ICO portfolio is down by 66% in the first half of 2018, according to EY study

– 86% of tracked ICOs are below listing price; 30% lost substantially all their value

– ICOs claim to have raised US$15b in first half of 2018

– Top 10 ICOs listed in 2017 account for essentially all of the gains since issuance, with a majority in blockchain infrastructure

 In the first half of 2018, 86% of the leading initial coin offerings (ICOs)

that listed on a cryptocurrency exchange in 2017 are below their initial listing price and a portfolio of these ICOs is down by 66% since the peak of the market at the beginning of this year, according to a study from EY, Initial Coin Offerings: The Class of 2017 – one year later, that examined the ICOs' progress and investment returns. The study finds 30% have lost substantially all their value. There were gains among The Class of 2017 since their ICO, with most gains (99%) concentrated in the top 10 ICO tokens, the majority of which are in the blockchain infrastructure category.

The latest study follows an initial analysis in December 2017, when EY analyzed top ICOs representing 87% of the ICO funding last year. It found that a lack of fundamental valuation and due diligence by potential investors was leading to extreme volatility in ICO performance, which is still an ongoing issue. The study announced today found that ICOs claimed to have raised more than US$15b in 2018, compared with US$4.1b¹ in 2017. However, EY found that only 29% (25) of the 2017 ICO projects that EY assessed have progressed to prototypes or working products – an increase of just 13% from December 2017. The remaining 71% have no offering in the market.  

Paul Brody, EY Global Innovation Leader, Blockchain, says:

"Despite the past year's hype around ICOs, there appears to be a significant lack of understanding around the risks and rewards of these investments. In addition, there is a disparity between those who invest in ICOs and the ICO project developers regarding the anticipated timelines of ROI. While ICOs are an entirely new way to raise capital, those participating should understand that there are factors – such as the slow progression toward working product offerings – that can introduce greater risk in ICO investing."

Utility tokens diminish in value

The study also examined the 25 companies with working products. Of those 25, seven were accepting payment in fiat currency as well as ICO tokens for their product offerings. As a result, customers can make purchases directly without buying the tokens issued in the ICO process, therefore bypassing the community of token holders and diminishing the value of the ICO tokens. In at least one case, an ICO company has abandoned ICO investors by no longer accepting their tokens (de-tokenizing).

Yuri Gedgafov, EY Tech Media and Telecom Center Leader, Central, Eastern and Southeastern Europe & Central Asia, says: "So far, utility tokens aren't creating the engaged communities anticipated to coalesce around innovative ideas. In fact, many of the most successful ICOs are mired in litigation or conflict over broken promises and unexpected changes in business strategy with little to no rights for the ICO investor."

Ethereum platform remains dominant

Ethereum is the dominant platform and shows the highest activity among developers and on social media. While new platforms arise on a regular basis, there is no sign that the new ICO infrastructure projects have had any success in reducing the dominance of Ethereum as the industry's main platform. Brody says: "It's clear that due diligence and awareness of risk are more important than ever. The number of ICOs showing gains since listing on one of the leading crypto exchanges is so limited that it would have required exceptional good fortune or a visionary portfolio strategy to have made any gains investing in the 2017 ICOs. At the moment, the level of reward in this market doesn't look like it justifies the risks involved."

Note to Editors:

About the survey

The survey collected data on global projects that have conducted ICOs and performed a detailed analysis of the top 141 projects, which collected 87% of all ICO proceeds, following up on their performance between January 2018 and September 2018. The ICO market is unregulated; there is no single source of ICO data, reporting standards or generally accepted methodology. The findings are preliminary and based on public sources, and EY cannot always match the information given by these sources with the transactional data available on the public blockchain. We based our study on project websites, the most popular crypto exchanges, ICO trackers, data aggregators and interviews. The figures on ICO funding volumes (total and per project) are derived from open sources as of September 2018. The EY analysis is of 141 ICOs from 2017. We did not audit or confirm the data and it is subject to change.

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A wide array of domestic and global news stories; news topics include politics/government, business, technology, religion, sports/entertainment, science/nature, and health/lifestyle. Articles that appear in this section may be written in English or other languages

https://www.prnewswire.com/news-releases/ico-portfolio-is-down-by-66-in-the-first-half-of-2018-according-to-ey-study-300734346.html

David https://markethive.com/david-ogden

Journalism Blockchain Startup Civil Cancels ICO, Refunds Investors

Crypto and blockchains startups, even those that hold great promise,

have sadly received the full brunt of 2018’s dismal market conditions, resulting in a widespread loss of clients and investment interest. For example, freshly-printed studies have revealed that Coinbase, widely regarded as this industry’s golden child, saw 80% of its U.S.-based customer base dissipate, resulting in a similar decrease in volumes. But most recently, on Tuesday, Civil, a promising blockchain-centric journalism startup, revealed that it had suffered a great setback.

Blockchain Startup Suffers Setback Amid Bear Market

While the conditions of 2018’s crypto winter are something that investors have grown accustomed to, Civil, an upstart blockchain startup, recently revealed that it had to formally cancel its initial coin offering (ICO) due to a lack of interest. For those who missed the memo, Civil’s raison d’être, if you will, is to revolutionize how digital journalism is managed from the ground-up. When it was founded in 2017, the company’s top brass envisioned a “new economy for journalism,” with many of the firm’s co-founders visualizing a series of platforms that brought change to this age-old industry.

However, ambitions don’t come without a cost. And in the case of Civil, that cost was one of a monetary variety. So while the firm initially saw a $5 million seed investment comes its way from ConsenSys, the Google of the blockchain world, Civil still craved capital. More specifically, the startup remained hell-bent on its plans to raise a minimum $8 million via an ICO of its CVL Ethereum-based tokens. But now, after the company’s one-month-long, long-awaited Civil Token ICO has finally elapsed, it is apparent that the startup overstated demand for its ICO, missing its soft cap by $6.5 million dollars. As reported by TechCrunch, although the firm’s head was in the clouds, in the end, only 1,012 investors purchased $1,435,491 worth of CVL tokens.

Seeing that it missed its soft cap by millions, Civil has sadly announced that it will be providing compensation to all participants of its ICO, with refund transactions being slated to be sent by October 29th. In a testament to the resilience of crypto innovators, who will stop at nothing to achieve the improbable, Civil has since revealed that it isn’t ready to shutter its blinds and close its doors. In fact, in a status update, Matthew Iles, the founder and CEO of the startup, alluded to the fact that his firm had learned from its mistakes, immediately divulging plans for a “much simpler token sale.”

Attempting to turn the unfortunate situation on its head, Iles adding that “Civil isn’t going anywhere [and is] here to say” due to a $3.5 million investment from ConsenSys, who seems to be a big believer in the startup. Eventually, following its second token sale, along with the use of its now-stocked up war chest, Civil intends to release a blockchain-publishing WordPress plugin, a “community governance application,” and a developer tool for utilizing data gathered by the firm’s operations.

The Brooklyn-based firm also inked a strategic deal with the world-renowned Associated Press, as reported by NewsBTC on a previous occasion, who will use Civil’s products to better its business in multiple capacities. Along with the Associated Press, Forbes also recently joined hands with Civil, which will see the major media outlet run the startup’s blockchain applications through the works. So while a failed funding round may have spelled the end of any other crypto project, Civil’s drive for innovation likely only rose exponentially after its ICO went kaput.

Article Produced By
Nick Chong

https://www.newsbtc.com/2018/10/17/journalism-blockchain-startup-civil-cancels-ico-refunds-investors/

David https://markethive.com/david-ogden

GG World’s ICO has been announced

to start from November 2, 2018, and the investors are keen to discover the benefits of this revolutionary idea, offering completely transparent, online and government-regulated national lotteries to players and interested investors, globally. Identifying a pressing need for disruption in a market which is incredibly popular, yet notably old-fashioned, GG World Lottery has come up with a solution that can bring the industry up-to-speed by implementing blockchain and other state-of-the-art technologies.

With a team of seasoned veterans and innovative approach, the GG World Lottery project stands out from the rest of the projects. Unlike other projects in the crypto-sector, the company has taken a reverse ICO approach to raise funds and build a strong community of interested investors, players, and even governments. The GGC token, to be issued as a part of the token sale also brings special benefits to the participants as token holders.

Why Is GG World ICO Interesting for the Investors?

The upcoming GG World Lottery ICO will undoubtedly become one of the best options to invest in 2018: an extraordinary professional team with a substantial industry background, unique offering with lucrative gains for investors and token holders, an ability to get the lifetime revenue share. By taking part in the GG World reverse ICO, investors will become eligible to receive a reverse share – USP of the platform’s special business model. The model includes the distribution of dividends based on jackpot prize wins. Overall, the platform intends to create a win-win situation for everyone including investors and lottery operators (government or private).

The GG World Lottery platform protects both players and users by employing blockchain nodes. It provides additional transparency by ensuring fairness of draws through the integration of TRNG technology based on Quantis True Random Number Generator. Also, it will utilize the advantages offered by DLT to share profits with eligible community members and respective jurisdictions as per their existing regulatory and legal frameworks. In addition, the platform also allocates a significant percentage of the profits, to be channeled to verified charitable organizations

The Rise of the Online Gambling Industry

For starters, GG World Lottery platform will take care of the issues that come with regulations while improving transparency levels by offering the lottery on Ethereum smart contracts. The platform will run on mobile devices, for added convenience and easy accessibility to the players, which will in turn appeal to more players and give them a chance to participate in world-class lottery programs.

With a model built around security, transparency, ease-of-use, and accessibility, GG World Lottery hopes to tap into unexplored markets such as the African, Asian, and South American continents. Thanks to GG World Lottery blockchain platform, the gambling industry is also set to receive a facelift as it will get rid of outdated lottery hardware such as communication routers, ticket dispensers, monitors, scanners, tickets, and terminals. In addition to removing retailers and other intermediaries from the equation, the platform will provide numerous advantages to the players by enabling them to play right at their homes while eliminating fraudsters from the lottery ecosystem.

What Makes the Project Special?

• It’s a Reverse ICO – Not a Startup with Merely an Idea

GG World Lottery knows better than to step into a vastly competitive market of the kind empty-handed. The project is responsible for developing one of the most unique products in this category – comprehensive white-label lottery software which offers a ticket-purchase courier service for the most well-known lotteries throughout the world. This allows it to open multiple lottery ticket-selling websites on behalf of its partners.

• Backed by Professionals

The project’s team consists of industry experts with decades of experience in the field of national lotteries. GG World Lottery’s CEO, Mark Hutchinson is a start-up expert with a background in some of the early lotteries in the US, including Wisconsin, Kansas, and Colorado. Furthermore, Mark is one of the founding members of Lotto America, which grew to become the biggest lottery in the world – the Powerball.

• A Lot to Come in Future

The company isn’t just starting the GG World Lottery. Apart from this, they are creating numerous African, South American and Asian lotteries. It has signed agreements with official regulators in a range of specified countries to be an official channel partner or to run national lotteries. They will be entirely online, government-backed and regulated, and mobile friendly.

• Enhanced Transparency

GG World Lottery has introduced its True Random number Generator (TRNG). The project has come up with a unique system which will deliver entirely true random numbers which is based on the natural randomness in the world.

About the ICO

The ICO is starting on November 2nd and will run till January 31st, 2019. GG World Lottery’s ICO participants, token holders will also receive a quarterly-paid revenue share based on each GG World Lottery Jackpot prize win. The company has already signed NDAs with multiple regulatory bodies throughout the world that would increase the value of the GGC token.

Article Produced By
GG World

https://www.newsbtc.com/2018/10/14/gg-world-announces-reverse-ico-prepares-to-offer-regulated-blockchain-lotteries/

David https://markethive.com/david-ogden

South Korean Government to Decide on Cryptocurrency ICO Legalization in November

A South Korean official has said

that the government is likely to announce its official stance on cryptocurrency ICOs in November. This statement was made during a National Assembly audit on Wednesday.

ICO Legalization: To be or Not to Be

According to The investor, Hong Nam-Ki, the chief of the Office for Government Policy Coordination, responding to a question raised on the government’s stance on

ICOs said:

We have had several discussions (on ICOs). Once the survey results are in by end-October, we plan to finalize the government’s stance.

In September the FSS commenced a study among some companies that are conducting or in the process of issuing an ICO in the country despite the ban. Various reports out of South Korea show a divide in government opinion in regards to Initial Coin Offerings. Also speaking at the National Assembly audit meeting, Choi Jong-Ku, chairman of the Financial Services Commission (FSC) reiterated the initial ban on ICOs. The chairman stressed the Commission’s stance to continue with the sweeping prohibition on cryptocurrency fundraising activities and

exchanges.

Although many people call for the government to allow initial coin offerings, there are still uncertainties related to such a move as well as the possibility of serious fallouts.

Meanwhile, Min Seong-woo, a member of the National Assembly is asking for the legalization of ICOs. The lawmaker while clamoring for ICO legalization also called for robust regulations to prevent speculation, money laundering, and fraud.

Current Cryptocurrency Regulatory Paradigm in South Korea

There is currently a ban on Initial Coin Offerings and anonymous crypto trading in South Korea. Despite the ban, the country is yet to release official regulations concerning cryptocurrency exchanges and trading. Throughout 2018, various reports have surfaced regarding drafted policies aimed at regulating the crypto space.

Earlier in the year, EWN reported on plans by the country’s legislative arm to ease crypto trading. In July, local media said that the FSC and FSS were working to create a favorable regulatory framework for the crypto exchange operators.

The Director of the KFIU (Korea Financial Intelligence Unit) has proposed stricter regulations for crypto exchanges, suggesting regulating exchanges similarly to commercial banks. In a country with zero tolerance for money laundering, legalizing ICOs which are currently viewed as a possible tool for money laundering and fraud, might take a while.

Article Produced By
Osato Avan-Nomayo

For quite by chance, I discovered Bitcoin in 2010 and I have been an ardent enthusiast ever since. I enjoy cryptography, mathematics, and theoretical physics. If I am not writing about cryptocurrency, I am attempting to beat my scrabble high score.

https://ethereumworldnews.com/south-korean-government-to-decide-on-cryptocurrency-ico-legalization-in-november/

David https://markethive.com/david-ogden

Malta to Assist the Government of Vanuatu in Forming Blockchain and ICO Legislation

The state authorities of Malta will assist the government

of the Pacific island nation of Vanuatu in forming blockchain regulations, the Vanuatu Daily Post reported Monday, Oct. 8. Minister of Foreign Affairs of Vanuatu Ralph Regenvanu has reportedly requested assistance from the Maltese government in forming blockchain legislation upon instructions from the Council of Ministers.

Speaking at a meeting with Maltese Prime Minister Dr. Joseph Muscat, and Parliamentary Secretary Silvio Schembri, Regenvanu noted the crucial role of adopting appropriate regulatory frameworks for the blockchain industry and Initial Coin Offerings (ICOs). In mid-September, the Reserve Bank of Vanuatu (RBV) issued a public warning on crypto, stating that digital currencies are “not recognized as legal tender in Vanuatu and are not issued or regulated by the bank,” according to Daily Post.

The statement subsequently raised concerns among local authorities, with state regulators suspending the issuance of Financial Dealers Licenses (FDL) to crypto and blockchain-related businesses until proper regulation is adopted. According to the report, Maltese authorities “immediately” responded to Regenvanu’s request, and offered assistance to the Vanuatu Government in developing proper legislation for the blockchain sphere.

Regenvanu also suggested the formation of a “Commonwealth of Blockchain Islands” for establishing blockchain regulatory standards. According to the Vanuatu Daily Post, Muscat “warmly welcomed the Minister’s recommendation.” In addition to providing training to both Ni-Vanuatu students and state regulators, and general technical assistance in blockchain regulation, Maltese financial authorities are also eager to contribute to Vanuatu’s financial oversight. In early July, the Parliament of Malta passed three bills that set a defined regulatory framework and legal environment for the crypto and blockchain industries.

Due to the high level of blockchain industry development, as well as increased awareness and openness to the cryptocurrency industry, the country has become a popular spot for crypto-related businesses, including major crypto exchanges lilke Binance, OKex, and BitPay. Recently, Muscat claimed that crypto is the “inevitable future of money,” while blockchain can create a more transparent and fair society. In October 2017, the Vanuatu government announced that the country accepts Bitcoin (BTC) as payment for its citizenship program, requiring a one-time payment of $200,000, or around 30 bitcoins as of press time.

Article Produced By
Helen Partz

Helen is passionate about learning languages, cultures and the Internet. She has years of experience working at international online advertising projects. Growing interested in Bitcoin and cryptocurrencies in late 2017, she joined Cointelegraph as a writer.

https://cointelegraph.com/news/malta-to-assist-the-government-of-vanuatu-in-forming-blockchain-and-ico-legislation

David https://markethive.com/david-ogden

Regulation for Legitimacy: South Korea Nears ICO Legalization

Min Byung-Doo, a member of the country’s governing Democratic party
 

ICO Has Become a New Trend

In his statement at the National Assembly of South Korea meeting, chairman Min emphasized the importance of embracing new technologies and acknowledging new trends in the global finance and technology space. He explained that the successful $1.7 billion ICO of Telegram and $4 billion token sale of Block.One / EOS have demonstrated increasing interest and demand for ICO projects, which the country cannot dismiss.

“The government cannot dismiss ICO. It needs to allow companies to conduct ICO. ICO has become a new trend in the global market and it is the responsibility and ability of the government to embrace new technologies,” he said, adding “We can see that the flow of investment is clearly changing compared to ICO and angel fundraising. The ICO has raised $1.7 billion for Telegram and $4 billion for Block.One, It is getting bigger and bigger.”

Previously, Choi Jong-ku, the chairman of the Financial Services Commission (FSC), prevented Kakao, the biggest Internet conglomerate in South Korea that has over 80 percent market share over local fintech, messaging, ride hailing, social media, and online stock trading industries, from conducting an ICO in South Korea. As the conglomerate established a company in Switzerland to conduct an ICO overseas, FSC chairman Choi stated that the country could consider the ICO to be an illicit fund raising method.

“Even if there is no prohibition on cryptocurrency or digital asset trading, there is a possibility that it [Kakao ICO] may be regarded as fraud or multi-level sales according to the issuance method. Since the risk is very high in terms of investor protection, the government has a negative stance on the ICO,” chairman Ku said. Ultimately, Kakao and Bithumb, the second biggest cryptocurrency exchange in South Korea, scrapped their plans to conduct token sales.

Based on the success of Telegram and EOS, the ICO of Kakao could have garnered similar interest from the global cryptocurrency sector. Considering the potential of the ICO market and local blockchain initiatives, chairman Min asserted that the government should regulate and legalize ICOs in the short-term. “Let the government, the National Assembly and the blockchain association quickly create a working group to block fraud, speculation, money laundering and develop the block-chain industry,” he said.

Legislation Pending, Generally Positive

Currently, the National Assembly is awaiting to approve or reject the first crypto and blockchain-related legislation of South Korea, which if approved would consider digital asset exchanges as regulated banks and blockchain projects as legitimate entities. The initial introduction of the legislation led the majority of investors within the local market to be optimistic about the long-term growth of the market. With the forward-thinking approach of chairman Min, South Korea is expected to see major changes in local regulatory frameworks surrounding the cryptocurrency market.

Article Produced By
Blockchain News

https://www.ccn.com/regulation-for-legitimacy-south-korea-nears-ico-legalization/

David https://markethive.com/david-ogden

South Korea’s Democratic Party Lawmaker Urges Authorities to ‘Open Up the Road’ to ICOs

A member of South Korea’s National Assembly has called

on the state to “open up the road” to Initial Coin Offerings (ICO) by easing regulations, South Korean financial outlet Economy reports October 2. According to the article, Min Byung-doo, a Democratic Party lawmaker, will introduce a project of for ICO legislation at the next round of the National Assembly. He claimed that the purpose of the new legislation is to allow ICOs while enforcing strict regulation for the negative parts of the industry,

noting:

"We are looking at ways to open up the road to ICO[s] while strictly prohibiting negative factors such as fraud, speculation and money laundering.”

Min Byung-doo has reportedly also suggested to local authorities such as the Financial Services Commission (FSC) that the government should legalize ICO operations in the country, claiming that “prohibition is not the only way.” According to Economy, after consulting with the government and the FSC, the authorities’ stance has “changed prospectively compared with the past.” Calling on the government to ease regulations for the industry, Min Byung-doo noted that the ban on ICO causes "weakening competitiveness" in South Korea’s blockchain industry, comparing it with the levels in the progress by the U.S.,

adding:

"[South Korea's] blockchain-related industries were at the top of the world in terms of competitiveness, but the competitiveness in ICOs has dropped sharply. Now, 75% of projects in the industry belong to the United States only, which is the world's top competitor."

The lawmaker warned that an uncertain future of regulation for the industry will “prevent the growth of the industry itself.” South Korea’s financial regulator, the FSC, announced they will ban all types of ICOs in September 2017, claiming that ICO token sales require strict monitoring and oversight. The original ban has since been followed by subsequent hints of a possible reverse of the ban.

In May of this year, South Korea’s government considered re-legalizing ICOs, with a National Assembly committee speaking of the “Fourth Industrial Revolution” and aiming to expand the legal basis for crypto industry in the country, including a reversal of the ICO ban. South Korea’s lawmakers most recently discussed the ICO ban at the end of August, debating the ban’s reversal as well as considering setting up the country’s own “blockchain island.” According to the report, discussions of a reversal were expected to gain momentum amid the preparation of investor protection rules, as well as the formation of a task force to oversee crypto trading.

Article Produced By
Helen Partz

Helen is passionate about learning languages, cultures and the Internet. She has years of experience working at international online advertising projects. Growing interested in Bitcoin and cryptocurrencies in late 2017, she joined Cointelegraph as a writer.

https://cointelegraph.com/news/bloomberg-puerto-ricos-noble-bank-reportedly-loses-clients-tether-bitfinex-seeks-buyer

David https://markethive.com/david-ogden

Safe Haven has announced a new project called ThorBlock,

described as a platform that will allow users to pool funds on the VeChainThor blockchain. The project will allow individual investors to participate in crypto-related activities that would normally be out of their price range, including ICOs.

The platform requires pool administrators to start a community pool by locking down their own SafeHaven tokens (SHA). Other users can then contribute to the community pool, which will be used to raise funds for group investments. Once the pool matures, the administrator will gain access to the deposited funds. They can then invest in the project that the pool has agreed to fund. After that, the rewards will be divided between the contributors.

ICO Investing

ThorBlock will enable individuals to participate in ICOs and token sales, even when regulations and investment limits restrict them from doing so. Many ICOs are too expensive for individual investors and are only open to accredited investors. Additionally, ICOs are generally off-limits to residents of the U.S., China, and many other countries. But with ThorBlock, a pool operator who qualifies as an ICO investor can invest in the token sale on behalf of the community pool. After the ICO is complete, the earnings can be redistributed to the pool members.

Staking Nodes

Update: According to VeChain Insider, “Although the [ThorBlock] pool wallet could potentially be used to create a new node (not an X-Node), this is not recommended, since it is not possible to distribute the generated VTHO between pool contributors. Safe Haven is currently working on a dedicated solution for node pooling called TrustNode.”

Previous Pools

Although ThorBlock may be the first platform of its type, crypto investors have been arranging pools for some time. One blogger notes that many pool administrators currently use Telegram to coordinate investors who want to fund a particular ICO. However, ThorBlock’s features may allow pool administrators to more effectively manage their contributors. The platform will allow administrators to whitelist users so that only trusted contributors can participate.

The platform will also allow users to put more trust in pool operators: administrators cannot withdraw funds early, and users can revoke their funds if they have second thoughts. Admittedly, many investment pools currently use smart contracts to control funds — these are known as trustless pools. However, ThorBlock will provide an all-in-one platform designed specifically for this purpose. The project will launch in early October.

Article Produced By

Mike Dalton

https://unhashed.com/cryptocurrency-news/thorblock-pools-allow-anyone-invest-icos-vechainthor/

David https://markethive.com/david-ogden

Wallet Provider Blockchain Sues Crypto Startup Days Before ICO

Luxembourg-based cryptocurrency wallet provider Blockchain

has filed a lawsuit against a startup with a similar name, the company announced Thursday. Blockchain – formerly known as Blockchain.info – is suing Blockchain.io just days in advance of the latter's initial coin offering (ICO) over concerns that investors may believe they are buying tokens distributed by the wallet distributor, according to a public court filing.

Specifically, the suit names Paymium SAS, the company behind Blockchain.io, and founder Pierre Noizat, as defendants, claiming that Paymium has participated in "bad acts," including the operation of the now-defunct crypto wallet Instawallet. A representative for Blockchain told CoinDesk that the move came as a result of investors confusing the two firms,

adding:

"As we allege in our complaint, blockchain.io is using our brand to cover up a history of hacking and theft of user funds. Worse, they are raising money in a dubious ICO they claim is 'registered with the [U.S. Securities and Exchange Commission].' There is of course no registration statement in place. Given the current climate of SEC enforcement and scam ICOs, when users and investors alerted us to this confusion, we needed to step up and take action before any further harm was done."

Among the suit's arguments is the claim that Blockchain.io's logo is similar to Blockchain's, which infringes its design marks (both logos are pictured above). The complaint specifically states that "Blockchain does not claim exclusive rights to the word 'blockchain' to describe the technology underlying cryptocurrencies …Rather, it claims exclusive rights in the BLOCKCHAIN marks, which it has been using exclusively for its Blockchain Products and which have become well and favorably known to consumers throughout the United States and the world as identifying its highly regarded and secure services."

It goes on to note that "in 2018, after years of doing business under different trademarks, Paymium adopted the mark BLOCKCHAIN.IO in a blatant and bad faith attempt to capitalize on the valuable and trusted BLOCKCHAIN marks and to confuse consumers into believing Paymium's inferior services emanate from or are otherwise associated with Blockchain."

"Paymium's digital currency services are identical or nearly identical to Blockchain's Digital Wallet Services, Mobile App Services and Website Services, which allow consumers to exchange one form of digital currency for another, such as bitcoin for ether or bitcoin cash," the suit continued. However, Blockchain.io has denied the claim, with founder Pierre Noizat telling CoinDesk that "we find it strange that Blockchain Luxembourg filed a claim just [six] days before our public token sale when they had [six] years to contact us regarding our domain name if they had issues with it."

Indeed, whois information confirms that the domain "blockchain.io" was first registered in April 2012 by Paymium. Public records with the National Institute of Industrial Property, the French patent office, also show that blockchain.io was registered as a brand in 2017. However, it is unclear if there was any activity under the domain prior to 2018. The Wayback Machine does have a snapshot from 2017, indicating the domain may have simply redirected to Paymium's website at the time.

And while ICOs cannot "register with the SEC," companies offering securities sales can declare their intent to do so. Public records indicate that Paymium filed a "Form D" for the sale of "digital tokens" in June 2018, announcing the company's intent to sell tokens in the future. CoinDesk was unable to confirm that Blockchain.io had registered with the Autorité de Contrôle Prudentiel et de Résolution, or the French bank and insurance company monitor, as the firm claimed in its pitch deck.

Lawyers weigh in

The lawsuit has failed to impress at least some lawyers who work in the space. Stephen Palley, an attorney with corporate law firm Anderson Kill P.C., told CoinDesk that "it's an odd argument to make in a trademark infringement action." His colleague, Dan Healy, explained further, saying that "BLOCKCHAIN" is a generic term.

"Generic terms are not generally trademarks because they do not identify [a] source. They generically refer to a thing or service. It looks like the plaintiff is trying to show that it is using its design mark as a source identifier for digital wallet services, as something not generic to blockchain, even though they are wallets for holding blockchain currency," he explained. Palley expanded on that idea, noting that "in fact, they had to disclaim any such protection, the lawsuit even says as much."

He added:

"Their use of the word blockchain isn't really protected under U.S. Trademark law … Perhaps because they couldn't get protection for the word, they filed a "design mark" – "blockchain" in all capital letters with a picture next to it. And even though they don't have trademark protection for the word, it appears that they are in effect by this lawsuit trying to use their design mark to prevent blockchain.io from using the word blockchain."

"We think that's a weak argument," he concluded.

Healy noted that Blockchain disclaimed the term, saying "no claim is made to the exclusive right to use BLOCKCHAIN apart from the mark as shown." "That means the plaintiff has a design mark and disclaimed the exclusive right to use the term BLOCKCHAIN, but appears to be trying to enforce its mark to preclude other from using the term BLOCKCHAIN," he said.

Article Produced By
Nikhilesh De

https://www.coindesk.com/wallet-provider-blockchain-sues-crypto-startup-days-before-ico/

David https://markethive.com/david-ogden

Blockchain files a complaint against a cryptocurrency exchange, launching ICO next week

Blockchain, a cryptocurrency company,

announced on their official Twitter that they have filed a complaint against Blockchaindotio, a cryptocurrency exchange, for using their name and promoting false information to users. According to the blog report, Blockchaindotio is a cryptocurrency launched by Paymuim, a company which focuses on providing services for Bitcoin. However, it is stated that the company which was popular for running Instawallet is rebranding itself since they lost their customers funds to a hack.

In the year of 2013, Paymuim claimed that Instawallet was compromised due to a hack and that the customers’ coins were stolen from the platform. The platform also stated that they have filed a complaint with the police. This falls in the same timeframe as that of Mt. Gox hack, the biggest cryptocurrency hack in the space.

However, the announcement of the hack eventually resulted in many stating that the platform was running a scam and are falsely claiming that they were hacked. This is because the platform failed to show any evidence related to the police report despite the community asking for it several times. Reportedly, the company has not completely paid off the claims made by their customers.

Blockchain claims that the platform is rebranding itself in order to conceal the allegations of scam. The blog further stated the company is falsely claiming that they have registered with the Securities and Exchange Commission [SEC] for their Initial Coin Offering [ICO]. The ICO is going to be launched in next week on 27th September 2018. This would result in the investors being unable to trade the token publicly. Moreover, the report also stated that there is no evidence regarding the ICO being regulated by the French ACPR.

Blockchain stated that they are particularly concerned about the company has rebranded to a name which is similar to theirs and that it has already led to a lot of confusion in the market. They stated that the similarities which both the companies share include the domain name, the color of the portal, logo, and the tagline. Blockchain further stated that there have been several people questing them about the ICO.

Blockchain said:

“Blockchain is not doing an ICO. When we inspected blockchain.io’s social media and Telegram channels, we discovered that many more people had assumed that blockchain.io was Blockchain.”

They further added:

“To protect our users and maintain the trust we’ve worked so hard to build, we’ve had to take action. Today we filed a complaint in US federal court. We’ll file more complaints in other courts if we need to and we will continue to fight false and misleading statements that endanger the crypto community.”

Article Produced By
Priya

Priya is a full-time member of the reporting team at AMBCrypto. She is a finance major with one year of writing experience. She has not held any value in Bitcoin or other currencies.

https://ambcrypto.com/blockchain-files-a-complaint-against-a-cryptocurrency-exchange-launching-ico-next-week/

David https://markethive.com/david-ogden