Corporations and governments around the world are implementing blockchain technology to create their own cryptocurrency. No more is the technology the exclusive playground of young startup entrepreneurs and crypto hobbyists. In the past, corporate organizations and government bodies saw cryptocurrency as a bubble and took steps to either disassociate themselves or outrightly place a ban. The narrative has changed as cryptocurrency has begun to win the hearts of these corporate bodies and governments. Some big companies and countries who have wasted no time in issuing and launching their own cryptocurrency coins, while some others have it on their bucket list. With this move, the fight to oust cryptocurrency is gradually waning, although, some countries are still adamant and believe everything is just a sham.
Companies Launching their Own Cryptocurrency
Startup companies were the pioneers of the ICO revolution. By issuing tokenized assets to the public in exchange for funding, they could raise capital for their projects without having to face the hassle associated with mainstream venture capital. Now, established corporations are getting in on the act, issuing their own tokenized assets. In the last few months of 2018, companies have raised ICOs that have really done very well. Below are some companies who have launched their own cryptocurrency.
The encrypted messaging app, Telegram, which is used for exchanging messages and media files, launched its own cryptocurrency early in 2018. The potential for a cryptocurrency inside a widely adopted messaging app created a buzz. It started to consider the idea of having its own cryptocurrency and blockchain platform in 2017.
In late December 2017, reports said that Telegram was seeking to do some kind of ICO, come 2018. It didn’t take too long before reports about its plan started to seep out, with its technical ambitions seen as a little too broad for the Telegram Open Network (TON). With cryptocurrency powered payments inside Telegram, it promises to have super-fast payments and micropayments using mobile devices with negligible transaction fees, and users could also bypass remittance fees
In February 2018, Telegram raised the sum of $850 million in its first pre-ICO sale. Although, they had a target of $1 billion in mind. Later that month, the Telegram raised another $850 million, through its second pre-ICO sale, bringing it to a total of $1.7 billion, way exceeding their $1.2 billion target. This makes it the biggest token sale in 2018 so far. With this massive success, however, the messaging app is thinking of doing a third ICO; although, the team has been tight-lipped over the matter, as information gotten are from leaked sources.
It does not seem to rest on this figure because it might just pursue one or more offerings in addition to the previous sales. The Telegram team, however, intend to use the funds to develop the TON, which is an ambitious blockchain that is meant to decentralize multiple facets of digital communication, which can range from file sharing to browsing transactions. The proceeds will also be used for the development and maintenance of Telegram Messenger.
According to Telegram’s white paper that TechCrunch has review portions of, its cryptocurrency will be called “Gram” and it has the potential to gain immediate mainstream acceptance by being tied to Telegram’s chat app. Sources say that Pavel Durov, CEO of Telegram, has decided to combine both a centralized and decentralized infrastructure, since a totally decentralized network doesn’t scale as fast as one which has some elements of centralization, hence why Telegram needs to own its own blockchain.
Line Corporation, a popular messaging app in Japan, announced in January 2018 that it would launch its own cryptocurrency that would enable users to transact and exchange digital currencies, insurance, and loans through a new company called Line Financial Corporation. The new company will be set to expand the financial services offered to users. In a bid to upgrade and reinforce its position in the financial business domain, the new company will foster research and development of technologies like Blockchain.
The move by Line Corporation comes few days after the Coincheck hack, where $543 million worth of cryptocurrency, NEM, was stolen, making it the biggest hack in history after the Mt. Gox hack. The cryptocurrency services will be made available via Line Pay app – the corporation’s mobile money payment and transfer app. Last year, Line Pay saw the overall volume of annual transaction rise to almost 450 billion Japanese yen ($4.1 billion), and registered users hit 40 million, the release claims.
MUFG – Tether for Japan?
Mitsubishi UFJ Financial Group (MUFG) is the largest bank in Japan and the fourth largest in the world. Reports coming in January 2018, says that the giant financial institution will be launching its own cryptocurrency and exchange in the fiscal year 2018. As far back as 2016, there had been plans to develop a cryptocurrency. The name of its digital currency will be called “MUFG Coin”.
This move by the bank to launch its own cryptocurrency will make it the first Japanese bank to have its own cryptocurrency. The aim of creating its own digital currency is to facilitate peer-to-peer transactions, reduce fees, and simplify payment procedures. MUFG is able to break into the cryptocurrency market because of Japan’s friendly policies for the operation of the cryptocurrency.
The MUFG’s move to control the exchanges enable them to suppress the fluctuations in the prices of MUFG coins. The bank can use its cryptocurrency for remittances, settlements, and shopping stably, as they plan to control the exchange. The idea is to keep this new pegged cryptocurrency at around JP¥1 meaning its worth would be about 1 yen. However, this will not be fixed in advance in order to bypass the regulations related to issuing and transmitting a private money as such in Japan.
Pioneer gaming company, Atari, has joined the list of companies to key in on cryptocurrency. As part of the effort to launch its cryptocurrency, the gaming company acquired a 15% stake in a Gibraltar-based company, Infinity Networks, Ltd and has licensed its brand to the firm. The partnership previously hinted in December 2017, will see the development of a digital entertainment platform underpinned by the Atari Token.
The gaming company noted that its investment was “made without cash disbursement by Atari.” The CEO, Frederic Chesnais, said in a statement that the aim of developing their own cryptocurrency was to take strategic positions with a limited cash risk, to create the best value with the Atari brand. The name selection is a notable one, given that Atari had previously created an Atari Token to serve as a currency for making in-game purchases. Whether the newly-announced Atari Token will serve that purpose remains to be seen.
Cities and Countries
In many countries, cryptocurrency is considered a taboo by the government and financial regulatory bodies. Ambivalence has given way to tougher regulatory measures targeted at preventing cryptos from being used for illegal activities like money laundering and terrorist funding (ml/tf).
In China, ICOs are unfavorable and unwanted by the government, and they went a step further to ban ICOs and prohibited exchange platforms in September 2017. South Korea has been following China’s lead, as the country’s very strict regulations make it very difficult for cryptocurrency to thrive in the country.
However, some countries and cities have not only embraced crypto, they have also created their own cryptocurrency. Whether on account of the need to get out of difficult economic situations or a desire to be at the forefront of one of the most exciting emerging technologies, these cities have either created their own cryptos or are making plans to do so. Below are some lists of pro-cryptocurrency countries.
In January 2018, reports emerged that the Venezuelan government was seeking to launch its own cryptocurrency, called the Petro. This came as a delegation led the country’s cryptocurrency chief, Carlos Vargas, visited Qatar to have discussions with the Qatari government in relation to the launch of the Petro. Earlier in the year, Qatar and Venezuela were on the receiving end of economic sanctions that greatly affected the two countries. Venezuela has been hit with multiple US-led sanctions that have practically stifled its economy. Qatar, on the other hand, has been on the receiving end of a Saudi-led economic blockade since 2016. As a result, the Arab nation has had to look outside the region for help. In the past year and a half, the country has signed agreements with Italy, France, the US and the UK. Both countries have also been greatly affected by the drop in global oil prices.
The economic strains being caused by the US-led sanctions was one of the reasons why Venezuela elected to introduce a cryptocurrency. The Petro was being backed by 5 billion barrels from the country’s crude oil reserves which are valued at more than $260 Billion. In addition to oil, the Petro was also backed by the country’s considerable gold, diamond, and natural gas reserves. Announcing the move late last year, Venezuelan President Nicolás Maduro expressed optimism that the Petro would help the country get around the tight nose that is threatening to strangle the nation’s economy.
In February 2018, Venezuela launched the Petro on Tuesday, 20th February 2018. The Petro was released for presale to investors who were offered $60 “tokens” at discounted rates that they can exchange for Petros during what is being dubbed an “initial coin offering,” or ICO, in March 2018. According to President Nicolás Maduro, he called Venezuela the “World’s Financial Vanguard” and was happy that the kick-off was successful, as $735 million was raised on the first day. Petro is the first official currency launched by a government.
Despite all of these, skeptics have strong beliefs that the Petro will be highly unsuccessful, mainly because the government is untrustworthy and whose policies have brought about skyrocketing inflation. Some others believe that this move is an avenue for the government to manipulate the coin. At the initial stage, long before the crypto was launched, the opposition party was strongly against the idea of its government launching its own cryptocurrency, challenging the legality of the move and saying that it was an attempt to mortgage the country’s oil reserves.
In 2017, Dubai launched its own blockchain-based cryptocurrency in September 2017, called the “emCash”. The city’s economy department partnered with one of its subsidiaries, Emcredit Limited, and U.K. based Object Tech Group Limited, to create emCash. Officials boast that the emCash uses the latest blockchain technology and also works as part of a payment system called emWallet.
According to the Deputy Director-General of Dubai Economy, Ali Ibrahim, the token will most likely be considered a legal tender for different government and non-government services, varying from coffee purchase, utility bills, children’s school fees, to money transfers. Ali further said that it would change the way people do business in Dubai and mark a giant leap in the harnessing game, like changing innovations to improve ease of business and quality life.
The government of Dubai is strongly pro-blockchain; so this move is very welcome in the country. Dubai is seeking to become a fintech hub for the eastern world and it has signed deals to allow for property sales entirely in Bitcoin.
Word went out in January 2018 that Sweden was planning to launch its own cryptocurrency called e-Krona. Amid the strict regulations in place by other countries and their financial regulatory bodies, the Swedish bank, Riksbank, was planning to launch its own cryptocurrency that would make Sweden the first economy to do so. The cryptocurrency will be launched in a few years’ time.
Sweden’s position as potentially the world’s first cashless society has led to a research note, written by HSBC economist, James Pomeroy, entitled “Sweden’s big year: Can the economy overcome some challenges?” to identify the country as looking for international cooperation in developing an officially-sanctioned cryptocurrency.
The capital of South Korea, Seoul, has joined the league of countries who have launched their cryptocurrencies or are planning to launch. The mayor of Seoul, Park Won-soon, announced his interest in blockchain technology and looks forward to creating a blockchain-friendly environment for crypto-based start-ups and also for developing Seoul’s cryptocurrency, called “S-Coin”. Park also aims to create a support fund for the progress of blockchain technology startups and cryptocurrency.
The city of Seoul is striving to become a crypto-friendly city and the initiative to introduce its own cryptocurrency was part of the city’s Blockchain masterplan which will help the city publish regulatory guidelines on digital currencies. There is also a plan to devote public resources towards the growth of the blockchain development sector. If all plans fall into place, the city of Seoul will become the largest city to adopt its own digital currency.
Notable countries/cities and companies are gradually embracing the cryptocurrency and launching their own cryptos. But that does not mean that the cryptocurrency has gained worldwide acceptance, as there are countries like China who have banned ICOs, and several companies who think cryptocurrency is all a bubble. In the months and years to come, we will see whose side is wiser.