Facebook Head to Senate: Libra will Respect Consumer Privacy

In a detailed defense of Facebook’s Libra coin, Facebook Blockchain lead, David Marcus told lawmakers at the U.S senate; that the social media giant will not have access to personal financial information with its new currency.

Facebook lead David Marcus was responding to a senate banking committee letter that had posed various questions to the social media giant. David went about addressing the questions posed by the lawmakers by acknowledging their concerns and seeking to put them at ease.

“I want to give you my personal assurance that we are committed to taking the time to do this right.”

Marcus presented a printed address to the senate which clearly indicated that the company would not be attached to any transactions conducted on the Libra Blockchain. The letter said;

“Similar to existing and widespread cryptocurrencies such as Ethereum, and Bitcoin, transactions that take place directly on the Libra Blockchain are ‘pseudonymous,’ meaning that the user’s identity is not publicly visible,” which is basically an reassurance that Facebook will be discrete with user information as had been revealed during the Libra project unveiling last month.

Marcus was however clear that the Blockchain addresses, timestamps, and transaction amounts will be public but any anti-money-laundering (AML), and know your customer information (KYC) would have to be stored by the wallet providers.

As a caveat, Marcus revealed that Libra will be an open source platform meaning that any third party will be able to build their own digital wallet. Marcus explained that any third party developer seeking to build on the Blockchain would be responsible for how their Libra wallets are built. He further explained that it would be the responsibility of the third parties to determine the type of information they may require from users, and to comply with the regulations and standards of their respective jurisdictions.

He went on further to add;

“Regulators of Calibra and other digital wallet services can require them to collect information about the identity and activities of their users and make such information available to law enforcement and regulatory agencies, such as for AML, CFT [counter-financing of terrorism], and sanctions purposes.”

While responding to questions about what consumer information the social media giant is already in possession off, Marcus responded that a subsidiary of Facebook which is not related to Libra; stores non-public personal financial information data” in compliance with existing law for transactions. The information though is not used for advertising or personalization. Moreover, the Facebook payments Inc. subsidiary processes these transactions, meaning that Facebook does not have access to any payment information credentials; though it does collect other information to do with the transaction such as date, time, and purchased goods.

Marcus told the senate that the Libra association, which is Facebook’s governing council for the Blockchain network will have even less information than Facebook payments.

Because validator nodes or wallets will process and store transactions, neither Facebook nor Libra will store personal data, he claimed.

Facebook put in place a subsidiary-Calibra- to develop an open source wallet for Libra. Marcus explained that Calibra will safeguard consumer financial data and will not use or share this data for ad targeting purposes.

Facebook’s Libra endeavor has been met by pushback from crypto enthusiasts, such as John MacAfee to regulators and lawmakers. The U.S senate banking committee is set to hold a hearing on the Libra project on July 16, and 17 with Marcus expected to make submissions at both meetings.

Top Reasons Why Facebook’s Libra is Facing Major Opposition

The unveiling of Facebook’s Libra currency has led to a lot of chatter among crypto enthusiasts, some of whom have vehemently refused to support it. Facebook has said that the crypto will enable users to make faster and cheaper international payments online, using platforms such as WhatsApp or Facebook messenger. With Facebook scheduling the currency’s official launch in 2020, backed by a separate entity The Libra foundation; a lot of entities as well as experts have expressed their reservations about the Libra project.

According to Facebook, Libra just like any other cryptocurrency will have its own wallet called Calibra, where users would be able to send and receive Libra. Facebook through the project head David Marcus claims that the wallet will have strong protection in order to keep data and money safe. There have however been questions raised on whether Facebook are just paying lip service here, due to the company’s history of mishandling data. The Libra project is therefore being threatened, and here are the main issues that are currently threatening to halt any more developments of this project.

Skepticism in congress

Congresswoman Maxine Waters, who is also the chairwoman of the house financial services committee, wrote to Facebook calling for the immediate cessation of any further development on Libra. The letter said that the social media giant should desist from any further action until the congressional financial services committee, and other affiliated committees; determine the possible risks Libra could cause to the global financial system. The letter also referred to Facebook’s recent privacy scandals that involved data harvesting of 50 million Facebook profiles.

“Facebook is already in the hands of over a quarter of the world’s population, it is imperative that Facebook and its partners immediately cease implementation plans until regulators and Congress have an opportunity to examine these issues and take action.”

The senate banking committee plans to hold a hearing that will address concerns over data privacy and potential risks of the Libra project on July 16.

Facebook’s past scandals

Another issue dogging the Libra project is Facebook’s past scandals which involve user data mishandling. According to Forbes contributor Enrique Dans, Libra has great potential; but in the wrong hands serious damage could be caused. According to him, Facebook has the worst reputation when it comes to privacy along with ethical standards. With its history of mishandling data as was the case with Cambridge Analytica, people fear that with their money now involved; the same mishandling could recur.

Security risks

Since Libra will be an open source Blockchain, allowing third parties to develop on it in a bid to identify bugs on it; people are concerned about security. A lot of people in the space are of the opinion that by allowing anyone to build products with access to billions of users, the project could become a major target for malicious actors. Hackers could possibly just easily create wallets and steal money from other users.

Libra is not a real Blockchain

Libra has also been criticized for not being a real Blockchain. Notable crypto enthusiasts such as John McAfee have termed it a “Grotesque distortion of cryptocurrency”. This heat is being caused by the fact that Facebook has not decentralized its currency. Libra does not offer any benefits of distributed governance that is common with most Blockchain platforms.

Libra may not really come through for the unbanked

Facebook’s claims of seeking to help unbanked people in developing countries such as Nigeria, Bangladesh, Indonesia, India, and Mexico, are opposed by the fact that some of these countries have slapped bans on Facebook. A lot of developing countries also have harsh laws towards cryptocurrencies.

Though there is a legitimate argument that Libra can make international payments in emerging markets cheaper and quicker, Facebook’s data harvesting past will make the cryptocurrency a hard sell. Some experts argue that if the issues above are handled and dealt with in time, Libra has the potential to dominate the market and kill off competition.

Goldman Sachs lists Project Manager Job Opening to add to their Crypto Team

Leading global investment banking, securities and investment management giant, Goldman Sachs, have listed a job opening for a project manager of their digital asset team.

The New York based investment firm that just recently saw a change in its top brass after welcoming now CEO David M. Solomon in October 2018, who later also was named as the firm’s chairman in January this year, has stressed the need for that vacant position to be filled.

The firm has made it clear that the executive level position will be responsible for the development of “comprehensive road maps for distributed ledger technology” that will “play an integral role in helping define both the scope and direction of the business,” according to the job posting.

The job listing comes quite soon after Goldman Sachs CEO David Solomon announced last month his bank could “absolutely” follow up JP Morgan Chase in launching its own cryptocurrency. Solomon said at the time, in a report published by the Block that the bank was extensively researching the crypto space. He mentioned Stablecoins and asset tokenization, as areas the firm was seriously looking at and exploring.

The job opening is part of the firm-wide initiative, which aims to bring together different bank divisions to drive innovation and growth. The new hire will consult the institution’s risk, compliance, legal, and finance teams to develop “unprecedented projects”. The project manager will be expected to animate the firm’s crypto endeavors and just like the chairman said about following in the footsteps of JP Morgan chase, could maybe help lay the groundwork for the launch of the investment firm’s own cryptocurrency.

This is not the first time that Goldman Sachs is involved in crypto and the Blockchain. Last year, the firm flirted with the idea of creating a crypto fund and secure storage service to limit the risk of hacking, and fraud. Some believed at the time that the move would lead to the firm launching other custodial services such as brokerage. Goldman Sachs also got involved in crypto, by becoming one of the first banks along with Morgan Stanley to use a Blockchain based payments service developed by IBM and CLS, which is a currency trading utility.

News of this job opening comes hot on the heels of a LinkedIn report that job openings related to crypto were growing rapidly in Singapore. With the crypto space still being in its nascent stages, it is expected that these opportunities will continue to grow with time.

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Korea’s LG launches Blockchain Supply Chain Platform for School Lunches

An interesting bit of news indicates that LG CNS, which is a subsidiary of Giant South Korean multinational conglomerate LG Corp., will use Blockchain technology to boost supply chain transparency for school cafeteria lunches.

According to the report, the new system will be built in conjunction with Local IT service provider SayIT, and will be based on LG’s proprietary Blockchain platform “Monachain”, first launched in May 2018. The system will be implemented and made to work with the help of regional governments, and will be used for foods served at national school cafeterias. The system will provide great value by providing transparent information and supply chain history of the agricultural products used.

The data provided by this system includes information on product’s production, processing, distribution, acquisition, and consumption. All this data will be recorded on the Blockchain, and will be made publicly available according to the report.

In an official statement of its own, LG CNS has said that the initiative is aimed at assisting parents to make informed decisions on their children’s nutrition and protect their health. It was also revealed that an advertising system will be supported by the platform, which will enable farmers and food producers as a whole to distribute mobile flyers promoting their produce.

As LG CNS, embarks on this school cafeteria project, it is also worth mentioning that this is not the only Blockchain project the conglomerate is involved in. Another project focuses on tracking, and recycling the batteries used in electric cars on South Korea’s Jeju Island. The conglomerate had also revealed plans to further improve its enterprise offerings in seven key areas including the Blockchain; months ago.

The monachain platform was launched to provide users with a new type of identification which is “a decentralized identifier (DID), that can be used for personal identification and online payments via smart devices.” Another Blockchain based lunch program does exist, which was launched in February by the charity arm of the world’s largest crypto exchange, Binance. This program was launched to help enhance lunch programs in African schools.

This development does indeed highlight that the Blockchain is taking a life of its own with new and important practical uses cases every day. The fact that giant cooperation’s such as LG CNS are experimenting and releasing products backed by this technology, marks another milestone for the space. Couple this with the fact that Blockchain job openings are growing every day, and you have an industry ready to explode. It looks like it’s only a matter of time until the Blockchain becomes part of every one’s daily life.

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Indian Crypto Startups Look to New Markets to Escape Harsh Environment

Crypto exchanges in India such as CoinDCX and WazirX are now setting their sights on global markets after one of the country’s leading exchanges Koinex, shut down operations last week citing an unclear regulatory framework in the country.

Cryptocurrency exchanges are trying options including peer-to-peer transactions, crypto-to-crypto-transactions, and entry into foreign markets to survive the uncertain phase, according to industry experts. These options though come with their own set of challenges which include; low user growth, lack of funding, low margins, global competition, and lack of funding for user education.

Indian crypto exchanges such as CoinDCX are looking into other markets since the Indian regulatory environment is just not conducive for business according to the Co-founder, and CEO of CoinDCX Summit Gupta. The crypto to crypto transactions firm’s CEO said;

“We initially wanted to cater only to the Indian market, but if the Indian regulations aren’t favorable we will be looking at focusing on onboarding international users”

The startup which was initially only looking at the Indian market claimed it had 50,000 users and processed about a million dollars in an average trading volume day. These numbers could rise significantly if their plans to go global bear fruit. Rival company, Mumbai based WazirX which started operations about four months ago revealed that it’s P2P, and crypto to crypto transactions have been growing at a rate of more than 20% monthly.

WazirX founder Nischal Shetty, believes that there is great potential for Indian crypto exchanges, but cited India’s cryptocurrency-banking ban as the major impediment to the growth of the exchanges. In his view, the right set of regulations could drastically drive up the user base and the transaction levels. Other than the crypto banking ban, the WazirX CEO also attributes the reluctance of trading in cryptocurrencies in India, to a lack of awareness. To address this, he is planning to try and make it easier to onboard and guide new users for transactions in digital currencies.

Nitin Sharma, who is the founder of Incrypt Blockchain also faults India’s crypto ban as the reason why the country’s exchanges, are still streets behind at a time when global exchanges are doing quite well thanks to a global resurgence of interest in crypto. Nothing shows that India’s crypto stance is killing the industry more than crypto exchange Unocoin, firing half of its employees back in April after a failed ICO. It should also be remembered that crypto exchanges Zebpay, Coinome, and Coindelta all shut down due to the lack of regulatory clarity in the country.

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Morgan Creek Founder Confident BTC will Reach $100,000 by 2021

The Cofounder of crypto asset management Morgan Creek, Anthony Pompliano has come up with yet another bold crypto prediction. This time he predicts that BTC will hit $100,000 by the end of 2021.

In an interview with Bloxlive.tv on July 2, he said the basic principle behind his forecast was not just random or idle speculation but classic supply-demand economics, still valid for the innovative digital asset class. According to Pompliano or Pomp as he is popularly known as on Twitter, one of the largest drivers of continued price appreciation will be Bitcoin’s halving, when mining rewards are reduced by half which will be in May 2020.

He noted that most institutional investors weren’t even aware of this looming reduction and added that the market will keep being on the ascendancy since its drivers will be based on sentiment which will be “a continuation of trends we’re already seeing”. These trends include; inflows of institutional capital, legitimization of the crypto space, record trading volumes, and the recognition of Bitcoin as a safe-haven asset.

According to Pomp; “Time is Bitcoin’s greatest advocate,” and according to him, as these trends continue, his current 70-75% confidence level in $100,000 by 2021 will hit 90%. Pomp went on to discuss how he had accurately predicted the disastrous BTC price slump that saw it sink from $10,000 to $3,000. He now believes that his $100,000 BTC price prediction by 2021 will not just be a prediction, and the markets will surely oblige.

“In August of last year I predicted Bitcoin would go down to $3,000 before returning to $10,000. It essentially did that now I think it’s going to $100,000, but there will be more volatility: there will be parabolic runs like we saw in June and then there will be 20-30% drawdowns from that. Along the way a lot of people will call the top at these local highs they’ll be incorrect.”

Elaborating on legitimization, pomp agreed with the notion that Facebook’s entry into the space with the Libra coin is a Bullish sign, adding that “People may not like Zuckerberg, but no one thinks he’s dumb,” Pomp’s thoughts on Facebook’s Libra are aligned to those of Bitmex CEO Arthur Hayes who believes Libra will majorly disrupt the financial markets as we know them. On the relation between Libra and BTC, Pomp added that “Bitcoin will benefit from Libra being a “gateway drug” for cryptocurrencies.”

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Crypto Cynic Nouriel Roubini wants the World to see his Latest Anti-crypto Tirade

New York University (NYU) professor Nouriel Roubini, who is a popular crypto cynic, has gone on an anti-crypto tirade in front of a crowd of crypto enthusiasts at the Asia Blockchain summit; and he wants the world to see it.

The CEO of Roubini Macro associates called on Bitmex CEO and co-founder Arthur Hayes to release the video for all to see, in a Twitter post.

The video is a debate between Roubini and Hayes at the Asia Blockchain summit in Taipei, which was hyped by the organizers almost the same way organizers, would hype a boxing bout. Just like the Mohammed Ali -Manila fight back was hyped and dubbed “Thriller in Manila”; this crypto bout was dubbed “Tangle in Taipei”

The two were set to have quite the duel and the footage whose rights are owned and controlled by Bitmex CEO Arthur Hayes has not been released. The Bitmex CEO did not allow for the footage to be streamed live, and the audience was barred from live recording the event. Hayes said he plans to release the highlights of the debate at a later time, which has disappointed a lot of followers who were not at the summit.

Roubini attacked him for it immediately on Twitter and went on to call him a coward after stating that he had destroyed him in the debate. At the “bout” Roubini attacked the key tenets of cryptocurrencies; criticizing its technology, lack of convenience, and security; which he has consistently done throughout his anti-crypto crusade. Hayes responded by acknowledging the presence of some malicious actors in the space, but insisted that cryptos provided a valuable service for those who wanted to avoid government regulation and surveillance.

In his response to Roubini’s attacks, Arthur added “People love to speculate, we’re just trying to give them an opportunity to do it in a safe manner.” The footage of the debate being unavailable for now, has incensed Roubini who believes that he made some killer points at the summit. Another of Roubini’s attacks on crypto is its volatility, which is a point that resonates with a lot of people in the space. Volatility has been a headache for investors in the space especially in the past week; with the price of BTC nearly reaching $14,000, before dropping back to $10,000 a few days later.

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John McAfee calls Libra a Grotesque Distortion of Crypto

John Mcafee is at it again, this time promoting privacy coins on Twitter. In between his ever roaring crusade to push Altcoins, he injects some his anti-Libra sentiment because he believes Libra; is an attack on his love for privacy and personal freedom.

He went on to Twitter to express his disgust for Facebook’s Libra terming it as “a grotesque distortion of the original intent of cryptocurrency- economic freedom”

Mark Zuckerberg’s Facebook; which is the Mother Company of the Libra Coin has been widely criticized for abusing user’s private information, which makes it a natural enemy for Libertarian like John Mcafee. A company like Facebook which has a tendency to take control of user information is seen as such a threat for the freedom obsessed world of cryptocurrency.

MacAfee’s scathing tweet gives a clear picture of what all those opposing Facebook’s Libra think about it. The likes of John Mcafee’s gripes with the Libra coin are born out of the knowledge of what crafted the idea of cryptocurrencies in the first place, which is governmental distrust. Facebook not decentralizing its coin is seen as corrupting the very purpose of cryptocurrencies.

Privacy coins maybe Mcafee’s darlings but it must be remembered that they face the exact same challenges that Libra has designed to get around. This is because the government is highly unlikely to fully sanction a medium of exchange that is entirely untraceable. Facebook has got its eyes fixed on ensuring very minimal regulatory hurdles in the future. It really has been designed to look like an authentic cryptocurrency as per the reasoning behind cryptocurrencies; but lacks the decentralized aspects that cryptos boast off.

Mcafee is not the only public figure in the crypto space to have criticized Facebook’s Libra. Commentators such as Joe Kernen have gone on CNBC and launched scathing attacks on the coin. Libra’s centralized nature has led to the likes of Kernen even questioning whether it deserves the title Cryptocurrency.

While the attacks on Facebook’s Libra have been relentless others in the crypto space have offered up surprising predictions about the digital currency will do in the future. While others argue that the currency is designed to be a Bitcoin killer, others such as Bitmex co-founder and CEO Arthur Hayes, believe Libra will shut down commercial and central banks. That would suggest that the Libra will probably get more establishment opposition than Bitcoin has ever had. This is contradictory to what Facebook have been working on which is drum up as much establishment support as possible.

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Blockchains.com Founder Acquires Nevada Bank to Fund his Crypto Ambitions

According to a report by the Nevada independent, the founder of Blockchain incubation and investment firm Blockchains.com; Jeffrey Berns, has bought a small community bank in Las Vegas, Nevada.

The report has it that the Blockchains.com founder acquired the community bank in order to fund his crypto startup dreams. Bern’s reasoning is that his ambitions are incompatible with the current financial system, and he feared that the same system would cut off his capital supply.

The 56 year old attorney has been eyeing crypto for a while with his initial plans being the construction of a Blockchain focused smart city, and an e-sports arena in the Nevada desert. As for now, he has confirmed the $28 million acquisition of the Kirkwood Bank of Nevada, which according to the Nevada independent report; is a “is a small but critical step in helping the nascent company achieve its wildly ambitious goals,”

Berns does not just need the company to finance his decentralized dreams; he hopes the bank will become one of the leading names and a big institution for the Blockchain industry. Bern explained his goal with this project to be;

It’s to create an environment where the Blockchain ecosystem, the legitimate businesses out there who are trying to build projects that are going to empower the individual and better the world… have a bank that understands what they’re doing and isn’t fearful,”. “Banks are hesitant, because if this takes off, you don’t need banks anymore. They become obsolete,”

Bern’s latest acquisition was done through a separate holding company in order to mitigate the reporting and ownership responsibilities. He also said that he planned to decentralize his companies in the future, a plan that he thinks will be resisted by regulators. He added that he may attempt limited integration of Blockchains to create a sandbox to test his financial technology and Blockchain ideas.

Berns revealed that he badly needed a playground to test out his ideas. “I needed a place to do proof-of-concept with regulators to show that loans can be done in such a way that if I have $1,000, I could invest 10 cents in 10,000 loans and, it would all be done on the Blockchain and micro payments would be made, and there’s no funny business.”

Berns began to negotiate for the bank takeover in February of last year after spending a year in search of a banking partner. $25 million was paid for the bank takeover, with an extra $3 million being an additional investment. This is the first time that the bank is changing ownership since its founding in 2008. It has $86.6 million worth of assets and 9.14 percent return on equity in 2019 according to the FDIC, which really shows its potential.

According to the acquired bank’s president John Dru, there will be no changes as far as the directors and the account numbers will not change. He even added that customers will not see any changes in the institution. Bern’s next move reportedly is to acquire a 3D printing company to print a portion of his Blockchain city. 

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Bitmex CEO: Something is going on in Crypto, Prepares to launch most Liquid Product for Crypto

Bitmex CEO and co-founder Arthur Hayes has dismissed Nouriel Roubini as a hater and stressed that there is a lot to be positive about when it comes to the crypto markets.

Hayes was speaking on Bloomberg day break Asia, on the sidelines of the Asia Blockchain summit in Taipei, where he and Roubini are expected to have a clash of ideas and opinions. He started his interview by dismissing the notion by some, that Bitmex volumes were fake; stating that his firm had a trading record of over a trillion dollars over the past year.

According to Hayes, those high volumes speak to the fact that there is more to crypto than a lot of these cynics such as Nouriel understand; and the price action is evidence of it. He also spoke of the crypto landscape over the past 18 months, mentioning BTCs fall from 2017 highs of $20,000 down to lows of $3,000 seen early this year. He also noted that it took about two and a half months for BTC prices to rally from $3,000 to $10,000; which according to him is a high watermark for a lot of investors.

When queried about the possible reasons for the latest crypto surge that has since eased minutely, Hayes said that market sentiment was back and also gave some of the credit to Facebook’s Libra; where he pointed out that a lot of people believe it will bring a few million people into the digital currency ecosystem.

                                       Why invest in Bitcoin?

Hayes believes it’s a call option, either BTC will be worth a lot in a decade, or it will be worth nothing. He went on further to make a case for BTC when his interviewer asked why anyone would prefer to invest in BTC which is only a decade old, compared to Gold which is has “been around for thousands of years”

Hayes pointed to Gold’s bulky nature as a barrier in this day and age. “If you want to transport a Million US dollars’ worth of Gold, that’s very heavy” he said

“With a wallet or a hardware wallet, you could essentially with a USB drive transport a vast amount of wealth anywhere you go, and if we are really moving into a digital economy then the way we store wealth or the hard asset if you will, which is pricing wealth must change, and I think Bitcoin could be that asset”

                                 The most liquid product for crypto!

Hayes went on to promote what he called the most “Liquid product for crypto” created by Bitmex. This product according to Hayes is a leveraged derivative that doesn’t have any expiry date and mimics market trading; trading about $5 to $10 Billion dollars per day. He also spoke of the Bitmex Altcoin products such as Ethereum, EOS and, Tron that can be traded on the platform on leverage as well. He also announced that in the next few weeks Bitmex will launch the first Bitcoin zero coupon Bond with a few counterparties that will allow people to earn by investing and loaning Bitcoin to some of the most stable companies in the crypto space.

When queried about some of the risks, a platform such as Bitmex faces in its operations; he offered up some familiar answers which included risks of hacks. He also mentioned that they caution traders to only have crypto assets on an exchange that they are actually trading with. He ended the interview with a bit of a bombshell when asked his thoughts on Facebooks’s Libra; to which he said that he expected it to destroy commercial and central banks!

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