Shipping Firms, DHS and Wine Merchants Participate in Blockchain Pilots
By: Simone O. Otenaike
Earlier this week, one of the United States’ largest multinational package delivery and supply chain management firms reportedly made the first blockchain-verified shipment of beef from the U.S. to Japan with the help of a leading agri-tech solutions firm. The two firms will reportedly continue to work together to deliver tracking and traceability technology that improves quality assurance for beef products being shipped internationally. The package delivery firm created a customized, integrated visibility tool that plugs into the agri-tech firm’s blockchain technology to offer live updates throughout the journey. The package delivery firm’s customs brokers also coordinated with health, food and safety regulators in both the U.S. and Japan to obtain all required certifications that promoted accurate customs compliance, timely clearance of goods, and reduced risk of delays or penalties. Late last week, another leading global package delivery firm announced plans to pilot a blockchain-based invoice system for one-off, noncontractual shipments. The pilot will be developed in conjunction with a leading global information technology firm.
According to recent reports, the U.S. Department of Homeland Security (DHS) is working with a Canadian blockchain firm, Mavennet, to build a cross-border, blockchain-based platform for tracking and tracing oil. To build this platform, Mavennet will retrofit its existing oil tracking platforms and build a proof-of-concept demo for use by the Customs and Border Protection branch of DHS at the Canadian border. In other recent international news, a Singaporean firm reportedly launched its blockchain-based wine marketplace for consumers across the Asia-Pacific region. The marketplace allows customers to purchase premium wines using a secure, blockchain-based platform with digital tokens that trace the provenance, quality and authenticity of new and vintage wines, ultimately eliminating layers of intermediaries and improving efficiency. The firm’s wine marketplace is supported by a leading professional services firm’s blockchain platform.
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Crypto Payment Gateways Announced, Multimillion-Dollar Property Sold for Bitcoin
By: Joanna F. Wasick
Lolli, a company that lets online shoppers earn bitcoin in lieu of regular cash-back points, recently announced a new partnership with a major Chinese online commerce entity. Lolli users can now earn up to 5 percent bitcoin when shopping on the site. The announcement was made on Nov. 11 – Singles’ Day, a shopping holiday popular among young Chinese consumers.
According to a press release, a major European payments firm has signed a letter of intent with “Bitcoin Suisse, the oldest and largest crypto financial-services company in Switzerland … to offer cryptocurrency payment services to Swiss merchants and consumers both in-store and in web-shops.” In more news from Switzerland, Utrust, a Swiss-based cryptocurrency payment and services platform, announced this week that it was partnering with a United Kingdom-based online travel agency to enable its customers to purchase flights on several major airlines using cryptocurrency.
Earlier this week, Paxos Trust Company introduced Fiat Gateway, a product that allows its users to swap between dollars and stablecoins. Binance, the world’s largest cryptocurrency exchange (by trading volume), will be the first to integrate the product. Also this week, Blockchain Venture Capital Inc. (BVCI) launched CUSD, a U.S. dollar-backed stablecoin. The launch comes about four months after BVCI issued a Canadian dollar-backed stablecoin. In a final item of note, the Magnum Real Estate Group recently sold an 11,400-square-foot Manhattan condominium for $15.3 million in bitcoin. The buyer was reportedly a Taiwanese entity, and the transaction was described as a “seamless process.” Magnum reportedly sold two units in the same building last year for bitcoin, one worth $875,000 and the other worth $1.48 million.
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Developments in Cryptocurrency Custody Providers, Banks and New Product Offerings
By: Robert A. Musiala Jr.
This week Bakkt, which recently launched a platform for physically settled bitcoin futures contracts, announced the launch of Bakkt Warehouse, a qualified bitcoin custodian that is authorized to offer institutional bitcoin custody by the New York Department of Financial Services. In a related development, according to reports this week, the state of Wyoming has released new custody rules for state-chartered special purpose depository institutions (SPDIs) that will allow banks that qualify as SPDIs to act as custodians of “digital assets” under Wyoming law. And late last week, Silvergate Bank, one of the first U.S. banks to begin servicing the cryptocurrency industry, officially began selling shares on the New York Stock Exchange in an initial public offering.
More new cryptocurrency-related products were announced this week. A Chicago-based global derivatives marketplace announced that it intends to launch options on its bitcoin futures contracts in January 2020, subject to regulatory approval. According to reports, U.S.-based cryptocurrency wallet Abra is adding support for 60 new cryptocurrencies. In Europe, Switzerland’s largest stock exchange has reportedly listed an exchange-traded product that is based on the tezos cryptocurrency. Finally, according to reports this week, cryptocurrency exchange Bitfinex has announced plans to launch cryptocurrency options products and a gold-backed stablecoin, Tether Gold.
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Enforcement Updates From US and Dutch Agencies
By: Joanna F. Wasick
Earlier this month, the Joint Chiefs of Global Tax Enforcement (J5), hosted The Challenge, an event bringing together investigators, cryptocurrency experts and data scientists, in order to find the world’s most egregious tax offenders. It was the second time the event was held, and this year’s focus was on cryptocurrency-facilitated crime. The J5 was established in mid-2018 by tax enforcement leaders from Australia, Canada, the Netherlands, the United Kingdom and the United States, to combat cross-border money-laundering, tax crime and cybercrime. After the recent event, the criminal division of the U.S. Internal Revenue Service (IRS) reportedly stated that it identified “dozens” of potential cryptocurrency tax evaders.
Last week in New York, Hugh Brian Haney pleaded guilty to money laundering charges based on his attempt to launder about $19 million in bitcoin obtained from a drug trafficking operation that he ran on Silk Road, the infamous Dark Web marketplace. Haney is scheduled for sentencing in February; he faces a possible maximum sentence of 30 years in prison. This week in the Netherlands, Dutch police arrested the founder of Komodore64, a now-bankrupt blockchain game development company. The founder, whose name has not been confirmed, allegedly lied to investors in order to procure about $86 million in startup funds, and refused to make promised payments to vendors who were helping with the company’s launch.
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