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Blockchain Technologies Achieve a New Legal Victory: Washington State Recognizes DLTs as Legally Valid

Remember Monday's panic? Things are looking much better for cryptocurrency

This week has been remarkably positive for the blockchain ecosystem. Not only is there a strong bullish trend in the markets, but DLTs scored a new victory, this time in the legal arena, thanks to the decision of the state of Washington to advance on a legislation that officially recognizes the legitimacy of distributed ledger technology.

Washington State is on its way to legally recognize blockchain as a vallid and encourageable technology
Washington State Flag

According to information published by the Washington State Legislature, earlier this year, Senators Brown, Rivers, Becker and Short introduced the bill SB5638 which was defined as “an act relating to recognizing the validity of distributed ledger technology”.

The bill passed with 46 votes in favor, 0 against, 2
absentees and 1 excused. However, in its second discussion on April 15, 2019,
the -substitute- initiative obtained an almost perfect majority with 96 votes
in support, 1 vote against and 1 excused.

The law seeks to combat mistrust towards DLT-based networks
and technologies related to blockchain:

The legislature intends to encourage the development of distributed ledger technology. It further intends for this chapter to comply with 15 U.S.C. Sec. 7002 and here makes specific reference to chapter 96 of Title 15 of the United States Code …

An electronic record may not be denied legal effect, validity, or enforceability solely because it is generated, communicated, received, or stored using distributed ledger technology.

Good Times for Blockchain Technologies

Blockchain developments are advancing in numerous areas, which is a sign that in the future these technologies will probably dominate several important aspects of everyday life.

From the legal point of view, in America, blockchain
technologies have gained the recognition of several legislators. In fact, in some states, the use of cryptocurrencies
and blockchain technologies is increasingly accepted as normal.

Two months ago, in Tennessee, legislators signed a bill that recognizes the legal validity of Smart contracts and blockchain technologies in general.

Likewise, Ohio lets its taxpayers to use cryptocurrency as means of payments and recently its legislators signed a series of crypto-bills that gave users the possibility of using a blockchain as a means of evidence, or commercial exchange.

The United States is not the only country that advances towards the consolidation of technologies, even countries such as Russia and China have also shown important signs of progress in the recognition of blockchain tech as licit mechanisms for testing and exchanges.

in 2018, China’s Supreme Court recognized blockchain records as legally binding and as a piece of legal evidence in case of disputes.

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Bank of America CTO “Privately Bearish” on Blockchain

Bank of America Blockchain

An executive at Bank of America has recently put forth comments which go against the growing adoption for cryptocurrency and blockchain in 2019.

According to a report published by CNBC on Mar. 26, Bank of America’s tech and operations chief Cathy Bessant says that she is “privately bearish” on the outlook for blockchain and its potential impact for financial technology. Despite her comments, the CNBC also points out that the bank has 82 blockchain-related patents, which amounts to more than any other bank or financial firm including that of Mastercard and PayPal.

In an interview, Bessant cast doubt on the impact of blockchain in the near-term, and gave her personal opinion that the technology would fail to achieve the prominence some industry supporters believe will occur,

“What I am is open-minded. In my private scoreboard, in the closet, I am bearish.”

Nonetheless, Bessant’s private opinion on blockchain does little to diminish the dramatic steps Bank of America has taken over the last several years to prepare itself for a future of blockchain and digital assets.

As CNBC writes,

“For half a decade, Bank of America has quietly been preparing for a future in which the world of finance migrates to the blockchain.

Under tech and operations chief Cathy Bessant, the giant bank has accumulated the most patents for the technology of any financial services company, for inventions ranging from blockchain-powered ATMs to storage for cryptocurrency keys.”

While supporters of blockchain have argued that the technology is in need of more time to develop, with adoption being a slow process to start, Bessant claims that it’s more an issue of blockchain searching for a use case as opposed to being an obvious source of improvement. Bessant says she is focused on supporting technology that will help finance and significantly improve upon existing methods–two features that she finds lacking in the current state of blockchain,

“I haven’t seen one [use case] that even scales beyond an individual or a small set of transactions. All of the big tech companies will come and say ‘blockchain, blockchain, blockchain.’ I say, ‘Show me the use case. You bring me the use case and I’ll try it’.”

She added,

“I want it to work. Spiritually, I want it to make us better, faster, cheaper, more transparent, more, you know, all of those things.”

In regards to Bank of America’s stockpiling of blockchain-based patents, which Bessant has overseen since starting her position in 2010, the executive views it as a method of future proofing. Rather than allowing Bank of America to blindsided by a wave of blockchain adoption and innovation, Bessant–despite her personal doubts–is preparing the company in the event that the technology lives up to its potential.

Bessant also claimed to be most skeptical over public blockchains like Bitcoin and other cryptocurrencies. Instead, she finds greater use in private blockchains that provide intermediaries for use, similar to the stablecoin that is being developed by J.P. Morgan Chase.

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Tron Launches Educational Events Series to Accelerate Blockchain Adoption

Tron’s marketing team has begun to conduct the Educational Events Series to make regular people better acquainted with blockchain and digital currencies

The Tron Foundation believes it is important to help people understand nascent technologies. Even though, crypto has been around for nearly ten years now and it is about the same for blockchain, for the biggest part of the world’s population these two words still seem incomprehensible or vague, say the least.

Tron has decided to bring light to ‘the world of darkness’.

First educational event already
behind

As March began, the Tron marketing team already arranged and conducted their first talk in the series of events aimed at helping ordinary people understand what crypto and blockchain are and how they can transform the world.

The first educational event took place on March 7 in San Francisco. Over
40 people came to attend. For this purpose, Tron managed to engage three
experts who were the speaker panel at the educational talk.

All of them work either in the blockchain space (Chris Eberle, COO of Swarm) or are occupied in the field of crypto/traditional finance and investments (Cecilia Li from OKCOIN U.S.; Kevin Ding, Managing Director at Danhua Capital).

Topics discussed with the
audience

During the talk, the panel discussed several topics, telling the
audience about numerous widely spread misconceptions about blockchain. One of
those is that many confuse Bitcoin and blockchain and that virtual currencies
may help you make a quick fortune.

The Tron speakers also explained why the first area to embrace blockchain
in full will be the industry of finance. The difference between traditional
payment systems, such as PayPal, and the way cryptocurrencies function were discussed.

The speakers touched upon the higher speed of open ledger transactions,
lower costs for those, as well as other aspects of transparency of crypto
transactions. Smart contracts were also explained.

Finally, the conversation turned to the subject of the current bearish
market and the team of speakers explained that technological development for
various blockchain platform is much more vital to follow rather than watching
coin prices go up and down charts.

Tron partners with San Jose
State University

Earlier, reports emerged that the Tron Foundation had made a partnership with the San Jose State University in the Silicon Valley. The purpose is the same – to tell regular people about blockchain and cryptocurrencies, thus raising awareness in this field.

With the San Jose University, it will be also educational events, rather
than traditional courses.

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PwC Partner: Central Banks Should Leave Cryptocurrency to Corporations

PwC Central Bank Cryptocurrency

The contention between the industry of cryptocurrency and banking institutions may have been furthered by an unlikely third party, with an even more unsuspecting alternative proposed as a substitute.

According to Pauline Adam Kalfon, a financial partner at PwC France, Central Banks should leave cryptocurrencies to corporations like Facebook and JPMorgan, as opposed to issuing their own digital asset. Kalfon cautions that institutions with as much political and economic sway would be wise to wait on the sideline before tokenizing fiat currencies themselves, and allow the emerging host of players such as Facebook test the waters first.

Kalfon does not rule out the potential for future monetary tokenization by Central Banks, with governments potentially re-issuing fiat currencies in the form of digital assets and cryptocurrencies–a move that has been proposed for inflation struck countries such as Venezuela. Instead, Kalfon says to observe the hurdles of transitioning assets to a digital equivalent, allowing cryptocurrency to become “battle-tested by corporations.”

By waiting, central banks can more effectively navigate the landscape of developing into cryptocurrency, potentially learning from the mistakes that JP Morgan & Co. are likely to encounter, and overall doing their best to avoid the negative consequences that could stem from governments adopting cryptocurrency en masse.

Included in her talk, Kalfon advised the Banque de France, in particular, to avoid testing fiat-to-cryptocurrencies before the rest, outlining that country’s economic landscape is even more precarious for such a transition. She explained,

“France’s central bank may not be the best entity to drive forward such a digital currency project, which would sit within the prerogatives of the European Central Bank, Kalfon added. Having said this, Banque de France could seize technological leadership by following European Central Bank guidance.

It is clear that a European-level project would be very complex and challenging governance-wise, requiring alignment and the political consensus of all relevant stakeholders from each Member State.”

In January 2018, the French minister of economy Bruno Le Maire warned his country about the dangers and speculative risks involved in cryptocurrency. However, by year’s end he had changed his tune to support the innovation of blockchain and the potential for crypto adoption in conjunction with better regulation.

Last month the French equivalent of the Securities & Exchange Commission echoed the comments of Le Maire and warned that cryptocurrency has the potential to disrupt the finance industry on a broad scale, necessitating the need for increased regulation.

However, the tune for both cryptocurrency and blockchain development in France appears to be in line with that growing across the globe, with French minister’s urging their government to adopt a proposal that would invest €500 million into blockchain development over the next three years.

The more interesting result of Kalfon’s remarks will be if Facebook and JP Morgan, among others, succeed in a large way in implementing digital assets on their platform. In such a situation, central banks may be even more compelled to consider the potential of issuing fiat through blockchain and digital currencies.

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Ethereum (ETH) Co-Founder Predicts Blockchain Will Dominate Economy in 10 Years

Ethereum co-founder Joseph Lubin made the prediction that blockchain will be a primary catalyst for the growth of the global economy over the next 10 to 20 years.

Speaking in a keynote at the SXSW conference in Austin on Mar. 14., Lubin claimed that he expected the global economy to grow ten times larger over the next decade or two, and fully expected blockchain to be involved in the majority of enterprise and market growth.

Lubin explained his prediction by comparing the current of blockchain and cryptocurrency to that of the internet and email in the years before it became a mainstream sensation. Speaking on the issue of mainstream adoption and the room left for blockchain to grow, Lubin said

“There weren’t a lot of ‘normal’ people firing email around in 1983.”

Ethereum’s co-founder also took the opportunity to address the advantages he sees in the development of Ethereum 2.0 over cryptocurrency market leader Bitcoin. In particular, Lubin explained that the Ethereum development team is specifically targeting the inefficiencies of Bitcoin as areas of advantage for Ethereum 2.0, presenting what he believes will be a cryptocurrency capable of overcoming the current industry hurdles,

“In Bitcoin and currently in Ethereum, you need to have specialized hardware, burn lots of electricity, waste lots of computation, to basically keep everybody in sync. [With Ethereum 2.0, in 18 months] we’ll have a blockchain system much more powerful and scalable that uses orders of magnitude less energy.”

While Ethereum is still a year and a half away from launching its anticipated major update, one that will witness a monumental switch from a Proof of Work system to Proof of Stake, the developer is already looking to how Ethereum can revolutionize the industry and improve upon its current framework.

Lubin made headlines earlier in the week for similar comments related to the benefits of blockchain, when he claimed that the decentralized technology could be of substantial benefit to content creators. Lubin singled out artists as a subgroup that would “benefit quite dramatically” from the adoption of blockchain, allowing them greater control over the distribution of their content while dictating the parameters of its consumption.

During that talk, Lubin went on to state that blockchain removed the need for middlemen in content creation and distribution, a factor that would greatly benefit the bottom line for musicians and other creative performers,

“I think artists in the music industry on average capture about 11 or 12 percent of the value in the industry and those big record companies are sucking up 70 or so percent. We can replace those record companies with smart contracts on the Ethereum platform.”

Cryptocurrency, as a whole, has seen positive price traction in 2019 after an abysmal year for coin prices in 2018. While there have been periods of price oscillation, Bitcoin reached its lowest 30-day price volatility earlier in the week since November 2018. In addition, the majority of top cryptos have experienced double digit price gains since the start of the year, with altcoins leading the market. Ethereum has managed a nice rebound in price after falling in valuation with the rest of the industry from it’s all time high established in early 2018. 

Last week, analytic firm Electric Capital reported that Ethereum had the most robust monthly developer contribution, generating twice that of second-place Bitcoin.

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Blockchain Technology Can Solve User Data Privacy Issues

Lucy Wang believes that blockchain technology holds the key to the actualization of robust data security for the digital landscape. The Lambda co-founder made the call recently while talking about the recent Marriott Hotel data breach.

Data Breaches Aplenty

Breaches that end up compromising user data aren’t a new phenomenon on the internet. Almost every website with a significant volume of user information has fallen victim to hackers and other cybercrime syndicates.

Recently, Marriott International Hotel Group became the latest prominent name to admit being victims numerous data breaches. A statement released by the company said that as many as 500 million customers had been affected by multiple hacks beginning in 2014.

By the company’s admission, hackers successfully compromised user information such as credit card details, addresses, and even passport information. How could this happen? Well, all that data found its way unto centralized servers, providing a single point of failure that could be exploited by agents on the internet.

There are many within the decentralized technology landscape like Wang who believes that blockchain technology offers a solution to this problem. However, before going into such details, why should we even care?

Data is Valuable

Data is the currency of the digital economy, and as such, data is valuable. However, the present construct of the internet places user data in the hands of corporations that can pretty much do whatever they like with our precious information. They can sell them to the government (for surveillance) or to other companies (for targetted advertisements) both of which are horrible exploitation of user privacy.

In the process of shopping, browsing websites, watching YouTube videos, reading various social information on the e-commerce platform, the algorithm will secretly monitor our behavior, and also collect our various data. In a sense, “data and the algorithm “knows” us more than ourselves. They know that we prefer juice or cola, we like beautiful models or men with eight packs of abdominal muscles. Like this Marriott case also shows that under certain circumstances, “data and algorithms” could have the “control right” of our wealth.

Data giants such as Google, Apple, Facebook, Tencent, Alibaba, and Baidu attract their attention by providing various information, services, and entertainment. And hotel giants like Huazhu and Marriott have our personal information and even bank card information. We have also seen that these “centralized” giants have used our data to earn hundreds of billions of dollars. We are not at all equal to the “centralized” giants.

Adopting Blockchain For Data Security

Under the centralized network, the giant almost has all of our private data, and the centralized internet has already relied heavily on the main-net. Whether it is academic or technical, these problems cannot be solved perfectly. In recent years, with the blockchain concept deeply rooted in people’s minds, the need to build a new decentralized network capable of subverting traditional client/server has gained more and more recognition.

However, most of the existing public chains are “ineffective” for data storage, TPS deficiency, cross-chain issues, governance issues, application development issues, etc. The nature of the blockchain is decentralized distributed ledger, and the data that can be stored is minimal (simple transaction records), other data cannot be efficiently stored. Therefore, in the absence of underlying data support, the actual use of the blockchain is significantly limited. More specifically, the decentralized storage of data is the most critical part of the future application of the blockchain.

To provide useful solutions to the problem, blockchain technology must of necessity, evolve with more robust and advanced features. Part of this improvement has to come at an algorithmic level like exists in projects like Lambda, with its Provable Data Possession (PDP) and Proofs of Retrievability (POR) protocols.

Recently, Ethereum World News reported the Project’s launch of the first ever Proof of Space-Time (PoST) protocol on GitHub. For Lucy Wang, the hope is that stakeholders become aware of the need to implement blockchain in data security frameworks to prevent further largescale data breaches.

Images courtesy of Shutterstock.

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The Bahamas Plans to Become a Leading Blockchain Hub

An NGO in collaboration with some institutions announced plans to establish blockchain developers in the Bahamas. The group also aims to place the Island at the forefront of distributed ledger technology (DLT) adoption.

A Leading Blockchain Hub in the Caribbean

According to The Nassau Guardian, an NGO known as the Caribbean Blockchain Alliance (CBA) is seeking to establish a group of decentralized technology developers in The Bahamas. In a press release, Stefen Deleveaux, founder of the CBA, talked about the inherent opportunities found in decentralized technology.

The founder further explained thus:

Blockchain technology is seen as the next step in Internet and financial technology, in what many describe as Web 3.0. There is a huge opportunity to use this technology to improve public and private services in this country. In addition, competent blockchain developers are in high demand, in an industry that almost guarantees access to a high-income job or potential project.

Deleveaux also said that part of the objectives was to build several cohorts of DLT developers. The CBA founder also recognized the importance of blockchain technology in software infrastructure as the reason for the groups.

Furthermore, Deleveaux announced a collaboration involving Inter-American Development Bank (IDB), CBA, Blockgeeks, and the University of the Bahamas. These four institutions would host a hackathon. Also, twenty-five Bahamian citizens would partake in a course for decentralized technology developers, from November 30 – December 1, 2018.

The press release further stated that after the course, students would get a certificate recorded on the decentralized technology.

Michael Nelson, who serves as IDB’s Chief of Operations, added that the bank seeks to empower Bahamian citizens. With the collaboration and the incentives in place for DLT developers, Ameer Rosic, the CEO of Blockgeeks, believes that the Island could be “the blockchain hub of the Caribbean.”

Island Governments Adopting Cryptocurrency and Blockchain Technology

Blockchain technology and cryptocurrency adoption are recording high among Island governments. Some of these countries go further to aspire to become “blockchain Islands.”

Towards the end of the second quarter, the Bahamas announced plans to issue its digital currency. According to the Island, a state-owned virtual currency would help to improve its economic development and eliminate barriers.

Malta, another DLT-friendly country, is at the forefront of decentralized technology and cryptocurrency adoption. Popularly known as the “blockchain Island,” it was the first country to have a holistic legislative framework regulating DLT technology.

Furthermore, Malta introduced the Virtual Financial Assets Act (VFA) and the Innovative Technology Arrangement and Services Act (ITAS). Both Acts would regulate virtual currency and decentralized technology.

However, Marshall Islands’ plan to adopt cryptocurrency isn’t receiving complete support. President Hilda Heine’s announced moves to create a virtual currency that would act as a legal tender but received a “no confidence motion” from some of the country’s senators. The IMF and the U.S. also disagreed with the president’s plan.

Image courtesy of Shutterstock.

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Blockchain Evidence is Legally Binding, says China’s Supreme Court

The Supreme People’s Court of China has issued a set of new rules on the trial of internet court cases, part of which is that blockchain can authenticate electronic data entered in as evidence.

Blockchain Authentication

The court’s ruling issued on Friday sets out new rules to guide the activities of internet courts, and protect the legal rights of disputing parties. A portion of the new regulations relates to the authentication of electronic data presented as evidence:

The electronic data submitted by the parties can prove their authenticity through electronic signature, trusted time stamp, hash value check, blockchain, and other evidence collection, fixed and tamper-proof technical means or through electronic forensic evidence platform certification. [a rough translation]

Data stored or retrieved with distributed technology are now admissible in Court. Also, in instances where electronic data entered in as evidence in a case is questioned by any of the parties involved, the data can be authenticated using blockchain technology.

This new ruling by the Supreme Court agrees with the precedence set by Hangzhou Internet Court earlier in the year.

In a case between a media company and a technology company, Hangzhou Internet Court ruled that decentralized technology can be used as a method to determine the authenticity of the digital information presented as evidence.

Internet Court was instituted due to the rising numbers of online trade disputes and copyright infringements in the country. The Hangzhou Internet Court is the first, and it was instituted in August 2017. The government plans to launch internet courts in two other cities – Beijing and Guangzhou.

China Picks Blockchain Over Cryptocurrencies

Despite the relentless crackdown on cryptocurrencies in the country, the Chinese Government is eagerly embracing blockchain technology.  On the one hand, the government banned ICOs and domestic cryptocurrency trading and exchanges and restricted crypto-related online content. On the other hand, it is also adopting distributed ledger technology in trade and other sectors.

In April, EWN reported that state-owned Sinochem Energy Technology Co Limited completed a shipment of gasoline to Singapore using blockchain technology.

Private Corporations in the country are also adopting the blockchain technology and driving decentralized technology-related innovation globally. Chinese company’s like Tencent and Alibaba are leading the global blockchain patent race.  56% percent of all issued distributed technology-related patents in the world belong to Chinese companies.  Even the country’s Central Bank is also not left out, issuing 68 filings for DLT (Decentralized Ledger Technology) patents.

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Senior Government Official Calls for Greater Blockchain Technology Capacity Development in the Country

A Bahraini minister has called on companies and individuals in the country to adopt blockchain technology. According to the minister, this would go a long way in developing the country and combating cyber-crime.

Bahrain Stands to Benefit from Blockchain Technology

According to lcoal media sources, Bahrain’s Minister of Electricity and Water Affairs, Dr. Abdulhussain Mirza, has emphasized the importance of blockchain adoption. During the inauguration of the two-day SmartSec Cyber Security and Blockchain Conference 2018, the Minister said that Bahraini companies and citizens must take advantage of the nascent technology.

Speaking on its potentials, Mirza referred to the technology as a “true mark of progress” and hailed it as a significant advancement for the country. The minister believes that blockchain technology was capable of combating cyber threats and insecurity.

The Bahraini minister also believes that the adoption of blockchain technology will go a long way in creating secure transactions. Also, the immutability of the blockchain is a valuable asset that can be useful for companies and industries, to maintain customer privacy.

Abdulhussain Mirza further said:

This is the kind of initiative that we would like Bahraini companies to have so that innovation can arise amongst the great minds of this community. “Cyber-security is an essential part of our lives because most of our daily lives involve the use of technology in one way or another.

Mirza also noted the prevalence of digital attacks which affected over sixty countries, including Bahrain, in 2017. Bahrain’s apex bank recently warned various financial institutions, including banks, of an impending attack aimed at ATMs all over the globe.

According to the minister, the digital age means that security should be taken seriously. He also said that adequate electricity supply should be a priority, as it ensures safety and immunity against cyber-attacks.

Cryptocurrency and Blockchain Adoption in Bahrain

Bahrain is looking to become a global virtual currency hub, with its firm belief in blockchain technology and cryptocurrency. In March, the island enabled a “regulatory sandbox” for virtual currency. At the time, four digital currency exchanges were entered into the Regulatory Sandbox which would be studied and later regulated.

In August, ABC, a Bahrain-based bank, became the first bank in MENA (the Middle East and North Africa) region to joinS a blockchain-based consortium, by R3.

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