Revolut to Make Crypto Available in 50 States, Google Joins Hedera Hashgraph, Microsoft Azure Embraces Commercial Blockchain, Shopify Joins Libra

February has been very interesting and super intense month in the Blockchain & Crypto world. IBM is developing a new blockchain product that will automate the reconciliation of casual labor contracts, Israeli blockchain startup Clear has raised $13 million in a Series A round led by Fidelity, Spanish soccer powerhouse FC Barcelona, or Barca, has teamed up with FinTech platform Chiliz to create a blockchain-based token for the sports franchise, to name just a few.

So without further ado, let us dive deeper into what was trending and hot in Blockchain and Cryptocurrency world past month.

Winklevoss Brothers Obtain Six Stablecoin Patents

During the first week if February, Tyler and Cameron Winklevoss, the founders of the Gemini cryptocurrency exchange, have obtained six stablecoin-related patents, according to filings with the United States Patent and Trademark Office. 

Three of the patents — the first, second and the fifth on the list — all describe systems for changing the supply of a public blockchain-based stablecoin. The first patent describes how trusted third parties such as exchanges or banks can generate the asset, also on-demand.

Two of the patents — the third and sixth on the list — describe a system for creating a stablecoin on a public blockchain. The third patent also suggests that backed stablecoins could be used as collateral in financial transactions that are executed via smart contracts.

The fourth patent — filed on April 23, 2018 — “relates to the use of a stable value digital asset to pay dividends for securities and other financial instruments tied to a blockchain.” This paper suggests that dividends from securities like stocks could be paid in stablecoin.

IBM Offers Blockchain Solution for Casual Labor Contracts

During the same week, tech giant IBM is developing a new blockchain product that will automate the reconciliation of casual labor contracts.

Technology news site CIO reported on February 3 that IBM considers the blockchain particularly well-suited to tackling the pain point for businesses of resolving discrepancies across thousands of casual work contracts.

A casual work contract — sometimes known as a contingent work contract — is a non-permanent employment relationship, which typically offers contractees less job security, and often part-time or payment on a piece work basis. It is thus used for work done by consultants, freelancers, independent contractors and temporary contract workers, known as temps.

IBM has its sights on the blockchain for enterprise management of such contracts, as it notes that processing the high volume of contracts generated by casual workers is a cumbersome and insufficiently automated task for firms at present. Burton Buffaloe, leader of global logistics and blockchain at IBM, said:

One of the biggest pain points of all suppliers of contractors is invoice reconciliation. Blockchain lives in the spaces where there is friction and discrepancy.

Dubbed the Contingent Labor on IBM Blockchain, IBM’s system automates the tracking of time sheets and purchase orders, while mediating between approved parties involved in the invoicing process, Buffaloe explained. Should the system’s worldwide rollout prove successful, it will soon go to market, CIO reported.

Fidelity Leads $13M Funding Round for Clear

Further, Israeli blockchain startup Clear has raised $13 million in a Series A round led by Fidelity-backed Eight Roads.

Clear — which develops blockchain networks for high-volume transaction systems between businesses — announced the round’s completion in a statement via TechCrunch on Feb. 5.

Eight Roads is a global venture firm that originates in Fidelity’s first investment business, Fidelity Ventures. 

Other participants in the Series A for Clear were the venture funds of several global telecoms leaders: Spain’s Telefónica Innovation Ventures, the Telekom Innovation Pool of Germany’s Deutsche Telekom, Hong Kong telco HKT and Singapore’s Singtel Innov8. 

Telecoms is Clear’s first sectoral focus in its development of a blockchain and smart contract-driven transaction network designed for cross-border business to business (B2B) payments. 

Co-founder Gal Hochberg said that smart contracts in particular are a powerful tool to deal with high-volume, international transactions, as they:

Create a trusted view of the true status of the relationship within the company’s business partners [...] they can find any issues in real time, either in commercial information or in service delivery, and they can even actually resolve those inside our platform.

Use of the blockchain ensures that all these B2B transactions are auditable and secured by cryptography, with data consistent and in-sync for all parties involved.

Hochberg has claimed that the network is ostensibly capable of processing “hundreds of millions of billable events,” based on internal testing.

Clear anticipates entering full carrier-grade production in H1 2020, with the aim of expanding beyond telcos with the help of yesterday’s Series A.

Blockchain Payments Platform Paystand Raises $20M in Series B Round

Finally, Paystand has successfully raised $20 million in its Series B funding round, VentureBeat and others reported on February 6. The company will use this money to accelerate the growth of its blockchain-based commercial payment platform.

The current round includes investment from DNX Ventures, Battery Ventures, Epic Ventures, Commerce Ventures and Wildcat Ventures. Existing investors Leap Global Partners, BlueRun Ventures and others also participated.

The company will use the funds to expand its teams in Scotts Valley, California and Guadalajara, Mexico, as well as funding the expansion of its product lines. Paystand offers a blockchain-based platform for its customers that digitizes the settlement of commercial payments in many industries.

Jeremy Almond, CEO of Paystand, said to VentureBeat:

It’s like Venmo for complicated transactions for commerce. We are rebooting the financial infrastructure because a lot of it was built pre-internet. It holds companies back. We’re coming in with a new business model, doing payments-as-a-service.

Paystand fully automates the payment procedures for certain industries. For example, it allows insurance companies to digitally receive premium payments and send settlements for claims. Industries such as manufacturing, transportation and pharmaceuticals also benefit from the digitized cash cycle.

Paystand also uses smart contracts to negotiate conditions between companies. As Almond explained:

We enable the infrastructure between companies to use what they call smart contracts. We pay you on these terms. How do you ensure that happens? Blockchain infrastructure is good for that kind of thing.

This is made possible by a hybrid blockchain system, made of a public component for security and traceability, connected to private infrastructure for scaling.

The company is on a fast track for growth, having more than doubled its year-over-year revenue in the past 24 months. In the same time frame, it added over 80 large enterprise customers. Some of its current clients include JCB, Bugaboo, Covetrus, Parachute Home and Silicon Valley Bank.

Google Joins Hedera Hashgraph’s Governing Council

The second week of February began with the news from Hedera Hashgraph that chose Google Cloud Platform as its preferred cloud provider for deploying its public networks. A February 11 post on Google blogs commends Hedera for the choice, while revealing that it is taking an active stake in the project’s governance.

Hedera is set to use Google Cloud to host its public testnets and Hedera Consensus Service ecosystem. This allows Hedera developers to benefit from Google’s geographical coverage and infrastructure.

Hedera is a distributed ledger technology project rooted in the enterprise world. It uses a hashgraph-based consensus algorithm to allow for multiple branches of blocks, as opposed to a single chain. The project reportedly provides a performance of ten thousand transactions per second.

It is governed by the Hedera Governing Council, a body composed of many well-known companies such as Boeing, IBM, Deutsche Telekom and others. The council’s function is to lead the network’s decision-making and ensure its continuous reliability.

FC Barcelona Dives Into Crypto, Partnering With Chiliz to Create Token

During the same week, Spanish soccer powerhouse FC Barcelona, or Barca, has teamed up with FinTech platform Chiliz to create a blockchain-based token for the sports franchise.

As part of the partnership with FC Barcelona, Chiliz created Barca Fan Tokens (BAR) for use on its social mobile app called Socios, according to a press release shared with Cointelegraph. 

“We are really proud to launch the Barca token on the Chiliz blockchain platform,” Chiliz and Socios CEO and founder Alexandre Dreyfus said, referring to Chiliz’s own Ethereum-based blockchain. “This is the ultimate goal and the best confirmation of our long term vision about fan engagement and monetization.”

Several months ago, Chiliz began working on Socios, seeing 100,000 users during beta testing, Dreyfus told Cointelegraph in an email, confirming that the platform is no longer in the beta phase.

Crypto Lending Firm BlockFi Secures $30M to Facilitate Mainstream Adoption

Furthermore, cryptocurrency-lending startup BlockFi has secured $30 million from an array of investors, including Morgan Creek Digital, Winklevoss Capital and Arrington XRP Capital.

The Series B funding round was led by United States-based capital fund Valar Ventures, with participation of Akuna Capital, CMT Digital, Avon Ventures, Castle Island Ventures, Purple Arch Ventures, Kenetic Capital, and Hong Kong-based HashKey Capital, among others.

With the raised funds, BlockFi — whose users can earn compound interest on and trade loans backed by assets — now has more than $650 million in assets on the platform. The company is planning to allocate the secured funds to the enhancement of its staff and expansion of its offerings.

BlockFi hinted in the release that it will roll out products accessible to a mainstream audience, starting with a mobile app in the coming months. A spokesperson for BlockFi told Cointelegraph that in addition to launching the mobile app — which will integrate user bank accounts directly to BlockFi, — the company is looking to roll out “the world’s first ever crypto-rewards credit card”. BlockFi further added:

We believe that the credit card will be a complete game changer in the crypto space. In terms of offering a rewards credit card, it will encourage our clients to invest and earn money in the long term, in the form of bitcoin.

Speaking about products that had the most notable impact on the company’s recent growth, BlockFi pointed out the launch of two new core offerings, including an institutional services arm and a zero-fee trading platform, for both private and institutional investors.

Binance Cloud to Allow Users to Launch a Crypto Exchange Within 5 Days

The 3rd week of the month was especially interesting. It began with the news from Binance whose newly released Binance Cloud platform might be somewhat different from what the crypto industry expects the new feature to be.

After Binance founder and CEO Changpeng Zhao (CZ) first hinted at the introduction of Binance Cloud on February 8, the new service has been officially released on February 17, targeting users willing to set up crypto exchanges, according to a blog post by Binance.

According to the announcement, Binance Cloud will serve as an all-in-one infrastructure platform for customers and partners to launch digital asset exchanges based on Binance’s industry-leading technology, security, liquidity as well as custodial services. The solution also supports dashboard for managing funds, multilingual functionality, as well as a range of trading pairs and coin listings.

The Binance’s new exchange-specific cloud solution will provide users with a method of setting up a crypto platform in their local markets. Binance Cloud’s features include crypto spot market and futures trading as well as local bank API integrations and peer-to-peer exchange services from fiat to crypto, the announcement notes. In the future, Binance Cloud plans to add more features like staking, over-the-counter trading services as well as token issuance with initial exchange offering platform.

Chinese Exchange FCoin Closes Down, Still Owes Users $125M

During the same week, Zhang Jian, founder of Chinese crypto exchange Fcoin, revealed in a post earlier today that FCoin may not be able to pay the 7,000-13,000 BTC (that’s $67 million to $125 million) that it owes users. 

According to Zhang, the exchange hasn’t been hacked and isn’t an exit scam. But evidence suggests it might be exactly that. 

Zhang claims that the shutdown is the result of a series of internal data errors and decisions that are too complicated to explain: 

This is a problem that is a little too complicated to be explained in a single sentence, the time span is also large, and the two story development lines are advancing and affecting each other at the same time, leading to the final outcome.

After FCoin’s launch in May, the exchange’s reported trading volumes became some of the biggest in the world overnight with a new business model called “transaction mining.” Later it was reported by one Redditor that this volume was actually fake. The FCoin order book appears to be crawling with bots. “The price of FT is constantly manipulated,” wrote one Redditor, who also described the exchange as a scam. 

The business model was suspicious from the get-go. There was no airdrop nor ICO at launch. FCoin distributed 51% of its native tokens to users for reimbursing transaction fees. Users were incentivized to transact as frequently as possible, since the platform reimbursed 100% of the transaction fees they paid in FT tokens. 80% of the exchange's daily revenue from transaction fees were then paid back to users. 

Crypto Custodian Copper Raised $8M for Expansion

Further, a new founding round will help London-based digital asset startup Copper meet the burgeoning demand for cryptocurrency custody services.

Tech business publication BusinessCloud reported on February 17 that Copper has raised $8 million in a Series A round which included venture capital firms like MMC Ventures and LocalGlobe. With such capital, Copper founder and CEO Dmitry Tokarev have expressed his intention of enhancing their offerings in North America and Asia:

Copper was always designed to be a global offering. This venture funding round is a real vote of confidence from investors. Their support will allow us to accelerate our scale up, hiring teams in key regions and introducing new products and services to better meet their needs.

Launched in 2018, Copper provides its clients access to crypto trading without taking digital assets out of its custody. This investment will allow Copper to hire business development teams for these markets in addition to specialists handling local crypto regulations. The company had planned on establishing new offices in Hong Kong, but such efforts have been curtailed with the recent outbreak of the coronavirus. 

Cloud Giant Microsoft Azure Embraces Commercial Blockchain

Further, Lition, a commercial blockchain, announced on February 18 that Microsoft has officially brought Lition blockchain solution to its Azure cloud marketplace.  

This makes Lition one of the few public/private blockchains currently supported by a major cloud provider like Microsoft. Microsoft also became the first to bring blockchain to the cloud and continues to remain at the cutting edge of blockchain adoption.

Integrating Lition blockchain into Azure allows Microsoft Azure’s worldwide enterprise clients to develop, test and deploy Lition side chains and applications with a click of a button on its platform, according to the announcement. Dr. Richard Lohwasser, Lition’s CEO added that: 

Lition is committed to providing an accessible onramp to blockchain for all organizations. We believe that making integration as seamless as possible is vital to bridging the gap to adoption. Azure will be a tremendous asset for our customers.

Lition marketing manager Benni Woerpel said that synergies between big companies and startups are crucial for the blockchain industry and real businesses:

Streamlining the processes to adopt blockchain technology through Microsoft Azure gives us a great advantage when approaching businesses. The challenge is to give simple solutions for complex corporate systems. I believe that Lition is evolving in the right direction to tackle this challenges.

Sweden Is Testing Its New Central Bank Digital Currency

To add, the country of Sweden has begun testing an e-krona, bringing it that much closer to the proper release of a central bank digital currency (CBDC). The pilot program will be in operation for one year, until February 2021.

If and when the e-krona formally launches for use by the public, the idea is that this blockchain-powered currency would drive conventional payments and banking activities throughout the country. Instead of swiping a credit card or spending fiat currency, everyday transacting can move to the blockchain.

CBDCs are a hot topic these days, and Sweden is the second country (after the Bahamas) to unveil what would appear to be a true, working national cryptocurrency. The Bahamas launched a CBDC pilot program in December and plans a full rollout sometime in the second half of 2020.

China has teased that it is developing its own CBDC, but developments there so far aren’t as cohesive as Sweden and the Bahamas.

Launching a CBDC in Sweden would seem to fit existing Swedish sensibility — the country is already one of the most cashless societies in the world.

E-Commerce Giant Shopify Joins Libra Association

Finally, the week was closed by e-commerce giant Shopify that has joined the Libra Association, a network of founding members supporting Facebook's stablecoin project Libra.

Shopify, a major Canada-based digital commerce platform hosting more than one million merchants, will be collaborating on the establishment of a global payment network within the Libra Association, the firm officially announced on February 21.

The Libra Foundation has confirmed the news in a Facebook post, outlining that Shopify would be an “incredible partner in making widespread economic participation a reality.”

In the announcement, Shopify claimed that its action to join the network comes in line with the company’s desire to tackle the unsolved problem of cross-border payments. According to the company, “much of the world’s financial infrastructure was not built to handle the scale and needs of internet commerce.”

Shopify further emphasized that as a major global e-commerce platform, the company should challenge existing standards in the global payment system in order to bring “transparent fees and easy access to capital,” while ensuring the security and privacy of merchants.

Shopify said:

Our mission is to make commerce better for everyone and to do that, we spend a lot of our time thinking about how to make commerce better in parts of the world where money and banking could be far better. That’s why we decided to become a member of the Libra Association. This is one step, but not the only step we’ll be taking to be a part of the solution to this global problem.

Shopify’s entrance to the Libra Association comes after a series of departures from the group by major global firms, which many associated with increased concerns of global regulators

Caitlin Long Starts the First Crypto-Native Bank in the US

The last week of the month began with the news from Caitlin Long, a former Wall Street executive who has helped Wyoming enact 13 blockchain-enabling laws, who is taking advantage of the progressive Wyoming legislature to establish a first crypto-native bank in the U.S. The bank’s name is Avanti, which means “forward” in Italian.

Long made this announcement in a series of 29 tweets. She believes that “a critical piece of U.S. market infrastructure is missing – a regulated bank that can act as a bridge to the Federal Reserve for payments and [offer] custody for BIG institutional money.”

Long thanked Wyoming governor Mark Gordon for making this possible, as Avanti takes advantage of the special-purpose depository institution law “which is the optimal regulatory-compliant structure in the U.S. for providing financial services around crypto.” 

“There’s not a bank in the US that can custody crypto right now – so this means trust company custodians are the only alternative at present. But trust companies can’t offer the risk reduction benefits of direct access to the Fed.”

However, Long notes that this special-purpose depository law has stringent regulatory requirements. According to this law, all deposits — in the case of Avanti, crypto deposits — must be 100% reserved. Avanti will also not be allowed to use deposits for any financial operations of its own — a practice known as “rehypothecation.” Strict Know Your Customer standard must be applied. “DON'T EVEN THINK ABOUT trying to use Avanti for illegal/nefarious purposes!!!!!!!!!,” warns Long in a tweet.

ConsenSys Spins Off Health Division to Tackle Healthcare Issues

During the same week, ConsenSys, the Ethereum-focused company founded by Joseph Lubin, announced on February 25 that it will spin off its health division. The new ConsenSys Health company will develop blockchain use cases to tackle issues in the U.S. healthcare industry.

The announcement is part of ConsenSys’ strategy shift of favoring products such as Codefiand Infura, which led the company to spin out several internal projects into independent entities.

ConsenSys Health focuses on applying blockchain to the health industry, citing issues such as rising costs and access to care as some of the areas where blockchain can contribute. Co-founder of Ethereum (ETH) Joseph Lubin commented on the news, saying:

Spinning off a separate company in this area is an opportunity for us to combine the powerful technology built by ConsenSys with a team of domain leaders to solve the biggest challenges in healthcare.

The new company will be headed by Heather Leigh Flannery, who was the Global Lead for healthcare at ConsenSys. She is deeply involved in many initiatives combining blockchain with healthcare, serving on the chair of associations such as HIMSS Blockchain in Healthcare Task Force, Blockchain in Healthcare Global and the Healthcare Special Interest Group in the Ethereum Enterprise Alliance.

Half of Cash App’s Revenue Now Comes From Bitcoin

Further, Square’s Cash App derived half of its fourth-quarter revenue from Bitcoin (BTC) services.

According to a shareholder letter published on February 28, Bitcoin revenue amounted to $178 million during the fourth quarter of 2019, while combined non-Bitcoin revenue totaled $183 million.

In total Bitcoin accounted for more than half a billion dollars of revenue across 2019, equating to around $8 million in profits. That’s up from $1.7 million the previous year.

The figures show that Bitcoin is increasing in popularity with smaller retail investors on the peer-to-peer payments app, with the last quarter accounting for almost 40% of Square's Bitcoin revenue for the year.

Cash App — from Twitter CEO Jack Dorsey’s firm Square — is currently the second most-used finance app on Google Play, and the 23rd-most used app on the platform overall. It also offers fee-free free stock trading for its 24 million active users.

They’re not major players on Cash App however, with each user conducting $7.42 worth of monthly BTC trades on average. Still, that’s twice as much as December 2018, when the average user generated $3.50 in Bitcon trades a month.

Per-person Bitcoin revenue is also growing at twice the speed of the platform’s average, with the average quarterly revenue of customers doubling from $15 to $30 since December 2017.

Cash App’s $8 million in Bitcoin profits account for less than 1% of Square’s total $937 million in gross profits when excluding the company’s $373 million sale of its food delivery app, Caviar.

Revolut Will Make Crypto Available in 50 States

Finally, Revolut is coming to the smartphone near you with an array of cryptocurrencies before tax day. Having just raised $500 million on a $5.5 billion valuation, Revolut is one of the biggest FinTechs in Europe. Revolut is a neobank: simply, a bank without the expense and convenience of physical branches or the headache of licensing.

Revolut is already well-established in Europe. On its home soil, it allows users to buy and sell Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), Bitcoin Cash (BCH) and (XRP) for one of 29 fiat currencies. Revolut expects to start offering the same service to its clients in all 50 U.S. states.

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About: I am a business developer, sales professional, FinTech strategist, as well as Cryptocurrency and Blockchain enthusiast. I'm highly passionate about Financial Technology and Digital Innovation, and strongly believe that it will change the world for the better. Apart from my daily job at a global payments startup where I'm leading company's expansion into Europe , I'm an active member of FinTech community and a TechFin evangelist.

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