Posted on

High Times Now Says It's Accepting Crypto Payments For Its IPO

It turns out that the cannabis publication High Times is accepting cryptocurrency for its ongoing initial public offering (IPO) after all.

The publication announced at the beginning of August that it would accept bitcoin and ethereum for its IPO, but later walked back that announcement in an August 13 filing submitted to the U.S. Securities and Exchange Commission (SEC), as previously reported by CoinDesk.

Despite the move, however, bitcoin appears to have remained as a payment option on the company’s investment page.

When reached for comment, High Times representative Jon Cappetta confirmed that the company is, in fact, accepting bitcoin and ethereum as payment options. Cappetta told CoinDesk that the regulatory filing was made “to make the SEC happy.”

“Yes, technically we are accepting bitcoin and ethereum,” Cappetta told CoinDesk. However, High Times is not taking or holding any cryptocurrencies – rather, a third-party processor called Fund America is taking the two cryptocurrencies and converting into U.S. dollars, which the company will then receive.

“On the legal side, it’s a lot of jargon. There’s no real easy way to spell it out. They issued the release to make the SEC happy,” he said.

He explained:

“We’re accepting [cryptocurrencies] as a payment option, but technically Fund America takes the bitcoin and ethereum … It’s similar to the way if we were doing an international IPO, and we were accepting the pound or the euro, those guys aren’t accepting that money, they’re converting it to [dollars].”

The reason for the earlier walk-back was due to concerns expressed by the SEC after the company initially said it would accept bitcoin, which mainly revolved around whether High Times would directly receive cryptocurrencies, he said.

“The reason we got slapped by the SEC last time is because we were accepting it … similar to a credit card processor … [however], it gets transferred to cash and we get that, we’re not explicitly holding [cryptocurrencies],” he said.

High Times’ IPO itself is going well, Cappetta said, and the company is looking at a direct listing as a result.

“The Regulation A [fundraising] is going to close on the 12th of this month, and then from there we will begin the listing process,” he said.

Hat tip to Scott.


The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

Posted on

Goldman Sachs Said to Have Sidelined Plans for Crypto Trading Desk

Investment bank Goldman Sachs has reportedly dropped plans to launch a cryptocurrency trading desk, for now at least.

A Business Insider report on Wednesday, citing “people familiar with the matter,” said the decision has been made as the regulatory situation in the U.S. is still a gray area when it comes to cryptocurrencies.

However, per the sources, the banking giant hasn’t abandoned the idea completely, but is rather pushing the possibility lower down on its priorities list and could still move to open the desk at a later date.

Further, Goldman Sachs’ plan to start offering a cryptocurrency custody service is apparently still on the table, with Business Insider citing the need for “reputable custody offerings” to bolster confidence around involvement in cryptocurrency at Wall Street firms.

As reported by CoinDesk, the bank was first revealed to have an interest in a crypto trading venture back in October 2017, though it was said to be in the very early stages of exploring the idea.

In May, however, it was also suggested, once more via anonymous sources, that it would use its own money to trade bitcoin futures products from CBEO and CME on behalf of its clients. Goldman was also preparing to launch “its own, more flexible version of a future, known as a non-deliverable forward, which it will offer to clients,” according to the New York Times at the time.

The latest piece of Goldman’s crypto jigsaw came into place in early August, when it followed up the futures plan with the possibility of a crypto custody service aimed to protect institutions’ holdings from hacking and accidental loss.

So far, though, little has been said publicly by the bank on these potential moves into the crypto space.

In fact, the bank has previously been somewhat skeptical about cryptos, warning investors in January that they were “in a bubble.”

Red traffc light image via Shutterstock

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

Posted on

Deutsche Börse Establishes Centrally-Steered Unit Dedicated to Blockchain, Crypto Assets

Germany’s joint stock company Deutsche Börse (DB) has established a dedicated unit for blockchain and crypto assets, Finextra reported September 3.

The newly established “DLT, Crypto Assets and New Market Structures” unit will comprise a 24-person team led by Jens Hachmeister, and will explore the disruptive potential the technology could have for financial markets infrastructure, as well as the new products DB could develop to enhance its existing offerings. As Hachmeister outlined:

“Deutsche Börse has been active with the technology in a first phase of ideation and exploration […] However, these explorative steps have not been coordinated on a group-wide level. In order to use the full potential of the technology for our businesses, to generate efficiencies and create revenues, a centrally steered approach is necessary.”

Hachmeister noted that blockchain could innovate and streamline many traditional segments across DB’s value chain, including functions such as pre-IPO listing, trading and clearing, settlement and custody, and could even be of service for DB’s financial data and analytics arm.

He conceded that while “blockchain will not be the answer to all our questions,” “expectations are high,” and that DB’s move is driven by shifting currents in the financial landscape:

“The digital economy in general is heading for decentralisation. In [the] future, there will be more peer-to-peer governed marketplaces and less intermediaries. In that regard, blockchain has the potential to disrupt the capital markets infrastructure.”

As Cointelegraph reported recently, DB has recently made a million euro investment to become a minority shareholder in blockchain-based liquidity provider HQLAx. The fresh investment followed the two parties’ joint initiative this March to develop a blockchain-based securities lending platform using R3 Consortium’s Corda platform.

Posted on

The Power of Private Blockchains Is Beginning to Show

Michael J. Casey is the chairman of CoinDesk’s advisory board and a senior advisor for blockchain research at MIT’s Digital Currency Initiative.

The following article originally appeared in CoinDesk Weekly, a custom-curated newsletter delivered every Sunday exclusively to our subscribers.

Cryptocurrency purists often dismiss private blockchains as overly expensive undertakings for projects that are better served with a traditional database.

Yet these distributed ledger solutions keep being rolled out by enterprises in various settings – mostly still in experimental phases, but, increasingly, with real money at stake. And while they fall short of the public blockchain ideals of censorship resistance and permissionlessness, these contained, private experiments are extremely useful to the development of the overall blockchain industry.

While crypto investors lick their wounds in a bear market and developers plug away at scalability fixes for public blockchains, we can learn a great deal from how economic actors behave in these controlled situations where transactions involving multiple non-trusting parties are collectively recorded in a shared ledger.

One example came last month, with a first-of-its-kind blockchain bond issuance by the World Bank. In partnership with the Commonwealth Bank of Australia, the international development institution used a private Ethereum blockchain to sell a two-year bond worth 110 million Australian dollars ($79 million) to seven investors.

This was hardly the disintermediated, peer-to-peer securities sale that crypto finance disrupters dream of – the Commonwealth Bank played the role of dealer, essentially that of an underwriter. And the two institutions were the only ones running nodes, of which there were just four in total.

But the fact that they could both witness and confirm the investors’ purchases in real time removed the need for time-consuming reconciliation and offered real efficiency gains, says Paul Snaith, Head of Operations for Capital Markets, Banking and Payments at the World Bank Treasury.

“The experience we’ve had so far is already demonstrating that we may be able to rethink some of the functions that current markets require,” Snaith said in an interview.

Cutting the cost of issuance

For full, seamless, real-time settlement, operations like these will need to integrate some form of digital currency. And while progress is being made on that front, a digital fiat currency or stablecoin that’s acceptable to major financial institutions is still some way off.

Nonetheless, in enabling “atomic settlement” of the security transfer side of these transactions, the World Bank’s experiment showed that a blockchain bond could “potentially reduce the settlement problem to seconds rather than days,” Snaith said.

The cost savings could be significant. The World Bank issues $50-$60 billion in bonds every year. The potential reduction in underwriting costs and, just as important, in settlement and counterparty risk could be a significant funding advantage to the institution, which leaves it with more money to pursue its mandate of supporting development in low-income countries.

Moreover, the concept’s relevance goes beyond the World Bank’s bottom line. The model could be of benefit to the governments of those same countries, too.

“It could result in a much lower cost for developing countries to issue, or to borrow for a project, and that might be interesting,” Snaith said. “I think there is potential for this type of platform to be used by issuers who might otherwise be pushed aside for cost reasons.”

Multilateral agencies: unlikely blockchain experimenters

The fact that the World Bank, which last year launched a blockchain lab to explore a variety of development-focused use cases for the technology, is taking a leading role in experimentation with it is significant – if perhaps a surprise, given its reputation for heavy bureaucracy.

As I’ve argued elsewhere, I also see its engagement – along with the International Monetary Fund and the United Nations – as an opportunity for everyone, including even libertarian crypto developers intent on bypassing such centralized entities, to learn about the real world impact of blockchain technology on our global financial system.

Some form of distributed ledger architecture will eventually become the norm for all forms of capital raising – bonds, stocks and commodity futures, not to mention the new “asset class:” crypto utility tokens – with trillions of dollars in potential payoffs. International development agencies are in as good a place as any institution right now to drive progress toward that end.

Unlike government officials, who face constant political demands, and company executives, who worry about shareholder reactions to quarterly earnings, the people who run these international development institutions have fewer such conflicts. They can’t take radical steps – Snaith’s team has been unable to carry out once-planned experiments in cross-border payments with cryptocurrencies, for example – but they have greater freedom to test out new approaches in the pure pursuit of efficiency.

And while this model used a narrowly defined distributed ledger and a “proof of authority” consensus mechanism, people at the World Bank, the IMF and

UN frequently tell me they see the longer-term advantages of fully permissionless systems once they can handle large-scale capacity with much less price volatility. In the meantime, during this lull period for crypto assets, in which developers are being encouraged to “BUIDL,” much progress could be made in working with these institutions in these controlled settings.

More to come

The good news is that there is more to learn from the life cycle of the newly issued World Bank bond. Though only a two-year issuance – unlike the Bank’s usual five- and ten-year bonds – there are still four more “events” to study: three six-monthly payments of interest coupons and the final maturity of the instrument when the principal repayment and final interest disbursement will be made.

Moreover, Snaith and his staff expect to see secondary market trading emerge in the bonds, which means more investors will be on-boarded, and it plans to bring on TD Securities as a market maker running a full node on the system. They have also had discussions with the Reserve Bank of Australia, the country’s central bank, about it potentially running an observer node.

All of this will provide valuable learning – not only for the World Bank, its government partners and direct financial counterparties – but for any entity involved in capital markets.

There’s still much to be done before these distributed solutions become the norm.   But with hundreds of trillions of dollars locked up in a global securities market that’s rife with trust problems, burdened with massive middlemen costs and prone to wealth-destroying crises, developments such as this one are welcome.

Chain gears image via Shutterstock

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

Posted on

Morgan Creek Digital, Bitwise Partner on New Digital Asset Index Fund

Morgan Creek Digital and crypto index provider Bitwise are teaming up to launch a new index fund aimed at institutional investors looking to enter the digital asset market.

The Digital Asset Index Fund offers the top 10 largest digital assets weighted by market capitalization to accredited and other major investors, with Bitwise managing the fund itself. According to its official website, the index fund is geared heavily toward bitcoin, while offering exposure to other major cryptos like ether, bitcoin cash and EOS, among others.

Anthony Pompliano, a cryptocurrency bull and a partner at Morgan Creek Digital, said in a statement that the 2018 bear market provides an opportunity for investors to build out their exposure to the market.

He separately told CoinDesk in an email:

“We have been approached by many institutional investors who want to gain exposure to digital assets. By partnering with Bitwise, the leading crypto index provider, we are able to bring an institutional-grade solution to these clients. The crypto industry continues to mature and we see this as another milestone along the way.”

Bitwise CEO Hunter Horsley told CoinDesk that the fund is geared toward simplified access.

“[Morgan Creek chief investment officer] Mark Yusko and Morgan Creek have spent more than a decade working with institutional clients and earning their trust,” he explained. “Having a firm like them partnering with investors who want to explore and get exposure to the crypto space is a huge step in making it more accessible to institutions.”

Assets stored by the fund will be kept in cold storage to improve their overall security. These assets will be governed by a set of eligibility requirements which include custody qualifications, trade concentration limits and pre-mine restrictions.

To further the fund’s security, Morgan Creek and Bitwise intend to conduct annual audits. Yusko, Pompliano and Bitwise global head of research Matt Hougan will form a committee to oversee the fund as well.

Bitwise already offers accredited investors access to cryptocurrencies through its private index funds, as previously reported by CoinDesk. The firm is also seeking to launch an exchange-traded fund based upon the top 10 cryptocurrencies by market cap.

Bitcoin image via Shutterstock

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

Posted on

Singapore Taps Blockchain Platform for Selling Tokenized Securities

The Monetary Authority of Singapore (MAS) and the Singapore Exchange (SGX) are looking to blockchain to create a secure platform for selling tokenized securities.

Technology firm Anquan, consulting giant Deloitte and stock exchange operator Nasdaq will work with the MAS and SGX to develop a Delivery versus Payment (DvP) platform for tokenized assets, including tokenized digital currencies and securities assets, according to a press release. The DvP platform will be able to simultaneously transact the securities asset being traded with the funds being used to pay for it.

In other words, both parties will simultaneously swap money for assets using a smart contract network, the release explained. This swap will be able to occur across different blockchain platforms.

The work will be a part of Singapore’s Project Ubin, the nation’s ongoing blockchain initiative.

The companies involved will examine Project Ubin’s existing protocols and determine how to leverage them for a DvP platform. The companies will then release a report by November 2018 explaining how to best launch a DvP system.

MAS chief fintech officer Sopnendu Mohanty said in a statement that “blockchain technology is radically transforming how financial transactions are performed today, and the ability to transact seamlessly across blockchains will open up a world of new business opportunities.”

He added:

“The involvement of three prominent technology partners highlights the commercial interest in making this a reality. We expect to see further growth in this space as FinTechs leverage on the strong pool of talent and expertise in Singapore to develop innovative blockchain applications and benefit from the new opportunities created.”

Similarly, SGX head of technology Tinku Gupta explained that the platform will “eliminate both buyers’ and sellers’ risk in the DvP process.”

Singapore flags image via small1 / Shutterstock

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.