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How to Buy NEO at Binance

This is a short guide to safely buying NEO on the Binance exchange.

What is NEO

NEO is a next generation smart economy platform (formerly called Antshares).

NEO has been described as the “Chinese Ethereum”.

The NEO system includes:

  • Delegated Byzantine Fault Tolerance (DBFT) algorithm – This is a consensus mechanism (instead of the traditional proof of work/stake) that allows the system to resist the Byzantine Generals problem and maintains consensus even if some nodes bare malicious intentions
  • NeoX – This system will create the ability to execute and operate across various Blockchains
  • NEO Contract – Is the mechanism for creating smart contracts seamlessly in scalable, high performance environments that integrates pre-existing codebases (e.g. C#, VB.Net, F#, Java, Kotlin)
  • NeoFS – This is a service which allows decentralized storage (like a peer to peer Dropbox)
  • NeoQ – A lattice-based cryptographic mechanism which creates problems that cannot be solved by quantum computers and ensuring being quantum-proof

NEO Token Details

Official Website: Neo.org
Token:   NEO
Total Supply: 100,000,000
Circulating Supply: 65,000,000

Step 1 – Register at Binance

To buy the token, you first need to sign up at Binance.

First go to Binance.com.

how to buy neo at binance

Next you need to click on the “Create Account” link.

Go ahead and Register at Binance by adding your personal details.

buying neo token at binance exchange

To sign up for Binance you’ll need a valid email address and create a secure password.

Step 2 – Activate Your Binance Account.

You’ll be asked to activate your account before you can log in on Binance.

Go to the email you entered and click on the link sent by Binance to complete the registration process.

guide to buying neo at binance

Step 3 – Log On to Your New Binance Account

Go back to Binance.com and use your new account details to log in.

Step 4 – Fund your Binance Wallet.

Before you can buy your new tokens, you need to have funds in your Binance wallet.

Note that you can’t send fiat currency direct to Binance.  Instead you need to send your favorite crypto (we recommend ETH or LTC due to low transaction costs and fast transfer times).

The easiest way is to buy crypto at Coinbase.com then send it to Binance.

How to Buy Bitcoin at Coinbase

Back at Binance, click the “Funds” link on the top menu bar, then the “Deposits” link on the sub-menu that pops up.

depositing funds to binance

You now need to find the deposit address for the specific type of crypto you are transferring over from Coinbase.

In this example we’re using ETH.

First, search for “ETH” in the search field.

Then click on the “Deposit” button.

deposit eth to binance

Now, copy the ETH Deposit Address and use that as the destination/outward address at your Coinbase account.

deposit address for eth into binance

Wait a few minutes and the crypto (ETH in this case) will be credited to your Binance account.

Step 4: Trade your Ether for NEO tokens.

Click on the ‘Exchange’ link at the top menu, next to the Binance logo.  Then click on the “Basic” option that is displayed on the drop-down sub-menu.

buy neo on binance

Search for the NEO/ETH pair among the list displayed on the page.  Do this by selecting the “ETH” tab and searching for “NEO” in the search box.

searching for neo eth trade pair on binance

Under the NEO/ETH chart, you’ll find the Buy NEO section.

buy neo on binance exchange

The first box with the Price label displays how much ETH or fraction of ETH you pay to buy each NEO token.

The second box with the Amount label is where you enter the number of NEO  tokens you plan to buy.

You can also use the percentage buttons to indicate what percentage of your funds you want to spend.  Clicking on the 100% button uses all the ETH in your account.  Clicking 50% uses 50% etc.   If you use the percentage buttons, the number of tokens you can buy will be automatically entered into the Amount box.

The Total box shows how much Ether in total you are paying for the transaction. This includes any transaction fees by Binance.

Ready to buy?

Go ahead and Click on the “BUY NEO” button.

Are you new to Bitcoin?  For a limited time only, you can grab our Bitcoin for Beginners course for absolutely free.  You can get access right here.

 

How to Buy Bitcoin at Coinbase in the US

Ok, so you want to buy Bitcoin but you don’t know where to start.

This guide will show you how to get started quickly and securely.

Beware of smaller sites that offer lower fees and other benefits.  There are a lot of sites trying to scam you.  Stick to our recommendations of time proven, verifiable and reliable exchanges.

What is Coinbase

Coinbase is the world’s largest and safest portal to buy Bitcoin.  It is fast an easy to register an account and verify your identity.

  • Operates in 32 countries.
  • Accepts debit & credit cards and bank transfers.
  • Can have low buy limits at first, increases with use.
  • ID verification required.

Step 1 – Sign Up for Coinbase

This first step is to sign up for a Coinbase account.

sign up at coinbase to buy bitcoin

This will give you a secure place to store your bitcoin, and easy payment methods to convert your local currency into or out of bitcoin.

Press the ‘sign up’ button and fill out your name (make sure this is exactly how it’s written on your photo ID), email, password and location.

guide to buying bitcoin on coinbase

Claim Your Free Bonus

If you use this link to sign up to Coinbase you will receive ten dollars worth of free coins when you spend over $100 (or the equivalent in your currency).  (We’ll also get ten dollars for recommending you to Coinbase!)

Step 2 – Confirm Your Email

Go to the email account you used to sign up for Coinbase.

Open the email from Coinbase and click the link to verify your sign-up.

step by step buy bitcoin at coinbase

Step 3 – Verify Your Details

Just like your bank account, Coinbase has to follow US Government regulations.   As a result, it takes identification verification very seriously.

I know, it slows you down and is a bit of a pain.  But its by following the rules that has given Coinbase its reputation for being a trusted service.

To verify your account you must supply a phone number, upload an image of your photo ID and verify a credit/debit card or bank account before you can buy.

Step 4 – Add a Payment Method

Using a credit/debit card means higher fees but offers instant purchasing. Using a bank transfer is cheaper but slower (taking up to a week to get your coins).

how to buy bitcoin

Step 5 – Buy Bitcoin on Coinbase

Once your payment details are verified, click ‘Buy/Sell’ on the top menu.

buying bitcoin on coinbase

Select ‘Bitcoin’, and at the bottom of the page choose how much to spend in your local currency / how many coins you want to buy.

Once you’re happy with the amount, click the big ‘Buy’ button.

You’ll be asked to confirm your purchase.

Press the ‘Confirm Buy’ button.

Congratulations! You now own some Bitcoin.

 

Bonus Level – A Way to Buy Bitcoin With No Fees

There is an more advanced way to buy Bitcoin that avoids paying Coinbases fees. If you’re interested in learning about that, you can read our quick guide here.

 

Miami Condo Seller ONLY Accepting Bitcoin

In a staggering development, the seller of a luxury one-bed apartment in Miami Beach has indicated that ONLY Bitcoin will be accepted.

The price? 33 Bitcoins.

miami condo bitcoin only

That’s nearly $550,000 if you’re still more comfortable with “old” fiat money.

Is this a gimmick?

Almost certainly. And likely a fantastic way to attract serious media attention to the property listing.

The biggest question we have is: will the seller be changing the listing price on a daily basis to keep up with the inevitable Bitcoin price fluctuation.

Fed Chairman Janet Yellen Talks Bitcoin

This afternoon during the December FMOC meeting, Janet Yellen, Chair of the Federal Reserve was asked by Steve Liesman of CNBC (a popular crypto currency news channel) if the Fed was worried about the stock market going up by triple digits every day. More importantly, Yellen was asked what is, with the ever increasing price and visibility of the most-popular cryptocurrency, the Fed’s policy on Bitcoin.

You can watch her answer below.

Why is this important? It’s just another brick in the wall solidifying the Bitcoin base. And adding layers to Bitcoin’s growing credibility.

Remember, this isn’t the first time that Bitcoin has popped-up at one of the Janet Yellen’s appearances.  Back in July, someone held up a ‘buy bitcoin’ sign during Yellen’s testimony to Congress.

If you followed that person’s advice, congratulations.  At the time Bitcoin was trading at around $2,400.  It’s currently nearer $17,000.

Here’s the full transcript of Janet Yellen’s thoughts on Bitcoin:

You asked about Bitcoin and there I would simply say that Bitcoin at this time plays a very small role in the payment system.  It is not a stable source of store of value and it doesn’t constitute legal tender it is a highly speculative asset and the Fed doesn’t really play any, role any regulatory role with respect to Bitcoin other than assuring that banking organizations that we do supervise are attentive.  That they’re appropriately managing any interactions they have with participants in that market and appropriately monitoring anti-money laundering Bank Secrecy Act responsibilities that they have. I don’t believe there’s been anything specific about that.

Just generally banks have Bank Secrecy Act anti-money laundering responsibilities and this applies to Bitcoin as it does in if every other realm.

SEC Chairman Statement on Cryptocurrencies and Initial Coin Offerings

It was a very busy day for the SEC.

Hot on the heels of last week’s news that the SEC had seized the assets of ICO operator PlexCoin, today, California company Munchee refunded the $15 million tokens it sold during its ICO following a cease and desist order from the SEC. The SEC had argued that the “MUN” tokens constituted securities on the basis that “they were investment contracts.” This was regardless of their alleged “utility” when the sale took place.

Not finished there, SEC Chairman Jay Clayton then released a detailed statement on Cryptocurrencies and Initial Coin Offerings.

This is a major development in the crypto-sphere where one of the hottest topics of debate has been how and to what extent US Regulators would police the booming crypto industry.

Clayton’s statement was balanced and fair and showed that the SEC is taking a pragmatic approach to regulation. And it led to this tweet by prominent blockchain lawyer, Marco Santori:

The Highlights

The Statement shows that the SEC isn’t being fooled by any attempts to dress up securities as “tokens”. If it wasn’t clear before that you couldn’t just slap a “Utility Token” nametag on your ICO, it is now:

Following the issuance of the 21(a) Report, certain market professionals have attempted to highlight utility characteristics of their proposed initial coin offerings in an effort to claim that their proposed tokens or coins are not securities.  Many of these assertions appear to elevate form over substance.  Merely calling a token a “utility” token or structuring it to provide some utility does not prevent the token from being a security.  Tokens and offerings that incorporate features and marketing efforts that emphasize the potential for profits based on the entrepreneurial or managerial efforts of others continue to contain the hallmarks of a security under U.S. law. 

Chairman Clayton didn’t want to let trading exchanges feel left out. There was a special mention for them:

Similarly, I also caution those who operate systems and platforms that effect or facilitate transactions in these products that they may be operating unregistered exchanges or broker-dealers that are in violation of the Securities Exchange Act of 1934.

It was not all bad news. There was a clear sign that the SEC is taking a very pragmatic approach to their securities-analysis:

We at the SEC are committed to promoting capital formation.  The technology on which cryptocurrencies and ICOs are based may prove to be disruptive, transformative and efficiency enhancing.  I am confident that developments in fintech will help facilitate capital formation and provide promising investment opportunities for institutional and Main Street investors alike.

As has been widely reported since the SEC published their guidance report in Summer 2017, Clayton emphasized that each case must be judged on its own facts, rather than a one-size-fits-all approach:

It has been asserted that cryptocurrencies are not securities and that the offer and sale of cryptocurrencies are beyond the SEC’s jurisdiction.  Whether that assertion proves correct with respect to any digital asset that is labeled as a cryptocurrency will depend on the characteristics and use of that particular asset. “Is the coin or token a security?”  As securities law practitioners know well, the answer depends on the facts.

Finally, came the warning that demonstrates the SEC is taking an ‘investor protection first’ approach:

By and large, the structures of initial coin offerings that I have seen promoted involve the offer and sale of securities and directly implicate the securities registration requirements and other investor protection provisions of our federal securities laws.  Generally speaking, these laws provide that investors deserve to know what they are investing in and the relevant risks involved. I have asked the SEC’s Division of Enforcement to continue to police this area vigorously and recommend enforcement actions against those that conduct initial coin offerings in violation of the federal securities laws.

The TL:DR Summary

Chairman Clayton’s statement demonstrates that, while the SEC isn’t launching itself into a regulatory blitzkreig, it sees what is developing and is wise to attempts by bad actors to circumvent existing regulation in attempts to defraud the public. The recent examples of PlexCoin and Munchee are surely just the tip of the enforcement iceberg. Act accordingly.

Are you new to Bitcoin?  For a limited time only, you can grab our Bitcoin for Beginners course for absolutely free.  You can get access right here.

Full Statement on Cryptocurrencies and Initial Coin Offerings

The world’s social media platforms and financial markets are abuzz about cryptocurrencies and “initial coin offerings” (ICOs).  There are tales of fortunes made and dreamed to be made.  We are hearing the familiar refrain, “this time is different.”

The cryptocurrency and ICO markets have grown rapidly.  These markets are local, national and international and include an ever-broadening range of products and participants.  They also present investors and other market participants with many questions, some new and some old (but in a new form), including, to list just a few:

  • Is the product legal?  Is it subject to regulation, including rules designed to protect investors?  Does the product comply with those rules?
  • Is the offering legal?  Are those offering the product licensed to do so?
  • Are the trading markets fair?  Can prices on those markets be manipulated?  Can I sell when I want to?
  • Are there substantial risks of theft or loss, including from hacking?

The answers to these and other important questions often require an in-depth analysis, and the answers will differ depending on many factors.  This statement provides my general views on the cryptocurrency and ICO markets[1] and is directed principally to two groups:

  • “Main Street” investors, and
  • Market professionals – including, for example, broker-dealers, investment advisers, exchanges, lawyers and accountants – whose actions impact Main Street investors.

Considerations for Main Street Investors

A number of concerns have been raised regarding the cryptocurrency and ICO markets, including that, as they are currently operating, there is substantially less investor protection than in our traditional securities markets, with correspondingly greater opportunities for fraud and manipulation.

Investors should understand that to date no initial coin offerings have been registered with the SEC.  The SEC also has not to date approved for listing and trading any exchange-traded products (such as ETFs) holding cryptocurrencies or other assets related to cryptocurrencies.[2]  If any person today tells you otherwise, be especially wary.

We have issued investor alerts, bulletins and statements on initial coin offerings and cryptocurrency-related investments, including with respect to the marketing of certain offerings and investments by celebrities and others.[3]  Please take a moment to read them.  If you choose to invest in these products, please ask questions and demand clear answers.  A list of sample questions that may be helpful is attached.

As with any other type of potential investment, if a promoter guarantees returns, if an opportunity sounds too good to be true, or if you are pressured to act quickly, please exercise extreme caution and be aware of the risk that your investment may be lost.

Please also recognize that these markets span national borders and that significant trading may occur on systems and platforms outside the United States.  Your invested funds may quickly travel overseas without your knowledge.  As a result, risks can be amplified, including the risk that market regulators, such as the SEC, may not be able to effectively pursue bad actors or recover funds.

To learn more about these markets and their regulation, please read the “Additional Discussion of Cryptocurrencies, ICOs and Securities Regulation” section below.

Considerations for Market Professionals

I believe that initial coin offerings – whether they represent offerings of securities or not – can be effective ways for entrepreneurs and others to raise funding, including for innovative projects.  However, any such activity that involves an offering of securities must be accompanied by the important disclosures, processes and other investor protections that our securities laws require.  A change in the structure of a securities offering does not change the fundamental point that when a security is being offered, our securities laws must be followed.[4]  Said another way, replacing a traditional corporate interest recorded in a central ledger with an enterprise interest recorded through a blockchain entry on a distributed ledger may change the form of the transaction, but it does not change the substance.

I urge market professionals, including securities lawyers, accountants and consultants, to read closely the investigative report we released earlier this year (the “21(a) Report”)[5] and review our subsequent enforcement actions.[6]  In the 21(a) Report, the Commission applied longstanding securities law principles to demonstrate that a particular token constituted an investment contract and therefore was a security under our federal securities laws.  Specifically, we concluded that the token offering represented an investment of money in a common enterprise with a reasonable expectation of profits to be derived from the entrepreneurial or managerial efforts of others.

Following the issuance of the 21(a) Report, certain market professionals have attempted to highlight utility characteristics of their proposed initial coin offerings in an effort to claim that their proposed tokens or coins are not securities.  Many of these assertions appear to elevate form over substance.  Merely calling a token a “utility” token or structuring it to provide some utility does not prevent the token from being a security.  Tokens and offerings that incorporate features and marketing efforts that emphasize the potential for profits based on the entrepreneurial or managerial efforts of others continue to contain the hallmarks of a security under U.S. law.  On this and other points where the application of expertise and judgment is expected, I believe that gatekeepers and others, including securities lawyers, accountants and consultants, need to focus on their responsibilities.  I urge you to be guided by the principal motivation for our registration, offering process and disclosure requirements:  investor protection and, in particular, the protection of our Main Street investors.

I also caution market participants against promoting or touting the offer and sale of coins without first determining whether the securities laws apply to those actions.  Selling securities generally requires a license, and experience shows that excessive touting in thinly traded and volatile markets can be an indicator of “scalping,” “pump and dump” and other manipulations and frauds.  Similarly, I also caution those who operate systems and platforms that effect or facilitate transactions in these products that they may be operating unregistered exchanges or broker-dealers that are in violation of the Securities Exchange Act of 1934.

On cryptocurrencies, I want to emphasize two points.  First, while there are cryptocurrencies that do not appear to be securities, simply calling something a “currency” or a currency-based product does not mean that it is not a security.  Before launching a cryptocurrency or a product with its value tied to one or more cryptocurrencies, its promoters must either (1) be able to demonstrate that the currency or product is not a security or (2) comply with applicable registration and other requirements under our securities laws.  Second, brokers, dealers and other market participants that allow for payments in cryptocurrencies, allow customers to purchase cryptocurrencies on margin, or otherwise use cryptocurrencies to facilitate securities transactions should exercise particular caution, including ensuring that their cryptocurrency activities are not undermining their anti-money laundering and know-your-customer obligations.[7]  As I have stated previously, these market participants should treat payments and other transactions made in cryptocurrency as if cash were being handed from one party to the other.

Additional Discussion of Cryptocurrencies, ICOs and Securities Regulation  

Cryptocurrencies.  Speaking broadly, cryptocurrencies purport to be items of inherent value (similar, for instance, to cash or gold) that are designed to enable purchases, sales and other financial transactions.  They are intended to provide many of the same functions as long-established currencies such as the U.S. dollar, euro or Japanese yen but do not have the backing of a government or other body.  Although the design and maintenance of cryptocurrencies differ, proponents of cryptocurrencies highlight various potential benefits and features of them, including (1) the ability to make transfers without an intermediary and without geographic limitation, (2) finality of settlement, (3) lower transaction costs compared to other forms of payment and (4) the ability to publicly verify transactions.  Other often-touted features of cryptocurrencies include personal anonymity and the absence of government regulation or oversight.  Critics of cryptocurrencies note that these features may facilitate illicit trading and financial transactions, and that some of the purported beneficial features may not prove to be available in practice.

It has been asserted that cryptocurrencies are not securities and that the offer and sale of cryptocurrencies are beyond the SEC’s jurisdiction.  Whether that assertion proves correct with respect to any digital asset that is labeled as a cryptocurrency will depend on the characteristics and use of that particular asset.  In any event, it is clear that, just as the SEC has a sharp focus on how U.S. dollar, euro and Japanese yen transactions affect our securities markets, we have the same interests and responsibilities with respect to cryptocurrencies.  This extends, for example, to securities firms and other market participants that allow payments to be made in cryptocurrencies, set up structures to invest in or hold cryptocurrencies, or extend credit to customers to purchase or hold cryptocurrencies.

Initial Coin Offerings.  Coinciding with the substantial growth in cryptocurrencies, companies and individuals increasingly have been using initial coin offerings to raise capital for their businesses and projects.  Typically these offerings involve the opportunity for individual investors to exchange currency such as U.S. dollars or cryptocurrencies in return for a digital asset labeled as a coin or token.

These offerings can take many different forms, and the rights and interests a coin is purported to provide the holder can vary widely.  A key question for all ICO market participants: “Is the coin or token a security?”  As securities law practitioners know well, the answer depends on the facts.  For example, a token that represents a participation interest in a book-of-the-month club may not implicate our securities laws, and may well be an efficient way for the club’s operators to fund the future acquisition of books and facilitate the distribution of those books to token holders.  In contrast, many token offerings appear to have gone beyond this construct and are more analogous to interests in a yet-to-be-built publishing house with the authors, books and distribution networks all to come.  It is especially troubling when the promoters of these offerings emphasize the secondary market trading potential of these tokens.  Prospective purchasers are being sold on the potential for tokens to increase in value – with the ability to lock in those increases by reselling the tokens on a secondary market – or to otherwise profit from the tokens based on the efforts of others.  These are key hallmarks of a security and a securities offering.

By and large, the structures of initial coin offerings that I have seen promoted involve the offer and sale of securities and directly implicate the securities registration requirements and other investor protection provisions of our federal securities laws.  Generally speaking, these laws provide that investors deserve to know what they are investing in and the relevant risks involved.

I have asked the SEC’s Division of Enforcement to continue to police this area vigorously and recommend enforcement actions against those that conduct initial coin offerings in violation of the federal securities laws.

Conclusion

We at the SEC are committed to promoting capital formation.  The technology on which cryptocurrencies and ICOs are based may prove to be disruptive, transformative and efficiency enhancing.  I am confident that developments in fintech will help facilitate capital formation and provide promising investment opportunities for institutional and Main Street investors alike.

I encourage Main Street investors to be open to these opportunities, but to ask good questions, demand clear answers and apply good common sense when doing so.  When advising clients, designing products and engaging in transactions, market participants and their advisers should thoughtfully consider our laws, regulations and guidance, as well as our principles-based securities law framework, which has served us well in the face of new developments for more than 80 years.  I also encourage market participants and their advisers to engage with the SEC staff to aid in their analysis under the securities laws.  Staff providing assistance on these matters remain available at [email protected] .

Sample Questions for Investors Considering a Cryptocurrency or ICO
Investment Opportunity
[8]

  • Who exactly am I contracting with?
    • Who is issuing and sponsoring the product, what are their backgrounds, and have they provided a full and complete description of the product?  Do they have a clear written business plan that I understand?
    • Who is promoting or marketing the product, what are their backgrounds, and are they licensed to sell the product?  Have they been paid to promote the product?
    • Where is the enterprise located?
  • Where is my money going and what will be it be used for?  Is my money going to be used to “cash out” others?
  • What specific rights come with my investment?
  • Are there financial statements?  If so, are they audited, and by whom?
  • Is there trading data?  If so, is there some way to verify it?
  • How, when, and at what cost can I sell my investment?  For example, do I have a right to give the token or coin back to the company or to receive a refund?  Can I resell the coin or token, and if so, are there any limitations on my ability to resell?
  • If a digital wallet is involved, what happens if I lose the key?  Will I still have access to my investment?
  • If a blockchain is used, is the blockchain open and public?  Has the code been published, and has there been an independent cybersecurity audit?
  • Has the offering been structured to comply with the securities laws and, if not, what implications will that have for the stability of the enterprise and the value of my investment?
  • What legal protections may or may not be available in the event of fraud, a hack, malware, or a downturn in business prospects?  Who will be responsible for refunding my investment if something goes wrong?
  • If I do have legal rights, can I effectively enforce them and will there be adequate funds to compensate me if my rights are violated?

[1] This statement is my own and does not reflect the views of any other Commissioner or the Commission.  This statement is not, and should not be taken as, a definitive discussion of applicable law, all the relevant risks with respect to these products, or a statement of my position on any particular product.  Additionally, this statement is not a comment on any particular submission, in the form of a proposed rule change or otherwise, pending before the Commission.

[2] The CFTC has designated bitcoin as a commodity.  Fraud and manipulation involving bitcoin traded in interstate commerce are appropriately within the purview of the CFTC, as is the regulation of commodity futures tied directly to bitcoin.  That said, products linked to the value of underlying digital assets, including bitcoin and other cryptocurrencies, may be structured as securities products subject to registration under the Securities Act of 1933 or the Investment Company Act of 1940.

[3] Statement on Potentially Unlawful Promotion of Initial Coin Offerings and Other Investments by Celebrities and Others (Nov. 1, 2017), available at https://www.sec.gov/news/public-statement/statement-potentially-unlawful-promotion-icos; Investor Alert:  Public Companies Making ICO-Related Claims (Aug. 28, 2017), available at https://www.sec.gov/oiea/investor-alerts-and-bulletins/ia_icorelatedclaims; Investor Bulletin:  Initial Coin Offerings (July 25, 2017), available athttps://www.sec.gov/oiea/investor-alerts-and-bulletins/ib_coinofferings; Investor Alert:  Bitcoin and Other Virtual Currency-Related Investments (May 7, 2014), available athttps://www.investor.gov/additional-resources/news-alerts/alerts-bulletins/investor-alert-bitcoin-other-virtual-currency; Investor Alert: Ponzi Schemes Using Virtual Currencies (July 23, 2013), available at https://www.sec.gov/investor/alerts/ia_virtualcurrencies.pdf.

[4] It is possible to conduct an ICO without triggering the SEC’s registration requirements.  For example, just as with a Regulation D exempt offering to raise capital for the manufacturing of a physical product, an initial coin offering that is a security can be structured so that it qualifies for an applicable exemption from the registration requirements.

[5] Report of Investigation Pursuant to Section 21(a) of the Securities Exchange Act of 1934:  The DAO (July 25, 2017), available at https://www.sec.gov/litigation/investreport/34-81207.pdf.

[6] Press Release, Company Halts ICO After SEC Raises Registration Concerns (Dec. 11, 2017), available at https://www.sec.gov/news/press-release/2017-227; Press Release, SEC Emergency Action Halts ICO Scam (Dec. 4, 2017), available at https://www.sec.gov/news/press-release/2017-219; Press Release, SEC Exposes Two Initial Coin Offerings Purportedly Backed by Real Estate and Diamonds (Sept. 29, 2017), available at https://www.sec.gov/news/press-release/2017-185-0.

[7] I am particularly concerned about market participants who extend to customers credit in U.S. dollars – a relatively stable asset – to enable the purchase of cryptocurrencies, which, in recent experience, have proven to be a more volatile asset.

[8] This is not intended to represent an exhaustive list.  Please also see the SEC investor bulletins, alerts and statements referenced in note 3 of this statement.

How to Explain Bitcoin to Your Grandparents

Bitcoin continues to set new all time high prices. And it seems like the media is bombarding us with all things Bitcoin. It’s no surprise then that friends and relatives will start asking questions.

While it may be a hot topic, many people really struggle to grasp what Bitcoin is. This seems to be particularly true for older generations, less familiar with the digital and online world in general.

So, are you sick of having to explain what Bitcoin is and how Bitcoin works to friends and relatives?

Well, thanks to the guys at  Visualistan.com you can just send them this helpful “What is Bitcoin” infographic.

how to explain bitcoin to your grandparents infographic

Are you interested in learning more about crypto and Bitcoin?  Check out our free Bitcoin for Beginners course here.

Viral Cat Game Overwhelms Ethereum Blockchain

Move over Bitcoin, there’s a new crypto craze.

Ethereum-based viral game, CryptoKitties burst onto the scene over the weekend and is now overwhelming the entire Ethereum network as users frantically buy, breed and sell their own digital Kitties.

ethereum cryptokitties who would win

Think of it as a decentralized Tamagotchi.   But since CryptoKitties is played on the Ethereum blockchain, there’s no central entity or server managing the game.  Instead, each user owns their own Kitties (stored on their Ethereum wallet).  And because everything is stored on the public Ethereum blockchain,  each CryptoKitties transaction will live forever.

Whether you think that’s a good thing is up for debate.

On the one hand,  the game is making Ethereum fun and accessible to non techies.  It’s a user-friendly interface and you get to try out wallets, gas, transactions and a decentralized ledger.  Based on the explosive growth over the last few days, it appears that’s something people really want.

However, there is a major downside.   With so many people transacting, the Ethereum blockchain is struggling to keep up with all the activity.  Remember, there are limits on the number of computations that can be done on the blockchain at any one time.

Just Look at these Numbers

  • The “Genesis Cat” (think ‘first generation’) sold for 250 ETH (that’s over US $110,000)
  • CryptoKitties is consuming over 20% of all Ethereum transactions.
  • The total value of Kitties sold: US$ 4,933,654.45
  • The total number of Kitties sold: 38,965

You can check out the latest transactions (and search for record purchases) yourself at this website.

What Does CryptoKitties Mean for Ethereum?

First up, this has shown that Ethereum (and the blockchain in general) is just waiting for that ‘killer’ dApp to take it mainstream.

Second, Ethereum and crypto in general is complicated. Having a user-friendly gateway is the perfect way to introduce non-techies to the blockchain. And there’s nothing more user-friendly that breeding and trading your own virtual cats.  CryptoKitties will be many user’s first taste of the power of the blockchain.

However, it also shows that Ethereum really isn’t ready for Primetime.  The network is too slow to support anything close to a mainstream adoption.  This isn’t news to anyone close to the development of Ethereum. But this is likely going to accelerate the already fast-paced projects aimed at scaling Ethereum to support more transactions.

One thing’s for sure.  There’s a rabid market of Ethereum holders out there just waiting for that first ‘killer dApp’ to spend their ether.

You can find out more about CryptoKitties on their FAQ page.

Are you interested in learning more about crypto and Bitcoin?  Check out our free Bitcoin for Beginners course here.

SEC Seizes PlexCoin ICO Assets

Today the US SEC announced that it halted a proposed ICO and froze it’s assets.

The proposed PlexCoin ICO had raised $15 million since its launch in August. The SEC was correctly alarmed by promises that PlexCorps made regarding a 13x profit in 30 days.

ICO scammers take note – the SEC is onto and is coming for your ill-gotten gains.

Remember, back in August, the SEC’s Office of Investor Education and Advocacy issued an Investor Alert warning investors about scams of companies claiming to be engaging in initial coin offerings.

You can read the full Press Release on the SEC website.

 

Washington D.C., Dec. 4, 2017 —
The Securities and Exchange Commission today announced it obtained an emergency asset freeze to halt a fast-moving Initial Coin Offering (ICO) fraud that raised up to $15 million from thousands of investors since August by falsely promising a 13-fold profit in less than a month.

The SEC filed charges against a recidivist Quebec securities law violator, Dominic Lacroix, and his company, PlexCorps. The Commission’s complaint, filed in federal court in Brooklyn, New York, alleges that Lacroix and PlexCorps marketed and sold securities called PlexCoin on the internet to investors in the U.S. and elsewhere, claiming that investments in PlexCoin would yield a 1,354 percent profit in less than 29 days. The SEC also charged Lacroix’s partner, Sabrina Paradis-Royer, in connection with the scheme.

Today’s charges are the first filed by the SEC’s new Cyber Unit. The unit was created in September to focus the Enforcement Division’s cyber-related expertise on misconduct involving distributed ledger technology and initial coin offerings, the spread of false information through electronic and social media, hacking and threats to trading platforms.

“This first Cyber Unit case hits all of the characteristics of a full-fledged cyber scam and is exactly the kind of misconduct the unit will be pursuing,” said Robert Cohen, Chief of the Cyber Unit. “We acted quickly to protect retail investors from this initial coin offering’s false promises.”

Based on its filing, the SEC obtained an emergency court order to freeze the assets of PlexCorps, Lacroix, and Paradis-Royer.

The SEC’s complaint charges Lacroix, Paradis-Royer and PlexCorps with violating the anti-fraud provisions, and Lacroix and PlexCorps with violating the registration provision, of the U.S. federal securities laws. The complaint seeks permanent injunctions, disgorgement plus interest and penalties. For Lacroix, the SEC also seeks an officer-and-director bar and a bar from offering digital securities against Lacroix and Paradis-Royer.

The Commission’s investigation was conducted by Daphna A. Waxman, David H. Tutor, and Jorge G. Tenreiro of the New York Regional Office and the Cyber Unit, with assistance from the agency’s Office of International Affairs. The case is being supervised by Valerie A. Szczepanik and Mr. Cohen. The Commission appreciates the assistance of Quebec’s Autorité Des Marchés Financiers.

This Week on Coin Street – 3 December 2017

Week ending December 3rd, 2017

Your weekly roundup of all things crypto brought to you by Coin Street

Neil’s Market Wrap

We’re back after taking a week off stuffing our faces with Thanksgiving turkey.  Fortunately not much happened in crypto, it’s been positively quiet out there.

Apart from …. another new all time high with Bitcoin touching $12,000 for the first time…. the CME confirming a date for the launch of their BTC derivative futures product  and the Commodity Futures Trading Commission, the main US markets regulator, giving the green light for the very same listing.  Oh and the Nasdaq are not going to be far behind.

Yeah you’re right, that’s massive.  In fact, it’s arguably the biggest thing to hit the crypto space since Satoshi released his original white paper nine years ago.  Just to recap: the Chicago Mercantile Exchange is the biggest derivatives exchange in the world and by listing a Bitcoin product it gives investors a familiar and reputable vehicle to access the Bitcoin space without having to touch the actual coin or go near a less well known or time served portal.  Of course, it also provides a means to ‘short’ bitcoin.  We could be in for a bumpy ride – even by Bitcoin standards!

It’s always difficult to predict what effect news will have on price action but it’s almost certainly bullish in a longer time frame.  Short term, Wall Street may want to teach the crypto space some manners by shorting the price as hard as they can.  By the same token the upward trend is strong and the hype across the globe is at fever pitch so there may just be enough buyers to buy into the short and keep this train rolling. Only time will tell but one thing is for sure, December is promising to be every bit as exciting a month in crypto as all the months before it.  It’s like a soap opera round here sometimes and you couldn’t make up the story line.  Talking of which, it didn’t escape our notice that The Big Bang Theory dedicated a whole episode to Bitcoin and crypto this week.

A word of caution for those readers who are still learning about the space and how to get involved.  We have been hearing more regular reports about newcomers getting involved in CFDs and other such risky investments.  We don’t offer investment advice here, but we do urge caution as it can be complicated and confusing at first.  Coin Street have a free beginners guide which you can access here and which will guide you through the basics.  Take your time if you intend to make the leap into a crypto investment and above all make sure you are getting what you pay for.  A CFD doesn’t actually buy you any coin, it’s just a complicated and confusing way of betting on Bitcoin and a sure way to lose your money if you don’t know exactly what you are doing.  If in doubt just ask.  We have an active community of admins and members on Facebook who are always happy to guide the way.

Remember, the easiest and safest way to buy Bitcoin is via Coinbase.

This Week’s Highlights

Bitcoin Not Legal Tender in India, Finance Minister Says

India’s finance minister, Arun Jaitley, has clarified that the government does not recognize bitcoin as legal tender.  The minister has previously informed the Indian parliament that the Reserve Bank of India (RBI), the country’s central bank, has not issued any licenses to operate with cryptocurrencies in the country. He further informed the parliament that the country does not have any regulations governing virtual currencies. (Source)

Bitcoin isn’t a currency or even a cryptocurrency, says France’s central bank governor

Bitcoin is a speculative asset and people who invest in it do so at their own risk, the Bank of France Governor Francois Villeroy de Galhau warned on Friday after recent volatile trading.

“We need to be clear: bitcoin is in no way a currency, or even a cryptocurrency,” Villeroy said in remarks made at a conference in Beijing, according to the Bank of France. (Source)

You can pay your rent in Bitcoin in Brooklyn.

Digital rent processor ManageGo is integrating bitcoin, litecoin and ethereum into its payment app, and will soon allow tenants to use these cryptocurrencies to pay rent every month.

Using Coinbase’s application programming interface (API), the app will convert any digital currency sent as payment into U.S. dollars, which will then be sent on to the landlords who use the platform to manage relationships with their tenants.

ManageGo vice president of business strategy Chaim Lowenstein told Technical.ly that the company does not intend to invest or hold the cryptocurrencies, but will instead immediately convert into fiat money. (Source

Tezos Founders Ask Foundation to Help Pay Legal Bills in ICO Suits.

In a confusing twist the founders of blockchain startup Tezos, who are embroiled in a legal wrangle with the chairman of their own foundation that holds all their $232 million (now over $500 million) they raised, have asked that same foundation to release funds so they can pay their legal fees.  I’m not completely sure what’s going on over there but one things for sure, it’s a hot mess. (Source)

Joseph Stiglitz believes the cryptocurrency should be outlawed because it “doesn’t serve any socially useful function”

The Nobel Laureate economist apparently believes that all asset classes should serve a socially useful function.  Like gold for instance, which makes peoples necks and fingers look pretty. (Source)

Coinbase ordered to give the IRS data on users trading more than $20,000

On Wednesday, a federal judge in San Francisco ruled that Coinbase must supply the IRS with identifying information on users who had more than $20,000 in annual transactions on its platform between 2013 and 2015. After noticing that the number of tax returns claiming gains from virtual currency didn’t line up with the emerging popularity of digital currencies like bitcoin as an investment vehicle, the IRS asked Coinbase to hand over a broad swath of information on its users. Coinbase pushed back, and now the court has landed on a compromise that the company is calling a “partial victory”. (Source)

Germany’s Energy Giant Launches 100s of Ethereum Based Electric Cars Charging Stations

A subsidiary of RWE, one of Germany’s biggest energy and gas provider with 30 million customers and billions of revenue, has launched 100s of electronic vehicles (EV) charging stations all over Germany, connected to Ethereum’s public blockchain. (Source)

Nerd Alert:  Tesla mining trunk

What happens when you have an electric car and free power courtesy of Tesla inc. ? You put an Ethereum mining rig in the boot that’s what.  (Source)

And finally our favourite crytpo crazy John Mcafee has a new long term bitcoin prediction.

He’s demonstrably unstable but he’s super long on Bitcoin, that’s for sure. (Source)

 That’s a Wrap

That’s all for this week.  It’s a fast moving space.  They say one week in crypto is a year in the real world.  

Can we ask one favor please?

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See you next week.

The Lazy Journalists’ Guide to Writing Crypto Articles

A’re you a journalist who’s heard of this “Bitcoin” thing?

Are you desperate to write an article, but don’t know the first thing about it?

No problem.

Here’s your guide to writing a “Cryptocurrency is a Bubble” article.

Step 1 – Start with the Classic Historical Lesson

Start with the 1929 shoe-shine boy stock tip anecdote. This is essential. It makes you sound learned and that you are a student of the history of the financial markets. Don’t worry that you just read about it on Buzzfeed.

Step 2 – Throw in the Usual Sound bytes

Ensure you refer to “Tulip mania”. Again, it doesn’t matter that you just read about this on Wikipedia. That’s enough detail for this type of article.

Include the word “Bubble” a minimum of three times. Three is just the right amount of repetition to hammer home your point.

Talk about the “greater fool theory”. But importantly, make sure you describe, in painfully simple terms, what this blindingly obvious concept means.

Throw in some statistics about illegal activities. Choose a random percentage; make it high. Drug-dealing and money-laundering are your go-to references. Follow the standard format: “In [insert year], over [insert %] of all bitcoin transactions were [illegal-activity] related”.

Mention Jamie Dimon. A lot.

Step 3 – Avoid These at All Costs

Value is derived from other people. Like every journalist before you, you’re going to be tempted to mention that the value of Bitcoin and other cryptocurrencies is derived from what other people are willing to pay for it. That’s fine, throw that in there. But, just make sure you don’t unintentionally mention that all fiat currencies (Pounds, Euro and USD included) are fundamentally identical.

Don’t Try it Out. Again, don’t stray into the dangerous territory of revealing that cryptocurrencies can be useful. For example, don’t actually buy some Bitcoin or Ethereum yourself. Don’t test out a transaction where you send money to a friend abroad in the quickest, lowest cost way possible.

Don’t Mention Use Cases. Highlighting the Bitcoin-bubble is a hot topic right now. Far hotter than the pain and suffering those poor folks in Venezuela and Zimbabwe are experiencing as their economy crumbles in the face of hyper-hyper inflation. Leave those stories for your reporter colleagues less concerned about click-baity content. Don’t dull the sharp edge of your editorial by showing how cryptocurrencies are providing a safe haven asset for everyday people in Venezuela and Zimbabwe.

Step 4 – Wrap It Up and Go Viral

Now you’ve finished your cookie-cutter article, it’s time to hit “Publish” and sit back for those sweet, sweet page views.  Make sure those social sharing buttons are working correctly.