The United Kingdom’s tax, payments and customs authority Her Majesty’s Revenue & Customs (HMRC) has reportedly requested that digital currency exchanges provide it with information about customers’ names and transactions aiming to identify cases of tax evasion.
Crypto exchanges come under fire UK’s Tax Authority Requests User Data From Crypto Exchanges: Report.
According to fintech-focused media outlet Coindesk, industry sources said that the agency has sent letters to at least three crypto exchanges in the U.K., including Coinbase, eToro, and CEX.io, requesting that they provide lists of users and transaction data.
What I’m Reading: AI for Businesses, Blockchain, Crypto Scammers
UK companies that adopt AI late or not at all could lose 20pc cash flow
British companies that fail to invest in artificial intelligence soon are at risk of losing 20pc of their cash flow, McKinsey has warned.
New figures claim that AI could boost the UK economy by 22pc in the next decade by making companies more productive, and fast-moving businesses could stand to grow in value by 120pc if they invest in AI tools.
A new report produced by the consultancy’s business and economics research arm McKinsey Global Institute has claimed the UK is “potentially more AI-ready compared with the global average”, but could miss out on the opportunity if investment does not occur.
“The United Kingdom has impressive pockets of innovation but is failing to scale to business more broadly,” the report stated.
Fashion Turns to Blockchain
Although once confined largely to agriculture, blockchain technology is now making major inroads into the luxury goods supply chain market.
Thus, Consensys recently announced a new platform with French multinational luxury goods conglomerate LMVH and the technology behemoth Microsoft to verify the authenticity of luxury goods.
Luxury brands trial blockchain
Although many products in the luxury goods market are renowned status symbols found in expensive city center stores the world over, the components of their products can originate in the most far-flung corners of the globe. The nature of globalized trade means that raw materials can be sourced in one continent, collected and assembled in another, and then shipped on to be sold in any of the world’s major cities.
Crypto scammers posing as legit UK businesses to scam YOUR money
Finance watchdog the Financial Conduct Authority (FCA) has issued a warning about crooks targeting people in the UK while claiming to be regulated financial companies soliciting cash for a non-existent investment. The crypto crooks say they are representatives of ICAP Crypto, a ‘clone firm’ of the legitimate, FCA-regulated ICAP – which has no association with ICAP Crypto.
Victims are given false details, mixed in with real data about the verified firms they are posing as, and asked to hand over cash. An FCA spokesperson said: “This firm (ICAP Crypto) is not authorised or registered by us but has been targeting people in the UK, claiming to be an authorised firm.
E17: Crypto bounce, NASDAQ bear market
E8: Crypto scams
ICO vs IPO – How do they compare?
I’ve participated in IPOs and recently ICO’s and felt investors needed to better understand the key differences between the two especially as cryptocurrency mania sweeps the world.
So let’s begin with an ICO which stands for an initial coin offering. A coin often referred to as a cryptocurrency gives the owner of that coin some future utility on a platform which is being built upon Blockchain technology. In future presentations, I’ll go deeper into the mechanics of how a coin is put together and the process by which it comes to market and is listed on a digital exchange where you can trade it just like shares.
IPO or an initial public offering is the traditional form of raising capital from the public by the issuance of shares in a company. Despite ICO funding skyrocketing to almost $5 billion in 2017, it is still a small fraction of the total IPO financings which were a strong $196 billion last year, up 44% from the previous year.
The video presentation below introduces the ICO concept and compares 10 key features of an ICO with a traditional IPO to help investors understand both the opportunity and risks associated with participating in either one.
Disclaimer: This article is for informational purposes only and does not constitute an offer to sell or a solicitation to purchase securities in any country or jurisdiction. It is not financial or investment advice.
8 Technology Predictions for 2018
I’ve been “working” in technology since 1997 when as a student I landed a part-time job at our University of Calgary’s computer store (called Microstore, if I recall correctly). My working days were filled with Windows 95 troubleshooting, advising on software sales, and helping professors and fellow students configure their computers.
There were no smartphones, tablets, let alone drones and autonomous cars. This thing called the ‘internet’ was just starting to get serious. Fast forward twenty years later, we are at the beginning of another leap forward in technology with artificial intelligence (AI), the blockchain, and other disruptive technologies will start to see the daylight of commercial feasibility.
I’ll keep my predictions for 2018 short and sweet. A few will seem obvious and to keep things interesting, I’m throwing in a few far-fetched predictions which though unlikely are possible.
1. Data protection and consumer privacy will be big news by mid-year as GDPR goes into effect on May 25th, 2018
2. Decent augmented reality (AR) headsets will be hot Christmas gift ideas for next year. To note is the One AR headset by MagicLeap which will be released for developers next year after six years of development and $2bln in funding!
3. Initial coin offerings (ICO) will calm down as most regulators will deem them as securities. Bad news in the short-term but great news for the long-term development and funding of blockchain platforms that will be able to issue tokens or cryptocurrencies to build genuine solutions to reduce transaction costs and increase the speed of delivery.
4. Global Cybersecurity wars will get nastier. Unfortunately, the tension between North Korea and the United States is likely to escalate. North Korea knows it does not have a military advantage but has the cyber defensive advantage because of the tight state control of its network. We could see the first major cyberattack on US critical infrastructure as a warning shot by the North Koreans if they feel threatened by a military strike.
5. Fund managers will jump on board cryptocurrencies as regulation comes to force. This will hopefully shift the market from speculators to investors and support the long-term development of digital platforms and assets.
6. Move from discussion of the Blockchain to distributed ledger technology (DLT).Most don’t realise that not all distributed ledgers have to necessarily employ a chain of blocks to successfully provide secure and valid achievement of distributed consensus: a blockchain is only one type of data structure considered to be a distributed ledger.
7. Smart devices with Artificial Intelligence (AI) will start to hit the main street. These will be physical devices such robots and drones that will exploit AI to deliver advanced behaviours and interact more naturally with their surroundings and with other people.
8. Bitcoin prices will collapse to $5,000 or less but doesn’t mean they could hit $50,000 in a final euphoric manic rally. The collapse will not necessarily be the result of all cryptocurrencies falling out of favour but the marketplace realising that Litecoin or Ripple cryptos are much more effective then bitcoin for transaction purposes. (Expecting some hate mail from bitcoin fans for this prediction!)
Wishing you and your family a happy, healthy, and prosperous New Year!
There is no ‘cryptocurrency’
Ok, I know what you’re going to say:
“But Suhail, everyone is talking about cryptocurrencies! How can you say they don’t exist?”
You’re right, all the media and many Tom’s, Dicks, and Helen’s are talking about cryptocurrencies. When they are in fact talking about crypto coins.
Let me clarify. The word “currency” is derived from Latin word “currens” meaning “in circulation” and in economics currency is defined as a system of money (monetary units) in common use and recognised as legal stores of value and form of payment (i.e. they cannot be refused as payment for debt) by a country.
Thus we have foreign exchange markets and can easily trade goods and services among nations. The global currency markets have an average daily trading volume of over $5 Trillion compared to the largest crypto coin, Bitcoin trading volume hitting a daily trading volume of $4 billion just last week as it broke through the $11,000 mark.
Now that we’re clear, let’s talk about crypto coins.
Crypto coins are similar to loyalty points and can indeed be a store of value. They can be exchanged for goods and services (in a limited capacity) and as the crypto-coin market matures and is recognised by governments, they could one day become a legitimate “currency.” Particular Bitcoin, which is the first and largest coin by market capitalisation. It is the gold standard of crypto coins.
Should we care about crypto coins? Is it too late to invest in crypto coins?
Yes, and No.
Crypto coins are here to stay and will become a legitimate asset class as regulators finally figure out how to protect consumers and standardise sale and trading of crypto coins.
As an investor, you have to be very selective and extremely careful investing in crypto coins. It is indeed risk capital and thinking like a long-term investor, not a speculator, is how I’m playing it.
I’ve been tracking the crypto-coin market more closely over past six months and have bought crypto coins and actually participated in my first Initial Coin Offering (ICO) last month.
Unfortunately, most people are treating crypto coins as poker chips and the crypto-coin market as a casino. Which it has become to a large degree. It is a bubble which could get a lot bigger before it either pops (devastation) or deflates in relatively non-destructive manner. We would be lucky if the latter occurred and if you were fortunate (or unfortunate) to have lived through the dot-com bubble from 1996 – 2000, will indeed see the similarities.
Look forward to sharing my journey and insights to help bridge the knowledge gap and help you cut through the noise with a series of articles and presentations over the coming weeks for the SiAlpha YouTube Channel. SiAlpha helps investors understand, evaluate, and invest in private and public technology companies worldwide.
I’ll be helping their subscribers understand crypto coins and blockchain in particular. As well as other emerging technologies such as AI and robotics which will reshape the world of business and finance over the next decade.
In the meantime, to learn about the types of crypto coins in the marketplace and their insane price movements, my team at the Financial Network have launched an impartial information and price quoting system at http://www.cryptocoinwatchdog.com
So next time you hear anyone call Bitcoin a currency or talk about “cryptocurrencies.” Please stop and correct them, it’s crypto coins mate!
Comments, questions, and feedback most welcome.
Suhail Ahmad has over 20 years of experience in financial services and technology working in Canada, U.K. and the Middle East. In addition to his start-up adventures, Suhail is the Founder of the Financial Network, Partner at Exolta Capital, and Head of Technology Practice at Gateway professional services. Email [email protected]
How NOT to buy Bitcoin
I wrote last week about crypto coins or so-called cryptocurrencies. Read here if you missed it and stated:
“Unfortunately, most people are treating crypto coins as poker chips and the crypto-coin market as a casino. Which it has become to a large degree. It is a bubble which could get a lot bigger before it either pops (devastation) or deflates in relatively non-destructive manner. We would be lucky if the latter occurred and if you were fortunate (or unfortunate) to have lived through the dot-com bubble from 1996 – 2000, will indeed see the similarities.”
Now the chatter and media noise around the mother of all crypto coins, bitcoin has become deafening. Wallstreet has joined the fray with the first bitcoin futures contracts trading this morning in Chicago.
What are futures?
Futures are a way to profit from short-term price movements, both up and down, in an asset without actually owning the underlying asset. A futures contract is a derivative product that gives you the right to buy a certain commodity or financial instrument (like bitcoin) at a later date, for the agreed price now on the condition, you agree to keep that promise and take delivery of the asset in the ‘future.’
A fun way to learn about futures and how you could make a ‘killing’ or ‘lose your shirt,’ consider watching the movie Trading Places. One of my favourite movies, Trading starring Eddie Murphy and Dan Akroyd puts the futures market at the centre of the plot. It tells the story of an upper-class futures commodities broker and a homeless street hustler who unknowingly are made part of an elaborate bet by the owners of a futures trading firm. Essentially they swap their places to see if anyone can be taught to trade. The storyline is a modern take on Mark Twain’s classic 19th-century novel The Prince and the Pauper.
Not to digress. In the case of bitcoin futures, one contract size is equivalent to 5 bitcoins with a notional value of around $80,000 based on today’s bitcoin price. So you would buy a futures contract expiring either on the last day of the month in January, February, or March. The futures have already jumped higher and triggered circuit breakers in overnight trading.
Futures are not the way to purchase bitcoin for individual investors and unless you’re a professional speculator, trader or using it as a hedging mechanism against your millions of dollars in bitcoin, avoid futures like the plague!
If you want to own bitcoin, have a conviction or thesis on why you believe it’s fair value is not being reflected in its current market price. Be an investor. An owner. Purchase the asset with cash (risk capital) and sell when you believe the asset has reached fair value. There are many relatively safe exchanges to buy bitcoin and other currencies as well as Coinbase, perhaps the best retail platform to buy small amounts of crypto coins.
With the market capitalisation of all crypto coins above $400 billion. I’m not expecting the excitement and speculation to abate anytime soon. I’m not buying any bitcoin at these prices. I believe there is relatively better value in other crypto coins that are worthy of consideration as an investment.
This article is for information purposes only and does not constitute investment or financial advice. The views and opinions are my own and not necessarily those of my partners, associates, or affiliates.
Suhail Ahmad has over 20 years of experience in financial services and technology working in Canada, U.K. and the Middle East. He is a trusted adviser on business growth, innovation, and value creation in a digital economy. For more information, email [email protected]