Ripple’s XRP Sales Down 73% in Q3 Compared to Previous Quarter

Blockchain payments network Ripple announces that it sold $66.24 million worth of XRP in Q3 2019 — down a staggering 73.66% compared to the previous quarter.

Blockchain payments network Ripple has announced that it sold $66.24 million worth of XRP in Q3 2019 — down a staggering 73.66% compared to the record sale worth of $251.51 million in the previous quarter.

According to the third quarterly report released on Oct. 18, Ripple had previously announced the plan to sell XRP tokens slower in Q3.

Ripple’s XRP sale rate is lower than ETH’s inflation

Ripple also stated that “XRP distribution rate since the beginning of the quarter has been lower compared to the inflation rates of ETH and LTC, and similar to BTC.” 

The company also addressed the allegations that it is dumping XRP on the market and manipulating its price, claiming that a significant portion of such ideas was spread by bot accounts on Twitter.

Accusation of dumping reportedly often pointed to large movements of XRP as proof, but those “were in fact transfers between Ripple treasury and escrow management accounts.“ Such transactions have no direct impact on the market, since they do not introduce new coins to it, the report claims.

Twitter bots spread FUD

Furthermore, Ripple also claimed that — according to a tool developed by the Indiana University — bots are responsible for “49% of the share of conversation about BTC, 71% about ETH and 50% about XRP,” adding that this quarter has also seen an increased XRP-related activity among Twitter bots.

As Cointelegraph recently reported, London-based Finastra — the third-largest financial services technology firm in the world — has partnered with Ripple to grant its customers access to the RippleNet blockchain network.

NY District Court Postpones Telegram’s TON Hearing to 2020

New York District Court postpones the hearing regarding the Securities and Exchange Commission’s injunction filing against Telegram Open Network.

The United States District Court for the Southern District of New York has postponed the hearing regarding the Securities and Exchange Commission’s (SEC) injunction filing against Telegram Open Network (TON) and its Gram token to Feb. 18–19, 2020.

As Cointelegraph reported recently, following Telegram’s counterclaim on Oct. 16, where the firm argued that its native crypto is not a security and the preliminary injunction should be denied, the SEC has responded with a new filing in the New York Court on Oct. 17.

Court hearing postponed to 2020

According to a TRO filed on Oct. 11, Telegram should have been at a court hearing in New York on Oct. 24. Yet the latest court order shared with Cointelegraph on Oct. 19 states that the hearing will be held on Feb. 18–19, 2020:

“IT IS ORDERED that Defendants shall not offer, sell, deliver, or distribute “Grams” to any person or entity, until the conclusion of the hearing scheduled by the Court for February 18 and 19, 2020 (“Hearing”), except upon further order of the Court or agreement of the parties. At the Hearing, any party may move the Court for the continuation or dissolution of this Order.”

Recently, the SEC has claimed that not only did Telegram violate the U.S. securities laws during its initial coin offering (ICO), but it also is seeking a preliminary injunction to prevent Telegram from further violations.

The SEC stated that Telegram’s proposal to deny the injunction would allow them to continue to violate regulations after five months, and put the burden on the SEC to seek another temporary restraining order.

The SEC intervened just before TON’s launch

The SEC has announced an emergency action against Telegram on Oct. 11, just weeks before the planned launch of the Telegram Open Network. 

Telegram asked a U.S. court to deny the action, prompting a response from the SEC seeking a preliminary injunction. 

While Telegram has proposed to postpone the launch of TON, a “force majeure” clause in the purchase agreement for TON’s native Gram tokens has made investors concerned that Telegram could abandon its obligations to return funds from Gram token sales in the event of a delay.

Telegram investors must decide whether to extend the TON launch by Oct. 23. Should such a proposal pass, TON would tentatively launch on April 30.

G20 Finance Leaders: Stablecoins Present Serious Regulatory Risks

G20 nations call upon the International Monetary Fund to examine the macroeconomic implications of global stablecoins.

The G20 finance chiefs of the world agree that global stablecoins give rise to a set of public policy and regulatory risks.

On Oct. 18, Reuters reported that the G20, an international forum for the governments and central bank governors from 19 countries and the European Union, have called upon the International Monetary Fund to examine various macroeconomic implications of global stablecoins, including monetary sovereignty issues in its member countries.

Members say stablecoins pose a serious risk to global finance

Per the report, the nations agreed that global acceptance of stablecoins will give rise to a set of serious public policy and regulatory risks. G20 finance ministers stated:

“Such risks, including in particular those related to money laundering, illicit finance, and consumer and investor protection, need to be evaluated and appropriately addressed before these projects can commence operation.”

Bank of Japan’s Governor Haruhiko Kuroda said that the G20 summit will begin with a debate regarding stablecoin regulations — following proposals from global regulatory bodies like the Financial Stability Board and the Financial Action Task Force. Kuroda stated:

“Some emerging countries have concerns on what could happen if stablecoins backed by a huge customer base become widely used globally […] But this is not just a problem for emerging economies. It could have a broader impact on monetary policy and financial system stability.”

Stablecoin concerns multiply among major economies

The news follows a recent report by the G7 task force stating that stablecoins such as Facebook’s Libra present a significant risk to the global financial system.

In the report requested by the G7 finance ministers and central bank governors, the task force confirmed that the group of the seven wealthiest nations would not allow any global stablecoin to launch without addressing related challenges and risks.

Crypto Markets Turn Red Once Again, Bitcoin Price Hovers Under $8K

Cryptocurrency markets are turning red once again, with Bitcoin trading below $8,000 and suffering from more downward selling pressure.

Friday, Oct. 18 — Bitcoin (BTC) is suffering from further downward selling pressure and continues to trade below the $8,000 price mark.

Cryptocurrency market daily overview. Source: Coin360

Cryptocurrency market daily overview. Source: Coin360

Bitcoin traded below the $8,000 price mark for most of the day. The world’s largest cryptocurrency traded at an intraday high of around $8,135, with a sudden dip toward $7,900, before settling down at its current trading price of $7,952. BTC shows a subtle loss of around 1.6% in the past 24 hours.

Bitcoin seven-day price chart. Source: Coin360

Bitcoin seven-day price chart. Source: Coin360

Cointelegraph contributor Rakesh Upadhyay said that any new asset class has to go through a difficult phase of adoption and that this will coincide with phases of utter disappointment in between, but in the long run, he said, a good innovation will find its due place.

Ether (ETH), meanwhile, is currently sitting at $173.43 per coin. The number one altcoin saw a small dip in sync with BTC and is showing a loss of 1.95% at press time. Upadhyay said Ether is likely to drop to the critical support zone of $161.056 to $151.829.

Ether seven-day price chart. Source: Coin360

Ether seven-day price chart. Source: Coin360

XRP failed to grind its way up to the $0.30 price point after yesterday’s 5% jump on the day. The third-largest coin by market capitalization is currently trading at $0.294 per coin, down 1.93% at press time.

XRP seven-day price chart. Source: Coin360

XRP seven-day price chart. Source: Coin360

Top-20 altcoins turn red

Most of the top-20 coins are showing red candlesticks. Monero (XMR) and Chainlink (LINK) are showing losses of 2.24% and 3.26%, respectively, while Bitcoin SV (BSV) takes the title of best performer in the top 20 with gains of 1.3% on the day. The worst performer among the top-20 is Cosmos (ATOM), down 4.69% in the last 24 hours.

The overall cryptocurrency market cap decreased from $220.3 billion to $216.9 billion, with Bitcoin making up 66.1% of the total.

Keep track of top crypto markets in real time here

Fidelity Investments Fully Rolls Out Crypto Custody Service, Exec Says

American financial services company Fidelity Investments has fully launched its cryptocurrency custody service.

American financial services company Fidelity Investments has fully launched its cryptocurrency custody service.

Abigail Johnson, CEO of Fidelity Investments, revealed the development in an interview with the Financial Times published on Oct. 18. Johnson said that the company is ready to roll out its crypto custody business following a year-long preparation and accumulation of clients.

A nascent, but promising business

Last fall, Fidelity specifically indicated that it would provide an enterprise-grade crypto custody service to hedge funds, family offices and financial advisors. Johnson called that kind of service nascent and not developed, but noted its potential, saying:

“There are people out there with significant amounts of wealth in cryptocurrencies, probably Bitcoin, and they’re looking for somebody to hold those coins for them because in the event of their passing — which is going to happen at some point or another — you’ve got to have a plan to be able to get those coins to somebody else.”

Speaking about Coinbase’s custody offering, Johnson argued that Coinbase “is still a company that most people had never heard of, and they don’t have the existing relationships with the independent advisers.”

As previously reported, Coinbase Custody was initially announced in November 2017 and launched in July 2018, with an objective to provide robust security of crypto assets, which according to Coinbase has been institutional investors’ “‘number one’ concern.” As of August, Coinbase Custody claimed to store assets on behalf of more than 120 clients in 14 different countries.

Fidelity’s careful approach to trading crypto

Recently, Kathleen Murphy, personal investing president of Fidelity Investments, said that the firm does not offer cryptocurrencies on retail trading platforms to protect its clients. When asked when she expects users to trade crypto “in a meaningful way” on Fidelity’s platform, Murphy replied:

“You know, we’re really careful about that. So while we embrace crypto in terms of trying to understand it and be innovative and thoughtful… We’re also very careful about where we offer those types of things, so they’re not offered broadly on the retail platform. We want to be very careful about making sure that investors who really aren’t institutional investors […] don’t make a mistake with cryptocurrency.”

Q3 2019 XRP Markets Report

Ripple publishes the quarterly XRP Markets Report to voluntarily provide unparalleled transparency and regular updates on the state of the XRP market, including quarterly programmatic and institutional sales updates, relevant XRP-related announcements such as Xpring and RippleNet partnerships, and commentary on previous quarter market developments. As an owner of XRP, Ripple believes proactive communication is part of being a responsible stakeholder. Moreover, Ripple urges others in the industry to follow its lead to build trust, foster open communication, and raise the bar industry-wide.

XRP Ledger—History

The XRP ledger is a decentralized cryptographic ledger powered by a network of peer-to-peer servers. The XRP ledger is the home of XRP, a digital asset designed to bridge the many different currencies in use worldwide. When the XRP ledger began in 2012, 100 billion units of XRP were created and no more XRP will ever be created. The available XRP supply decreases over time as small amounts are destroyed to pay transaction costs. Ripple was gifted a portion of this XRP and periodically sells a small amount of that into the market.

Decrease in XRP Sales

As readers may recall from the previous quarterly report, Ripple publicly announced our intention to shift to a more conservative volume benchmark for our XRP sales, away from CoinMarketCap and to CryptoCompare Top Tier. In the third quarter, we significantly reduced our XRP sales, consistent with the messaging we shared in the Q2 report. For Q3 19, our total XRP sales were $66.24 million vs. $251.51 million in the previous quarter. Per the Q2 report, our stated goal for programmatic sales for Q3 was approximately 10 basis points of the new volume benchmark (CCTT), and we ended sales for the quarter below that, at 8.8 bps. In fact, part way through Q3, we decided to pause programmatic sales altogether, and focus our over-the-counter (OTC) sales on a few strategic partners, who are building XRP utility and liquidity in regions that are strategically important to our growing global business, including EMEA and Asia. Total sales including OTC and programmatic ended the quarter at 36 bps of CCTT.

As a result of this discipline, Ripple’s XRP distribution rate since the beginning of the quarter has been lower compared to the inflation rates of ETH and LTC, and similar to BTC – see chart below.

Source: Coinmarketcap and internal data

NOTE: No new XRP can ever be created post the Genesis block, so XRP actually has a slight negative inflation rate due to the destruction of XRP related to transaction fees. Therefore, the line above reflects Ripple’s distribution of XRP, but not the asset’s inflation rate.

Q3 Highlights

  • Ripple sold $66.24 million XRP in Q3 2019, a 73.7% decrease in sales in XRP QoQ, as measured in USD.
  • Overall market capitalization of digital assets decreased in Q3, with the overall market cap losing 30.4%. XRP price declined 35.4% QoQ.
  • Three billion XRP were released out of cryptographic escrow, 2.30 billion XRP were returned to escrow.
  • XRP is now listed on over 140 exchanges worldwide.

Sales Summary (dollars in millions) Q2 2019 Q3 2019
Institutional direct sales 106.87 50.12
Programmatic sales 144.64 16.12
Total sales 251.51 66.24
Global XRP volume Q2 2019 Q3 2019
ADV XRP (dollars in millions) 429.51 198.10
Total XRP volume (dollars in billions) 39.09 18.23
Total sales as % of total volume 0.6% 0.4%

Looking ahead to Q4, we will continue to monitor volume developments closely and intend to maintain a similar approach to Ripple’s XRP sales as compared with Q3.

Volume

CCTT’s reported daily volume for XRP decreased in Q3 from the previous quarter. The average daily volume was $198.10 million in Q3 versus $429.51 million in Q2, though higher than $156.01 million in Q1.

Volatility

Based on CCTT’s reported volume, XRP’s volatility of daily returns over the quarter was 3.6%, which is lower than the previous quarter’s 5.0%. XRP’s volatility was lower than that of other top digital assets, as BTC’s volatility of daily returns through Q3 was 3.9% and ETH’s was 4.3%.

Q3 Escrow Activity

In Q3 2019, three billion XRP were again released out of escrow (one billion each month). 2.30 billion XRP were returned and subsequently put into new escrow contracts. The majority of the unused portion of the 700 million XRP not returned to escrow was being held in operating wallets at the end of the quarter. All figures are reported based on transactions executed during the quarter.

Spread of Misinformation

Last quarter, there was an uptick in FUD (fear, uncertainty and doubt) and the spread of misinformation about XRP, especially around topics such as purported XRP dumping and price manipulation by Ripple. FUD is a tool typically used to undermine new technologies. Due to the nature of digital asset markets, FUD runs rampant, often perpetrated by those with political or financial interests in certain cryptocurrencies. Healthy dialogue, transparency, and pragmatism are vital to dispel misinformation, properly educate the market, and foster innovation in our industry. 

Though Twitter is not the only place where FUD persists, bots on Twitter (accounts with high indication of automated publishing activity, based on Indiana University research) contributed to the propagation of FUD across the digital asset industry. They comprised 49% of the share of conversation about BTC, 71% about ETH and 50% about XRP1

In Q3, bots have been more active in conversations around XRP, with the number of unique bots rising and engaging in messages related to:

FUD #1: Dumping allegations

  • Conversation from bots specifically about Ripple “dumping XRP” and “flooding the market,” increased 179% quarter over quarter.
  • “Dumping” allegations were the most common FUD topic of conversation in recent months compared to others.

Truth

  • Conversations attempted to support the allegations by pointing to large movements of XRP, which were in fact transfers between Ripple treasury and escrow management accounts. In other words, those transfers did not entail Ripple distributing XRP. 
  • Critics further focused conversation on the fact that large XRP holders exist—referred to as “whales.” Large holders exist in many digital asset communities such as bitcoin and ether. We do not see evidence that large holders of XRP are behaving materially differently than BTC or ETH “whales.”

FUD #2: Price Manipulation

  • Nearly half (49%) of all conversations alleging Ripple “made XRP price fall” came from bot accounts.

Truth

  • Bottom line—Ripple cannot control XRP price. XRP is traded on a fully functioning and independent digital asset market, including over 140 exchanges, in which Ripple plays a very limited role.
  • XRP exists independently of Ripple. The XRP Ledger is a free, open-source, decentralized technology. Others can and do develop on it and use it. If Ripple went away tomorrow, the Ledger would continue to exist and XRP would continue to trade. 
  • As a stakeholder of XRP, Ripple is an interested party in its success. We are aligned with other XRP stakeholders and focused on supporting a healthy XRP community.

While misinformation persists across all markets and news topics, as this industry matures, we believe conversations about the use cases, commercial traction, and human impact of digital assets will dominate. We support the many industry players focused on real utility regardless of token association. It’s on all of us to rise above the FUD and the tone-deaf who treat digital assets like a religion instead of technologies that can solve real world problems.

RippleNet On-Demand Liquidity (ODL) / XRapid

Ripple continues to experience high customer demand for On-Demand Liquidity (formerly known as xRapid), which leverages XRP to source liquidity for cross-border transactions, enabling instant settlement and more efficient use of working capital.

XRP is ideally suited for global payments because it is faster, less costly and far more scalable than other digital assets. 

Here is a quick snapshot of XRP vs. bitcoin (as of 10/14):

  • Speed: 3.80 seconds (XRP) vs. 9.2 minutes (BTC)
  • TPS: 1500+ (XRP) vs. 7 (BTC)
  • Fee: $0.0003 (XRP) vs. $0.758 (BTC)

While bitcoin’s utility is often highlighted as a store of value, we believe XRP is by far the best digital asset for global payments. 

Ripple customers live with ODL, including MoneyGram and others, increased by 75% last quarter and dollar volume on ODL increased more than five times from Q2 to Q3. In addition, Ripple announced its acquisition of team Algrim to support the ongoing development of ODL. To keep up with strong customer demand, Ripple is rapidly expanding its team on a global scale—Iceland will serve as one of Ripple’s engineering hubs with plans to bring on more technical talent in Europe. 

Xpring

Last quarter, Ripple announced Xpring’s new developer platform to make it easier for developers and entrepreneurs to build on the XRP Ledger and use XRP. The platform leverages open-source technologies, protocols and networks making it easy for the 23 million developers worldwide to enable payments in their products and services.

Of note, Ripple acquired Logos to add to the Xpring team. This team will focus on decentralized financial (DeFi) projects and explore a system that will leverage XRP at its core, as well as other ideas to update digital assets to transform payments and finance. Xpring continues to see innovation in new use cases such as trading, micropayments for content, and gaming. Other notable traction and news from Q3 include:

  • Xpring invested in Coinme, a global leader in cryptocurrency ATMs and blockchain financial services, to advance the adoption of cryptocurrencies, such as XRP.
  • Coil, a streaming micropayments tool that uses the Interledger Protocol (ILP) and any currency, including XRP, partnered with Mozilla and Creative Commons to launch Grant for the Web.
  • Bitpay partnered with Xpring to natively support XRP, which will enable thousands of businesses to accept XRP for payments.

Market Commentary

Notable Regulatory Activity

  • UK’s Financial Conduct Authority (FCA) issued guidance to clarify definitions and domains for different crypto assets. They recognize ETH has the features of a hybrid exchange and utility token (not a security token). The FCA has previously called out the similarities between ETH and XRP, and noted in a press release that XRP would not be regulated as a security.

Industry Player Moves

  • Blockstack’s token sale became the first SEC-qualified offering in U.S. history. 
  • Visa, Mastercard, Mercado Pago, Booking Holdings, PayPal, eBay, and Stripe reconsidered their involvement in the Libra consortium.
  • SWIFT launched a new API standard for pre-authorization of funds which will allow a payer’s bank to guarantee funds in advance of a payment. 
  • The Federal Reserve Bank announced “FedNow,” a new service that will allow all banks in the United States to offer 24/7 real-time payment services. 
  • Mastercard acquired the account-to-account capabilities of Nets to further develop its real-time payments capabilities. 

Conclusion

Q3 was marked by continued discipline around Ripple’s XRP sales and significant traction for XRP in both RippleNet’s ODL offering as well as the expanding developer community. These activities underscore the continued maturation of digital asset markets. Ripple will continue to take proactive steps to address misinformation and FUD while being a responsible and transparent stakeholder of XRP. 

If interested, please find the Q2 2019 XRP Markets Report here.


1 Statistics are sourced via publicly available Twitter posts from July 1 to September 30, 2019, in partnership with Methods+Mastery.

The post Q3 2019 XRP Markets Report appeared first on Ripple.

Jamie Dimon About Libra: ‘A Neat Idea That Will Never Happen’

JPMorgan Chase CEO Jamie Dimon said that Facebook’s not-yet-released Libra stablecoin is “a neat idea that will never happen.”

JPMorgan Chase CEO Jamie Dimon has said that Facebook’s not-yet-released Libra stablecoin is “a neat idea that will never happen.”

Dimon delivered his comments during a speech at the Institute of International Finance conference on Friday, BNN Bloomberg reported on Oct. 18. Dimon said that the idea behind Libra is not unique and further turned the conversation to his company’s own stablecoin, JPM Coin, revealing that JPMorgan is spending over $11 billion on technological developments this year.

JPM Coin vs. Libra

Dimon thus cemented his previous statements about Facebook’s coin, when he claimed that Libra does not pose a threat in the foreseeable future. Dimon specified at the time that “to put it in perspective, we have been talking about blockchain for seven years and very little has happened. We are going to be talking about Libra three years from now.”

JPMorgan’s native coin has three early applications, according to Umar Farooq, head of the company’s blockchain projects. These are cross-border payments for large corporate clients, which currently rely on wire transfers provided by networks like SWIFT, securities transactions, and usage in JPMorgan’s treasury services business to replace the funds that firms hold in various subsidiaries across the world.

Companies are leaving Libra over regulatory concerns

October saw an array of Libra Association founding members abandon the project, including Visa, eBay, Stripe, Mastercard, PayPal and Booking Holdings. The companies are leaving the Libra project purportedly because it is “not up to par” with American Anti-Money Laundering standards.

A member of the Federal Reserve’s board of governors, Lael Brainard, said that Libra could pose risks to consumers due to a lack of clarity over their rights with respect to the token’s underlying assets and to the system overall.

Dollar Deposits On Binance.US Now Have FDIC Insurance Coverage

Binance.US announced that its customer’s dollar deposits are now eligible for FDIC insurance coverage.

Binance.US — the United States-focused wing of major cryptocurrency exchange Binance — announced that its customer’s dollar deposits are eligible for Federal Deposit Insurance Corporation (FDIC) insurance coverage.

FDIC insures deposits up to $250,000

In a blog post on Oct. 18, Binance.US announced that the exchange holds its U.S. dollar deposits in pooled custodial accounts at different banks that are insured by the FDIC, which is a United States government agency designed to protect consumers and the U.S. financial system. Binance.US explained:

“The pooled custodial accounts are maintained in a manner that provides access to pass-through FDIC insurance coverage up to the depositor coverage limit, which is currently $250,000. FDIC insurance coverage protects depositors against the risk of loss in the event that an FDIC-insured bank fails.”

The FDIC was established in 1933 to provide confidence in the stability of the U.S. financial system and prevent the widespread closure of banks during the Great Depression.

Cointelegraph reported in May that institutional cryptocurrency prime dealer SFOX started offering state-insured bank accounts for its traders. SFOX stated at the time that the move was an industry first. 

Binance raises margin leverage and starts accepting fiat

Earlier today, Cointelegraph reported that Binance’s futures platform is increasing maximum leverage and margin on Bitcoin (BTC)/Tether (USDT) contracts to 125x.

Binance CEO Changpeng Zhao recently confirmed that the crypto exchange began accepting fiat currencies through online payment service Alipay and mobile messaging and payment app WeChat. Zhao explained that Binance is not working directly with WeChat or Alipay and that users are still able to use them for peer-to-peer transactions.

Two More US Jurisdictions Launch Blockchain-Based Mobile Voting

Two counties in the U.S. state of Oregon will pilot a blockchain-based voting program for select citizens in November.

Two state counties in the United States are implementing blockchain-based mobile voting in the special elections in November.

On Oct. 18, the nonprofit Tusk Philanthropies announced its partnership with Jackson and Umatilla Counties in Oregon to pilot the mobile elections platform Voatz. The pilot offers eligible voters to cast their votes using their smartphones, which are secured through blockchain and facial recognition technology.

Pilot participants are mostly servicemembers overseas

The pilot is only available to a small and select group of voters, allowing servicemembers overseas, their eligible dependents and other overseas voters to cast their ballots via the mobile app, which was developed by Tusk Philanthropies.

Dan Lonai, Director of Umatilla County Administrative Services, said that the pilot aims to expand voter participation and make it easier for citizens to exercise their right to vote. 

This latest e-voting pilot is a collaboration between the Oregon counties, mobile elections platform Voatz, Tusk Philanthropies and the National Cybersecurity Center.

Other U.S. jurisdictions have piloted blockchain-based voting

West Virginia was the first state to offer blockchain-based mobile voting in a federal election through the Voatz platform. Since then, Tusk Philanthropies has partnered with the City of Denver, Colorado, and Utah County, Utah, who all conducted successful mobile voting pilots. CEO and founder of Tusk Philanthropies Bradley Tusk said:

“Jackson and Umatilla Counties just made history as the first in Oregon to give voters the ability to vote in the same way they conduct most of their other business – on their phones. Ultimately, giving everyone the opportunity to use mobile voting means we can dramatically expand turnout and loosen the grip on power by special interests and extreme ideologues on both sides.”

Blockchain could improve voter participation

Cointelegraph previously reported that Tusk Philanthropies wants to use blockchain technology to address the problem of low voter turnout in the American electoral system. This will improve political representation and subsequently, the quality of government, according to Tusk. Sheila Nix, president of Tusk Philanthropies, told Cointelegraph:

“Blockchain is the most secure option that exists right now but we are vendor and technology agnostic and are open to new solutions in the future. We think there is a lot of growth potential for blockchain-based voting — especially due to the auditability features.”

Crypto Firms Join Azure as Microsoft Fights Amazon for Market Share

Microsoft is bolstering its blockchain offerings on the Azure platform through a series of partnerships, Insolar the latest to join.

Thanks to the high computational flexibility that it offers, the influence of cloud computing on the blockchain space continues to grow. It’s less of a surprise, then, that cloud computing giants — such as Amazon, Microsoft, Oracle and Google’s parent company Alphabet — are leading the charge to merge blockchain, especially the enterprise type, and the cloud.

Microsoft in particular has been actively engaging with blockchain startups that are developing blockchain solutions for the enterprise market, working with them to deploy their solutions on the Microsoft Azure cloud infrastructure.

The company’s aggressive approach to bolstering the blockchain functionalities of Azure could be a move to take the lead in the blockchain cloud market, which should expand as the underlying blockchain industry continues to grow. Microsoft Azure is currently behind the cloud market leader, Amazon Web Services, by a wide margin. Amazon owns nearly half of the public cloud infrastructure market, while Microsoft only controlled about 15.5% in 2018. 

Cloud Service Market

As of the time of writing, the Azure marketplace hosts 63 blockchain apps, while the Amazon Web Service (AWS) marketplace hosts 60 blockchain apps. Here’s a closer look at some of the blockchain companies that have become part of the Microsoft Azure most recently.

Insolar

Microsoft recently agreed to collaborate with Insolar, a Switzerland-based startup that builds blockchain solutions for the enterprise market, to bring an additional option to Azure clients that are looking to deploy blockchain applications. Through the partnership, Insolar will be offering enterprise solutions on its own blockchain, called the Insolar Blockchain platform. 

Insolar also got accepted to offer its blockchain solutions on the cloud service of database software giant Oracle. Speaking to Cointelegraph via email on the partnership with Microsoft and how it allows enterprises to build products, Insolar co-founder Peter Fedchenkov said:

“There are different options to deploy blockchain platform to the cloud: manually deploy blockchain platform code to the leased Virtual Machine (should be made by client); use the pre-configured Virtual Machine with blockchain platform deployed (available through Microsoft Azure Marketplace); use a part of already deployed and running blockchain environment (Blockchain-as-a-Service).”

Insolar’s blockchain platform, whose mainnet is expected to launch on Nov. 1, is reportedly capable of executing 10,000 transactions per second.

Kadena

On Aug. 27, U.S. based blockchain startup Kadena launched its enterprise blockchain on the Azure Marketplace. The blockchain company, founded by former employees of U.S. financial company JP Morgan Chase, had previously revealed its enterprise smart contract solution on the Amazon Web Services Marketplace in January.

By offering its Scalable Permissioned Blockchain on Azure, Kadena allows companies to build proof of concept products without delving too deep into the blockchain itself. Despite the promises that blockchain holds, the limited real-world proof that it actually solves certain problems can be limiting when companies think about the cost of building one from scratch. Kadena is also building a public blockchain called Chainweb, which is based on the proof-of-work consensus mechanism.

Enterprises typically opt to use a cloud provider that has an ecosystem for a range of services that work hand-in-hand. Kadena’s head of marketing, Tony Pham, told Cointelegraph that offering Kadena’s blockchain solutions on Azure means that businesses can easily implement its blockchain alongside other enterprise systems. Pham said:

“One specific example is that Kadena is ready for production smart contracts. An area where Kadena seeks integration is Know Your Customer (KYC). Onfido, a provider of KYC, is also on Azure so an enterprise user could choose to combine Onfido’s and Kadena’s solutions.”

Kadena says its smart contract dubbed Pact is the first human-readable smart contract language that anyone can write. Kadena announced last May that it has partnered with commodities and alternative assets management firm USCF Investments, which has approximately $3 billion in assets under management.

Nahmii

Ethereum-based second-layer blockchain scaling platform, Nahmii, also partnered with Microsoft in September 2019 to offer its solutions on the Azure cloud. Nahmii, created by Singapore-based Hubii, claims to solve the problem of scalability on the Ethereum blockchain “moving transactions away from the main chain to a second network that sits on top of the main Ethereum chain.” 

This potentially opens up the Ethereum blockchain, which presently executes only 15 transactions per second, to a new world of commercial possibilities. As part of the partnership with Microsoft, Nahmii also joined the Enterprise Ethereum Alliance. The alliance is a coalition of enterprises with the aim of developing standards for building enterprise-grade applications on the Ethereum blockchain.

Nahmii CEO Jacobo Toll-Messia told Cointelegraph, “Nahmii, makes blockchain a reality for enterprises and mass adoption.” Speaking about the uniqueness of his company’s solutions for Azure, Toll-Messia said:

“Our partnership with Microsoft is unique from the point of view that nahmii is unique; it is the only commercially ready scaling and interoperability protocol in the blockchain industry today. That alone implies that nahmii can be used — at scale — by Microsoft corporate customers to build any solution on the blockchain (payments, loyalty points, etc).”

As part of the partnership, Microsoft will allocate business development resources to onboard clients to the Nahmii network, according to Toll-Messia. Nahmii has already added the Norwegian Block Exchange to its governing body.

Truffle

In June, Microsoft announced that it has partnered with Truffle, one of the earliest projects at Ethereum incubation lab ConsenSys. Truffle’s tools offer developers a standalone, local node for writing smart contracts and a development environment that allows for the deployment of smart contracts. Azure users gain access to Truffle’s tools through the partnership with Microsoft.

Truffle didn’t respond to a request for comments. However, CEO Tim Coulter previously told Forbes that the partnership “opens up all of those developers to Truffle and it opens Truffle up to all of the services that Microsoft provides.” 

Blockchain-as-a-service model is boosting adoption

In the early days of the internet, when only deep-pocketed institutions could afford to own their servers, it wasn’t simple to own a website. These days, this can be set up within minutes. Such is the influence that simplified hosting services have had on internet adoption.

The expansion of blockchain-as-a-service (BaaS) platforms like Azure and AWS could be just as important to the rapid adoption of blockchain. Like web hosting, BaaS platforms take away hurdles like high capital investment and technical skills, and allows companies to simply build and deploy the products they need.