Token Guard

Korea’s Kakao Corp. Considers Private Placement to Raise Funds for Blockchain Subsidiary

South Korea’s messaging app operator Kakao Corp. is considering offering a private placement to attract investors to develop their blockchain subsidiary, Bloomberg reports today, June 28.

Kakao Corporation’s blockchain initiative, the Tokyo-based Ground X, was announced at the end of March as part of the messaging app operator’s new Kakao 3.0 business plan aimed at the wider Asian markets. Bloomberg writes that Ground X aims to release a test version in September, with the blockchain platform going live by the end of 2018.

Jason Han, Ground X’s CEO, told Bloomberg the blockchain platform may be considering getting capital next month from collaboration with consumer-service companies used for gaming and content sharing, but added that no firm plans have been finalized.

In terms of what Ground X will consist of, Han predicts the addition of services like Steemit, in this case where users are rewarded for original content with cryptocurrency. According to Han, the services that Ground X will offer will be “more practical” than what other players offer in the blockchain space:

“The biggest problem with blockchain right now is that there isn’t a single service that an average person would use.”

Ground X’s location in Japan was chosen due to regulatory reasons, Han said, as Initial Coin Offerings (ICOs) are not legal in South Korea, where most of Korean chat app Kakao’s 50 million monthly users are based. Han notes that although Ground X and Kakao will work together, there are currently no immediate plans to put the Kakao chat app on the blockchain.

Pavel Durov’s popular messaging app, Telegram, also expanded into the crypto sector this year, cancelling their plans to launch a public ICO after their two accredited investor-only pre-ICO rounds raised a combined total of $1.7 billion.

Han acknowledged to Bloomberg that while it was true that creating a blockchain platform is no longer anything new, “we aren’t late here:”

“We know we’re not frontrunners of blockchain technology. But the industry is still developing.”

Hong Kong Securities Regulator Promises to Keep ‘Close Watch’ on Crypto Sector

Hong Kong’s Securities and Futures Commission (SFC) says in their 2017-2018 annual report released today, June 27, that they will “keep a close watch” on crypto and Initial Coin Offerings (ICO).

The SFC notes that since new technologies “come with risks,” they will be looking closely at crypto and ICOs and “intervening when appropriate.” The report states that the SFC took regulatory action against crypto exchanges and ICO issuers in Hong Kong this year, and released two public warning to investors about the risk of investing in crypto.

The SFC report also includes the agency’s supportive actions in the crypto sphere, highlighting the launch of the SFC regulatory sandbox that allows “qualified firms to conduct regulated activities utilising financial technologies.” The SFC also reports it is working with the Investor Education Center to release educational materials on crypto, as well as public campaigns about the “risks associated with ICOs and cryptocurrencies.”

The SFC’s first statement and circular on ICOs was released in September 2017, with a second circular published in December 2017 on the regulatory requirements for cryptocurrency operators. The SFC issued another statement in February after taking action against crypto-related firms.

In March, the SFC halted Black Cell Technology’s ICO on the grounds that it constituted an unregistered security, with the company responsible for refunding investors in its token.

At the beginning of May, a Hong Kong government report said that virtual currencies like Bitcoin (BTC) are not particularly involved in either money laundering or terrorism financing.

US Congressman Says ICO Market Needs ‘Light Touch’ Regulation to Provide Certainty

U.S. Representative Warren Davidson (R-Ohio) said the initial coin offering (ICO) market needs “light touch” regulation on CNBC's Squawk Box today, June 21.

When asked about cryptocurrency regulation, Davidson argued that the “big thing” the market needs is a “light touch regulatory framework” which, according to the congressman, would provide more certainty.

Davidson stressed the necessity of defining the status of cryptocurrencies, pointing out the recent announcement of the U.S. Securities and Exchange Commission (SEC) that the top altcoin Ethereum (ETH) will be considered a commodity rather than a security. He added that the government still “[has not] put together” a coherent regulatory framework, claiming that there’s still “arbitrage going on.”

“You don’t really know when somebody does an ICO, whether they are really launching this great distributed ledger product that is going to be a security or if it looks a little different, like [Ethereum] and [Bitcoin] determined to be essentially commodities.”

Davidson stated that a lightweight regulatory framework could provide more clarity to investors without encumbering projects with undue regulations. He said that a clear regulatory framework would save companies from the bureaucratic difficulties of navigating myriad different court decisions at varying levels.

The congressman further explained that the lack of regulatory certainty made the ICO market risky and potentially unsafe, as fraudulent ICO projects could take advantage of investors. He advocated for the proper application of know your customer (KYC) and anti-money laundering provisions to “make sure we protect ourselves.”

When asked why crypto is the “currency of choice” for people engaged in illicit activities, Davidson responded:

“I’m not sure that it would be considered the currency of choice, but it is easy to transmit through time and space, and its distributed, you don’t need a central clearing house… but if you look at how cases like Mt. Gox have been solved, there are ways to trace who is the beneficial owner...”

Davidson said that crypto asset flows are “more trackable than cash,” and “certainly more open than hawala network, and both those things are still legal.”

Yesterday, Nasdaq CEO Adena Friedman claimed that ICOs pose “serious risks” for retail investors and highlighted that the ICO processes have “almost no oversight.” from the SEC in comparison with initial public offerings (IPOs).

On June 19, CBOE Global Markets President Chris Concannon claimed that the ICO market could soon face a two-fold regulatory “reckoning,” should the SEC classify ICOs as unregistered securities.

Swiss Federal Councillor: Blockchain Will ‘Penetrate Our Entire Economy’

One of the seven members of Switzerland’s collective head of state stated that blockchain will someday “pe*****te our entire economy,” according to a transcript published by the Federal Department of Economic Affairs, Education and Research today, June 21.

Swiss Federal Councillor Johann N. Schneider-Ammann stated during a speech at the Crypto Valley Conference in Bern today that:

“Hardly anyone still doubts that blockchain will pe*****te our entire economy.”

However, Schneider-Ammann added that at this point, Switzerland does not know enough about the new technologies, “their potential and their risks,” noting that the “decisive factor” will be a push for tech education:

“We need to put even greater emphasis on digitalisation and technology in schools. We need more IT specialists (not to mention Blockchain experts). And we need more research projects and professorships in this field.”

Schneider-Ammann also noted that regulation in the sphere of blockchain, cryptocurrencies, and Initial Coin Offerings (ICO) is needed moving forward, mentioning a “Blockchain Task Force” cooperating with private actors led by himself and finance minister Ueli Maurer:

“But just to be clear, a good economic framework doesn’t mean giving carte blanche! Abuses must also be consistently prevented in the new digital world. And businesses need legal certainty. Otherwise investment will be withheld.”

Switzerland has been referred to as a crypto nation, specifically in reference to Zug’s “Crypto Valley,” due to its crypto friendly tax regulations and “balanced approach” to tokens issued in ICOs. In early June, Zug announced that they would be holding the country’s first blockchain-based municipal vote this summer.

CBOE Global Markets President: ICO Market to Face a ‘Regulatory Reckoning’

CBOE Global Markets President Chris Concannon has claimed that the initial coin offering (ICO) market could soon face a two-fold regulatory “reckoning,” Business Insider reports June 19.

According to Concannon, the reckoning will come in two waves. First, the U.S. Securities and Exchange Commission (SEC) will classify ICOs as unregistered securities and the holdings of investors would be “rendered valueless.” This would subsequently cause the second wave, as a slew of class-action lawsuits are filed against the companies behind ICO projects:

“The reckoning will come in two waves. First, the SEC will go after ICO market participants. Then, class-action lawsuits against the teams behind ICO projects will surge.”

Concannon said that ICO investors “should lay awake at night” worrying about the uncertainty in the ICO market. Concannon explained that if someone offered an unregistered coin, they would technically have issued an unregistered security, and in the eyes of the law would be considered an “unregistered underwriter.”

"If you sold someone an unregistered security you are liable to them if they decide to take them to court."

Whether the SEC would retroactively prosecute ICO projects remains uncertain. Professor of financial regulation at Cornell University Robert Hockett said the SEC would likely only take action in extenuating circumstances:

"I don't think it is the case that people involved in the business are going to be prosecuted against as if they have been violating the law. But there is a little bit of a room for exception with something particularly egregious."

In 2017, the ICO market broke funding records, raising a fiat equivalent of $4 billion. Using data from from Token Report, Business Insider estimates that ICOs will raise $7 billion in 2018.

Financial regulators have repeatedly urged the public to comply with existing laws, and have taken action against those who have failed to do so. In a large-scale probe into suspicious crypto investment products dubbed “Operation Cryptosweep,” U.S. and Canadian regulators from 40 jurisdictions have opened up to 70 investigations.

Earlier today, founder of McAfee Antivirus Software and crypto enthusiast John McAfee announced that he will stop cooperating with ICOs and promoting ICO projects due to supposed threats from the SEC. McAfee, who revealed his second run for president in early June, claimed that he charges $105,000 per tweet to promote cryptocurrency projects and products.

Freedom of Press Foundation Starts Accepting Crypto, Sees $550K Donation on First Day

Nonprofit organization the Freedom of the Press Foundation (FPF) began accepting cryptocurrency donations June 18, opening its doors to Bitcoin and four altcoins.

FPF, which formed in 2012, aims to support and protect free speech in the media, as well as campaign through whistleblower projects and raise awareness of threats to media publications.

“Your support enables us to protect journalists and whistleblowers worldwide, and will help further projects like SecureDrop, the US Press Freedom Tracker, and the archival of threatened news outlets,” the donations page explains.

FPF lists addresses for five cryptocurrencies - Bitcoin, Ethereum, Bitcoin Cash, Litecoin and ZCash - while officials say they will also consider donations in using other coins.

The move appeared to receive a warm reception in some circles, with decentralized message routing network Mainframe donating 1000 ETH ($542,000) to the FPF.

“Public advocacy becomes that much more powerful when coupled with innovation and better choices. Both organizations plan to work towards the mutually beneficial goal of tipping the scales in favor of the fight for freedom of information,” Mainframe wrote in a blog post explaining the impetus behind its decision.

Ex-Denver Post Journalists, Editors Launch New Blockchain-Powered Colorado News Outlet

Former Denver Post reporters and editors plan to launch a new local media outlet in partnership with ConsenSys-backed blockchain startup Civil Media Company, The New York Times reports today, June 17.

According to the Times, the group left The Denver Post to create a new local state online newspaper, The Colorado Sun, after newsroom layoffs and deteriorating morale following newspaper’s change in ownership. New York hedge fund Alden Global Capital took control of The Denver Post after acquiring its parent company, MediaNews Group, and manages it through a subsidiary, Digital First Media, the Times reports.

The Colorado Sun will use blockchain technology via Civil to store data, with initial funding via a grant from Civil, the Times reports. Once the new outlet is up-and-running, The Colorado Sun intends to be “a community-supported, journalist-owned team focused on investigative, explanatory and narrative journalism for a state in the midst of a massive evolution,” and will be completely ad-free, according to the company’s website.

There is currently a Kickstarter campaign for the fledgling outlet, which hopes to raise $75,000 over the next month. A statement on the campaign page implies that the new outlet will be subscription based, as well as relying on “local supporters” to keep the platform free of advertising.

Emerging media platforms like The Colorado Sun purportedly seek to address the problems of an ad-driven media economy, and shareholder interest-driven content. Civil Media Company — which the Times reports aims to open 1,000 publications in the U.S. by the end of the year — will operate on the Ethereum network using a decentralized governance model, powered by Civil’s upcoming native token CVL, that holds publications in the system to a particular set of ethical and professional standards.

South Korea to Develop ‘Crypto Beach’, Modelled After Switzerland’s ‘Crypto Valley’

South Korea has revealed plans to launch a blockchain center in Busan city modeled on the Swiss Crypto Valley, local news outlet Edaily reported June 14.

At a recent blockchain event in Seoul “2018 Global Blockchain Conference,” chairman of the Korea ICT Financial Convergence Association Oh Jung-geun claimed that the organization seeks to build a space similar to the “Crypto Valley” located in the Swiss canton of Zug.

"We need a place to concentrate on the cryptographic industry in Korea like the Crypto Valley in Switzerland," Oh said at the event.

The association reportedly plans to launch the “Crypto Beach” space at Haeundae, Busan. Located in eastern Busan, South Korea, Haeundae is an affluent beachfront community that attracts thousands of tourists each summer. The space has also been classified as a commercial development center by the government in recent decades. The Association reportedly plans to discuss the project with Busan authorities on Aug. 30.

Oh pointed out that many South Korean companies must launch initial coin offerings (ICOs) overseas due to the government’s current ban on ICOs. Oh expressed concern about the lack of understanding of the new technology and its benefits by local authorities and their strict regulations.

In September 2017, South Korean financial authorities announced a ban on ICOs, claiming they should be strictly controlled and monitored. The government has ostensibly realized the risks associated with banning the practice, such as displacement of talent and investment overseas, as South Korean lawmakers are reportedly working on legislation that aims to lift the existing ban on ICOs.

As Cointelegraph reported earlier, Switzerland is the most blockchain-friendly country in the world. Swiss Crypto Valley, a state-backed blockchain consortium was launched in March 2017 to support the development of blockchain and cryptography-related technologies and businesses. Last week, the city of Zug announced it will trial blockchain-powered municipal voting this summer.

🌐 We represent the interests of investors in the ICO systems.
📡 Which means: there are hundreds, if not thousands of ICO projects out there, and an average user always has one question: “What is real in it”..?
⚙ We are sure that most people who want to enter this field of online earnings have little idea about what it is and how to distinguish really worthwhile projects from "bubbles".

🛡 You have to agree that there are a priori no people wanting to end up with nothing, risking their hard-earned money, which means that there are two ways: first means you study gigabytes of data, plunge into the routine study and comparison of strategies, general aspects of work routine, nuances of the organization of each project, read through the White Paper, the Roadmap... a month later you understand that there are more questions than answers, and the industry is a few steps ahead of you.
🔑 The second way means that you find a broker, trusting them your own funds, in the hope of their decency and foresight in the field they claim to be a professional. Drawbacks are that you are distracted from the process, a human factor of mediation, a little informational flow in your direction, i.e. a lottery.

📌 Let’s summarize: you can find a brief set of rules of conduct on the ICO market in our section "Library" ➡ https://token-guard.com/library
We hope that this manual will contribute to your development and caution.

❓ So, what do we offer you?
💡 It's easy – we track at least the top 30 ICO projects from around the world, buying a pool of tokens at the starting, so-called "Pre-ICO" stage, i.e. a private pre-sale to raise funds for the project development.

🔎 How do we choose?

🔑 The answer is simple: experience of more than a year in this field, both positive and negative, has allowed us to develop our own behavioral model + software for primary analytics of the project, its technical part, personnel and marketing, up to native technologies, which allows to "parse" and discard all the "garbage" in an automatic mode, followed by the work of a specialist, assessment of the model and its viability.