Swiss financial regulator: a risk Factor for the cryptocurrency investment is 800%

Management to oversee the operations of the financial market Switzerland (FINMA) informally signaled that the risk ratio for cryptocurrency investments should amount to 800%. The Agency announced this figure in a letter dated 15 October in response to the Association request EXPERTsuisse, consisting of experts in the field of tax and audit activities.

In his letter to FINMA also said that the relevant legal provisions are not yet valid, therefore, banks and other stakeholders are often required to clarify this issue.

“FINMA recently received many inquiries from banks and securities dealers, which owns positions in cryptocurrency assets, and subject to requirements on capital adequacy, risk allocation and legal regulations on the calculation of ratios short-term liquidity” —quoted by Swissinfo representatives of FINMA.

In Switzerland, for several years there has been a formal integration of cryptocurrency products and banking sector, this European country is trying to create a legal environment that can support the development and operation of new financial instruments. At the same time, until the international Basel Committee on banking supervision develops all acts and laws necessary to regulate this area, FINMA can only give approximate figures.

However, the final decision may be announced at the end of November, when is the next meeting of the Basel Committee. Therefore:

“All scriptactive must assign an overall risk ratio of 800% to cover market and credit risks, regardless of where hold positions in the banking or trading assets,” — said in a letter to FINMA.

According to several sources, comment on the situation, 800% is a big figure, but it is within the allowable range. For example, the startup SEBA, which in September drew 103 million dollars to create cryptocurrency Bank of Switzerland, said:

“This recommendation will have limited impact on its business model. Nice to see that the banks no longer look away from the increased number of clients requiring services associated with cryptocurrencies, and ask for advice and do your own contribution,” said a spokesman for lobby group Bitcoin Association Switzerland.

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Venture capital investment into blockchain startups increased by 280%

Cryptocurrency market is on the decline, largely due to problems with the regulation, but many of the ICO projects are not experiencing funding problems due to the influx of venture capital investment.

In its latest report, the research team Blockchain Diar reports that for the first three quarters of cryptocurrency and blockchain startups raised nearly 3.9 billion dollars with venture capital investors, representing a 280% increase compared with the 2017 year.

Along with the increase in the number of transactions with venture capital investors in the cryptocurrency sector, the average size of investment in cryptocurrency and blockchain projects increased by more than $ 1 million in 2018.

Black denotes investment capital, grey – number of transactions in the cryptocurrency sector.

Explaining the growing popularity of venture investment among ICO, the authors of the study cite cost reduction projects, as well as the fact that the prices of almost all tokens are far from their highs.

The research company also refers to the regulation of and problems with by the ICO as additional reasons for the popularity of crowdfunding.

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FOMO in action: the Story of a failed investment in Bitcoin is a Japanese family

The majority of Japanese people have one common problem — the nation is not able to save money! Even families, wealthy enough by local standards, unable to set aside at least some funds for a rainy day.

Japanese family of four, referred to in this story, lives in the Tokyo Bay area in the luxury high-rise building. For many years now they have to pay many loans. Every month the family spends monthly income almost to the last penny and unable to pay the training of daughters in private schools.

Once the head of the family, 42-year-old employee of the company Masao Ikeuchi learned about Bitcoin and decided that investing in this cryptocurrency will change their plight:

“At the end of November last year, when I first invested in Bitcoin (100,000 yen), a month later, its price has increased two and a half times. I was overjoyed and invested another million yen, expectations of fabulous wealth. But, as you already know, everything was on the decline. In the end, once awake, I realized that I had lost half of their savings”

The decision to purchase bitcoins to Masao and his wife Naoko came under the influence of colleagues Masao, who told them about the “easy” way to earn money. Before that, they talked with a financial Advisor. The beginning was great, but soon the couple suffered serious losses.

“How could this happen?” — ask yourself the question Masao and Naoko.

Their eldest daughter studying in second grade of secondary school and the youngest in fifth grade of elementary school. The family has Pets — two cats. The couple leads a happy life, typical of the “tribe caveman” as they are called in Japan (from the expression “tower-mansion”). We are talking about the Japanese possession of a new apartment worth about 60 million yen ($ 550,000 US). Basically, it’s three rooms with kitchen and dining room.

The monthly salary of her husband is 420,000 yen (3,800 USD), wife of 310,000 yen (USD 2800); Thus, their monthly income is equal to 730 000 yen (6600 USD). In Japan, the family income level is considered rich. Please note that in 2018 the minimum monthly salary in Japan is around 1300 USD, average — about $ 3,000, a high salary is considered to be $ 7,000 (about as much get doctors and lawyers).

Thus, the pair Ikeuchi earns in a year is 15 million yen (135,000 USD). They bought the apartment eight years ago, having spent almost all their savings. The initial payment of 10 million yen (90,000 US dollars). Every month the family spends about 710 000 yen (6,400 US$ ) to defer only 17,000 yen (153 USD) per month. By last autumn, the amount of their savings was 2.4 million yen (us $ 21 500. USA), and the pair began to fear that they will not be able to pay for children’s education. They needed easy and quick money. They thought about the investment that would bring them more than one million yen (9,000 US dollars) a year. These funds were enough to pay for school. And then, as has been said, a colleague advised them to bitcoins.

The head of the family decided to study and read a lot of articles about cryptocurrencies, and then bought bitcoins for 100,000 yen ($ 900 US), just to try. At first everything was fine: just over a month the price of Bitcoin rose to $ 2350. Mr. Ikeuchi was so inspired that he bought more bitcoins at 1 million yen (9,000 dollars).

In 2018, as we all know, Bitcoin price has fallen three times. The head of the family was nervous and even started to buy shares in the foreign exchange market. By the time when he fully realized what was happening, 1.1 million yen ($ 9900) that he has invested in Bitcoin has turned into 300,000 yen ($ 2,700).

So, Mr. Ikeuchi became a victim of the syndrome of loss of profits (FOMO — fear of missing out), and the desire to get rich quick. Investment did not increase savings, but rather ate them. The media constantly share success stories of investors, disrupting the jackpot in bitcoins or in the currency exchanges. Not surprisingly, many, such as Mr. Ikeuchi willing to take the risk.

Mizuki Yokoyama, financial planning specialist, said in an interview with the President Online:

“Investments rarely work when you are in a hurry to enter into some sort of alleged success. Often, it’s just beginner’s luck. As far as I know, little durable. I’m not saying that you should avoid investment per se. Saving on everyday expenses, people need to invest these funds in long-term projects with minimal risk”

It seems that our hero just can not manage money. But maybe he’ll learn from his mistakes and next time will invest more meaningful way.

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Qiwi has launched “the first” crypto investment Bank in Russia

As reports the edition “Kommersant” Qiwi Blockchain Teсhnologies (QBT) has launched Russia’s first cryptocurrency investment Bank under the name “HASH”.

HASH based on the “classical model of investment banking,” according to “Kommersant”, is a platform for the ICO. Yakov barinskiy, chief financial officer QBT (CFO), said that the HASH “will help companies pass phase of collecting money”.

According to “Kommersant”, HASH plans to cooperate with international funds specialized in investing in cryptocurrency assets. According to brinskogo, the company is already working with ten such funds with the largest of them has a turnover of approximately $ 100 million.

Barinsky also said that HASH will provide services for trading digital currencies next year, after the company receives the necessary license. July 1, the government plans to present its primary bill for the regulation of cryptocurrencies and blockchain sphere.

Founded in 2007 in Moscow, Qiwi has become one of the largest payment services in Russia and also in Ukraine, Kazakhstan, Moldova, Belarus, Romania, USA and the United Arab Emirates. The company is also included in the list of 39 international companies, which cooperate with a consortium of R3 in the identification of clients.

Subsidiary Qiwi QBT was launched in March 2017 with funding in the amount of 100 million rubles (1.6 million USD) to develop internal blockchains products.

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Leading investment Bank GP Bullhound: 90% cryptocurrency can be destroyed within a year

Leading investment Bank GP Bullhound predicted the disappearance of about 90% of all crypto-currencies within the next 12 months. However, in the opinion of the Directors of the Bank, the ICO will remain that will lead to new altcoins.

The report titled “Rush tokens: the fuel for the blockchain”, the managing GP Bullhound Sebastian Markowski described his vision for blockchain technology, cryptocurrencies and the future of ICO.

One of the key predictions of the Bank describes the “serious correction”, which over the next 12 months to face the digital currency. Not all will survive — only about 10% of the strongest.

“Although this correction will be crucial to overcome the current hype, the lack of its impact on financial institutions will give rise to new phenomena that were not observed in any of the bubbles, known history,” according to the report. — “However, once kryptonim end, the dynamics of growth for the few survivors of digital assets will be unprecedented”

Mark NORS, Director of marketing and distribution in the Blockchain Capital, I agree with Sebastian Markowski. In his opinion of the existing 1600 cryptocurrency and hundreds ICO most “do not meet the needs of the market.”

“I see no future for most of them, so Yes, 90 percent will be destroyed. They either will be absorbed by other similar currencies, or just disappear”.

As for the blockchain, and its report Sebastian Markowski voted in favor of this technology, calling it “the most important catalyst for technological change”.

“Last year saw a surge in popularity blockchain technologies … We believe that the underlying technology that is stimulating this surge would transform virtually every aspect of daily life, to change global business practices and even to transform national political systems”.

The report further States that the ICO became a phenomenon and changed the ways for startups gain access to capital.

In 2017, the company with ICO attracted $ 4 billion. investment, five times more than a traditional VC financing, and 47 times more than in 2016.

Markovski said that in 2018 only leading projects with reputable teams and supporters to succeed.

GP Bullhound predicts that funding for the ICO to continue, but will undergo several changes.

Mark NORS configured much more skeptical, believing that the ICO has virtually no chance of success, and that many of them will never appear on the exchanges.

“With ICO, you are simply speculating on the hope that in the future the token will grow in value. That’s why I’m not going to invest in 99 percent of ICO. It is only a matter of time when the cryptocurrency space will flow a serious institutional money. Almost every Bank, Fund, private equity and venture capitalist are already looking for money demanded by their customers.”

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Break the pattern: German cryptocurrency project, which drew $ 50 million, pretended to be a Scam to attract more investment

18 APR Frankfurt startup Savedroid popular, which grossed over $ 50 million investment just disappeared with the money collected during the ICO. CEO and founder of the project and Yassin Hanker after arisen among investors panic, have issued the following tweet:

“Thank you all! The end… #savedroidIC”

Savedroid German ICO, collecting money from February 9 to March 9, 2018. The description reads: “the Ecosystem of crypto-savings for everyone.”

Savedroid promised to develop a service for portfolio investments in the cryptocurrency, which enables even inexperienced traders to successfully invest. It was also stated on the release card to output tokens and pay for the goods.

The project pages in social networks were available, however, the new publications were not. The project site showed a meme from South Park: “IIiii… he’s gone!”

Runaway businessman on communication did not leave. Almost every user of cryptocurrency, decided that such a promising and ambitious project was the most common fraud. Especially all struck by the arrogance of the organizer, who shamelessly showed investors a selfie from the airport as well as the sea.

Was organized by the “search expedition”, for example, representatives of the blog Cryptobriefing claimed that they were able to track the location of a cheater for the above tweet. The combination of Egyptian beer and the background in the photo pointed to the fact that it is located on the red sea coast, Movenpick resort in the Egyptian El Quseir. The authors of the blog to an aggressive form called to track and capture the criminal. About the project wrote CCN, Finance Magnate, Cryptovest, Crowdfund Insider, Bloomberg. Perhaps the hype over Hanker can be compared only with references to Vitalik Buterin and Charlie Lee.

But a day later the situation has changed dramatically. Yassin Hanker he made contact with a loud statement that his escape is a prank and a way to show investors how the scope of the ICO needs to change. The changes that Savedroid can realize with the help of their new services.

The first service is as simple to use, and most importantly — free, a list of items that will allow “just a few minutes to evaluate any ICO to make an informed investment decision”. The second product is already paid and intended for the organizers of the ICO. The service will allow them to design a campaign that corresponds to antisamos policy.

This method of promotion of new services have caused anger cryptocurrency community that it is not momentary prilnula to bring down on the heads of Ancira and his team:

“What a horrible idea! Do you know what experiences your trick was worth to investors? And now you’re going to give advice on the ICO”.

“What you did was unethical, immoral and absolutely disgusting. You robbed people enough time. People donated money to those who said that went bankrupt because of your project. Your so-called “lesson” was ill-conceived and will cause the petition to remove you from the position of CEO!”

In his video on YouTube and Yassin Hanker explained that just wanted to show investors how easy it is ICO-startup to hide their money. According to him, the current situation threatens the future success of cryptocurrency startups and requires actions. Savedroid willing to share their knowledge with regulators and authorities to change things for the better, says Hunker.

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