Bitmain Leads Circle’s $110 Million Round; Teams Up to Create Stable Coin

16.05.2018 bitcoinbabeau 0

Bitmain Leads Circle’s $100 Million Round; Teams Up to Create Stable Coin

Bitmain, the largest of the Bitcoin mining operations, is putting its muscle behind mobile payments and cryptocurrency trading firm Circle by leading a $110 million Series E round of funding, the companies announced on Tuesday, March 15, 2018, at Consensus in New York City.

Several other venture capital firms, including Breyer Capital, General Catalyst and Accel, joined the round, which now pushes the value of Boston-based Circle to $3 billion, from a reported $480 million in 2016, according to a statement by Circle.  

Bitmain is also joining forces with Circle to create a so-called “stablecoin,” a cryptocurrency that is pegged to a stable asset. The goal is to eventually have lots of stable tokens, all backed by different fiat currencies, but the first will be Circle USD Coin (USDC), a coin backed one-to-one by the U.S. dollar with the fiat to be stored in an auditable bank account and redeemable by verified buyers.

The tokens will be based on Ethereum’s ERC20 standard and developed and governed by CENTRE, a foundation that will manage a collection of new, fiat-backed tokens. CENTRE is a wholly owned subsidiary of Circle, but Circle CEO Jeremy Allaire said that the foundation would become more independent as other members joined.

Alongside Circle and Bitmain, other CENTRE members will be able to produce their own fiat-based stablecoins and help set rules around how the coins will operate. According to the CENTRE’s whitepaper, governance of the network will include a type of voting that will leverage a forthcoming CENTRE-specific token that is separate from fiat tokens.

The way Circle sees it, a price-stable token is critical for enabling mainstream adoption of blockchain technology for payments and supporting financial contracts built on smart contract platforms, such as those for controlling token securities, loans and property.  

Circle’s new stable token joins a growing list of stable tokens meant to ease volatility of cryptocurrencies, like bitcoin, which can fluctuate wildly in value over even a few hours. Tether (USDT), introduced in 2015, is the biggest of the stablecoins, with about $2.2 billion in circulating supply.

Circle made news earlier this year when it purchased cryptocurrency exchange Poloniex. Circle plans to offer USDC through Poloniex. It will also incorporate USDC in its social payments app and over-the-counter (OTC) trading desk.

This article originally appeared on Bitcoin Magazine.

DMG Blockchain Solutions Launches BitScore AML Risk API for Crypto Exchanges and Payment Platforms

10.05.2018 bitcoinbabeau 0


Vancouver-based blockchain and cryptocurrency firm DMG Blockchain Solutions Inc. has announced the official launch of its BitScore web API. The platform is designed to provide cryptocurrency deposit and withdrawal risk-scoring for both anti-money laundering (AML) and anti-fraud compliance.

DMG Blockchain Solutions seeks to manage, operate and develop end-to-end solutions for monetizing the blockchain ecosystem, and BitScore is already being used by crypto exchanges and enterprise payment platforms so they can assess their risks of legal non-compliance. BitScore was engineered by DMG’s Blockseer development team and is powered by sophisticated artificial intelligence and machine learning models to examine the flow of cryptocurrency funds through the blockchain and establish their respective origins.

Speaking with Bitcoin Magazine, DMG CTO Danny Yang explained, “Understanding the provenance of source and destination addresses is imperative for any exchange or payment platform sensitive to regulatory compliance. Allowing an address that accepts deposits from, or makes payments or deposits to disreputable networks is potentially abetting their activities, which creates legal liabilities for banks, exchanges and traders.”

Here’s how it all works. Customers can submit any cryptocurrency source or destination address to BitScore. The platform’s algorithm returns a risk score to the user after evaluating the source of the funds. Customers are also informed if at any time in the past the monitored address has ever sent funds to high-risk parties. These typically include dark markets, hacking sites or money-laundering services.

BitScore also examines several generations of transactions in both directions (receiving and sending) and applies a weighting function that determines the amount of questionable cryptocurrency flowing through studied transactions. At press time, BitScore supports bitcoin only, though it plans to add ether and ERC20 tokens this coming summer. Litecoin and bitcoin cash will be added by the end of 2018.

BitScore is not the first effort of its kind. As regulatory compliance for cryptocurrency platforms becomes more crucial, several ventures involved in the blockchain arena are working to implement changes to their operations to certify rules are followed, customer safety is intact and monetary authorities remain satisfied.

One such company — cryptocurrency exchange platform Vaultbank — recently entered a partnership with Gordian Compliance Solutions to guarantee AML and Know-Your-Customer (KYC) compliance.

COO Aaron Travis stated, “If you’re on an exchange, or buying digital assets in which the originator or person selling them to you has not gone through great efforts to get to know you, and [has not] undergone KYC and AML checks, then I would be wary of it. If the platform you’re buying a digital currency from is not going through those hoops — those standard, basic efforts to protect the investor — you need to be wary of that.”

Other companies —  like Coinfirm, a risk and compliance platform designed predominantly for cryptocurrency businesses — have also released APIs built for further customer security and AML protection.

This article originally appeared on Bitcoin Magazine.