Deutsche Bank Report Claims Demand for Crypto to Accelerate in the Next Decade

Banking giant Deutsche Bank has recently published its outlook for the decade ahead – the ‘Imagine 2030’ report – highlighting the dangers of the forces holding the fiat money system unravelling in the next decade, thus fostering the demand for crypto.

According the recent research report from Deutsche Bank, by 2030, the demand for alternative currencies will rise, with digital currencies eventually replacing fiat money.

Deutsche Bank strategist Jim Reid raised awareness, in the recent report, of the challenges the existing fiat system has encountered in recent years, specifically with the emergence of cryptocurrencies. He further claimed that people’s heightened demand for dematerialized means of payment and anonymity could lead to more individuals switching to digital currencies.

According to data provided by the banking giant, nearly two thirds of consumers prefer dematerialized to cash payments and a third are concerned about anonymity, two things unique to digital currencies.

Whilst digital currencies may not have gained as much traction as a means of payment despite their well-known benefits, such as security, speed, minimal transaction fees, ease of storage and relevance in the digital era, this may change in the next decade.

In the meantime, the researcher report noted that cryptocurrencies need to overcome three main hurdles in order to gain wider acceptance. Firstly, digital currencies must become legitimate in the eyes of governments and regulators, which requires bringing stability to the price as well as advantages to both consumers and merchants.

Secondly, cryptocurrencies must allow for global reach in the payment market. According to the report, this could be achieved by forging alliances with key stakeholders. For instance, mobile apps such as Apple Pay, Google Pay, card providers such as Visa and Mastercard, and retailers, such as Amazon and Walmart.

Last but not least, to realize a smooth transition to a fully digitalized platform, the financial system needs to be ready to overcome any kind of electricity shutdown or cyberattack. These are challenges that may arise with mainstream adoption and Reid pointed out that “as that occurs, the line between cryptocurrencies, financial institutions, and public and private sectors may become blurred.”

Deutsche Bank further noted in its research report how prone to inflation and unstable fiat money could be, further suggesting the possibility that inflation could become more embedded in our system and doubts will rise about the sustainability of fiat money.

“Politically it is always too tempting to create money when nothing is backing it. That this current fiat system has survived so long has required a fortuitous set of global forces across multiple decades that have created sizeable natural offsetting disinflationary forces,” they said.

Researchers estimate that by 2030 there could be 200m blockchain wallet users and digital currencies might eventually replace cash , granted that governments back cryptocurrencies, and consumers want them, and if current trends continue.

However, currently, political support remains far from clear. Buying and selling cryptocurrency in countries like China and India is still banned, with the former adopting a singularly hard stance of late.

FinTech Firm SoFi Receives BitLicense from NYDFS

San Francisco-based financial firm SoFi has announced that it was granted a BitLicense from the New York State Department of Financial Services (NYDFS).

According to a press release, the fintech firm confirmed that the NYDFS granted a BitLicense, which would allow its users in the state of New York to trade digital currencies through its SoFi Digital Assets subsidiary.

The BitLicense acquisition comes just a couple of months after the firm launched in September its cryptocurrency trading services within its investment platform.

SoFi launched as a student loan refinancing platform and has ever since offered a varied portfolio of fintech services including online lending, such as student loans and mortgages. In addition to that, the platform also facilitates investing in other securities such as ETFs and stocks as well as robo-investing.

Following the announcement, SoFi will be authorized to support a total of six digital assets including Bitcoin (BTC), Ether (ETH), Bitcoin Cash (BCH), Ethereum Classic (ETC), Litecoin (LTC) and Stellar (XLM). SoFi’s cryptocurrency offering sits alongside other investment vehicles including stocks and ETFs on its SoFi Invest application, released earlier this year.

In addition to the BitLicense, SoFi has acquired another license – a money transmitter license, which will help the firm offer crypto trading service to its clients.

“After a rigorous application process, SoFi can now provide its members in the state of New York a trusted, secure platform to trade crypto,” stated SoFi in a press release.

Whilst sharing more details about the license, CEO SoFi Anthony Noto noted that the decision to pursue a BitLicense was a result from client demand:

“Putting our members’ interests first is our top priority at SoFi. That includes both offering individuals the products they want, like cryptocurrency within SoFi Invest, as well as protecting them, through a solid regulatory framework like that created by the New York State Department of Financial Services. We’re thrilled to now be able to offer the trading of cryptocurrency, in addition to active and automated investing, as part of SoFi Invest in New York State, in addition to the full suite of SoFi products that help our members borrow, save, spend, invest, and protect their money.”

Noto further added that the approval is proof to SoFi’s ongoing commitment to earning the trust of regulators and stakeholders as the platform tries to expand their line of services and products targeted at investors.

As it is known, a BitLicense serves a major business license for cryptocurrencies with a number of terms and conditions such as rules on operating with digital currencies, its control, administration, maintenance, storing and issuing, among others.

The California-based financial firm is now one of 24 crypto-related firms that have been granted a BitLicense since 2015, including exchanges like Gemini and trading operations like Tagomi. Earlier this year, NYDFS granted a BitLicense to two subsidiaries of crypto derivatives firm Seed CX — Seed Digital Commodities Market LLC and Zero Hash LLC.

Germany: Proposed Bill Set to Introduce Cryptocurrencies at Local Banks

Cryptocurrencies might get the same treatment as fiat money in Germany. A newly introduced bill hints at authorities looking to allow German banks to sell cryptocurrencies and provide custody solutions.

According to local news agency Handelsblatt the new bill was proposed for voting in the Bundestag, the German parliament and has seen positive reception. Now, it requires consensus across the country’s 16 federal states to be successfully implemented.

As it stands, banks and financial institutions are restricted from allowing transactions related to cryptocurrencies for clients. The proposed legislation, if approved, will make a monumental difference for cryptocurrency availability in the country.

If the states agree upon the legislation, German citizens will be able to buy and hold Bitcoin, Ethereum, along other cryptocurrencies directly with their banks. The whole spectrum of banking services might be available for cryptocurrencies as well.

Banks have been eager to get into the cryptocurrency industry as the interest for digital currencies seems to be mounting both from consumers as well as governments and corporations. The bill is set to be implemented in 2020, as Handelsblatt outlines:

“​​Starting in 2020, financial institutions will be able to offer their customers online banking, virtually at the touch of a button, along with classic securities such as stocks and bonds, as well as cryptocurrencies.”

The new legislation has seen wide support and enthusiasm from the domestic industry. The Association of German Banks — a major lobbying group representing over 200 financial institutions — is a huge advocate of the bill, arguing that established financial institutions have the experience and risk mechanisms in place to safeguard client assets.

In October, the Association released a paper arguing that the European economy may benefit from a programmable digital euro.

At the same time, there have been mixed signals towards cryptocurrencies from various governments. The Bundestag has recently shared an opinion that cryptocurrencies such as Bitcoin are not real money, citing their volatility and allegedly limited use for payments. Concurrently, nation states have been quick to dampen the development of Facebook’s stablecoin, fearing a potential disruption of the existing monetary system.

The European Central Bank has also been stringent on digital currencies, stating that global stablecoin payments raise potential risks across a broad range of policy domains, which is the primary objective of a central bank.

Poloniex Announces Acquisition of TRXMarket, a Tron-Based DEX

Cryptocurrency exchange Poloniex has just announced its acquisition of TRON-based decentralized exchange (DEX) TRXMarket. Several reports indicated that this acquisition was partly funded by TRON’s founder Justin Sun in addition to some others, who had previously invested in Poloniex Exchange with some noteworthy investment fund.

Poloniex confirmed the news via an official post on Medium, stating that it had bought TRXMarket for an undisclosed amount. According to the post, TRXMarket will operate under the umbrella of Poloniex and all of the exchange’s functions will remain the same, however, under a new name – Poloni Dex.

The post further indicated that users looking for decentralized trading services can find them on the Poloniex official website or by going straight to Poloni DEX.

Poloniex has been one of the top 3 digital currency exchanges. Founded in 2014 by Tristan D’Agosta, Poloniex is a cryptocurrency exchange that offers over 100 bitcoin (BTC) markets available for trading.

Furthermore, the platform provides its customers with a secure trading environment as well as advanced charts and data analysis tools. With no deposit or withdrawal fees, it charges a flat rate of 0.2% on all trading transactions.

In October, Poloniex spun off from Boston-headquartered Circle. Prior to this, Goldman Sachs-backed startup Circle had acquired the cryptocurrency exchange startup in February of 2018.

Poloniex noted that it had acquired TRXMarket to expand its decentralized trading ecosystem in an effort to provide its users with varied trading options – a long-term strategic design that Poloniex had been working on since 2018. This acquisition comes as a significant boost to both Tron and Poloniex as its partnership continues to create ways for more innovations within blockchain and cryptocurrency.

Meanwhile, the newly acquired TRXMarket is the first TRON-based decentralized exchange, and it executes all transactions through TRX smart contracts that are stored safely and transparently on the blockchain. The exchange does not require private keys to make a payment as users’ private assets are securely isolated from the exchange.

TRXMarket is one of the most used DEX on the TRON network, listing amongst the 127 TRON Super Representatives. In addition to that, the DEX it records, on average, a 7-day transaction volume of $30 million and has long been a top ten DApp by transaction volume according to DApp Review.

A spokesperson for Poloniex gave out a statement, in which they explained why the exchange had chosen TRXMarket, emphasizing that they had every reason to choose TRON as their underlying infrastructure over other public chains, who were slow progressing and charged high transaction fees.

“We recognize and value the rate TRON is expanding its ecosystem. Under the leadership of Justin Sun, founder of TRON, TRON’s ecosystem is growing at an exponential speed. After the official launch of TRON public chain in June 2018, within just a year, the total number of accounts on the chain of TRON has exceeded 4.1 million and the daily average number of transactions is over a million, securing a place among the top three public chains in the DAapp ecosystem.”

Ripple Completes $50 Million Investment in MoneyGram

Money transfer company MoneyGram has announced that it has received another $20 million from blockchain service provider Ripple, thus completing a $50 million investment commitment. The funds will go to supporting the use of On-Demand Liquidity, a global payments product that uses XRP.

According to a press release on November 25th, San Francisco-based Ripple Labs has made a final $20 million equity investment in MoneyGram as part of Ripple’s original $50 million equity investment commitment.

In June, Ripple pledged $50 million total and made an initial payment of $30 million. The two companies then entered into a 2 year strategic partnership with the goal to invest in cross-border payments as well as foreign exchange settlements with digital assets.

The funds will be used to support MoneyGram’s continuing use of Ripple’s On-Demand Liquidity service. By using the Ripple-linked digital asset XRP, the global payments product – XRapid – eliminates delays in global payments while also dramatically lowering their cost, thus making cross-border payments instant and inexpensive.

The most recent investment acquired shares at a price of $4.10 each, which is 30% higher than the current market price of just over $3. At the moment, Ripple now owns almost 10% of the company’s outstanding common stock and around 15% on a fully-diluted basis including non-voting warrants held by Ripple.

Following the news, Alex Holmes – MoneyGram Chairman and CEO – has stated:

“Our partnership with Ripple is transformative for both the traditional money transfer and digital asset industry – for the first time ever, we’re settling currencies in seconds.”

He further noted that partnerships with companies such as Ripple support and encourage innovation, and allowing them to invest in creating better customer experiences. Following this partnership, Holmes fully anticipates exploring new products and services.

Holmes also commented on initial successes using the On-Demand Liquidity product —Ripple’s XRP-powered payments platform. Since Moneygram’s partnership with Ripple in June, the company has used the service to move around 10% of its Mexican Peso foreign exchange volume. In addition to that, it has expanded its cross-border transactions to Europe, Australia, and the Philippines.

According to the press release, the new funding will also allow the firm to continue using On-Demand Liquidity to increase its trading volume.

Ripple CEO, Brad Garlinghouse, also commented on its partnership with Moneygram, noting that he was encouraged by how much progress had been made since Ripple made its first investment in June. He further added:

“Digital assets and blockchain technology have the potential to make a tremendous impact on cross-border payments – MoneyGram and Ripple is an example of that.”