Blockchain Report — 12/21/2018
Summary: Western Union Might Soon Provide Cryptocurrency Services; Coinbase Will Pay Users To Learn About Cryptocurrency; Two U.S. Lawmakers Want To Change The SEC’s Definition Of A Security To Exclude Cryptocurrency
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Western Union Might Soon Provide Cryptocurrency Services
According to CCN, the American-based financial service company Western Union has stated that it might soon begin providing cryptocurrency services. Odilon Almeida, President of Western Union, said the company is evaluating whether or not to provide cryptocurrency services to its users.
Furthermore, Western Union is also doing research to discover if blockchain technology can assist the company with the service that it provides. Almeida said that, at the moment, there are still some limitations to most cryptocurrencies that prevent them from being globally adopted. These limitations include high volatility, lack of governance, and lack of legal compliance. However, that doesn’t mean that Western Union might not one day provide cryptocurrency services:
“Western Union is ready today to adopt any kind of currency. We already operate with 130 currencies. If we one day feel like it’s the right strategy to introduce cryptocurrencies to our platform, technology-wise it’s just one more currency. I think cryptocurrency may become one more option of currency, or assets, around the globe to be exchanged between people and businesses. If that happens, we will be ready to launch”
Western Union had a trial with Ripple to see if using Ripple’s platform would cut costs for Western Union. Ultimately, the trial did not provide any cost saving measures and the CEO of Western Union said that Ripple’s blockchain is still too expensive.
Coinbase Will Pay Users To Learn About Cryptocurrency
According to Fortune, the popular cryptocurrency exchange Coinbase will offer users 0x tokens (ZRX) in exchange for watching videos and taking quizzes on learning about cryptocurrency. People who participate in the program will receive approximately $3 in ZRX tokens.
Coinbase has 1.6 million ZRX tokens reserved for the giveaway, which is approximately $500,000 USD in total given that the price is currently around 34 cents. Coinbase states that this is part of a new paradigm where people obtain cryptocurrency by earning it:
“Traditionally, the two ways people get cryptocurrency are by mining or buying. Mining cryptocurrency typically means high setup costs and technical knowledge, while buying cryptocurrency requires disposable income to exchange for cryptocurrencies, which limits access. Earning cryptocurrency is a third option.”
This is part of Coinbase’s new initiative known as Coinbase Earn. Earn pays users small amounts of cryptocurrencies to complete small tasks. Coinbase expects to offer similar rewards for other cryptocurrencies besides ZRX in the future.
Two U.S. Lawmakers Want To Change The SEC’s Definition Of A Security To Exclude Cryptocurrency
According to CNBC, two congressmen are introducing a bill that would exclude cryptocurrencies from the definition of a security. This is important because many people within the cryptocurrency industry believe that the old definition of a security does not apply.
The bill is called the “Token Taxonomy Act”, and it is being introduced by representatives Warren Davidson, R-Ohio and Darren Soto, D-Fla. The fact that the two representatives introducing this bill are from different political parties shows that this bill is a bipartisan effort. Davidson explained why he helped introduce the bill:
“In the early days of the internet, Congress passed legislation that provided certainty and resisted the temptation to over-regulate the market. Our intent is to achieve a similar win for America’s economy and for American leadership in this innovative space.”
Kristin Smith, who is the head of the Blockchain Association, explained why cryptocurrencies don’t exactly fit within the traditional definition of a security:
“These decentralized networks don’t fit neatly within the existing regulatory structure… This [bill] is a step forward in finding the right way to regulate them.”
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