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EY Report: How the Wealth Management Industry Could Benefit from the Blockchain

Blockchain technology has morphed from a popular buzzword to a technology that is in the process of revamping a wide range of operational and business processes within the financial service industry. A segment of the financial industry that could benefit greatly from the implementation of the distributed ledger technology is the wealth and asset management sector.

The global accountancy firm Ernst & Young published a report on the benefits of blockchain technology for the wealth and asset management industry titled ‘Blockchain Innovation in Wealth and Asset Management.’ The report states that the implementation of blockchain technology would likely result in reduced operational expenses, elimination of redundant yet time consuming functions and more opportunities to better the client experience. More specifically, using blockchain technology in important areas such as the client onboarding process, the creation of model portfolios, the settling and clearing of trades and compliance processes related to AML regulations can all be improved by implementing distributed ledger technology-based solutions in the wealth management industry.

Blockchain Use Cases in Wealth Management

In this report, Ernst & Young highlights two use cases as examples of the benefits of the blockchain.

Firstly, blockchain technology can be applied to digitize and streamline the customer onboarding and profiling process. Strict regulatory requirements require wealth managers to collect information such as proof of identification, marital status, residency, sources of wealth and political ties from new potential clients. This can be a cumbersome, long-winded and, therefore, costly process.

If, instead, high net-worth individuals’ data were to be stored on a distributed ledger to which permissioned parties could gain access with the individual’s approval, then this would greatly reduce the time and cost of onboarding a new customer. Furthermore, due to the immutability and auditability of the blockchain, an audit trail could easily be kept for each client.

Secondly, the blockchain could facilitate the creation of portfolios and the communication of portfolio changes to clients. Currently, wealth managers use a variety of different platforms to create and maintain portfolios and most of these platforms do not enable direct communication with the client.

Hence, by developing and implementing a blockchain solution that allows wealth managers to create and manage portfolios according to clients’ stored investment constraints that also allows for direct communication with regarding portfolio changes, the entire investment process would be made substantially more efficient and client relationships could be deepened due to an increase in direct communication between the wealth manager and its clients.

There Will Be Hurdles for Adoption but First-Movers Will Benefit

The report also highlights the challenges of adoption that the technology is likely to encounter. Scalability, interoperability with legacy systems, security and accordance with technology standards were the largest issues raised by the firms polled by Ernst & Young.

In addition, wealth and asset management funds do not exist in a bubble and are usually interconnected with other firms. Therefore, a wide-scale adoption would likely take a long time, considering there would have to be a consensus as to what type of blockchain solutions the whole financial industry chooses to adopt. Due to these factors, most firms are currently only willing to test blockchain technology on a small scale before considering a broader adoption of the tech.

Ernst & Young, however, believes that firms that are the first to adopt blockchain technology will reap the lion’s share of its benefits. As the success of financial blockchain solutions depends on its participants, E&Y encourages firms to begin the innovation process early as first-movers are likely to benefit the most.

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Blockchain

No Money to Buy the Dip? Start Hunting!

If you’ve spent some time in the cryptocurrency sphere, you’ve probably heard the phrase “Buy the F-ing Dip” (BTFD). While the BTFD strategy is a viable one for dollar-cost averaging and gaining solid entries, there may come a time when one is unwilling or incapable of adding to existing positions. However, this does not render an individual unable to grow his or her holdings. It simply means their efforts must be spent elsewhere: on bounty hunting!

The term “bounty hunter” traditionally refers to one who tracks down and detains fugitives and criminals that have failed to respond to court orders and other legal obligations in return for the posted bail or other financial rewards. While bounty hunting in the crypto space is not quite as adrenaline-fueled, it’s a similarly fruitful and expansive affair, where top bounty hunters are earning upwards of tens of thousands of dollars worth of cryptocurrency each month for their participation in the variety of bounties posted every day.

How to find bounties

Almost every single ICO and the majority of cryptocurrencies offer some type of bounty program. Perhaps the best first step is to find a cryptocurrency you believe in and would like to build a bag for, as almost all bounty programs will pay you in the native currency of the project they represent. Generally, these projects post bounty sections or portals on their main websites. Additionally, they are likely listed in Bitcointalk’s Bounties section. Bount0x, a blockchain platform specifically for bounties, also contains plenty of opportunities. Bounty responsibilities range from actions that are as simple as joining Telegram and Discord channels, all the way to video productions and coding projects. To begin bounty hunting, it is important to have accounts on the popular platforms in the cryptocurrency space: Bitcointalk, Reddit, Telegram, Discord, and Twitter. From there, here are a few tips to follow to ensure your success:

1. Evaluate the Programs

The Bitcointalk Bounties section is populated with flashy threads guaranteeing millions of dollars of bounty rewards. Before jumping into the one with the highest dollar amount, take a look at the fundamentals of the project. Because bounty campaigns will almost certainly pay out in the native currency, it’s important to make sure the currency itself holds some value. Valuations for assignments are likely assigned to the ICO price of the currency – will the ICO see activity? Will the coin have liquidity? Beyond this, check out how the bounties are split up. Bounty campaigns typically assign shares to certain actions, like retweets, forum posts, articles, etc. Make sure that what you are earning shares for doing is being adequately rewarded compared to other activities.

2. Play to your strengths

While there is very simple money to be made from signing up for airdrops and chat rooms, these activities will only earn you a few bucks at most. More skilled tasks, like technical writing, art creation, video production, and programming is where the big bounty payouts can be made. If you possess a skill relevant to what projects need, seek out the bounty programs that are in need of those skills. Additionally, if you have a solid background in working with cryptocurrencies, there are oftentimes large bounties assigned to testers and bug finders.

3. Keep at it

The more you participate in bounty campaigns and the cryptocurrency community as a whole, the more you can earn. The highest level forum accounts on Bitcointalk are eligible to enter signature campaigns that sometimes rake in hundreds or thousands of dollars a week simply for participating on the forums. Similarly, consistent and quality work utilizing the skills listed above are often recognized, and oftentimes these projects will recruit their most valuable campaign participants for more permanent positions on their teams.

4. Stay safe

In any large community, there are bad actors. Unfortunately, bounty campaigns are no different. There have been a number of instances in which hackers and exploiters have employed malicious airdrop and bounty programs that simply act as a tool to phish information from users. In the worst cases, wallet information and cryptocurrency balances have been stolen. Make sure to use unique passwords and emails for different campaigns (if necessary), and under no circumstances whatsoever should you share your private key with anyone. Good luck!

 

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Blockchain

Rewards.com Begins Offering Cryptocurrency Rewards

Cryptocurrencies are slowly making inroads in various areas of finance. So far, there has been little to no progress in regards to loyalty schemes or bonus point offerings. Rewards.com is looking to shake things up by offering Dash support to its customers. As such, users can earn rewards for making retail purchases in the form of cryptocurrency.

A Feather in the cap of Dash

It is evident getting people interested in cryptocurrencies will not be easy by any means. To most people, this new form of money offers no real improvements. Even so, things will gradually improve from here on out, as there has been an increase in overall cryptocurrency awareness. 

The latest news from Rewards.com may shed some more positive light on the cryptocurrency industry. While the company isn’t looking to integrate Bitcoin or any of the other top established coins, they are incorporating Dash support in a meaningful manner. First of all, the company has announced they will change their rewards system by letting users earn rewards in Dash, which should introduce some improvements over time.

Secondly, it seems the platform is leaning toward fully integrating cryptocurrency in the near future. Whether or not that will result in positive changes for the eBitsecosystem remains to be seen. Obtaining various cryptocurrencies – especially those with smaller market caps – will remain challenging for most consumers. Even so, any positive attention for cryptocurrencies is considered a victory these days.

Rewards.com’s co-founder and CEO, Todd Rowan, explained the company’s decision:

The remarkable aspect of this partnership is we are introducing people to cryptocurrency in a nonthreatening way. Let’s say you shop at Macy’s, Groupon, or Hotels.com – you can earn a portion of their total purchase in cryptocurrency. The program works just like any points program. You can keep your rewards in the ecosystem just like you would with any type of reward point or redeem it for products, travel, restaurants, or gift cards. The earnings from Rewards.com will help you to start to learn about how to use cryptocurrency, including trading it on the market for Bitcoin or [other] cryptocurrencies. Rewards.com takes us one step closer to global mainstream acceptance of cryptocurrency.

Given the major presence of Rewards.com in the US retail sector, it will be interesting to see how both retailers and consumers respond to this development. It seems users will need to enable the Dash option manually, and thus the rate of acceptance may not be all that impressive when looking at the bigger picture. Even so, it is another feather in the cap of the cryptocurrency industry and a positive change for the Dash ecosystem.

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Blockchain

Researchers Claim $1.2B Worth of Crypto Has Been Stolen Since 2017

Cryptocurrency has been a prime target for criminals for quite some time now. This trend has only intensified over the past few years. A new study by the Anti-Phishing Working Group claims that close to $1.2 billion worth of cryptocurrencies have been stolen since early 2017. It’s a very worrisome number that warrants some clarification.

Criminals are Crazy for Crypto

It is no secret that criminals all over the world have been paying extra attention to cryptocurrencies over the past few years. In the minds of most criminals, this form of money is anonymous and will help them cover their tracks. In reality, however, most (though not all) cryptocurrencies are anything but anonymous or privacy-oriented. Given the rise of eBits firms, using Bitcoin for criminal purposes is less favorable now than ever before.

Even so, there have been numerous thefts of various cryptocurrencies in the past year and a half. As it turns out, researchers claim that close to $1.2 billion worth of crypto has been stolen since early 2017. This is simply an educated guess, as it is nearly impossible to gauge the exact impact of all of these cryptocurrency-related heists.

Even though criminals have seen their fair share of success in the cryptocurrency world, theft is a relatively new trend. To be sure, Bitcoin and other cryptocurrencies have been associated with money laundering, drug trafficking, and other illicit behavior for some time now. Stealing tokens and assets from users is only the proverbial icing on the cake.

It is also worth noting that the Anti-Phishing Working Group is confident that nearly 20% of stolen funds have been recovered. That is an interesting figure, even though it means close to $1 billion worth of stolen funds are still out there somewhere. Additionally, tracking down criminals remains an ongoing challenge despite the rise in popularity of blockchain analysis firms.

The study also touched upon Europe’s recently-implemented eBits:

GDPR will negatively impact the overall security of the internet and will also inadvertently aid cybercriminals. By restricting access to critical information, the new law will significantly hinder investigations into cybercrime, cryptocurrency theft, phishing, ransomware, malware, fraud and crypto-jacking.

It is a bit unclear what steps are being taken to recover the remainder of the stolen funds. Although it’s a major struggle, it seems some progress has been made. Even so, cryptocurrency enthusiasts will have to remain vigilant in order to thwart further heists from happening. This also means users will need to stop relying on centralized trading platforms which offer custodial services. So far, it seems those services remain extremely popular despite their obvious drawbacks.

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