CMC Markets adds Bitcoin BCH support

A financial derivatives brokerage firm out of London, CMC Markets, has allowed traders to take positions against Bitcoin Core (BTC) and Ethereum (ETH) since this past July. The firm has now announced that it is giving its 60,000 customers more options and will provide support for both Bitcoin BCH, Ripple (XRP) and Litecoin (LTC), all of which can be paired against the U.S. dollar.

The firm’s group commercial director, David Fineberg, stated in a release about the offerings, “Since the successful launch of our cryptocurrency offering in March, and subsequent extension to retail clients in July, our clients have expressed interest in extending their trading options beyond bitcoin and Ethereum. We are pleased to offer them the chance to take a position on bitcoin cash, litecoin and ripple, three altcoins which continue to generate much speculation among traders.”

More brokerages have been looking for ways to increase crypto-based products as day traders move away from foreign exchange (Forex), contracts for difference (CFD) and spread betting in traditional exchanges. Offering the same types of products for the cryptocurrency markets has been seen as the possible solution, but derivatives have come under fire in the UK, with regulators contemplating a complete ban on the products. However, CMC doesn’t view this as a deterrent in a market that continues to look for more investment options in the crypto space.

Fineberg added, “Spread bets and CFDs offer a way to trade on cryptocurrencies as clients can take a position on market movements without owning the asset. By trading with an established provider, funds can be deposited and withdrawn with ease, avoiding the risks of purchasing cryptocurrencies directly through an exchange. However, like all other financial instruments we offer, we always recommend clients understand the risks and conduct thorough research before trading.”

The brokerage was a little slow to enter the cryptocurrency space. It only did so after several other brokerages, notably Admiral Markets, IG Group Holdings Plc,. Gain Capital’s City Index and Plus500 Ltd., had entered the market. However, the continued adoption of cryptocurrencies by traditional financial institutions shows how digital currency is grabbing hold and becoming a legitimate alternative to fiat options.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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UK mulls ban on crypto derivatives

The UK’s Financial Conduct Authority (FCA) will be holding consultations on a “potential prohibition” of cryptocurrency-based derivatives, in order to protect consumers from risks posed by digital assets.

“[T]he FCA will consult on a prohibition of the sale to retail consumers of all derivatives referencing exchange tokens such as Bitcoin, including CFDs, futures, options and transferable securities,” read the policy paper by the Cryptoassets Taskforce, which is composed of the FCA, HM Treasury, and the Bank of England. Not included under the proposed ban are cryptocurrencies classified as securities, which are then to be regulated by the European Securities and Markets Authority (ESMA).

The paper noted that the FCA has already supported ESMA’s restrictions on contracts for difference (CFDs) that reference cryptocurrencies, a measure that took effect last August 1.

The report added that the FCA “will not authorize or approve the listing of a transferable security or a fund that references exchange tokens (for example, exchange-traded funds) unless it has confidence in the integrity of the underlying market and that other regulatory criteria for funds authorization are met.”

The consultations have been scheduled for some time before the end of the year.

The task force also called for further clarification of general regulations for the cryptocurrency market, expressing similar concerns as the UK Treasury committee in its report released last month, such as price volatility of many  virtual currencies.

While acknowledging the benefits of the use of cryptocurrencies, such as increased efficiency of financial transfers and the capacity to raise funds, the task force said, “Evidence of the current generation of cryptoassets delivering any of these benefits is limited and many use cases are unproven at a large scale,” leading it to conclude that “in many cases, the risks posed by the current generation of cryptoassets outweigh any potential benefits.”

The task force noted that the UK government itself is exploring the use of blockchain technology apart from financial services, having invested more than £10 million for various distributed ledger projects, and creating a £20-million GovTech Catalyst Fund to study applications of the technology for the public sector.

Last year, the FCA had already warned of the risks in investing in CFDs, but without suggesting a prohibition. It also issued guidelines last April affirming its authority over the trade of derivatives.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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UK gov’t shelves plans for Royal Mint Gold token

The UK government has pulled the plug on plans that would have seen the Royal Mint launching its own cryptocurrency, amid fears over the unregulated nature of cryptocurrency markets, Reuters  reported.

Previously regarded as an exciting development, both for the Royal Mint and for the cryptocurrency sector, the decision follows a breakdown in relations between the Royal Mint and its development partner, CME. As a result, the UK government vetoed plans to continue with the project, effectively ending efforts to develop a Royal Mint Gold cryptocurrency.

The plans would have seen the Royal Mint issuing digital gold in the form of a cryptocurrency, RMG. These would then have been available to trade on cryptocurrency exchanges, and had been seen by some commentators as the initial tentative steps towards a more central role for cryptocurrency in mainstream finance.

With several startups and other mints working on similar projects, the decision could now leave the UK and the Royal Mint trailing behind, effectively destroying its chances of creating a new multi-billion dollar asset class.

Sources familiar with the matter told Reuters the decision was initiated by a change of management at CME. According to the report, “CME’s management changed, and they walked away, didn’t want to get involved.”

After the Royal Mint attempted to partner up with a new firm, the Treasury reported vetoed the plans, citing the risks they could pose to the government and the reputation of the Royal Mint.

With the project expect to go live in spring of this year, the Royal Mint said the plans weren’t completely off the table. It stated, “Sadly, due to market conditions this did not prove possible at this time, but we will revisit this if and when market conditions are right.”

Governments have become increasingly wary of cryptocurrency projects of this kind, with concerns over the lack of global regulation and the frequency of hacks and thefts from major exchanges.

The project’s failure is a major setback for the Royal Mint, and for the broader digital gold use case. Until firmer regulation is in place, and improved security measures to protect against hacks, more projects of this kind may well follow suit.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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Crypto companies in the UK now have a banking option

In a world where cryptocurrencies are still considered by some to be the black sheep, it’s nice to see strides being made to give them their proper place in society. One of the most common areas where they are shunned is in the banking sector, but that is changing. For example, the London Block Exchange (LBX) is introducing a new service that will give customers in the UK a banking option for both their fiat and their crypto assets.

The LBX platform, LBX Pay, will allow users to store, transfer and manage funds, whether they be “regular” currency or digital. It is going to be offered, at first, to the business market, but could eventually be rolled out to other sectors, as well. LBX states that the retail version will “provide all consumers with a whole new way to interact with their cryptocurrency.”

LBX Pay will be available to traders, investment fund managers and initial coin offerings (ICO). The platform is designed to give customers an easy way to convert traditional fiat to crypto without having to move funds between accounts or across multiple service providers.

Users can manage their balances, payments and trades – including third-party payments – using a single app. In the event a business customer needs support for significantly larger transaction volumes, LBX will provide access to its over-the-counter (OTC) trading desk. An application programming interface (API) is scheduled to be released early next year to facilitate the access.

As an added security measure, cryptocurrency will be held in cold storage, not connected to the Internet. Traditional fiat will be held in segregated bank accounts and each will have its own IBAN (international bank account number) for routing.

LBX launched its OTC desk in November of last year. It also serves as a crypto wallet services provider, which is registered with the UK’s Financial Conduct Authority. The LBX Pay platform is more than likely being facilitated through a partnership between LBX and Clearbank, a bank that was formed last year by Nick Ogden, founder of the Worldpay payment services company.

LBX supports Bitcoin BCH and Ethereum Classic (ETC) pairs against the British pound. That support was introduced this past May.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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Coinfloor, UK’s first crypto exchange, lays off staff: report

Coinfloor, the UK’s oldest cryptocurrency exchange, is to lay off staff following the announcement of a slew of redundancies at the firm this week, Financial News reported.

Founded in 2013, Coinfloor is considered to be the first cryptocurrency exchange to setup in the UK. Focused on institutional and larger investors, the platform currently enjoys daily trading volumes in the region of $1 million.

However, according to informed sources, the exchange is now turning to significant redundancies amongst its 40 strong team, as part of a wider essential restructuring of their business.

Coinfloor CEO Obi Nwosu was quoted by the news outlet as saying the move has been prompted by changes in trading volumes at the exchange over recent months. He confirmed to Financial News, “Coinfloor is currently undergoing a business restructure to focus on our competitive advantages in the marketplace and to best serve our clients. As part of this restructure, we are making some staff changes and redundancies.”

The news comes at a time of increasing difficulties for some notable cryptocurrency exchanges, following the bear market conditions that have prevailed through much of 2018 so far.

In the last few weeks, similar rumours had emerged from Kraken, suggesting they too were laying off staff, with their offices in Halifax, Canada, earmarked for closure.

However, the firm subsequently denied this was the case, issuing an unequivocal statement that they “can confirm that we are not shutting down any operations in any specific place.”

Much of the difficulties can be attributed to the plummeting price of BTC, dramatically down on its highs of nearly $20,000 in late 2017. According to a growing number of crypto analysts, it looks unlikely BTC will even nearly recover this lost ground any time soon, if ever.

According to Nwosu, Coinfloor has handled as much as $1 billion in BTC transactions over the last 12 months—perhaps indicative of the current extent of their apparent problems.

While it remains to be seen whether the rumours of job losses are confirmed, the news is further confirmation of the dwindling relevance of the old BTC coin in today’s cryptocurrency ecosystem.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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