The Reserve

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18 December 2017 | SUBSCRIBE

// SECTOR SURPRISED SEC ENFORCES SECURITIES LAW

A US based ICO, Munchee, was shut down this week, and the only surprise should be how slowly the SEC is enforcing its warnings — it has constantly remained clear that most token offerings fall within existing securities law.

This is merely the beginning; the SEC and others will be more active, confident, and aggressive. Regulation exists in practically every single jurisdiction, it is just ignored. If you follow the road to regulation below, you’ll notice it almost never reads: ‘country introduces new legislation to cover bitcoin’, instead, we always have a financial authority simply reiterating cryptocurrency falls under existing legislation.

The smart money has known regulation will continue to apply, and has been building the infrastructure required for this funding innovation to continue. Indiegogo’s move this week into ICOs is one example, AngelList’s CoinList, another. [Fun fact: AngelList made more from Filecoin’s ICO than the total of all other revenue it has ever generated]. The point is that the sector is being rapidly professionalised and is here to stay — with 1/2 trillion dollars of wealth at stake, the solutions will continue to be built.

As an aside, in a space that at times feels like a limitless pool of greed, I was pleased to see $86M of Bitcoin — about 1/5000th of bitcoin’s current market cap — being donated to good causes this week.

// MUST READS

Fundamental challenges for public blockchains.
Bitcoin is none of the things it was supposed to be.
Last week but — “Please invest responsibly” from Coinbase CEO.

// PRICING SUMMARY

// DISASTER OF THE WEEK

Munchee shut down; the cease and desist itself.

// TRACTION

Bitcoin futures have been trading on the CBOE since last Sunday.
Craigslist now allows its sellers to get paid in cryptocurrency.
Indiegogo now offers ICOs on its platform.
Blockchain based supply chain financing project will kick off in January.
An anonymous early investor in bitcoin is giving away $86 million of bitcoin to charity through the platform Pineapple fund.
Deutsche Börse will probably be the first european exchange to trade bitcoin futures.
The co-founder of Wikipedia, Larry Sanger, is now building an encyclopedia based on blockchain.

// ROAD TO REGULATION

The FCC has voted to eliminate 2015’s Open Internet Order and the net neutrality protection
SEC issues ‘extreme caution’ over cryptocurrency investments.
India’s central tax authority is considering the possibility of collecting tax from bitcoin transactions.
South Korea will allow cryptocurrencies but under regulatory oversight.

// ICOS

Last week highlights:

Dream Team raised $3.4m for an esports recruitment and management network.
Dmarket raised $19m for a decentralized marketplace trading in-game items.

Upcoming:

Skara — January 23, 2018 — An existing blockchain gaming economy.
Bee Token — December 18, 2017 — Decentralized short-term housing rentals platform.
Fynance — December 24, 2017 — Blockchain-based digital insurance broker.