Commodity trading gets sweeter with blockchain-based sugar exchange

Commodity trading gets sweeter with blockchain-based sugar exchange

The UAE project will allow clients to trade tokenized sugar 24/7 without brokers, and fits into the Emirate Blockchain Strategy 2021’s goals

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The world’s largest sugar refinery, Al Khaleej Sugar, officially announced the application of blockchain technology in its recently launched sugar trading platform, DigitalSugar.io.

Users of the UAE-based platform will trade the spot price of sugar via tokens tied to “up to 100,000 tonnes of raw sugar,” with its peg assured by the Universa blockchain who will be issuing electronic warrants of ownership with the tokens. Traders will be able to hold tokens representing between 1 kg to 1M tonnes, and will pay .4% in exchange fees as well as a 2.5% yearly storage fee.

The platform, launched in partnership with the flagship Free Zone and Government of Dubai Authority on commodities trade (DMCC) and Universa Blockchain, will be the first global exchange to offer traders and investors raw spot sugar trades on an immediate basis, rather than the more common options or futures offered by other current exchanges.

Jamal Al Ghurair, Managing Director, Al Khaleej Sugar, said that the launch of a blockchain-based sugar trading platform is in line with the wider goals of UAE Blockchain Strategy 2021, which Highness Sheikh Mohammed bin Rashid, Vice President and Prime Minister of the UAE and Ruler of Dubai, launched in 2018.

The Emirate Blockchain Strategy 2021 outlines an ambitious plan to migrate at least 50% of government-related transactions onto distributed ledger technology (DLT) platforms before the end of this year.

Sheikh Mohammed said of the Strategy: 

“The adoption of this technology will reflect on the quality of life in the UAE and will enhance happiness levels for citizens. 50 percent of government transactions on the federal level will be conducted using Blockchain technology by 2021 … This technology will save time, effort, and resources and enable individuals to conduct most of their transactions in a timely manner that suits their lifestyle and work.“


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The UAE project will allow clients to trade tokenized sugar 24/7 without brokers, and fits into the Emirate Blockchain Strategy 2021’s goals

JPMorgan says Bitcoin slightly overvalued as a commodity

JPMorgan says Bitcoin slightly overvalued as a commodity

Referring to Bitcoin as a commodity seems to show a maturing view of the asset.

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Multiple JPMorgan Chase experts analyzed Bitcoin’s current price when compared to other commodities, and noted that the asset could see selling pressure ahead. 

“The JPMorgan strategists said they calculated an intrinsic value by effectively treating Bitcoin as a commodity and looking at the marginal cost of production,” according to an Oct. 14 article from India’s BloombergQuint media outlet — a partnered entity involving Bloomberg and Quintillion Media. The article added:

“Bitcoin faces a ‘modest headwind’ in the short term based on an analysis of bets in the futures market and an estimate of the cryptocurrency’s intrinsic value, according to JPMorgan Chase & Co.”

Bitcoin futures prices often trade slightly above or below the going market rate for the asset, also known as its spot price. Futures prices tend to get closer to spot prices as contracts near their expiration dates. Futures prices above spot can indicate bullishness, while prices below spot can indicate bearish expectations.

JPMorgan’s specialists reported that Bitcoin’s bullish positions outnumber its bearish positions, according to a futures-based indicator. The strategists also mentioned an increase in buying pressure resulting from the recent trend of mainstream financial giants entering Bitcoin; Paul Tudor Jones, MicroStrategy, and Square have all purchased heavy Bitcoin bags in 2020.

Bitcoin has gained mainstream notoriety as a commodity in recent years, with participants commonly comparing to the asset as digital gold. The fact that traditional analysts have begun to view Bitcoin as a commodity could indicate a continuation of the asset’s mainstream trajectory.


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Referring to Bitcoin as a commodity seems to show a maturing view of the asset.

Tether’s Gold-Backed Stablecoin in Demand as Commodity Hits ATH

Tether’s Gold-Backed Stablecoin in Demand as Commodity Hits ATH

The price of gold and Tether’s XAUT rallied to more than $1,900 today, a value not seen since September 2011.

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The Tether Gold stablecoin was valued at $1,902 on July 24, putting the price of gold within reach of the commodity’s all-time high set in September 2011.

Gold has risen 22.7% from $1,550 to $1,902 since Tether Gold (XAUT) — a stablecoin allowing ownership of one troy ounce of gold held in a Swiss vault controlled by the company — was released on Jan. 23. According to The Wall Street Journal, the commodity set a new record for closing price at $1,897.50 on July 24, but has yet to reach its record intraday high of $1,921 from 2011.

The surge comes just three days after the U.S. government announced a second stimulus bill to counter the economic impact of the COVID-19 pandemic.

“In times of uncertainty, people like having accessibility to gold,” said Paolo Ardoino, Tether Chief Technology Officer (CTO). “Tether Gold is clearly a product that resonates in these times.“

Bitcoin or gold?

The price of Bitcoin (BTC) briefly rose above $10,000 today after a particularly long stretch of low volatility between $9,000-$9,500. 

However, for gold bugs like Peter Schiff, traders who invest in Bitcoin are not looking for stability. He said that investors aren’t going to “get rich on gold” — or, consequently, gold-backed stablecoins — but they assume less risk in losing more from volatile crypto prices. 

Today Schiff continued to push the idea that “a big drop” in BTC price was inevitable:

Meanwhile, Tether’s USD-backed stablecoin (USDT) reached a market capitalization of more than $10 billion on July 22.


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The price of gold and Tether’s XAUT rallied to more than $1,900 today, a value not seen since September 2011.

US CFTC Chairman Says Ether Is a Commodity, ETH Futures Coming Next

US CFTC Chairman Says Ether Is a Commodity, ETH Futures Coming Next

New U.S. CFTC chairman Heath Tarbert believes that Ether is a commodity and that ETH futures are next

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Chairman of the United States Commodity Futures Trading Commission’s (CFTC) believes that Ether (ETH) is a commodity, with ETH futures trading a coming reality.

Heath Tarbert, new CFTC chairman who overtook J. Christopher Giancarlo in July, put forward his stance on Ether, other cryptocurrencies and forked coins at Yahoo Finance’s financial event  All Markets Summit on Oct. 10, Yahoo Finance reports.

First CFTC guidance on Ether

While the CFTC has been very clear that Bitcoin is a commodity, this is reportedly the first time that the authority has provided a vision for Ether, the second-biggest cryptocurrency by market cap. Moreover, the CFTC chairman also expects Ether futures trading on U.S. markets in the near term, the report notes. Tarbert said:

“We’ve been very clear on bitcoin: bitcoin is a commodity. We haven’t said anything about ether—until now […] It is my view as chairman of the CFTC that ether is a commodity.”

“Similar digital assets should be treated similarly”

According to the report, Tarbert acknowledges the existing uncertainty about the status of altcoins. However, Tarbert reportedly claimed that similar digital assets should be treated similarly.

Tarbert suggested that forked cryptocurrencies such as Bitcoin Cash (BCH) or Ethereum Classic (ETC) — those that derive from the original underlying blockchain — should be treated the same as the original asset. At the same time, the chairman noted that the status of a forked coin may alter in case if the “fork itself raises some securities law issues under that classic Howey Test.”

Tarbert reportedly claimed:

“It stands to reason that similarly assets should be treated similarly. If the underlying asset, the original digital asset, hasn’t been determined to be a security and is therefore a commodity, most likely the forked asset will be the same.”

CFTC in the news

In December 2018, the CFTC announced its intention to release a Request for Information (RFI) in order to acquire public comments and guidance on the Ethereum blockchain. At the time, the authority was willing to better understand the differences and similarities between Ether and the major cryptocurrency Bitcoin (BTC).

In mid-September, the CFTC appointed former Coinbase vice president Dorothy D. DeWitt as new director of the division of market oversight.


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New U.S. CFTC chairman Heath Tarbert believes that Ether is a commodity and that ETH futures are next

Indonesia’s Commodity Futures Regulator Releases Regulation for Crypto Futures Market

Indonesia’s Commodity Futures Regulator Releases Regulation for Crypto Futures Market

Indonesia’s commodity futures regulator has established a legal framework for operating crypto and digital assets futures markets

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Indonesia’s commodity futures regulator has established a legal framework for operating crypto and digital assets futures markets, according to an official press release published on Feb. 18.

The Indonesian Commodity Futures Trading Supervisory Agency (Bappebti), which operates under Indonesia’s Ministry of Trade, has officially required multiple entities involved in crypto futures trading to seek regulatory approval and apply for registration before legally operating in Indonesia.

The news follows the recent release of legislation that officially recognizes Bitcoin (BTC) and other digital assets as trading commodities. The Bappebti first greenlighted crypto trading as a commodity on Indonesian stock exchanges back in June 2018.

The new regulatory framework is based on a number of major rules for futures market operations, including regulation on the adoption of crypto as a tradable commodity on futures exchange markets, as well as technical provisions for placing crypto futures contracts on exchanges.

The new rules require both futures exchanges and clearing houses that offer crypto futures trading to pay at least 1.5 trillion Indonesian rupiahs (IDR) or $106 million, as well as maintain a closing capital balance of at least 1.2 trillion IDR ($85 million), according to international law-focused media agency Lexology.

The rules also affect crypto futures traders and storage service providers, requiring both to maintain at least 1 trillion IDR ($71 million) and a minimum closing balance of 800 billion IDR ($57 million) before they can become officially approved to trade crypto futures.

The regulation demands crypto futures exchanges to ensure compliance with security policies, requiring at least three staff members to be acquire Certified Information System Security Professionals (CISSP) certification. The entities should undergo risk management procedures, including compliance with Anti-Money Laundering (AML) and combating terrorism financing policies.

The new regulation was established in order to provide legal certainty around the crypto futures trading field, as well as to protect investors, as Head of Bappepti Indrasari Wisnu Wardhana stated, stressing that commodities futures trading intends to provide the ecosystem with support in the development of digital innovative business models.

While the latest document confirms crypto as being an officially accepted tradable commodity on the futures market, Bitcoin still remains banned from being used as payment in Indonesia, following a ban imposed in 2017 by Indonesia’s central bank. According to Lexology, the regulation stressed that the new regulatory scheme cannot be applied to initial coin offerings (ICOs).

Recently, Indonesia’s crypto trading volumes have surged significantly, with Bitcoin trading volumes reaching around $730,000 on peer-to-peer (P2P) exchange LocalBitcoins during the week ending Feb. 16, according to data from Coin.Dance.

Indonesia LocalBitcoins weekly trade volumes in BTC

Indonesia LocalBitcoins weekly trade volumes in BTC. Source: Coin.Dance

Recently, Cointelegraph reported that crypto traders have negatively assessed the Indonesian regulators’ decision to set a capital requirement of $70 million in order to launch futures trading.

Oscar Darmawan, CEO of local crypto exchange Indodax, recently told Reuters that the sums required are even bigger than the cost of opening a rural bank.


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Indonesia’s commodity futures regulator has established a legal framework for operating crypto and digital assets futures markets

Former JPMorgan Exec Becomes New CEO of Blockchain-Based Commodity Trading Platform Vakt

Former JPMorgan Exec Becomes New CEO of Blockchain-Based Commodity Trading Platform Vakt

Former JPMorgan exec Etienne Amic has been appointed as new CEO at Vakt, a blockchain-based commodity post-trade platform

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Former JPMorgan Chase executive Etienne Amic has been appointed as new CEO at Vakt, a blockchain-based commodity post-trade platform, according to a press release shared with Cointelegraph on Feb. 13.

Having served as a managing director at both JPMorgan Chase and Mercuria Energy Trading S.A., Amic is expected to bring direct experience in commodities trading to the Vakt platform, which is designed to digitize physical commodities trading by cutting out paperwork.

The new Vakt CEO has most recently served as co-founder and chairman of Vortexa, a cargo and analytics firm specializing in global crude oil and refined products markets, and as founding partner at CommodiTech Ventures, a funder of innovative commodities technologies and business models.

In the press release, Amic said that he believes technology will fundamentally change the physical commodities market.

Pointing out multiple participants of the commodities trading process such as operators, physical clearinghouses, service providers and inspection companies, Amic stressed that Vakt’s platform intends to bring together all contributors on one platform.

United Kingdom-based Vakt — whose platform launched in November 2018 in partnership with major oil companies BP, Shell, and Equinor — offers a post-trade processing platform for any kind of tradable commodity, including energy. The company released its first blockchain-based processing tool targeting the crude oil industry sector based on JPMorgan’s Quorum blockchain technology at the end of November.

The company’s original investors and first users of the platform also include banks ABN Amro, ING and Société Générale, as well as independent traders Gunvor, Koch Supply & Trading, and Mercuria, according to the press release.

In January, the Vakt platform was joined by major United States-based global energy giant Chevron along with French multinational integrated oil and gas company Total and major Indian refiner Reliance Industries.


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Former JPMorgan exec Etienne Amic has been appointed as new CEO at Vakt, a blockchain-based commodity post-trade platform

More Oil Giants to Join Blockchain-Based Platform Vakt for Energy Commodity Trading

More Oil Giants to Join Blockchain-Based Platform Vakt for Energy Commodity Trading

Multinational energy corporations Chevron, Total and Reliance Industries have joined blockchain-based platform Vakt for energy commodity trading

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Chevron, one of largest American multinational energy corporations, and two other major energy companies have joined Vakt, a United Kingdom-based blockchain platform for energy commodity trading. Reuters reported on the development on Jan. 16.

Along with Chevron, Total, a leading French multinational integrated oil and gas company, and major Indian refiner Reliance Industries have become members of the Vakt platform.

The article stresses that the agreement is a step towards quicker and safer logistical operations. The Vakt platform, backed by JPMorgan’s Quorum blockchain technology, aims to become a digital transaction platform that would transform the oil business worldwide.

Thomas Waymel, the Total’s head of trading and shipping, underlined in a statement:

“Total has been supporting industry initiatives to digitize cargo post-trade processes for some time.”

Back last fall, the world’s leading oil companies such as BP, Shell and Equinor had agreed to unite with large banks and trading houses to establish the blockchain-driven platform Vakt for energy commodity trading, as Cointelegraph reported on Nov. 12.

Later in November, the first Vakt users were announced, among them the aforementioned BP, Equinor, Shell, as well as Gunvor and Mercuria, Cointelegraph wrote on Nov. 29.

In September of last year, a different blockchain-based platform for financing commodities trading was announced by a group of major banks and industry players, including Shell.


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Multinational energy corporations Chevron, Total and Reliance Industries have joined blockchain-based platform Vakt for energy commodity trading

US CFTC Asks for Comments to Improve Understanding of Ethereum Blockchain, Altcoin

US CFTC Asks for Comments to Improve Understanding of Ethereum Blockchain, Altcoin

The U.S. Commodity Futures Trading Commission has asked for public comment and feedback to improve its knowledge of the Ethereum blockchain and altcoin

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The United States Commodity Futures Trading Commission (CFTC) is seeking public comments and guidance on the Ethereum (ETH) blockchain, according to an official press release published Dec. 11.

In order to improve the commission’s understanding of Ethereum and its underlying technology, the CFTC has announced its intention to publish a respective Request for Information (RFI) with the Federal Register.

In the upcoming RFI, the commission will request public comments on a wide range of questions such as Ethereum-related “technology, opportunities, risks, mechanics,” its market features, as well as use cases of Ethereum network applications.

Moreover, the CFTC has expressed the wish to better understand the differences and similarities between Ethereum and the seminal cryptocurrency Bitcoin (BTC), specifically the “opportunities, challenges, and risks” associated with the Ethereum altcoin.

According to the statement, all public comments to the Ethereum-related RFI will be accepted within 60 days after publication in the Federal Register. In addition, the commission noted that the results of the RFI will assist the CFTC’s fintech initiative called LabCFTC.

Founded in May 2017, LabCFTC is a dedicated hub for “engagement with the fintech innovation community,” aiming to examine “new regulatory fintech developments in the marketplace,” as noted by CFTC chairman Christopher Giancarlo earlier this year.

In late November, LabCFTC published a primer concerning smart contracts, following its first crypto-publication in October 2017. In the document entitled “Primer on Smart Contracts,” the CFTC’s innovation hub formed a working definition of the technology in addition to outlining its risks and benefits.


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The U.S. Commodity Futures Trading Commission has asked for public comment and feedback to improve its knowledge of the Ethereum blockchain and altcoin