South Korea is all in for blockchain voting, SEC chair holds out a warning flag for bitcoin ETFs, and Coinbase adds Ethereum Classic support. Plus, what’s going on with crypto and the US dollar?
South Korea to Develop Blockchain-Enabled Voting System
ZDNet is reporting that South Korea is planning to create a blockchain-based voting system. The South Korean Ministry of Science and ICT and the National Election Commission (NEC) have indicated that the system will be ready for trials in December.
The NEC has had an online voting system since 2013, but it faced hacking and fraud concerns. The new system would use blockchain for voter authentication and result saving. Voting would be done via mobile device or personal computer, with results available for viewing as they are registered.
The system will be applied to surveys conducted by the Seoul National University’s Blockchain Society and the Korea Internet & Security Agency. If the trials go well, the system may be rolled out for public elections.
Market Deficiencies May Keep Bitcoin ETFs from Getting SEC’s Blessing
US Securities and Exchange Commission Chairman Jay Clayton has reservations over giving permission for the issuance of what would be the first ever bitcoin exchange-traded fund (ETF).
Arguing that – because crypto markets do not use the same monitoring tools as traditional exchanges – investors may not be able to get a fair assessment of bitcoin’s price, he is not “comfortable” approving the investment vehicle.
“What investors expect is that trading in the commodity that underlies that ETF makes sense and is free from the risk of manipulation,” Clayton said at the Consensus Invest Conference. “It’s an issue that needs to be addressed before I would be comfortable.”
Clayton pointed out that “surveillance” systems, or monitors that prevent and investigate manipulation on the exchange, do not exist on crypto exchanges typically. Among the exceptions is the Tyler Winklevoss and Cameron Winklevoss-founded crypto exchange Gemini, which partnered with Nasdaq to integrate surveillance technology into the exchange.
The SEC has rejected multiple applications for crypto ETFs, including one from the Winklevoss brothers, on the grounds of risk of fraud and market manipulation.
Coinbase to Add Support for Ethereum Classic
In a blog post released Monday, Coinbase announced it will support Ethereum Classic.
“With this asset launch, Coinbase Wallet now supports Ethereum (ETH), Ethereum Classic (ETC), and all of the 100,000+ ERC20 tokens on the Ethereum blockchain,” Coinbase wrote. “As part of our mission to be the easiest and most trusted crypto wallet, we plan to add support for even more blockchains in the future.”
Ethereum Classic is the result of a 2016 hard fork of Ethereum, where a minority of the nodes opted to protect the original Ethereum code instead of accepting a change that would reverse the damages of the high-profile DAO hack.
The post states that the Coinbase Wallet app should be updated in the “next few days,” after which users can send and receive ETC transactions.
Fortune: Crypto Prices Tied to the Price of the Dollar
There is something weird going on with the crypto market.
Many believe that cryptocurrencies are positioned to respond in opposition to fiat markets. For example, if the value of the US dollar or UK pound were to drop, crypto prices should rise as investors seek refuge. Similarly, if the dollar or pound were to rise, you should expect crypto prices to drop.
Yet, this is not what’s happening. Despite a litany of world market disturbances, including Brexit, the United States’ trade war with China, brewing trouble along the Ukraine-Russia border, foreign buyers abandoning the US housing market, a possible US recession, and unsustainable global debt, crypto prices are tanking.
Fortune has postulated on the conundrum and has came up with a possible explanation: crypto prices are linked to the US dollar. “Any strongly tied currency pair will experience the gains and losses associated with each pair. The US dollar marketplace presently suffers from a torrent of negative influences,” writes Jefferson Nunn for Fortune. “All of this leads to negative pressures on any investment tied to the US Dollar. As evidenced by the NASDAQ, it went from $8,100 on August 31 to $6,983 on Black Friday November 23. Also, Bitcoin went from $6,900 to $4,300 over the same time span.”
With the advent of stablecoins pegged to fiat currencies, crypto has grown more entangled with fiat money systems. If the market itself is tied to the US dollar, then all crypto – including decentralized ones like bitcoin and Ether – would be effectively centralized around US Federal Reserve policies.
This may prove problematic for the market, especially if 2019 turn out to be as harsh for the US dollar as some anticipate.
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Frederick Reese is a politics and cryptocurrency reporter based in New York. He is also a former teacher, an early adopter of bitcoin and Litecoin, and an enthusiast of all things geeky and nerdy.
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