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Chinese Central Bank Launches Testing Phase of Trade Finance Blockchain Platform

The People’s Bank of China (PBoC) has officially launched the testing phase of a blockchain trade finance platform, local news outlet Shanghai Securities News reported September 4.

The Shenzhen Central Sub-branch of the People’s Bank of China, the central bank of the People’s Republic of China, has entered the trial phase of the so-called “Bay Area Trade Finance Blockchain Platform” earlier than scheduled.

The platform is aimed at conducting trade and financing activities, such as accounts receivable and trade financing. At the same time, the platform provides a regulatory system for trade finance to enable real-time monitoring of various financial activities.

According to Shanghai Securities News, the platform plans to create an “open financial and trade ecosystem based on the Guangdong, Hong Kong, and Macau Bay Area.” The organizations involved in the platform include Bank of China, China Construction Bank, China Merchants Bank, Ping An Bank, Standard Chartered Bank, and BYD Co., Ltd.

The report states that the platform can “help banks to conduct business authenticity audit[s], reduce business costs, improve business efficiency, [and] prevent and control business risks,” as well as to assist regulators and strengthen information sharing between departments.

Earlier in August, Chinese insurance, banking, and financial services giant Ping An Insurance released a “White Paper on Smart Cities,” advocating for blockchain, AI, big data, and cloud computing technology development, promoting the creation of a “smart city.”

Back in July, the Ministry of Science and Technology of China announced that China would lead an international research group on the standardization of the Internet of Things (IoT) and blockchain technology, as Cointelegraph reported July 18.

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Australian Gov’t Partners With IBM and Legal Experts to Build Smart Contracts Platform

IBM, CSIRO’s Data61 and law firm Herbert Smith Freehills have partnered on a new Australian consortium to build a cross-industry blockchain-based smart contracts platform for enterprises, according to a press release published August 29.

Data61 is a digital innovation center that forms part of the Commonwealth Scientific and Industrial Research Organisation (CSIRO) – an Australian government corporate entity that undertakes scientific research to advance diverse local industries.

The initiative has been dubbed The Australian National Blockchain (ANB), and will pool the tech, scientific and legal expertise of the three partners to create a nationwide, legally-compliant blockchain infrastructure for the digital economy. As the press release outlines:

“The ANB will enable organisations to digitally manage the lifecycle of a contract, not just from negotiation to signing, but also continuing over the term of the agreement, with transparency and permissioned-based access among parties in the network.”

At a more granular level, the release states that the platform’s smart legal contracts (SLC) will be designed to contain “smart clauses” that can interact with external data sources such as Internet of Things (IoT) device data, and will self-execute to trigger pre-determined business processes and events as soon as a given contract condition is met.

One example is given for use in the construction industry, in which smart sensors on site could record the time and date of a successfully delivered load on the blockchain, and trigger a smart contract that would automate payment on behalf of the construction firm.

The concept will reportedly initially be tested as a pilot using IBM’s blockchain solution, and the consortium says it plans to invite local regulators, banks, law firms and businesses to participate in the pilot, which is due to start before the end of 2018.

IBM Global Business Services’ Paul Hutchison has given his perspective that:

“Blockchain will be to transactions what the internet was to communication – what starts as a tool for sharing information becomes transformational once adoption is widespread. The ANB could be that inflection point for commercial blockchain, spurring innovation and economic development throughout Australia.”

Beyond ANB, major initiatives are underway in Australia to integrate blockchain across both the government and the financial sector. This July, IBM signed a five-year AU$1 billion ($740 million) deal with the Australian government to use blockchain and other new technologies to improve data security and automation across federal departments, including defense and home affairs.

Earlier this month, the World Bank and the country’s largest bank, the Commonwealth Bank of Australia (CBA), successfully issued a public bond exclusively through blockchain technology.

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China’s IT Ministry Considering Strategy for Advancing Blockchain Development

The Chinese Ministry of Industry and Information Technology (MIIT) is reportedly considering ways to accelerate blockchain adoption, local news agency Xinhua reports Aug. 9.

According to the report, the MIIT has proposed a number of measures to speed up the promotion of blockchain applications in the country in a move to provide a “healthy and orderly development of the industry.” The ministry stated that the blockchain tech ecosystem is currently in its initial stage.

The MIIT intends to provide a gradual extension of blockchain applications from the financial sector to other industries, such as electronic deposit services, supply chain management, Internet of Things (IoT), and others.

The IT ministry plans to enhance interaction with various localities and departments, as well as build a solid industrial ecosystem by boosting the operating capacity of computing power and storage.

In May, the MIIT revealed that the blockchain industry in China has seen “exponential” growth  in 2017, citing Blockchain Industry White Paper’s findings that the number of blockchain-oriented businesses exceeded 450 in 2017.

Recently, the MIIT’s deputy director called on the country to “unite” in addressing blockchain promotion, saying that the country must now develop blockchain applications on an “industrial” scale to accelerate its adoption across all areas of the economy and society.

Earlier this year, the ministry revealed research which found that the average longevity of blockchain projects is 1.22 years. According to He Baohong of the China Academy of Information and Communications Technology (CAICT), only 8% of blockchain projects ever launched are still alive.

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Bank of China CIO Says Bank to Increase Investments in Blockchain, Fintech

The commercial, state-run Bank of China, not to be confused with the People’s Bank of China, announced its plans to invest further in fintech innovation, according to local news outlet The Paper August 9.

Citing comments at a press conference on the banking industry, The Paper reports that the Bank of China’s Chief Information Officer (CIO), Liu Qiuwan, has revealed plans to increase the company’s investments in research and development technologies such as blockchain, the Internet of Things (IoT), and fintech. Investment in the technologies will reportedly be more than 1 percent of the bank’s operating annual income, which in 2017 was 483.7 billion yuan ($70.9 trillion).

Qiuwan has also said that in 2018, the Bank of China will complete the construction of three major technological platforms, a cloud computing, big data, and artificial intelligence platform. He also added that Bank of China has been applying blockchain technology in 12 different projects, “mainly focusing on data sharing, cross-border payment, digital currency, digital bills, etc.” He continues:

“According to the statistics of the global blockchain enterprise patent rankings in 2017, Bank of China has 11 patent applications for blockchain, ranking 20th in the global business and ranking first in the domestic banking industry.”

On of the bank’s recent blockchain patents was aimed at “solv[ing] the problem of storage space in new blocks without compromising on traceability and immutability,” as Cointelegraph reported back in February.

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China: World’s Fourth Largest Bank by Assets Trials Blockchain Loans Backed by Land

The Agricultural Bank of China (ABC), the world’s fourth-largest bank by assets, has issued its first loan on blockchain, local news outlet Financial News reported July 31.

State-owned ABC, which counts itself among China’s “Big Four” lenders, revealed it had issued a loan worth around $300,000 backed by a piece of agricultural land in the Guizhou province.

According to Financial News, the bank will “buil[d] blocks with local people, pilot land and resources bureaus, and agriculture and animal husbandry bureaus,” through the blockchain system, adding that the loan aimed to “support the local tea industry.”

The blockchain project received participation from third parties, including the provincial branch of the People’s Bank of China (PBoC), acting as nodes to keep tabs on the validity of loan data.

In the future, the bank says, other types of loans will come under the auspices of blockchain, the decentralized ledger technology allowing ABC to prevent the issue of clients applying for loans at different banks using the same piece of land as collateral.

China continues to adopt blockchain technology with considerable speed, with the government keen to deploy industry-wide standards next year.

In July, China’s joint technical committee of the International Organization for Standardization (ISO) and the International Electrotechnical Commission (IEC) announced they would lead an international research group on the standardization of the Internet of Things (IoT) and blockchain technology.

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Top 10 Crypto Deals in 2017 Returned Over 136,000% on Average, Report Shows

Research into the top ten crypto deals in 2017 based on their investment returns (ROI) has revealed that on average each returned over 136,000 percent, according to data shared with Cointelegraph by Crypto Finance Conference (CFC) analysts July 27.

Out of all the crypto projects that raised a minimum of $1 million in 2017, IOTA (MIOTA) clinched a staggering 614,934 percent return for investors, sealing the top spot in the researchers’ rankings.

IOTA is an Internet of Things (IoT)-focused crypto platform that uses a so-called Tangle system. The protocol is different from blockchain, in that it does not use “blocks” or mining, but rather is built upon a directed acyclic graph (DAG) –– a topologically ordered system in which different types of transactions run on different chains in the network simultaneously. CFC notes that the project is “expected to reach 75 billion connected devices by 2025.”

In second place is Nxt, a blockchain-powered, decentralized ecosystem that focuses on crowdfunding, governance, cloud services and digital asset exchange. Investors in the project’s native NXT token saw returns of over 500,000 percent.

Open-source blockchain platform Ethereum (ETH) –– co-founded by Vitalik Buterin, who has characterized the project’s ambition as nothing short of becoming a “world computer” –– ranks third, after bringing over 141,000 percent returns to its investors.

Andrea-Franco Stöhr, co-founder and CEO of CFC, said of the research findings:

“No project in the top ten had an ROI that was less than 6,000%—gains that are unfathomable for investors in many other markets. These numbers demonstrate the strong upside and myriad real-world applications for cryptocurrency. Also, the extreme success of infrastructure projects suggests investors should be seeking foundational companies that will redefine the internet in the next 10 to 15 years.”

ROI-Driven Crypto Research Findings

ROI-Driven Crypto Research Findings. Source: Crypto Finance Conference

Earlier this week, Reddit co-founder Alexis Ohanian — whose VC firm Initialized Capital was one of Coinbase’s first investors — gave his own perspective on crypto investments. Ohanian said his bets are on “the picks and shovels” of the nascent space –– in other words, those projects that are building the “robust” but admittedly “unsexy” infrastructure that will cement the industry’s foundations.

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Everledger’s Leanne Kemp on How to Enable Marketplaces with Fair Pricing

This interview has been edited and condensed.

Leanne Kemp is the founder of blockchain platform Everledger, which tracks high-class assets like diamonds in order to reduce fraud and promote more viable marketplaces.

Cointelegraph spoke to Kemp about how the service’s role as a global digital registry can help ensure ethical trade across a variety of assets.

In the interview, Kemp explains how she considers Everledger’s role to be an anchor between the crypto space and the “real world,” providing a provenance platform to develop sustainable practices across the diamond industry.

Molly Jane: As a first question, why did you guys choose to track diamonds specifically out of all the high-class assets?

Leanne Kemp: Everledger started in 2015. And we believe that there’s not a platform provenance in the world. We’ve seen applications come into the marketplace for procurement systems, but there is no platform provenance. Then, when you imagine what a provenance platform would entail, we have to go deep within understanding the material science of an object.

We’ve seen a lot of activity in this space with provenance now, from tracking fish to avocados and pigs, but diamonds have some underlying constructs that are really important.

Firstly, every diamond is unique in the world, and to be able to capture the uniqueness of that diamond in a digital twin was able to be done not purely from a blockchain perspective, but a combination of other technologies.

The ability to track a diamond that might start at a rough of 10 million dollars in wholeness of a stone through to a diamond in the marketplace, where that’s still in the thousands or tens of thousands— it’s a very different economic proposition to tracking it tomorrow.

MJ: Who is the target audience for buying diamonds? Are millennials still buying diamonds?

LK: I think it’s aimed at the same set of people that it’s been aimed at generations ago. There are certain life events that want to be celebrated. Whether it’s a marriage, or whether it’s the birth of a child, these types of life events are often celebrated with diamonds or something that’s precious and memorable. These events are still happening — people are still being getting married and people are still having babies. That’s certainly one part of the consumer market.

Millennials are asking themselves a lot of different questions. They are involved heavily in conversational commerce, so they are making certain aspirational choices. They’re really looking now around sustainability and where do items come from. Hence, the reason why Everledger is providing the service that it provides to the market.

Certainly, we are seeing synthetic stones being manufactured and, of course, there are other life events that might be as memorable as a one time marriage or birth of a child. I don’t think it’s all or nothing, the light switch isn’t going to be just turned on or turned off on one day. We still have healthy growth within the industry.

MJ: How is Everledger a part of the Hyperledger and IBM communities?

LK: Hyperledger, in the first instance, is open source and we make contributions into that community. It’s a very important construct. The relationship that we hold with IBM at an enterprise-partnership level serves two roles for us.

The first role is clearly from a secured cloud deployment environment, with the HSBN [High Security Business Network] they called it in the first instance. So that’s one part — the opportunity for our customers, the big names within the industry, to choose whether they wanted to host it within an IBM infrastructure or an AWS infrastructure sits well within the constructs of what we do.

The second part is we work very deeply with the R&D team, and I’m appointed as a board advisor for the blockchain advisory group for IBM. So helping to lead and understand from a perspective of fabric, where that needs to grow, where the engineering could be placed to suit certain market applications.

But from a perspective of service offerings, we service the industry directly because we’ve all come from industry — we know and understand the diamond industry and the jewelry industry intimately well from a technology standpoint.

You can watch the interview here:

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MJ: What other industries did you work in before you began your work with Everledger and blockchain?

LK: I’m a software engineer, so I’ve spent 25 years working in and around software. In fact, in the mid-90s, I worked in RFID, which is radio frequency identification — at the silicon chip and inline level — so I understood the constructs of that technology and did a fair bit of work on scatter devices, which is remote connections on machines.

I’ve had a couple of companies and been okay — I’ve never had to ask dad for money, so I’ve sold them at the right price.

But for me, I invested some money in a jewelry business and that gave me some intimate learning of industry, generally, more than just the experience of a consumer to buy a diamond.

When you have world experience, you get to understand that when technologies come together like this, it’s not necessarily just about the technology and how cool it is: it’s about addressing a particular type or set of challenges within the industry.

And that’s what we did differently very early in the stage than maybe in a couple of others in the industry. We knew exactly what problems were to be solved, the challenges in the economic pain points, and then the economic benefit to applying it. The rest is history.

You see where we are now in the market, and we have seven locations, we service the largest names within the industry, and we’ve extended well beyond diamond — so colored gemstones, emeralds, rubies sapphires, tanzanites are important to us. We look deeply at wine and wine authentication.

So, how can we apply all of the geniuses that we’ve built in terms of our engines with machine vision, how can we apply it in wine?

Last week we were awarded the 2018 Tech Pioneer for the World Economic Forum, particularly around the work that we’re doing in sustainability. So, it’s not just about tipping the grower for the coffee that we’ve drunk, but more deep constructs on how do we enable actual artisanal, small-scale mining communities? How can we enable that so that marketplaces can be built with fair pricing? And that’s the big work that you’ll start to see start seeing coming out of Everledger in the next 12 months to two years.

MJ: How did you get started tracking wine? Are there any new asset classes you are considering adding?

LK: When we were first tapped on the shoulder with a wine expert — her name is Maureen Downey, she’s the Sherlock Holmes of wine. There are certain types of knowledge, when you’re a wine expert like Maureen, that you can gain from just being within the industry for 30 years.

But the reality is there’s no underlying system or construct to capture each of those methodologies or systems or insight. That’s a part of the work that we’ve been doing from a technical standpoint. But, for us, we’re really interested in physical assets — how can we digitize those at a material science level, and some objects won’t be able to easily or affordably — and then we’re interested in rising asset classes.

So when you look at our portfolio — diamonds, jewelry, watches, wine, collected automotive cars, maybe even helicopters — I guess it’s motivated by me, the things I like to eat, to drink, to fly, to wear — handbags — selfishly, why not be motivated by that?

MJ: Could you explain how exactly a diamond is tracked from the mine to the store on the blockchain?

LK: To understand the process is actually a highly complicated supply chain, but it’s also relatively consolidated geographically and within each part of the process.

Diamonds are mined within a number of countries in the world, and there are sort of 10 to 12 major mining companies globally. Diamonds will be extracted out of the ground, it will go through a certain set of washing, bay processes, and sorting.

The diamonds, as they cross borders, are then attracted with a certificate called a Kimberley certificate, which is also recorded as a part of the chain as well as the invoice for the commercial construct of the pricing.

Then a diamond will actually go through to the next stage, which is where it’s cut and polished.

We’re a quite IoT-enablement company, where we connect not only the opinion of experts but actual machines across the network. It’s all this forensic layer that we get involved with, and the forensic layer is already captured within the industry within laboratories, particularly if they’re certified diamonds.

Then diamonds will eventuate out into the retail network, and then the retailers will again check the diamonds through machines that are connected and then sold to a consumer. And the entire story is captured and told to the consumer.

MJ: It looks like there is really no room for fraud in the process you just described.

LK: There’s always room for fraud. Of course, there is.

MJ: How would that look?

LK: I mean, you can see diamonds literally go off stream. So not all diamonds are going to be captured on a blockchain. There’ll be some diamonds that might start on the blockchain and then, all of a sudden, they do not eventuate into the retail network. The history will not be persuasive.

We will see the same thing happen in other types of assets. There’re always ways to defraud systems, and there’re always ways to subvert certain constructs. But there’s a value reason why people would be deterred away from doing that.

There’s always going to be black markets, and there’s always going to be fraud, and there’s always going to be crime, and there’s always going to be anti-money laundering. It’s up to the governance controls to help to reduce that, not eliminate it.

MJ: I’m just curious because blockchain and cryptocurrencies are so connected, what do you think about Bitcoin (BTC)? Do you invest in Bitcoin? Do you think that cryptocurrency use will become more widespread in the future?

LK: I was fortunate enough in 2010 to buy Bitcoin, and so that was — believe me — it wasn’t an educated decision, it was just one that felt like a risk at the time, so why not buy some?

So, yes. I certainly believe that in a cryptocurrency sense that Bitcoin, of course, is the grandfather of the industry and has been there since day one.

At its inception, I think that it has survival and longevity beyond just today’s current competition that may be staying between Ethereum (ETH) and Bitcoin.

Where the entire future goes for that is not really for me to say. We do not see ourselves as a crypto company — and, to be honest with you, we don’t even see ourselves as a blockchain company. We’re building a platform of provenance to help with transparency, and conflict, and opaque markets. And we want to build an ethical trade platform.

At the end of the day, we still need to have a good anchor between the crypto and the real world. And that’s where we sit, and we will probably forever sit.

I think it’s an exciting space to be in. We just chose to pick the boring end of the exciting space.

MJ: Since you mentioned Ethereum, do you have an opinion about other altcoins out there?

LK: I certainly didn’t make the comment about Bitcoin being the grandfather to the exclusion of everybody else. But undeniably Bitcoin was the first white paper with peer-to-peer that came out. We always must recognize where this came from. I think it’s important.

Ethereum is a very powerful, powerful network that’s being built with some incredibly talented engineers. I don’t believe it’s only a two horse or a three horse race. We’ll start to see some changes happen within the next couple of years, I think, in the crypto world, as each of the economics — the macroeconomics — of cryptos start to become more scrutinized and looked at globally.

We have a real world that we live in here. We’re still breathing oxygen, and we have an amazing view across the lake, and crypto needs to find its place between digital and physical. That is where we’ll start to see it play out in the next few years.

MJ: Thank you!

LK: Alright. I hope that was helpful.

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Barclays Files Two Digital Currency and Blockchain Patents with U.S. Patent Office

Barclays has filed two patent applications relating to the transfer of digital currency and blockchain data storage, both published by the U.S. Patent and Trademark Office (USPTO) July 19.

The first patent describes a system for transferring digital currency from payer to recipient that would securely authenticate the identities of both, as well as validating and recording transactions using public-key cryptography and a digital currency ledger.

Beyond currency transfer, the patent goes on to describe a wide range of use cases for securely and privately processing data in a trustless manner using a blockchain system. One illustration outlines how claims and attestations could be verified on the blockchain, using the example of credit status and insurance claims.

Barclays envisions the potential beneficiaries of such a system to be individuals, authorities, enterprises, and banks, as well as objects to which a digital wallet could be assigned, such as an Internet of Things (IoT) item. The patent further outlines the advantageous step of using a Merkle Tree Structure to store blocks in order to maximize efficiency and ease data validation.

The second patent relates more narrowly to storing and endorsing data and claims relating to specific entities, using the validation of personal information for Know Your Customer (KYC) checks as a key example.

This spring, it was rumoured that Barclays was assessing whether client interest was sufficient to warrant setting up a dedicated cryptocurrency trading desk. The claims were soon refuted by Barclays’ CEO Jes Staley, although the bank notably continues to help its clients to settle Bitcoin (BTC) futures contracts that are offered on derivatives exchanges such as CME Group Inc. and CBOE Global Markets Inc.

Barclays was also the first UK bank to open an account for a cryptocurrency exchange, making a deal with major U.S. exchange service and wallet provider Coinbase this March.

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Waltonchain (WTC) Unveils World’s First Blockchain-based Clothing Authenticity Traceability System

Waltonchian (WTC) –It is no gainsaying that blockchain technology is proffering solutions to many of the problems bedeviling the world, be it in the industry or at home.

As different sectors continue to receive helping hands from blockchain technology, the least expected sector, which is the apparel industry, is being disrupted by this technology and the Internet of Things (IOT) through Waltonchain’s WTC-Garment.

At the moment, there is a lot of happiness in the blockchain industry with the introduction of WTC-Garment. It is branded as the world’s first blockchain-based high-end clothing authenticity traceability system invented by Waltonchain, the global leader in blockchain and IoT. The project is a joint implementation of Waltonchain and Kaltendin, China’s leading high-end clothing brand.

The idea applies the RFID core technology to the smart management system for smart production, warehousing management and smart shopping experience.

Experts have tagged it “a revolutionary application of big data and IOT+ in the apparel industry”.

According to an introductory video released by Waltonchain on the technology, WTC-Garment provides automatic data filling form production orders, label printing, factory package verifications, unified document management, and batch barcode printing.

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At the same time, it offers automatic print record storage, factory real time order receiving and confirmation, and amendment of products.

In the same line, it automatically generates order report, while storing factory info into Waltonchain blockchain technology, giving room for all data to be tracked in real time.

The invention does garment scanning on arrival, thereby reducing warehousing errors. Necessary pieces of information are stored via RFID handsets while available data uploaded into blockchain makes good to be easily located and checked from time to time.

Waltonchain is becoming globally recognized for its efforts in creating a stable atmosphere for many industrial sectors. Recently, Waltonchain CEO Mo Bing had said the company will be the Qualcomm + Cisco in the blockchain industry, the ‘Google’ of blockchain, stating afterward that the company’s current achieve is “quite fortunate”.

This year alone, the CEO said the company has applied for more than 20 patents with over a dozen software copyright objects.

“This year we have been preparing our layout. We have already applied for more than 20 patents, and there are more than a dozen of software copyright objects. These may be the moats we have built for our core technologies.”


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CEBIT '18: IOTA and Volkswagen Present Proof of Concept for Autonomous Cars

IOTA and Volkswagen are demonstrating a Proof-of-Concept (PoC) that uses IOTA’s Tangle system for autonomous cars at the Cebit ‘18 Expo in Germany today, June 11th.

The PoC enables Volkswagen to use IOTA’s Tangle architecture to transfer software updates “over-the-air” as part of the car manufacturer’s new “Connected Car” systems.

Tangle is different than blockchain, in that it does not use “blocks” or mining, but rather is built upon a directed acyclic graph (DAG), a topologically ordered system in which different types of transactions run on different chains in the network simultaneously.

According to the PoC press release, Volkswagen’s vision is to use Tangle to securely and wirelessly distribute data within its developing smart car economy. Industry experts expect over 250 mln connected cars to be on the road by 2020, raising the need for frequent remote software updates and transparent data access on a large scale.

A recent IOTA news release states that as part of its partnership with Volkswagen, IOTA may also be integrated into a Mobility-as-a-Service (MaaS) system in the future, a development that would use its distributed ledger technology for trip planning, booking, and payment services within the smart vehicle ecosystem.

In January of this year, Volkswagen’s Chief Digital Officer (CDO), Johann Jungwirth, joined the IOTA Foundation’s Supervisory Board, saying that the IOTA platform would “allow connected devices to digitally send money to each other in form of micropayments,” making it “useful” for the future of IoT. IOTA’s platform is notably transaction-free, which its developers have argued makes it optimal for a micropayment infrastructure.

Earlier this month, IOTA partnered on a major Mobility Open Blockchain Initiative (MOBI) for the transport industry, alongside manufacturing giants BMW, GM, Ford, and Renault, as well as Bosch, Hyperledger, and IBM.

At press time, consistent with the drop in crypto markets overall, IOTA is trading at $1.37, down 1.28 percent over the 24-hour period.