Chamber of Digital Commerce December Newsletter 09
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The Chamber will be holding DC's first Blockchain Summit at Georgetown University, featuring the industry's top thought leaders, innovators, and influencers.

More information to follow soon. Sponsorship opportunities are available, for further information contact Susan Poole, at DCsummit@DigitalChamber.org.

NORTH CAROLINA EMBRACES BLOCKCHAIN TECHNOLOGY

Multi-sig, Non-hosted wallets, and Blockchain 2.0 Excluded From Onerous Regulation


At the request of the Chamber of Digital Commerce, North Carolina Commissioner of Banks issued guidance that specifically excludes miners, blockchain 2.0 entities, multi-signature software, and non-hosted, non-custodial wallets from having to obtain a money transmitters license in the State of North Carolina. This regulatory update is quite remarkable in that specific activities are defined as falling outside the scope of the regulation, which very well may serve as a template for other state interpretations.

For more information visit: http://us8.campaign-archive2.com/?u=a87f67248663abe55ad9325d6&id=fb04ff3281

Dear G7, Bitcoin is Already Highly Regulated

Let us not regulate out of fear - with the risk of stifling innovation - rather educate ourselves to the advantages bitcoin brings to law enforcement


Amid calls within the G7 for greater regulation of virtual currency after the Paris terrorist attacks, the Chamber calls on the G7 to carefully consider any new regulations with the G7 nations. The Chamber points out that bitcoin is already highly regulated within the G7 countries and any additional regulation simply could encourage bitcoin companies to locate in other countries. 

For more information visit:
http://digitalchamber.org/assets/press-release---g7---for-website.pdf

The SEC has approved Overstock's Plan to Issue $500 Million of Digital Securities on the Bitcoin Blockchain 

 
The SEC has approved a plan by Overstock.com to issue company stock via the bitcoin public blockchain. The approval signals a potential pivotal turning point in the way companies issue stock. Overstock.com, through its t0 subsidiary, has developed technology that allows companies to issue stock on the public ledger. The technology offers substantial savings over using the traditional clearing houses. Using a clearing house can take days and is subject to the fees of the clearing house. Issuing stock via the blockchain happens in near real time and is not subject to fees.

For more information visit: 
http://www.wired.com/2015/12/sec-approves-plan-to-issue-company-stock-via-the-bitcoin-blockchain/

CFTC Commissioner Makes the Case for Blockchain to Harvard Law School

CFTC Commissioner J. Christopher Giancarlo made the case for blockchain’s distributed ledger technology in a guest lecture at Harvard Law School, earlier this month. Commissioner Giancarlo stated: 

“The 20th century underpinnings of the current “closed ledger” financial system are inefficient and unstable…. Distributed open ledgers have the potential to revolutionize modern financial ecosystems. Distributed ledgers will have enormous implications for financial markets in paymentsbankingsecurities settlement, title recording, cyber security and the process of collateral management that is made infinitely more complex by new regulations.”

Commissioner Giancarlo also points out in his lecture that “blockchain will help reduce some of the enormous cost of the increased financial system infrastructure,” however, this could greatly impact jobs on Wall Street that support the “recordkeeping of contemporary financial markets.”
 
The CFTC holds that Bitcoin and other virtual currencies are commodities covered by the Commodity Exchange Act.
 
To read CFTC Commissioner Giancarlo’s full lecture visit:  http://www.cftc.gov/PressRoom/SpeechesTestimony/opagiancarlo-11

Department of Homeland Security Accepting Applications for Blockchain Research Proposals 


The Small Business Innovation Research (SBIR) program, part of the US Department of Homeland Security (DHS) Science and Technology Directorate (S&T) is accepting grant proposals concerning the applicability of blockchain technology to privacy respecting identity management and blockchain applications for homeland security analytics. The DHS SBIR Program began receiving proposals to topics in this solicitation on December 16, 2015. Proposals submitted to this joint solicitation are due no later than 2 pm ET on January 20, 2016.  All offers must submit proposals through the online proposal submission system at https://sbir2.st.dhs.gov.

For more information visit: 
http://www.dhs.gov/science-and-technology/sbir

Former Secret Service Agent Sentenced to 6 Years for Stealing Bitcoins


A Secret Service agent has been sentenced to 71 months in prison for obstruction of justice and money laundering. The former Secret Service agent was a member of the Baltimore Silk Road Task Force and was conducting investigations for the DOJ to take down the illicit online market place, Silk Road. During his investigations the Secret Service agent stole over 20,000BTC (approx. $350,000). 

For more information visit: 
http://www.coindesk.com/secret-service-agent-gets-six-year-prison-sentence-for-bitcoin-theft

SEC Charges Bitcoin Mining Companies for Running Ponzi Scheme 


Earlier this month the Securities and Exchange Commission charged GAW Miners and ZenMiner with running a Ponzi scheme. Josh Garza operated both of these companies. Garza’s scheme involved selling “Hashlets,” which represented shares of mining profits from a mining pool. Garza allegedly sold more “Hashlets worth of computing power than they actually had in their computer centers.” The SEC argued their jurisdiction under the Securities Act by claiming that “Hashlets” are securities; however, not all mining contracts are securities. 

For more information visit: 
http://www.sec.gov/news/pressrelease/2015-271.html

Linux Foundation Unites Industry Leaders to Advance Blockchain Technology

The Linux Foundation, perhaps the most successful Open Source consortium of all time, has announced a new Open Source project to advance the blockchain technology. Essentially every single major player involved in the Linux Foundation has announced their support. In addition, multiple organizations have committed to contribute their existing blockchain intellectual capital. For example, IBM has committed tens of thousands of lines of code. R3, a consortium of the world's largest 42 banks researching the blockchain, is bringing their new architectural framework for financial transactions. And, Digital Asset Holdings, led by the Chamber Advisory Committee member Blythe Masters, is contributing their Hyperledger technology. 

For more information visit: 
http://www.linuxfoundation.org/news-media/announcements/2015/12/linux-foundation-unites-industry-leaders-advance-blockchain


Digital Asset Holdings Hires SWIFT and SunGard Veterans


Cristóbal Conde, former President of SunGard will serve as a non-executive board member of Digital Asset Holdings and Chris Church, a former chief executive at SWIFT will become the chief business development officer. The two join DA Holdings to build processing tools for a distributed, encrypted world. 

For more information visit: 
http://www.coindesk.com/blockchain-digital-asset-swift-sunguard/

 

Goldman Sachs Report “The Blockchain Could Change Everything”


A new report by Goldman Sachs states that bitcoin was just the opening act and blockchain technology is ready to “take center stage.”  The report explains why distributed ledgers, the blockchain technology behind bitcoin, are a disruptive technology for many industries, by cutting out the middleman needed to validate transactions. Goldman Sachs believes the blockchain will begin to take off in 2016 and points to the half a billion dollar in investments in the technology as reasons to believe its time has come. 

To read the full report visit: http://www.goldmansachs.com/our-thinking/pages/macroeconomic-insights-folder/what-if-i-told-you/report.pdf

 

BTSC Closed $1.45M In Financing


BTCS Inc. a blockchain technology focused company which secures the blockchain through its transaction verification services business, completed a $1,450,000 financing round on December 16, 2015 led by Cavalry Fund I LP.

For more information visit: 
http://finance.yahoo.com/news/btcs-closes-1-45-million-133500601.html
IBM

 

Hard Fork Question Divides Developers at Scaling Bitcoin Day 2

The question of bitcoin scalability as the block size approaches its current 1MB limit was hashed out at the second Scaling Bitcoin conference in Hong Kong. Pieter Wuille presented segregated witness, a new way to scale bitcoin without using a hard fork. A hard fork would require all bitcoin nodes in the distributed network to upgrade to the new version immediately; whereas, a soft fork would allow for a phased upgrade.  The segregated witness solution removes the data regarding the entity authorizing the transaction (the signature) from the transaction, placing it instead in the input of the transaction. The signature requires about .75MB of storage; thus, removing it from the transaction effectively increases the block size by four fold. 

For more information visit: 
http://www.coindesk.com/hard-fork-developers-scaling-bitcoin/
http://www.coindesk.com/segregated-witness-bitcoin-block-size-debate/

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