Kraken Expands in Europe Despite MiCA and Will Acquire a Dutch Broker

Leonardo Perez
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Kraken Expands in Europe Despite MiCA and Will Acquire a Dutch Broker

Kraken, one of the oldest crypto exchanges in the world, is strengthening its presence in Europe and plans to buy Coin Meester BV (BCM), a Dutch crypto broker.

In a press release on October 5, Kraken said the purchase would give them a “considerable position in the Dutch market” and benefit the broker’s clients. BCM supports over 170 digital assets and is one of the oldest brokers in the country. With the acquisition of BCM, Kraken reaffirms its commitment to expand throughout Europe:

“Kraken is thrilled to announce our planned acquisition of Coin Meester B.V. (BCM) in the Netherlands. The deal highlights our commitment to growing our business in Europe by leveraging our strong financial position and highly competitive product offering.”

Kraken Will Acquire BCM

With the acquisition of BCM, Kraken reaffirms its commitment to expand throughout Europe. The exchange plans to expand its product line, increase liquidity, and improve security for a broader user base. Kraken CEO David Ripley had this to say:

“The Netherlands has one of the most advanced economies in the world, with a well-established culture of innovation and a high level of cryptocurrency adoption. This makes it a key market for us in our European expansion plans. The acquisition of BCM will give Kraken a considerable position in the Dutch market. It will allow BCM customers to benefit from an even stronger product offering.”

BCM co-founder and CEO Mitchell Zandwijken said its existing customer base would benefit from Kraken’s investment and innovations expected as a result of the acquisition:

“Kraken is the pioneer in this field, with a track record spanning more than a decade, making it the perfect steward of our business going forward.”

BCM, which recently rebranded from Bitcoin Meester, was founded in 2017 and offers cryptocurrency trading and staking services including access to over 170 cryptocurrencies.

The company is registered as a Dutch cryptocurrency service provider with De Nederlandsche Bank. Both companies note that the deal is subject to regulatory approvals that will include authorization from the Central Bank of the Netherlands.

Kraken said they are encouraged by the European Commission’s introduction of the Cryptoasset Markets (MiCA) regulatory framework. MiCA seeks to bring comprehensive crypto regulation to the European Union (EU). These rules aim to standardize the regulatory environment for various cryptoassets, including fungible assets such as Ethereum (ETH) or Bitcoin (BTC) and non-fungible tokens (NFTs).

MiCA Rules to Protect Investors and Adjust Stock Markets

However, the European Union has stated that the primary objective of MiCA is to protect consumers and investors by mitigating the risks associated with cryptocurrencies, including hacks and pulls, while promoting financial stability and market integrity.

By setting clear rules and requirements for crypto companies and market participants, MiCA aims to “level the playing field,” even encouraging innovation. MiCA came into force on June 1, 2023. Its full implementation will be in 2024.

As a result of these developments, cryptocurrency companies and exchanges, such as Binance France, are closely watching the implementation of MiCA. In late August, Binance France said the license from the Autorité des Marchés Financiers (AMF) presented “an opportunity to adapt to regulatory challenges and capitalize on opportunities within the European market.”

In Europe, Kraken has already been granted an Electronic Money Institution license from the Central Bank of Ireland, as well as a virtual asset service provider (VASP) registration from the Bank of Spain. With the Irish license, Kraken can offer euro to cryptocurrency trading services in the EU.

By Leonardo Pérez

UNAM: Artificial Intelligence Could Automate More Than 50% of the Workforce in Mexico

Audy Castañeda
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UNAM: Artificial Intelligence Could Automate More Than 50% of the Workforce in Mexico

Artificial Intelligence (AI), software, machines, as well as robots, could perform some routine jobs in Mexico in the future. UNAM researchers point out that Artificial Intelligence in the Mexican workforce will occur in jobs that were previously considered immune to this type of situation. AI could also lead to inequality in wages, and displace human labor in the Aztec country.

UNAM academics assure that Artificial Intelligence could automate a large number of routine jobs. In addition, it would bring about significant wage inequality.

The workforce in Mexico could be significantly affected by the rise of Artificial Intelligence (AI). At least that’s what different UNAM academics think. According to experts, more than 50% of work in Mexico is prone to automation. In other words, machines and robots could perform some routine jobs.

Would Artificial Intelligence Represent a Threat to the Workforce in Mexico?

According to IDC, 38% of CEOs and managers in Latin America plan to invest in generative AI in the remainder of 2023. The above occurs because with this tool they have the possibility of solving central problems of their businesses, reducing costs and even increasing productivity.

This is not the whole story. A Statista report published in July 2023 revealed that around 70% of Latinos admitted that the potential of AI is more important than “any drawback.”

According to a survey conducted by market research and consulting company Ipsos, favorable opinions towards AI vary from market to market. Among the countries analyzed in Latin America, Mexico has an approval rate 65%, while Colombia and Chile are close with 64% and 63% of respondents, respectively, showing a positive perception of AI.

These figures show that more and more companies see AI as a solution to improve their economy and performance. According to José Manuel Márquez Estrada, academic secretary of the UNAM Economic Research Institute, it is still not clear whether or not AI would replace the workforce in Mexico, so there is more waiting to do.

“We are waiting to see what is going to happen, whether this artificial intelligence will come to displace a lot of labor or not, or whether the solution is not to worry, but to think about training, the use of these technologies that make the job more efficient,” admitted Márquez Estrada.

Wage Inequality in the Mexican Workforce, Is AI a Solution?

On the other hand, UNAM researcher Delia Margarita Vergara Reyes assured that the automation of the workforce in Mexico will occur in jobs that were previously considered immune to this type of situations. In her words:

“We are talking about how it will not only replace routine tasks of an unskilled workforce, but now it will also affect other fields, which will lead to inequality in wages. Only those who use artificial intelligence will obtain better remunerations.”

Recently the Mexican Senate assured that they are working on creating a legal framework for AI cybersecurity. According to the senators, it is essential to “protect the infrastructure” and “stop the traffic of users’ personal data” on the Internet. In addition, they assure that it is important to establish legislation with the rapid growth that AI is having in the country.

For the Mexican senators, AI already impacts daily lives and it is necessary to regulate the technology and its tools. Finally, they reiterated that Mexico continues “to be a pioneer” at the local level in terms of the development of technologies. That is, AI could be adapted to the Mexican context.

By Audy Castaneda

PwC Highlights Blockchain in Financial Inclusion, 43% Lack Access to Digital Payments

Leonardo Perez
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PwC Highlights Blockchain in Financial Inclusion, 43% Lack Access to Digital Payments

More than 1.4 billion people around the world lack access to essential financial services, posing a significant challenge. PwC report highlights blockchain’s role in financial inclusion, with an increase in nearly 200 stablecoins. The report also reveals that 3.55 billion people in developing economies have never participated in saving money.

PricewaterhouseCoopers (PwC) has highlighted the need for blockchain technology to combat the current problem of financial inclusion, which will only increase as time goes by.

“Financial inclusion remains a major global challenge, with more than 1.4 billion people lacking access to an account or essential financial services,” the report states.

PwC Champion Blockchain for Broader Financial Inclusion

A recent PwC report highlights substantial growth in innovative services within blockchain networks. PwC noted that this has played a key role in fostering financial inclusion.

One role that stood out, in particular, is the rise of stablecoins in the following terms:

“Today there are almost 200 different stablecoins available, offering users the stability of a variety of traditional fiat currencies while maintaining the benefits of digital assets. The largest stablecoins are pegged to the US dollar.”

PwC emphasizes the importance of offering alternatives, as many people in developing countries face limited access to conventional financial institutions. Additionally, PwC states that around 3.55 billion people in emerging economies have never participated in saving money.

However, PwC highlights the emergence of crypto platforms that are currently facilitating the creation of digital wallets on blockchain networks, allowing users to store stablecoins and generate returns. This presents an alternative for people who do not have access to conventional financial institutions.

PwC: Developing Countries Favor CBDCs in Digital Payments

43% of people in developing countries have never made online payments. Meanwhile, a recent survey by the CFA Institute reveals that central bank digital currencies (CBDCs) are gaining more ground in developing countries.

In developed countries, only 37% of respondents showed a preference for CBDCs, while in emerging markets, the figure rose to 61%.

On the other hand, it was recently reported that 130 countries, representing 98% of the global economy, are actively exploring CBDC implementation.

The study consisted of an online survey that was carried out from February 13 to February 27, 2023 and published in July of this 2023, on a random sample of 90,443 members of the CFA Institute worldwide. The results reveal that 40% of those surveyed have low knowledge about central bank digital currencies (CBDC).

In addition to these results, the report shows that, despite not very well understanding the fundamentals of central bank digital currencies (CBDC), emerging markets are in favor of the issuance of this type of cryptographic instrument.

Last August, BBVA presented a report according to which there will be significant growth in AI interfaces and chatbots related to customer service, which will facilitate the growth of FinTech. In such a way that this type of technology companies will grow 21% annually over the next five years.

Additionally, most G20 countries are aggressively pushing their plans to introduce CBDCs in the coming years. Meanwhile, in India, thousands of customers and merchants signed up for the CBDC pilot in the country. The e-rupee initiative is actively exploring the viability of an alternative to digital cash.

More than 20 countries in total are reportedly actively moving towards starting CBDC pilot programs this year.

By Leonardo Pérez

Blockchain Summit Latam: Navigating the World of Crypto Wallets

Audy Castañeda
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Blockchain Summit Latam: Navigating the World of Crypto Wallets

During this Thursday’s session, among the most important topics, the relevance of wallets in access to crypto was highlighted.

Blockchain Summit Latam Colombia includes three days to learn, connect and visualize opportunities that blockchain technology offers us in various areas such as government, banking and financial services, international trade, decentralized finance, NFT, Metaverse, web3, among others.

Access to Cryptocurrencies and the Exploration of Wallets was one of the most notable forums of the day at BSL 2023. As expected, wallets and their different functionalities are fundamental for the adoption of cryptocurrencies.

The forum featured a group of experts and entrepreneurs from the business of virtual currencies and the blockchain. These were Manuel Beaudroit, CEO of Belo, Marcelo Cavazzoli, CEO of Lemon, Edwin Zácipa, founder of Latam Fintech Hub and Luis Ocegueda, director of Engineering at Trust Wallet.

The forum members discussed topics of great interest that have to do with the way people land in this market. Emphasizing Latin America, they highlighted that the space has a huge number of portfolios, but there is a lack of clear regulation.

Access to Crypto and the Role of Regulations

Like most BSL 2023 forums, crypto access and digital wallets focused primarily on the Latin American subcontinent. Beaudroit assures that adoption in the region depends on several factors such as education to remove people’s fear.

Beaudroit states that the tax view of cryptocurrencies as money plays a very important part. Thus, he explains that many people who are not necessarily enthusiasts or knowledgeable about cryptocurrencies tend to adopt them for many reasons.

As an example, there is the case of remote workers, who use crypto platforms to receive their payments. It should not be lost sight of that some traditional digital money platforms are expensive in terms of commissions. In the case of those related to the crypto sector, the great advantage is the low costs.

“The fact of digitizing money resets people’s minds and that helps a lot,” he said.

For his part, Cavazzoli believes that decentralization must go hand in hand with regulation. In his opinion, this will allow decentralized and traditional finance to work with the same purpose.

These elements touched on at BSL 2023 are now one of the great debates in the crypto world, given that user access depends on them.

Regulation as a Driver of Cryptocurrency Adoption

The representative of Trust Wallet, Ocegueda, highlighted that previously people entered the wallet and saw the transfer companies and did not recognize them. However, other recognized firms were recently added and that gave more confidence to users.

Therefore, the presence of recognized brands encourages people to have peace of mind when adopting crypto services. Ocegueda emphasizes that all this goes through regulation. Large companies are not willing to get involved with unregulated actors and that is so far the big obstacle to people’s access to the crypto world.

Definitely, an important factor that will expand, mature and normalize the cryptocurrency industry in Latin America is the active participation of governments in the regulation and promotion of the market.

Latin America represents a revolutionary region for the cryptocurrency and blockchain industry, and is poised for even greater growth. With proper regulation, the region can become the world leader in efficient real-world applications for cryptocurrencies.

In any case, experts agree that the conditions for progress are present in the subcontinent. The number of service companies based on virtual currencies and wallets are increasingly sophisticated. All of this rise occurs despite the current bear market.

By Audy Castaneda

Should Low Ethereum Futures ETF Trading Volumes Be a Cause for Concern?

Leonardo Perez
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Should Low Ethereum Futures ETF Trading Volumes Be a Cause for Concern?

Ethereum exchange-traded funds (ETFs) launched this week disappointed speculators with a slow start. The funds, including the ProShares Ether Strategy ETF, accumulated a total trading volume of $1.92 million. Analysts suggest a pattern similar to Bitcoin’s initial rise and fall, indicating a potential scenario for Ethereum.

The crypto community’s eyes have focused on the performance of the long-awaited Ethereum futures exchange-traded funds (ETFs) that launched this week.

However, analysts have given explanations as to why the initial week fell short of expectations in terms of price and value.

Lack of Significant Attraction for Ethereum Futures ETFs

This week’s debut of several Ethereum futures ETFs has left many speculators who had been eagerly anticipating it disappointed for over a year. Nine Ethereum futures ETFs were introduced to the market this week. They were launched by investment companies ProShares, VanEck, Bitwise, Valkyrie, Kelly and Volshares.

On October 2, Bloomberg analyst Eric Balchunas shared the information through his official account on X (Twitter):

“Pretty mediocre volume for Ethereum futures ETFs as a group, just under $2 million, about normal for a new ETF, but compared to $BITO it is low”.

However, upon launching on October 2, the ETFs attracted just under $2 million in flows, according to a recent report. Anticipating an increase, the price of Ethereum rose by approximately 4.5% to reach $1,734 the day before the launch on October 1, which ended on October 2 at $1,659, though, being a 4% drop.

At present, the price of Ethereum is $1,643. As of October 2, the six funds accumulated a total trading volume of $1.92 million. However, the largest of them, the ProShares Ether Strategy ETF, contributed significantly with a trading volume of $878,560, representing 45.7% of the total volume.

This presents a notable difference compared to the rapid achievement of $1 billion in flows in just two days for the ProShares Bitcoin Strategy ETF (BITO) upon its launch in 2021. However, the broader crypto market was in a solid phase during that time.

Meanwhile, an X (formerly Twitter) user highlighted that it represented only 0.2% of trading volume compared to the initial day of Bitcoin futures trading. However, there is no need to be alarmed. According to Bloomberg Senior ETF Analyst Eric Balchunas, this has happened before:

“Any cryptocurrency-related launch tends to be a ‘buy the rumor, sell the news’ event,” Balchunas noted.

Fate Awaits Ethereum Spot ETFs

Balchunas also noted a decline in the price of Bitcoin following the initial surge in demand for BITO. It suggests a similar potential scenario for Ethereum price:

“If you look at BITO, Bitcoin fell a lot after that […] I wouldn’t be surprised if this happened with futures ETFs either.”

Meanwhile, the SEC recently announced that it would delay its approval decisions for Ethereum spot ETFs. An announcement won’t be made until at least late 2023.

According to two separate filings, the SEC has postponed the outcome of both the ARK 21Shares Ethereum ETF and the VanEck Ethereum ETF. Both companies filed applications for the Ethereum spot ETF on September 6. If granted approval, these would be the first ETFs to provide direct exposure to Ethereum within the US.

On October 2, Grayscale joined the list of investment firms that applied for an Ethereum spot ETF. In a filing, the New York Stock Exchange (NYSE) made the request to the SEC. The filing requests permission to convert the Grayscale Ethereum Trust (ETHE) into an Ethereum spot ETF

By Leonardo Pérez

SOL Validators Get Amazing Grants from Alameda Research and the Solana Foundation

Audy Castañeda
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0
SOL Validators Get Amazing Grants from Alameda Research and the Solana Foundation

Solana is a high-performance blockchain that aims to compete with Ethereum. It combines proof of stake (PoS) with proof of history (PoH) as a consensus method.

One X user, @arixon.eth, alleges that more than 90% of Solana validators are heavily subsidized by the Solana Foundation and Alameda Research, the defunct trading wing associated with the bankrupt cryptocurrency exchange FTX. in a post On Oct. 4, the analyst said the level of subsidization is “shocking,” but will come to “hurt SOL prices in the long run.”

Are Solana Validators Heavily Subsidized?

TradingView validators play a crucial role in Ethereum’s architecture, verifying the validity of transactions and adding them to the blockchain, while ensuring the network remains secure and decentralized.

A node must stake SOL to become a validator, and the amount of SOL staked determines the voting power or “voting keys.” Like miners, validators are rewarded SOL each time they validate a block within each epoch.

There are 1,997 Solana validators at the time of this publication. However, the analyst points out that of 1,997 validators, 1,818 received delegations from the Solana Foundation and Alameda Research. Solana validators have delegated 106 million SOL, of which 73 million are distributed from the Solana Foundation and 33 million from Alameda Research.

The analyst concludes that if it were not for the “strong” incentive, the count of Solana nodes, validators, would be much lower. @arizon.eth adds that Solana has many nodes only because “two centralized entities are giving free money to node operators.”

Due to this agreement, the analyst continues, the Solana Foundation “can manipulate node operators to do whatever they want if they do not want their participation withdrawn.” @arixon.eth further notes that many node operators do not have delegations from ordinary SOL holders.

Solana Co-Founder Responds, “Claim Participation is What’s Important, Not Validator Count”

Solana co-founder Anatoly Yakovenko has since responded to these accusations, saying that while approximately 2,000 validators, their nodes and voting keys secure the network, not their respective stake. In this statement,

Yakovenko emphasizes the importance of online voting and the meaning of the votes. Since all validators approve valid blocks simultaneously, their votes, not each other’s participation, are important to the security and stability of the network.

Every time a node withdraws SOL and claims staking rewards as well as possibly block validation rewards, its voting power is reduced.

Therefore, the network will depend on other validators for decentralization and security, regardless of each one’s participation. A Solana node operator explained that the distribution of online validators will play a critical role whenever this happens.

Meanwhile… Solana Foundation Highlights a 31% Participation through Jito Labs

The Solana Foundation recently unveiled an impressive milestone that highlights its continued progress. In its most recent report, the organization revealed that a staggering 31% of its shared network now passes through the Jito Labs client.

The number of validators opting for Jito has almost doubled since the last report in March. To put it in perspective, the Jito Labs client, first launched on the mainnet in August 2022, had 0% participation. In March 2023, that figure jumped to 16%. And now it has reached a remarkable 31%.

The Solana MEV infrastructure the company is building has attracted a lot of attention and big names like Solana Ventures, Anatoly Yakovenko, co-founder of Solana Labs, and Austin Federa, head of communications at the Solana Foundation, were present at the funding round.

By Audy Castaneda

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