An Interview with Elizabeth Kukka, Program Director at ETC Labs 1652

Can you tell us something about the pilot program? What is it all about and why did ETC Labs consider supporting them?

Our pilot program started on October 1st; we invited six companies to join us. Currently, these pilot projects get free working space, great coffee ;), and the opportunity to work alongside some of the best minds in the business. They will also have the opportunity to pitch their ideas to a roomful of investors at our launch event on October 25th. The goal of this pilot program is to put the incubator model to work and get feedback from these initial teams before going live.

The ETC Labs incubator will kick off in the first quarter of 2019. There’s been a lot of interest and inquiries about the program — we have received around 120 applications so far! We’re considering all projects that build on the ETC blockchain and we’re even trying to convince some projects that aren’t on ETC yet!

In the course of the work you do, you come across a lot of interesting ideas and concepts in the cryptocurrency space. Would you be able to share a few highlights? It could be anything, for example, the ideas that struck you the most, the ones you thought had the most potential, and so on.

We sorted through many companies interested in our incubator program, so there were quite a few great ideas and startups. However, some of them stood out for their uniqueness and growth potential. There was one startup involved in the organization and support of scientific research in the field of blockchain technology. They have their own blockchain and technology capabilities and help scientific researchers with fund raising. I came across another startup, which is actually a decentralized IoT platform that allows users to store IoT data in real time, without any support from a centralized authority. Another interesting one was a VR/AR collectibles app that focused on building on the blockchain. So yes, there were some really good ones and some that were not quite there yet.

Why Ethereum Classic? Is there any reason behind wanting to invest in startups operating in this space?

Ethereum Classic because there is a lot of security on the main layer, and it doesn’t really matter what sidechains are used in conjunction to this. Also, the Ethereum Classic space is very competitive, with a lot of good ideas and startups with immense potential for growth.

Can you tell us about ETC Labs’ future plans — how many startups do you plan to support, why and how?

In the near future, we plan to support around 20 to 24 startups per year, and that’s mostly due to capacity and how many we can accommodate at any given time. We would probably look at supporting 10 to 12 startups at one time. Support will vary depending on each project’s needs.

What are the characteristics you would look for in a startup that you would potentially like to support?

We look at the technical capabilities of the team and their ability to build on the ETC blockchain. Of course, great ideas and a motivated team are important too.

Can you tell us something about yourself?

I played competitive soccer until age 18. (Laughs)

You come from a background of startups and technology ecosystems. What made you join ETC Labs?

I am interested in blockchain technology and have been following it over the past four years. I now have a place where I can talk with people about blockchain without sounding like a nerd! Also, I wanted to get into the scouting side of the business and play an active role in making investment decisions and connecting investors and startups. I enjoy designing things from scratch, and ETC Labs gives me a great opportunity to do all of these things.

Anything else you would like to share with us about the incubator program or ETC Labs in general?

If you have a great idea, or are a startup looking to grow, talk to us. We offer great coffee, free working space, and some of the best minds you can work with. During the incubation program, startups have the opportunity for one-on-one guidance from industry leaders and developer mentors.

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Former CFTC chair and ‘Crypto Dad’ says 2019 is the year to get serious about crypto policy 51096

Former CFTC Chairman Christopher “Crypto Dad” Giancarlo left his role at the regulator this summer, but now he’s stepping even further into the crypto world. Now as a board member for the Chamber of Digital Commerce, Giancarlo is using his expertise to further policy talks across the board, not just on a CFTC/SEC level. Giancarlo sat down with The Block to talk transitions in the regulatory space, as well as his own transition in the industry.

The Block: At the time of your departure from the CFTC how do you feel attitudes toward crypto have shifted from the time you took the position as chairman?

Giancarlo: I think quite dramatically, one of my perspectives on the CFTC at the time I took the helm, it was inordinately backward-looking, perhaps justifiably, but inordinately. So much of its energy and attention was on completing Dodd-Frank reforms to derivative markets. And in Dodd-Frank, there’s no mention about anything technological including crypto assets or blockchain, and the agency’s attention was primarily drawn to that. To its credit, the agency had developed an informal working group under Jeff Bandman that was looking at emerging crypto assets, primarily bitcoin. It was that effort that I accelerated with the formation of Lab CFTC.

The Block: How are you looking at the EOS and Sia settlements with the SEC? Can you provide any insight into what might have gone on there?

Giancarlo: One of the things I want to avoid doing is commenting on activities by the agency. I’m not the type, and don’t want to be seen as the type of former chairman who is looking over the shoulder of the incoming team and commenting on them. What I would say is that it generally shows a continuing focus and attention in this space by the agencies.

The Block: How have you seen the attitudes of regulatory bodies shift in recent years? What is the current attitude characterized by?

Giancarlo: 2017 I think was the year that regulators really woke up to the accelerating pace of crypto assets because of the bitcoin bubble. I would say 2019 is the year in which there’s a growing recognition that regulators and policy makers need to do more than just be aware of these, but may actually need to look at some policy responses. And I think the thing driving that in 2019 is a combination of Libra and the prospects for central bank digital currencies.

The Block: Looking at recent developments, we saw Regulation A+ emerge as a possibly compliant way forward for some companies. What is your take on that innovation, and what other innovations can we perhaps expect to see?

Giancarlo: I think that it shows that the SEC under Jay Clayton is moving beyond just getting smarter and more aware, but actually thinking about some of the policy responses.

The Block: I understand you’ve said you’re not interested in looking over new leadership’s shoulder, but members of the SEC have said they feel federal securities laws adequately tackle digital assets because they are technology agnostic. Do you see the legislation as operating fully for the digital assets space?

Giancarlo: I would go further afield than just SEC/CFTC specific. I do think the time has come for thoughtful consideration of a digital dollar. I think that the dollar’s status as the world’s primary reserve currency should be enhanced with a digital component and done in a way that doesn’t have to disintermediate the traditional banking system but can be done so traditional finance financial intermediaries can play a role in a digital component to the dollar. I don’t see the Federal Reserve becoming a deposit-taking institution, but where banks would continue to do that, but would use a uniform set of technology protocols in order to provide access to a digital dollar format.

The Block: Looking into some of your ventures now, I understand you’ve joined the Chamber of Digital Commerce.

Giancarlo: Yes. I’ve been very impressed with their work over the past several years in serving as a sort of a go-between. There’s this FinTech phase of innovation and policymakers helping to both translate the technology into concepts and things that policymakers can understand and interact with and giving policy makers a similar ability to interact with the innovators. And so I think with the chamber, almost uniquely, I think provides a very good interface between the world of Washington and the world of financial innovation.

The Block: I remember I read somewhere when you joined that you were looking to streamline and modernize the regulatory landscape. Which areas are you specifically immediately looking to streamline and modernize in your role on the board?

Giancarlo: As a former chairman, I will leave the new leadership to focus on CFTC-related matters, and I have every confidence in the leadership of the SEC to do that. But there’s a need for policy makers and innovators to come together to lay down a policy framework upon which these innovations can move forward with greater regulatory and legal certainty. A good example, although not a perfect analogy, is the period during the Clinton Administration when a Republican Congress and the Democratic administration came together to develop the foundation for the first phase of the internet revolution, the digitalization of information.

It’s a do-no-harm approach that allowed for very rapid innovation and global leadership. The reason why it’s not a perfect precedent is because digitization of information is a process that certainly falls into a regulatory light zone because of the First Amendment restrictions on regulation of speech. When it comes to financial areas, that’s always been a regulatory heavy zone. Some of the same precedents don’t apply, but what I think should apply is that same commonality of purpose between policy makers and innovators to want to create a regulatory and policy foundation upon which innovation can proceed in a way that is, intelligent, that’s thoughtful, aware of policy concerns, whether it be about privacy, whether it be about appropriate anonymity, whether it’d be about regulatory transparency,or for oversight where we can make sure that the right policy imperatives are brought to bear and yet a framework that can bring certainty to innovators so that they can move forward with innovation, and knowing the consequences of decisions they make.

So what I hope to do in my post-CFTC life is be an advocate for sound policy development. Not CFTC or SEC specific, but across the board where I can use skills I have as a communicator and an advocate for innovation in a well-regulated environment, and with relationships I build, hopefully help communicate that message for the need for sound policy here in the U.S. So that once again the U.S. can emerge as a leader in this new phase of the digitization of our modern world, digitization of finance in this case.

The Block: You’ve been affectionately dubbed “Crypto Dad” by the industry. How do you feel that title came about and where did this generosity towards digital assets stem from, especially in a regulatory environment some consider hostile towards the digital asset world?

Giancarlo: So the title came about out of that February, 2018 hearing that chair Clayton and I did before the Senate Banking Committee. We had been asked to testify on Bitcoin and crypto assets. We’d prepared a lengthy written testimony to Congress, and the night before, I was preparing my oral remarks and I looked at this 60-plus page, 100-footnote document and said, you know, I cannot summarize that in five minutes. I went in the next morning and when I was asked to speak in my opening address, I actually put the paper down and said, look, you’ve got my written submission. What I want to do is speak to you for a moment not as a chairman of a regulatory agency, but as a father, as a dad. I explained that I had just come back from our annual family ski trip with my children and my nieces and nephews and at the dinner table every night all they wanted to talk about was Bitcoin.

My children grew up in a financial family. I’ve worked on Wall Street for my career and I’ve tried to interest my kids in the stock market since they were young, and they had no interest in it and suddenly they’re very, very interested in Bitcoin. And some of my nieces, in fact, one of my nieces was a bitcoin holder. I said to Congress, I noticed some of your heads are nodding, some of you probably have the same conversations. I said, it strikes me that we owe it to this generation to treat their interest in this new asset class not with derision and disdain, but with respect. If nothing else, we owe it to them to get the policy right so that they’re not prey to fraud and misappropriation, but more that they can build a framework upon which they can build this new structure.

And it was from that my Twitter account exploded and I was dubbed Crypto Dad. It’s something that was unexpected, delightful at the same time, but more importantly, I think it showed that I stumbled onto something. We have a generation that came of age in a financial crisis when all of the traditional institutions that were supposed to provide stability and certainty seem to have fumbled, and in some cases failed. I think there is a generational interest here that is not going away, is not worthy of being dismissed, but should be taken seriously. I take it seriously, and I must say that, in the early days of the internet, and I’m old enough to have been around them, the same people dismissing crypto assets now were dismissing the internet as good-for-nothing other than access to pornography. It was dismissed as a fad that would fade. Well in fact you can’t even hail a taxi today without using an internet app. Our whole world has been dramatically changed in many cases for the better by the internet. What I called it, the digitalization of information, well now we’re on the digitalization of assets, the digital tokenization of a value, and it’s as fundamental a change as the early internet was.

I think for the adults in the room the choice is to put down solid policy frameworks upon which this new phase of digitalization can be built or to do nothing and see jurisdictions that put down solid policy foundations become the leaders in innovation. I don’t want to see the U.S. left behind. I want to see the U.S. do what it’s traditionally done in the face of technological revolution. And that is take a leadership role. I think that’s achievable if we put down the right policy prescriptions, and that’s why I’m pleased to join the Chamber of Digital Commerce, because it advocates for solid policy foundations and does a great job of putting the right experts forward and engaging the right communications with policy makers to maximize the opportunities. So if Crypto Dad can answer that effort, then I’m delighted to do so.

Source: Theblockcrypto.com

Altcoins: XRP, LINK, LEO, MIOTA and XTZ 44711

Altcoins

LEO/USD

The best performer of the past seven days is UNUS SED LEO (LEO), which has declined by about 3% during the period. Cryptocurrency exchange Bitfinex has said that owners of LEO will benefit by access to higher allocations during its initial exchange offering compared to others who participate with other cryptocurrencies. Can LEO continue to outperform in the next few weeks? Let’s analyze its chart.

LEO/USD

The LEO/USD pair has been under pressure since topping out at the end of June this year. It has consistently made a lower high and a lower low, which shows that traders are selling on minor rallies. The bulls have been attempting to stall the decline close to $1.0464 for the past three weeks. If successful, the pair might attempt a pullback that will face resistance at $1.36.

On the other hand, if the support zone at $1.0464–$1.0075 breaks down, it can drop to the next support at $0.80. The bulls are unlikely to buy aggressively if the price slips to new lows and the traders who own positions will bail out of their positions. We will wait for the trend to turn around before suggesting a trade in it.

LINK/USD

Chainlink (Link) can now be used to pull reliable data about the various pairs traded on Binance. This can come in handy for various innovative decentralized finance applications. The listing on Kraken also helped put a floor beneath the prices. Can it stage a recovery from current levels? Let’s analyze its chart.

LINK/USD

The Link/USD pair has been consolidating between the psychological support of $1.50 and the previous support turned resistance of $2.0531 for the past four weeks. The 20-week EMA has flattened out and the RSI is also close to the midpoint, which suggests a balance between buyers and sellers.

If the bulls can push the price above the overhead resistance of $2.0531, it will indicate buying at lower levels. The next level to watch on the upside is $2.8498, above which the momentum is likely to pick up. Conversely, if the bears succeed in breaking below the support of $1.50, a drop to $1.3139, which is the 78.6% Fibonacci retracement of the entire rally is probable.

However, we like the way the cryptocurrency has held its support in this pullback. Therefore, traders can initiate long positions on a close (UTC time) above $2.0531 with a stop loss of $1.40.

IOTA/USD

The Iota Foundation has teamed up with the Linux Foundation. Together they will work to advance the development of an interoperable solution set for IoT, Edge and Cloud integration. In another partnership, the foundation joined hands with the European Institute for Technology (EIT) and EIT Climate KIC, to connect and scale sustainable solutions across the continent. With fundamental news backing Iota (MIOTA), can it rally from the current levels? Let’s study its chart.

IOTA/USD

The bounce from the $0.244553–$0.207622 support zone fizzled out at the 20-week EMA.  Both moving averages continue to slope down marginally and the RSI is in negative territory, which shows that bears have the upper hand.

If the price slides below the support zone, it will be a huge negative because the next support on the downside is way lower at $0.104073. However, as the bulls have been defending the support zone for the past six weeks, the possibility of a breakdown is low.

Conversely, if the bulls defend the zone once again and the IOTA/USD pair climbs above the 50-day SMA, it will signal demand at lower levels. On crossing above $0.385033, a move to $0.541 is possible. There are two ways to trade this. Either buy on a rebound off the support zone, which gives a close stop loss, or wait for the price to rise above $0.335, which shows that the bulls are back in action.

XRP/USD

Ripple, the company behind XRP has acquired Logos Network, a startup that focuses on speed and scalability. The Logos team will join Xpring to develop decentralized financial products. XRP has been a huge underperformer in the past few weeks. Can it stage a turnaround or will it continue to correct? Let’s analyze its chart.

XRP/USD

The pullback in the XRP/USD pair reversed direction from just below the overhead resistance of $0.34229. This shows selling by the bears on minor rallies to strong resistance levels. The bears are currently attempting to sink the pair to new 52-week lows.

If the pair dips and sustains below $0.22, it will complete a descending triangle, which is a bearish pattern. The next support to watch on the downside is $0.19 and if that also cracks, the downtrend can extend to $0.13. The downsloping moving averages and the RSI in the negative territory also show that bears are in command.

Our bearish view will be invalidated if the pair bounces strongly from the current levels and scales above $0.34229.

XTZ/USD

Binance added support to Tezos (XTZ) and trading commenced on Sept. 24. However, the bounce due to the positive news was short-lived as traders used the opportunity to lighten up their positions. Tezos was the fifth-best performer of the past seven days. It slipped about 16% during the period. How does it look on the chart? Let’s find out.

XTZ/USD

The bulls are attempting to defend the critical support of $0.829651. If this support breaks down, the next stop is likely to be $0.650511, which is the 78.6% Fibonacci retracement of the rally and if that level also cracks, a drop to $0.33 will be in the cards. That will bring the large range of $0.33–$1.85 into play.

Conversely, if the XTZ/USD pair bounces off the support at $0.829651, it will act as a higher low. Above $1.20, a rally to $1.85 is likely. If bulls propel the price above this resistance, a new uptrend is likely.

The market data is provided by the HitBTC exchange.

Ongoing EOSIO exploit allows attacker to gain 30,000 EOS as network freezes 43667

EOSIO

An ongoing exploit on EOSIO is allowing an attacker to win every roll on gambling dApp EOSPlay by paying to fill blocks with their transactions. So far, the attacker gained 30,000 EOS worth over $110,000 while making the network “unusable.”

Scale of the exploit

A clever attacker was able to use REX, an EOS resource exchange for RAM and CPU, to ensure that blocks were filled with their transactions to continuously win on the gambling dApp EOSPlay. This resulted in the EOSIO network “freezing” as thousands of EOS were fed to the attacker’s wallet, as confirmed by another source.

For 300 EOS, worth a little over $1,000, the attacker was able to make away with 30,000 EOS tokens, said Jared Moore to CryptoSlate, an active community member. A look at the on-chain transactions involved confirms the attack.

One anonymous smart contract developer, the creator of the ERC-233 token, stated the attack may have impacted more than just EOSPlay. The attacker appears to be leveraging multiple accounts to exploit several different smart contracts.

China says new digital currency will be like Facebook’s Libra 40589

China

China’s proposed new digital currency would bear some similarities to Facebook’s Libra coin and would be able to be used across major payment platforms such as WeChat and Alipay, a senior central bank officer said.

Mu Changchun, deputy director of the People’s Bank of China’s payments department, said the development of the coin would help protect the country’s foreign exchange sovereignty as commercial applications of such currencies expanded.

“Why is the central bank still doing such a digital currency today when electronic payment methods are so developed?” said Mu, according to a transcript of a lecture he gave this week that was published online.

“It is to protect our monetary sovereignty and legal currency status. We need to plan ahead for a rainy day.”

He said the tokens would be as safe as central bank-issued paper notes and could be used even without an internet connection. They could also be used on Tencent’s (00700.HK) WeChat and Alibaba-backed Alipay.

The state-run newspaper Shanghai Securities News reported his comments on Friday.

The People’s Bank of China set up a research team in 2014 to explore launching its own digital currency to cut the costs of circulating traditional paper money and boost policymakers’ control of money supply.

It had said little since but Mu last month announced that the digital currency was almost ready. US financial magazine Forbes, citing sources, said the currency could be ready as soon as Nov. 11.

Some analysts say China appears to have accelerated the push to digital money after US social media giant Facebook announced plans in June to launch digital coin Libra.

Mu said China’s digital currency would strike a balance between allowing anonymous payments and preventing money laundering. It would also bear some similarities to Libra in design but would not be a direct copy, he said without elaborating.

Facebook’s proposed cryptocurrency has sparked concerns among global regulators that it could quickly become a dominant form of digital payment and a channel for money laundering given the social network’s massive cross-border reach.

Libra will be a digital currency backed by a reserve of real-world assets, including bank deposits and short-term government securities, and held by a network of custodians. Its structure is intended to foster trust and stabilize the price.

Like other cryptocurrencies, Libra transactions will be powered and recorded by a blockchain, which is a shared ledger of transactions maintained by a network of computers.

Mu said the advantage a central bank-issued digital coin had over those issued by WeChat and Alipay was that commercial platforms could in theory go bankrupt which could cause users losses.

Argentina Imposes Capital Controls as Reserves Drain Away 38112

argen

Argentina’s government imposed capital controls to halt a slump in foreign currency reserves and the peso that has pushed the country to the brink of default. The central bank set a limit of 5 days for exporters to repatriate foreign currency, while institutions will need authorization of the bank to buy dollars in the foreign exchange market, except in the case of foreign trade, according to a statement from the bank. Individual Argentines will be limited to dollar purchases of no more than $10,000 a month.

The announcement comes as Argentina’s currency crisis spirals out of control. About $3 billion drained out of foreign currency reserves on Thursday and Friday alone as the government struggled to repay short-term debt and slow the drop in the peso. The country risks exhausting its net reserves, which stand at under $15 billion, within weeks if it keeps losing money at this pace.

The peso collapsed more than 25% last month after primary election results showed the market-friendly government has little chance of retaining power in October’s polls. Interest rates soared as the central bank tried to roll over debt, culminating Wednesday in a decision to delay payments on $7 billion of bills coming due this year.

The opposition had called for currency controls, saying the government was in “virtual default.” Central bank reserves have slumped to $54.1 billion from $66.4 billion the day before primary.

The re-imposition of currency controls will be an embarrassment for President Mauricio Macri, who came to office over three years ago pledging to free up the economy after years of state intervention. While money originally flooded in the country, the expanding fiscal and current account deficits eventually unnerved investors, prompting the peso to lead emerging-market currencies declines last year.

Now, faced with an electoral defeat in October, Macri has given up trying to restore investor confidence and has instead resorted to the policies he had criticized his predecessors for imposing.

As well as pushing back maturities on local short-term debt on Aug. 28, Argentina also said it will ask holders of $50 billion of longer-term debt to accept a “voluntary reprofiling.” It also plans to renegotiate payments on $44 billion it has borrowed from the International Monetary Fund.

The IMF will “continue to stand with Argentina during these challenging times,” according to a statement by a Fund spokesman Sunday. The “capital flow management” measures aim at “protecting exchange rate stability and the savers.”

Fitch Ratings now classifies Argentine debt as RD (restricted default); Standard and Poor’s as CCC-; and Moody’s as Caa2. Credit default swaps are pricing in more than a 90% chance of a fully-fledged default within five years.

BitGo Launches Multi-Signature Wallet and Custody for EOS 34956

BitGo

BitGo, the leader in digital asset financial services, today announced support for multi-signature EOS wallet and custody services. BitGo now supports over 200 coins and tokens enabling institutional clients to hold a broad array of assets. The EOS token is one of the top 10 digital assets by market capitalization, and is used on the largest public blockchain that utilizes the EOSIO blockchain open sourced software, a blockchain protocol focused on transaction speed and scaling for distributed applications. The low cost of transactions and quick transaction times have made EOSIO popular with decentralized app developers, with hundreds of dApps in active use on several EOSIO-based blockchains.

EOSIO is published by Block.one, a leader in high-performance blockchain software. “We are pleased to see continued institutional acceptance of digital assets,” said Brendan Blumer, CEO of Block.one. “Having trusted and transparent solutions will promote greater participation by businesses and their customers.”

“At BitGo we are dedicated to providing support over the wide array of digital assets our clients demand,” said Ben Chan, Chief Technology Officer, BitGo. “The EOSIO software has some innovative differentiators like its high transaction capacity and fee model that required our engineering team to scale our platform. We were able to successfully create an experience for EOS users that is seamless and consistent with how we support other coins and tokens.”

EOS custody is available through either BitGo, Inc. or BitGo Trust Company, which is the first qualified custodian purpose-built for digital assets.

BitGo offers security, custody, and liquidity services that are built on multi-signature security. All cryptocurrencies supported by BitGo are integrated using the company’s single API, which creates an easy, seamless experience for clients with no additional coding required for new coins and tokens.