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All You Need to Know About the Silicon Valley Cryptocurrency

Andra Capital, a US-based venture capital firm, is intending to launch its own Silicon Valley cryptocurrency (SVC). The firm seeks to issue SVC through a security token offering route in collaboration with TokenSoft and Tezos Foundation. After the announcement of the coin, Tezos (XTZ) prices have experienced a daily rise of almost 9% against the dollar. The Silicon Valley Coin will be developed on Tezos blockchain and use Tokensoft’s issuance platform.

Venture capital firm’s open-ended technology fund, popularly known as the “Fund,” will majorly use the Silicon Valley Coin to invest in late-stage, private technology companies. The new token will offer investment opportunities for qualified purchasers in the United States and permitted investors across the world. Competent investors will be able to use the Silicon Valley Coin to explore further investment opportunities in the US and around the globe.

Andra Capital is immensely active with regards to investments in crypto startups. The Silicon Valley Coin will be utilized as a funding mechanism to invest in startups, which are close to maturity. Andra Capital focuses on such mature companies through its various investment arms majorly located in the US

Partnership is key to unlocking the SVC’s potential

The head of strategic partnerships at Andra Capital, Sam Raman, said that the forthcoming Silicon Valley Coin would represent the best elements of both the Tezos Foundation and TokenSoft.

Raman said, “The TokenSoft platform offers the tech for qualified retail investors to take part in suitable, late-stage venture firms. We have also partnered with best-in-class providers like the Tezos Foundation for its expertise in digital securities for the SVC offering.”

The President of TQ Tezos, Alison Mangiero, also commented about the collaboration and the upcoming product. She stated, “We are happy to see venture capital companies embracing digital securities that enable them to compliantly and easily offer global investors access to a constantly exclusive asset class.”

TokenSoft CEO, Mason Borda, also added, “We have seen huge demand from issuers looking forward to issuing on the Tezos blockchain because of its institutional-grade properties/qualities. TokenSoft’s platform will offer the tech for qualified retail investors from more than 50 countries to make investments using the SVC.”

The combination of these three companies will, therefore, work well for qualified investors. The collaboration is set to bring the best opportunities to the participating investors. The forthcoming Silicon Valley cryptocurrency will be a unique offering in the investment field in terms of global outreach and accessibility.

Image via Shutterstock

CFTC FinTech Research Wing Welcomes Innovators to Discuss with Regulators With its New Office Hours

LabCFTC, the United States Commodity Futures Trading Commission’s FinTech research wing, is planning to host office hours during the New York FinTech Week.

According to the CFTC’s announcement, the derivatives regulator aims to engage with innovators in the industry during the New York FinTech Week, to be held end of March and early April. The office hours will enable interested innovators to be able to give a presentation to regulators and participate in dedicated discussions.

LabCFTC working with technologists, innovators, and the public

LabCFTC was established in 2017, which aims to promote fintech innovation and competition, as well as providing CFTC with a better understanding of new technologies. The research unit has been very active with over 350 different private meetings held with innovators in the last two years. LabCFTC was awarded status as an independent operating office in October last year; the research unit published three primers to the marketplace based on their understanding of smart contracts, artificial intelligence, and crypto assets. They have also looked into how these three categories are evolving outside of, or challenging the current regulatory dynamic.

United States Commissioner of the Commodities and Futures Trading Commission (CFTC), Brian Quintenz said that one of the main values that the Commission stands by is to “first do no harm, then be technology-neutral.” By engaging with innovators, “to understand what they were doing, to help them understand if what they were doing implicated our rules, and to help the CFTC understand if there is any technology we can take advantage of as an agency to enhance our own processes.”

Rounding up crypto-related regulatory penalties

In the fiscal year of 2019, the CFTC rounded up has collected over $1.3 billion in regulatory and administrative penalties including funds collected from cryptocurrency businesses. The result in regulatory penalties has also increased by 40% compared to the fiscal year of 2018, of around $947 million.

Several charges were pointed out, including the $147 million crypto scheme Control-Finance Ltd, Jon Barry Thompson, who was accused of a $7 million Bitcoin-related fraud, and Joseph Kim, who was charged with defrauding investors. However, the CFTC did not specify the exact amount of regulatory penalties obtained from these companies.

Image via Shutterstock

UNICEF Cryptocurrency Fund Invests in Tech Startups Fighting COVID-19 in Emerging Economies

Eight technology companies in developing and emerging economies will receive investment from the UNICEF Cryptocurrency Fund (CryptoFund) to solve local and global challenges.

In an email shared with Blockchain.News, UNICEF announced that its CryptoFund will invest 125 ETH into eight tech startups from seven different developing nations. The companies—Afinidata, Avyantra, Cireha, Ideasis, OS City, StaTwig, Somleng and Utopic—will be awarded the Ethereum cryptocurrency to fund the development of prototypes, pilots, or scale their technologies over six months.

All of the above investees have previously been the recipients of UNICEF’s Innovation Fund and are now receiving cryptocurrency to continue the development of their open-source and digital public goods.

UNICEF’s Innovation Fund

UNICEF’s Innovation Fund is the first of its kind within the UN and offers financial support of up to $100,000 USD, as well as technical advice and mentorship, to worthy startups that are innovating to improve the world through open-source technology.

Christina Lomazzo, Blockchain Lead at UNICEF told Blockchain.News, “There are different ways to actually explore how these new exponential technologies may have an impact on UNICEF and one of those ways is through a venture fund, because it actually widens the amount of exposure that we have to the tech.”

UNICEF does not take any equity away from these startups and exclusively invests in open-source projects, that are based in UNICEF program countries. Lomazzo said, “These projects are typically in emerging or developing economies—the thing that is so fantastic is that they are building solutions for local challenges.”

According to Lomazzo, one of the difficulties within the tech space is the assumption that new technology built in places like San Francisco or New York will automatically translate to every single geography’s needs, which she asserts is “absolutely not the case.” This is why UNICEF invests in local innovation and exclusively open-source technology that can be accessed by everyone. Lomazzo said. “Open source software can reach the most people and the beneficiaries of our venture fund are solving local challenges which will also have a greater impact. When you start building for those who are in low connectivity areas, or those who are not literate—those types of tech applications will also work in developed economies.”

Investees Fighting COVID-19

The investees of the CryptoFund come from seven different emerging or developing economies. Several of the startups benefitting from the CryptoFund are working to mitigate the hardships of COVID-19 on children and youth around the world. They are collaborating with national governments and local partners to send vital messages on COVID-19, track the effectiveness of rice delivery to vulnerable communities, improve children’s literacy through remote learning, treat pandemic and isolation-related anxieties, and other vital solutions.

“We are seeing the digital world come at us more quickly than we could have imagined – and UNICEF must be able to use all of the tools of this new world to help children today and tomorrow,” says Chris Fabian, Senior Adviser, co-Lead, UNICEF Ventures. “The transfer of these funds – to eight companies in seven countries around the world – took less than fifteen minutes and cost us less than five dollars. Almost instant global movement of value, fees of less than 0.000015% of the total amount transferred, and real-time transparency for our donors and supporters are the types of tools we are excited about.”

Besides funding, investees receive business growth mentorship, product, and technical assistance, open-source and UX and UI development, access to experts and partners, as well as opportunities to showcase their solutions.

The UNICEF Innovation Fund and CryptoFund currently have an open call for blockchain solutions to apply for funding (up to $100,000 and cryptocurrency combined) and mentorship.

SEC Commissioner Hester Peirce Confirmed for Second Term By US Senate, Crypto Mom Will Remain Until 2025

The United States Senate has voted in Commissioner Hester Peirce of the Securities and Exchange Commission for a second term that will see her remain with the regulator until 2025.

The US Senate has confirmed Securities and Exchange Commission (SEC) commissioner Hester Peirce, renewing her position for a second term via a voice vote on Aug 5.

Peirce who has earned the name ‘Crypto-Mom’ for her pragmatic and reasoned approach to dealing with digital innovation projects brought before the SEC was voted in alongside Caroline Crenshaw.

Commissioner Peirce first took office in January 2018 and received a nomination to finish the last two years of her term from US President Donald Trump. Peirce was originally nominated by former President Obama in 2015 to fill a Republican seat, without Trump’s second nomination her term would have ended on June 5.

SEC Commissioner Peirce’s second term will expire in 2025.

Crypto Mom: Voice of Reason in the SEC

Peirce earned the nickname of ‘Crypto Mom’ when she first proposed a safe harbor for digital token projects as the SEC regulating authority had become increasingly prejudiced towards cryptocurrency and blockchain-related project.

According to Commissioner Peirce’s safe harbor proposal, a three-year reprieve from securities law should be granted to developers and projects that can demonstrate they are raising funds and making progress towards an open-source network. These projects will be required to make full disclosures regarding their raised funds to the public.

Peirce highlighted that the benefits would allow developers to fundraise, investors to access more detailed project information and innovations in this emerging technology would stay in the US.

SEC Commissioner Peirce made further headlines in the cryptosphere when she spoke out and highlighted parameters that were set and heavily scrutinized in the SEC’s processing and ultimate rejection of Bitwise’s Bitcoin ETF application. Peirce argued that the standards that Bitcoin ETF’s are subjected to have never been applied to traditional markets offering.

SEC Commissioner Hester Peirce wrote that “the Commission applies a unique, heightened standard under Exchange Act Section 6(b) to rule filings related to digital assets” in a dissenting statement in response to the Bitcoin ETF rejection. Peirce wrote, “This line of disapprovals leads me to conclude that this Commission is unwilling to approve the listing of any product that would provide access to the market for bitcoin and that no filing will meet the ever-shifting standards that this Commission insists on applying to bitcoin-related products—and only to bitcoin-related products.”

During a recent appearance, Peirce was also incredibly critical of the SEC’s handling of Telegram’s TON network, which she believed was a waste of resources and ultimately helped no one.

Peirce Will Likely Continue Advocating for Innovation

Securities and Exchange Commissioner Hester Peirce has shown no signs of pulling out of her advocacy role for digital projects.

Last month on July 7, Peirce spoke at the Unitize Virtual Conference and advocated for a clear regulatory framework for crypto projects to foster innovation in the capital markets. Peirce said, “I wanted to make sure that our regulatory structure was flexible enough to accommodate innovation.”

Alluding to her previous safe harbor proposal Peirce highlighted that the benefits of clear regulation would allow developers to fundraise, investors to access more detailed project information, and innovations in these emerging technologies would stay in the US.

The exodus of tech talent from the US to Asia and Europe has been well documented and Peirce believes that’s “all the more reason for a jurisdiction like the United States to try to develop a workable framework that allows people to come and avail themselves of our market.”

While Peirce wants to see the US Government be more proactive in cutting through the regulatory uncertainty for crypto and blockchain, she also highlighted that innovation rarely comes from the public sector.

Peirce said, “Remember that innovation typically comes from outside the government sector. We need to set up a framework that allows people who spend a lot of time thinking about new ideas to continue to spend time thinking about those ideas and not a lot of time worrying about complying with regulations.”

Crypto Mom Hester Peirce Officially Sworn in as SEC Commissioner

Commissioner Hester Peirce has been officially sworn in for a second term as one of the United States Securities and Exchange Commission’s five commissioners alongside Caroline Crenshaw.

The Securities and Exchange Commission (SEC) has sworn in Hester Peirce and Caroline Crenshaw after the pair were confirmed by vote in the United States Senate on August 6. Peirce, who has been an ally to digital innovation within the SEC, received a nomination for a second term from President Donald Trump in June.

Peirce earned the nickname ‘Crypto Mom’ when she spoke out and highlighted parameters that were set and heavily scrutinized in the SEC’s processing and ultimate rejection of Bitwise’s Bitcoin ETF application. Peirce argued that the standards that Bitcoin ETF’s are subjected to have never been applied to traditional markets offering. She also called for a safe harbour period of three years for digital asset and crypto projects as the regulation was not clear.

In the official release on August 18, Chairman Jay Clayton said:

“As a Commissioner, Hester has been a tremendous advocate for our markets and investors, and I know she will continue to be a strong voice for them in the years to come.”

After being sworn in for a second term, Commissioner Pierce said:

“I am honored to be able to continue to serve our investors and protect the integrity and efficacy of our markets together with the SEC staff and my fellow commissioners, including my newest colleague, Commissioner Crenshaw.”

Innovation and Government

Commissioner Peirce was first sworn in as a Commissioner in 2018. She has focused particularly on matters of innovation in financial services and has often been critical of the SEC’s rigid and unyielding approach to an industry still finding its way.

At the Unitize virtual conference on July 7 , Peirce said:

“I wanted to make sure that our regulatory structure was flexible enough to accommodate innovation.”

Peirce has often highlighted that the benefits of clear regulation would allow developers to fundraise, investors to access more detailed project information, and innovations in these emerging technologies would stay in the US.

Peirce said,

“Remember that innovation typically comes from outside the government sector. We need to set up a framework that allows people who spend a lot of time thinking about new ideas to continue to spend time thinking about those ideas and not a lot of time worrying about complying with regulations.”

Commissioner Peirce fills a term that expires on June 5, 2025.

Commissioner Crenshaw fills a term that expires on June 5, 2024.

CIA Eyes Blockchain Technology with New Research Lab

The US Central Intelligence Agency (CIA) has rolled out a federal laboratory and in-house research and development arm dubbed CIA Labs to scale up technological and scientific breakthroughs for future intelligence challenges.

It views blockchain technology as one of the technological advancements that will boost its mandate of gathering, processing, and analyzing national security information from across the globe.

CIA interest in DLT and Blockchain

The CIA Labs will be part of at least 300 U.S. federal labs, which offer science and technology solutions to new challenges.

The research arm has earmarked distributed ledger and blockchain-enabled technologies as an area of interest. Others include quantum computing, human interface systems, bioscience and biotechnology, artificial intelligence, virtual and augmented reality, and data analytics.

The head of CIA’s Directorate of Science and Technology, Dawn Meyerriecks, noted:

“Some phenomenal innovations have come from the CIA over the years, and with CIA Labs, we’re now better positioned to optimize developments and further invest in our scientists and technologists. In an evolving threat landscape, CIA Labs will help us maintain our competitive edge and protect our nation.”

He, therefore, hopes that these incentives will offer the agency an upper hand in the future.

A New Way to File Patents

The CIA Labs will present its officers with new opportunities to file patents on innovative ideas using cutting-edge technologies like blockchain. They will also attain a percentage of the profits from the same.

The American administration continues to view blockchain as a game-changer in streamlining various sectors. For instance, in July, through its federal agency the Food and Drug Administration (FDA), it revealed its consideration for blockchain as one of the technological innovations that could prompt traceability and food safety culture.

The FDA noted that blockchain could help in tracing new sources of food ingredients to help in bending the curve of foodborne illness in the nation.

US House of Representatives Passes Blockchain Innovation Act On to the Senate

Two bills introduced by Representative Darren Soto—the Digital Taxonomy Act and the Blockchain Innovation Act—are now making their way to the Senate after being approved in the House of Representatives.

The two acts have been updated into the Consumer Safety Technology Act (H.R. 8128), which is a bill directing the Consumer Product Safety Commission to explore applications for AI earlier this month. The Bill is now headed for the Senate for the final vote.

What Do the Blockchain Bills Mean?

Essentially if the bills are passed, they aim to protect the public from scams and illegitimate projects—leveraging blockchain technology to combat fraud.

Specifically, the Digital Taxonomy Act (H.R.2154) provides clarity on the definitions of two terms—’digital asset’ and ‘digital unit’—and place a burden on the Federal Trade Commission to prevent unfair trade practices of both aspects. In addition, the Blockchain Innovation Act (H.R. 8153) also requires the Federal Trade Commission (FTC) to research and present information on how blockchain can be leveraged in consumer protection.

The two bills were introduced by Rep. Darren Soto (D-FL) and have been rolled into the Consumer Safety Technology Act which was introduced by Rep. Jerry McNerny (D-CA)—which as mentioned pertains to using AI in consumer safety inspections.

The act highlights that remaining competitive with digital tokens and blockchain is critical to maintain American innovation, and obligated the FTC to provide further recommendations limit the abuse of the technology while allowing the United States to remain competitive.

Congressman Darren Soto said in a release:

“As lawmakers, it’s our duty to ensure the United States continues to lead in blockchain technology […] The Digital Taxonomy Act adds greater jurisdictional clarity for a strong digital asset market in the United States.”

Rep. Darren Soto has attempted to introduce or co-sponsor multiple blockchain bills pertaining to digital assets, but so far all bills have had a very hard time making their way through the house.

On the success of passing the two bills, Soto said:

“The study mandated by the Blockchain Innovation Act is a starting point meant to give government agencies a chance to make recommendations before any bills pass with a regulatory effect[…] These recommendations will perform an educational function to Members of Congress and will pave the way for more actionable blockchain-focused legislation.”

Blockchain Industry Leaders R3 and FORMS HK join Cyberport to Launch “Block AdVenture” Program

Hong Kong’s innovation hub, Cyberport has partnered with leading global enterprise blockchain platform provider R3 and pioneer of blockchain applications FORMS HK to launch the Block AdVenture program.

The Block AdVenture program is part of Cyberport’s commitment to empowering Hong Kong start-ups through the use of cutting-edge technologies and creating innovative digital solutions that meet the market’s needs. Blockchain is one of the key technology clusters promoted by Cyberport.

According to a release shared with Blockchain.News on Oct 22, the Block AdVenture, program equips local startups with a deeper knowledge of blockchain and assistance in making better use of blockchain platforms. The program has been designed to help start-ups validate their business ideas and accelerate their product-market fit through community events, workshops, mentorship from industry leaders and access to prospects and investors.

Eric Chan, Chief Public Mission Officer of Cyberport, said:

“Blockchain applications have become prevalent across different industries, helping to make the information transfer in business activities more efficient and transparent. We can see successful examples of blockchain technology being used in finance, logistics, testing and even esports and the fashion industry.”

How does it Work?

Over the three month duration of the Block AdVenture program, representatives from R3 and FORMS HK will pass on their knowledge of blockchain applications to start-ups and provide one-on-one coaching to help participants develop proofs of concept (POCs).

Marc Liew, APAC Venture Development Lead of R3, said:

“R3’s Venture Development program will serve as a gateway to the R3 ecosystem for entrepreneurs and start-ups seeking to leverage blockchain technology to accelerate their business. As the world of enterprise rapidly evolves, businesses need strong partnership networks and support to face a ‘new normal’ – and we will do everything we can to support Hong Kong’s thriving technology sector in collaboration with our partners.”

The program is open to all start-ups and other local companies that have an interest in applying blockchain technology in their business development but only ten will be shortlisted to take part in Block AdVenture based on three criteria – impacts, innovation, and technology – in the business proposal they submit.

The Block AdVenture program will end with a demo day, and the most outstanding companies will be awarded cash prizes and investment matching opportunities as well as the Corda Enterprise Development License to help deploy their solution for production. In addition, R3 will provide all participants with an extended Corda Enterprise evaluation license, free AWS cloud credit, business use case consultancy, one-on-one industry expert mentorships, and technical consultancy.

The program is free of charge. Hong Kong startups interested in taking part can apply before November 16.

In other news, R3 has also teamed up with tech giant IBM to boos Hybrid Cloud capabilities with blockchain, for enhanced data privacy, compliance and performance.

US Department of Homeland Security to Host Blockchain-Based Digital Wallet Event with $25K Reward

According to an announcement by the US Department of Homeland Security (DHS) shared with Blockchain.News, DHS Science and Technology Directorate (S&T) and Silicon Valley Innovation Program (SVIP) will be hosting a virtual event for a Digital Wallets Challenge on Oct 27.

The Digital Wallets Challenge has a total prize of $25,000 that will be awarded in two stages. There will be 3 finalists at the end of Stage 1 who will be awarded $5,000 each. One top winner of the three Stage 1 finalists will be rewarded an additional $10,000.

During the events, the finalists will present their user interface (UI) and user experience (UX) designs. Next, government experts and standard communities such as World Wide Web Consortium (W3C) will provide feedback, insights, and comments. One grand prize winner will be awarded at the end of the challenge.

The digital wallets will be leveraging blockchain and distributed ledger technologies to enhance security, and prevent forgery as well as counterfeiting for the issuance and storage of paper-based credentials.

DHK’s blockchain-based digital wallet is another case that DHK and other government departments are utilizing blockchain technologies. The digital wallet challenge is a practice that invites ideas and solutions directly from the public.

Alibaba Founder Jack Ma Criticizes Current Financial Regulations

Alibaba founder Jack Ma highlights the importance of innovations over regulations. Recently, Ma made a voice for digital currency at the “Second Bund Financial Summit” organized by the China Financial Forty Forum (CF40), asserting that “digital currency could redefine money.”

In contrast, he criticized the current banking regulations and supervisory practices — Basel Accords. He explained:

“Basel Accord is more like a club for the elderly. What it wants to solve is the problem of the aging financial system that has been in operation for decades, and the problem of system complexity. But China’s problem is just the opposite. China has no financial systemic risk but has a risk of lacking the financial ecosystem.”

The Basel Accords, the most influential blueprint for international banking reform, provide both an authoritative and a controversial framework for credit risk management in global banks. The Basel Committee was established to enhance financial stability through global banking supervision. Formed at the end of 1974, the Basel Committee is comprised of central bank Governors originating from ten countries, following the serious disruptions in international currency and banking markets.

Financial regulations are the key to protecting investors, as finance has a history of cheating, scam, and high-risk speculation. There were the cases of the famous Tulip Bubble in Dutch in 1637 and the Railway Mania bubble in the United Kingdom in the 1840s. Even the US Securities and Exchange Commission (SEC) was the result of an initiative established by Roosevelt to refrain from rampant speculation – the act of putting one’s money into bets with the goal of acquiring high returns in a way that is similar but not identical to gambling – and scam. It was created by Joseph P. Kennedy, the father of the 35th former US President John F. Kennedy.

Jack Ma, as China’s richest man and as a super successful businessman, has realized the power the Internet, eCommerce, and online payment hold much earlier than most people. The Alipay was once a payment channel innovation that is on the verge of regulation. The coming biggest IPO project Ant Group, the owner of Alipay, is also the result of constant fintech innovation, realized under his leadership. Ma knows the importance of innovation and thinks that at times, regulation may stifle technological and financial innovations.

Worldwide, the regulations regarding finance are tightening, especially with respect to disruptive blockchain technology and cryptocurrency-related practices. Recently, Ripple CEO also expressed his worries and criticized the “Cryptocurrency Enforcement Framework” by the US Department of Justice (DOJ).

Whether industry leaders like Jack Ma could cause an amendment to existing regulations pertaining to fintech innovations is still up for question.