banks frequently declining to provide key payment services to money remitters and cryptocurrency operators in particular.” This also effectively restricts the capabilities of crypto owners from withdrawing their crypto assets from banks.

In response, the Australian Banking Association said banks around the world offered their services in accordance with their appetite for risks and also pointed to global banking regulators’ view that cryptocurrencies were very high-risk exposures for banks, reported SMH.

BTCM, which was established in 2013, underwent a stringent accreditation process with Volt. Additionally, BTCM is AUSTRAC and ISO 27001 accredited, and in the process of acquiring an Australian Financial Services Licence from ASIC and is undergoing SOC 2 certification.

Will a neobank partnership with crypto exchanges be the future in Australia?

Caroline Bowler, BTCM CEO, added that “increased speed will result from our customers gaining almost instant access to Australian dollars for trades through native and integrated banking solutions such as bank accounts. Greater stability will arise out of this first-of-its-kind relationship between a bank and a crypto exchange in Australia.

“Both of these factors will generate customer confidence that their funds are in place and available, and that they will be able to time the market far more easily – which is absolutely critical in such a dynamic industry as crypto.

“This partnership demonstrates that we are progressing in the right direction of a financially inclusive future where crypto sits alongside mainstream finance.”

Earlier this year, Jack Dorsey, CEO of Twitter and US fintech Square, acquired the Australian BNPL (buy now pay later) firm Afterpay. Square, a big believer in bitcoin, is very likely to be one of the largest companies to be listed on the Australian Securities Exchange.

These fintech and crypto moves in Australia are indicative of more interesting times ahead as changing customer behaviors and trends plot a path in the finance and banking sector in the nation.

With challenger banks going head to head with nervous traditional banks in Australia, will the government be forced to further intervene and regulate neobanks and crypto?

Guess we’ll just wait for the results of the senate inquiry for now.

The post Australian neobank Volt world’s first to partner crypto exchange BTC markets appeared first on Tech Wire Asia.

For a long time, China has been home to more than half the world’s bitcoin miners. Things, however, took a turn two months ago when the government called for a severe crackdown on bitcoin mining and trading, setting off what’s being dubbed in crypto circles as the “great mining migration” in China. This exodus is underway now with hundreds of Chinese miners pulling the plugs on their machines.

Truth be told, the move by the Chinese government didn’t come off as a surprise. It started in 2013 when China first moved to restrict its banks from using Bitcoin as currency, citing concerns about its inherently speculative nature which could threaten the country’s financial stability. Over the years, the government has grown even warier. Authorities put a stop to token sales in 2017 and pledged to continue to target crypto exchanges in 2019.

CHINA’S LUCRATIVE BITCOIN MINES RISK DERAILING CLIMATE GOALS

AFP | 8 April, 2021

In May this year, Beijing moved to effectively shut down all crypto mining operations in the country. In late June, the central bank also required payment firms and banks to shut down the accounts of individuals involved in crypto transactions. By July, half the world’s bitcoin miners have now gone dark,  and the ‘great mining migration’ in China is afoot.

What led to a migration of miners from China?

While the argument rages about whether the volatility of cryptocurrencies is a sign of its fundamental weakness or merely a bump along the road, the initiatives coming out of Beijing are being seen by experts as a sign of China’s attempts to incubate its own fledgling e-currency and reboot the international financial system.

When Chinese Vice Premier Liu He called for a “severe” crackdown on and punishment of “illegal securities activities,” including crypto mining and trading, it was to—as he put it—”stem risks and ensure financial stability”.  As it is, the Chinese miners helped raise Bitcoin’s value by more than 1,000 percent in a year to an all-time high of nearly $65,000 in April. After the Chinese miners began shutting down their machines, the value plummeted, closing out the first half of the year down almost 50% from its record.

Huobi, the world’s second-largest crypto exchange by volume, said in a statement on Sunday that it has suspended crypto-mining hosting services and the sale of crypto mining machines in China, according to Coindesk.  Even mine operator HashCow has indicated it will suspend new businesses in China and stop purchasing new mining rigs, according to a Reuters report.

Another crucial motivation is the increasing alarm in Beijing at the size of the crypto industry in China, where a huge amount of cryptocurrency was being “mined” until the recent crackdown. The threat of an unregulated alternative monetary system emerging from blockchain technology is a clear and present danger to the Communist party, according to observers.

It is perhaps important to note that Chinese miners account for 75% of the world’s Bitcoin hash rate—the total computational power used to mine and process crypto transactions—given the country’s access to specialized hardware and cheap electricity, according to new research published by Nature Communications.  

They are mostly in four Chinese provinces: Xinjiang, Inner Mongolia, Sichuan, and Yunnan. Sichuan and Yunnan’s hydropower make them renewable energy meccas, while Xinjiang and Inner Mongolia are home to many of China’s coal plants. 

The post The great mining migration is happening in China. Here’s what we know so far. appeared first on Tech Wire Asia.

It is common for people to confuse blockchain with Bitcoin in the early days, given the latter was the first widely known application of blockchain. It somehow managed to monopolize how and what people perceive as blockchain tech. However, since its public debut in 2008 as the technology behind Bitcoin, blockchain’s wider benefits have gained wider recognition and this budding technology is now catering to many other industries.

For starters, blockchain is the technology, among other things, that enables the existence of cryptocurrency. Bitcoin is the name of the most-known cryptocurrency, the one for which blockchain technology was is most recognized. 

What exactly is blockchain technology?

A blockchain is simply a database file used to store records. It is a transparent, public ledger (or database) that ensures the information recorded on the blockchain is shared through several machines instead of a single source, and is therefore decentralized. Another aspect of blockchain which makes it so revolutionary is its decentralization. Unlike a standard centralized platform, where documents are handled by a single central authority, blockchain is entirely open.

Blockchain might have achieved renown with cryptocurrencies, but it doesn’t end there. Blockchain can be used for a variety of purposes, with Bitcoins and other digital currencies just one of the use cases. It can be also used to provide a low-cost, safe and secure environment for peer-to-peer (P2P) transactions, cutting out the now-unnecessary middleman in the process. 

Blockchain applications have countless uses in both the private and public sector over the years. For example, storing public health records and land registries, offering immutable voting platforms, guaranteeing secure identity management. In the private sector, big tech companies have invested a lot into the blockchain space, and are now catering third-party solutions to other businesses. 

To date, blockchain has been more widely adopted in the banking and fintech industry. Supply chain management and logistics is another industry where the blockchain has been used to achieve transparency and to build an immutable registry of transactions. Other industries, such as the automobile industry, aviation, telecom, music, and entertainment among others, have also been exploring their blockchain options.

CHINA LEADS THE CHARGE TOWARDS BLOCKCHAIN 3.0

Dashveenjit Kaur | 2 April, 2021

Similar to how the internet changed the world by providing greater access to information, blockchain is poised to change how people do business by offering trust. The benefits of blockchain for business are numerous, including reduced time (for finding information, settling disputes, and verifying transactions), decreased costs (for overhead and intermediaries), and alleviated risk (of collusion, tampering, and fraud). For all the ways blockchain is already being used in business, there are even more applications that haven’t been fully realized yet.

What about Bitcoin?

Bitcoin is a type of unregulated digital currency that was first created by Satoshi Nakamoto in 2008. Also known as a “cryptocurrency,” it was launched with the intention to bypass government currency controls and to simplify online transactions by getting rid of third-party payment processing intermediaries. Since there had to be a secure way to make transactions with the cryptocurrency, bitcoin transactions are stored and transferred using a distributed ledger on a peer-to-peer network that is open, public, and anonymous. 

That said, blockchain is the underpinning technology that maintains the Bitcoin transaction ledger. The cryptocurrency, however, has a more limited scope. Some countries have embraced it more openly, while other governments have banned or restricted it. For the most part, Bitcoin is still not legally acceptable as a substitute for a country’s legal tender. For now, that is.

The post Bitcoin vs Blockchain: What is the difference, exactly? appeared first on Tech Wire Asia.

Visa, the long-established card and traditional payments issuer and former staunch enemy of the burgeoning cryptocurrencies market, is now completing its turnaround into a Bitcoin supporter with the reveal of its plans to help banks roll out cryptocurrency buying and trading services with a Visa crypto software program, set to launch later this year.

Visa’s announcement comes after a year of institutional and other traditional investors finally coming aboard the crypto as a digital currency bandwagon, buoyed by bullish performances by Bitcoin and the crypto market as a whole towards the middle of 2020.

Not surprisingly, governments and players in the existing banking system are unwelcoming of payment networks that are “powered by users with no central authority or middlemen.” Many fear that cryptocurrencies like Bitcoin can be used to circumvent capital controls, and can be used for money laundering or illegal purchases.

But wide-scale adoption of crypto also has the potential to render certain traditional finance channels irrelevant, especially if the valuations in the volatile crypto market stabilize. Why would one store their funds in banks with hefty interest rates, for instance, if a stable crypto coin can store value for minimal charges, yet with the potential to gain even more?

That development, if it ever happens, is still far off on the horizon. But the interest from traditional financial services and investment groups to invest in the crypto market, along with calls to formally regulate the space, appear to be steps in a more fruitful direction.

Over the past year, hedge funds and various institutional investors have changed their tune about Bitcoin and the crypto market in general, now pouring in billions and sending the prices of certain coins skyrocketing. It is an attractive time to be a cryptocurrency trader once again after the initial market boom in 2017-2018, but Visa has actually been quietly working on its crypto software services for some time.

The credit card firm has been partnering with 35 various bitcoin and cryptocurrency platforms in recent years, and the company is finally ready to roll out Bitcoin and cryptocurrency buying and trading services that are intended to help banks, the traditional bastion of finance, ease into onboarding crypto transactions and trades.

A US bank in Kansas will be the first to pilot the Visa APIs, which will help the card issuer’s bank clients integrate Bitcoin and certain other cryptocurrencies. It’s understood banks will be able to allow their users to withdraw and self-custody their crypto holdings, a departure from Visa rival PayPal, which also joined the crypto acceptance train late but drew criticism for preventing people from moving their holdings off its platform.

WHAT IS STALLING THE CRYPTOCURRENCY INDUSTRY IN ASIA?

Tech Wire Asia | 4 January, 2019

The price of Bitcoin and other notable cryptos like Ethereum have surged of late thanks to the support of institutional investors and PayPal, drawing global attention once again. But Bitcoin’s growing popularity among investors as a speculative asset and a hedge against inflation has reduced its perceived utility as an alternative payment method.

“We see crypto assets as more like digital gold,” Visa’s head of crypto, Cuy Sheffield, told Forbes over the phone. “There’s less demand to spend Bitcoin.”

His comments on “digital gold” echo those of Visa chief executive Al Kelly, indicating the card company as a whole view Bitcoin and possibly all crypto assets more for their function as a store of value, rather than as a form of payment.

Kelly also pointed out that digital currency exchanges and platforms like Crypto.com, BlockFi, and BitPanda have begun issuing Visa cards, telling a Q1 2021 earnings call that “Our strategy here is to work with wallets and exchanges to enable users to purchase these currencies using their Visa credentials or to cash out onto our Visa credential to make a fiat purchase at any of the 70 million merchants where Visa is accepted globally.”

The post Will Visa get traditional banks hooked on the crypto market? appeared first on Tech Wire Asia.

Bitcoin has soared to new, previously unimaginable highs in the last year or two, driving market sentiment to once again be looking at the world’s most valuable cryptocurrency. With the value touching an eye-watering US$40,000 this week for a single Bitcoin, the Bitcoin mining industry is set to kick into high gear again.

Bitcoin mining refers to the production of the digital coin by solving complex algorithms with specialized computers. “Miners” process and confirm bitcoin transactions to be entered into the digital currency’s shared public ledger, a trustless verification and storage network known as a blockchain.

Miners also provide security to the network. New coins are awarded to miners who complete the calculations first along with transaction fees for their services. With the lower costs of electricity, cheaper rental for spaces, and the looser regulatory environment, Southeast Asia (SEA) has become a popular destination for hosting Bitcoin mining ‘farms’.

The necessary computing power for generating new Bitcoins, with large numbers of linked computer units requiring massive amounts of energy to generate one coin or digital fund, and the power required can oftentimes come at an environmental cost.

“We now have an entirely new industry that is consuming more energy per year than many countries,” said Max Krause, a researcher at the Oak Ridge Institute for Science and Education and lead author of a study entitled the Quantification of energy and carbon costs for mining cryptocurrencies, published in the 2018 Nature Sustainability journal.

The total energy consumption of the Bitcoin network has grown and now consumes more energy than certain countries, according to the Cambridge Bitcoin Electricity Consumption Index (CBECI) that calculates the real-time energy consumption of the Bitcoin network in real-time.

The CBECI found that Bitcoin mining consumes more energy than the entire nation of Singapore. With the unknown number of server farms globally, the high energy consumption of Bitcoin mining comes with a significant carbon footprint.

The heavy dependence on fossil fuels to power server farms could be lessened by tapping renewable energy sources. The cost could be prohibitive at the initial stage which might put off profit-focused Bitcoin miners, who elect to run their farms in Southeast Asia for the very reason of lowering costs.

Another method to reduce carbon emission is the development of more energy-efficient algorithms, like ‘proof-of-work’ or ‘proof-of-stake’. In proof-of-stake, coin owners create blocks rather than miners, eliminating both miners and their power-hungry machines in the process.

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Christian Stoll, a researcher at the University of Munich and the Massachusetts Institute of Technology (MIT) who studies energy emission rates for crypto mining, says, “We do not question the efficiency gains that blockchain technology could, in certain cases, provide. However, the current debate is focused on anticipated benefits, and more attention needs to be given to costs.”

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