▲ Incubator Series
By: Gabriel Dusil, Co-founder & Board Member, Adel
Jessica Allen, Blockchain Enthusiast & Social Media Expert
A Philosophy for Blockchain Integrity
Given Bitcoin’s meteoric rise, some claim that its underlying technology, blockchain, is ushering in an Internet 2.0. Don Tapscott , bestselling author and winner of the 2017 Digital Pioneer Award, remarked, "The first generation brought us the internet of information. The second generation, powered by blockchain, is bringing us the internet of value, a new, distributed platform that can help us reshape the world of business and transform the old order of human affairs for the better."
Even with blockchain’s potential to improve society, not everyone has its best interest in mind. With many deregulated technologies, including the internet, both the corrupt and complaint manage to find a way to profit within the same sandbox. It is for this reason that regulators have needed to play catch-up to blockchain initiatives and cryptocurrencies . The intention is to close gaping holes where criminals are passing with impunity. Once laws are in full force, blockchain service providers will need to seriously consider compliance tactics. This may alienate blockchain liberalists who stubbornly oppose centralized control. But alignment to legislation will also attract mainstream investors who want the confidence and assurance that their investments will be kept safe.
Blockchain’s first application, Bitcoin, was occasionally tainted by nefarious actors who harmed its reputation. Unfortunately, the media perceived Bitcoin as harmful to communities. Now that the blockchain technology has been researched by many financial institutions, there is a common interest to redefine the blockchain brand in a positive light. Integrity in the development, release, and use of new blockchain-based software is of the utmost importance. And both the media and the public should be educated on its benefits.
To create integrity, there are three regulatory considerations for cryptocurrency services in 2017:
- Know Your Customer (KYC)
- Anti-Money Laundering (AML)
- Counter Terrorism Financing (CTF)
Blockchain projects till now had not been subject to such strict requirements. Nor did governments have the regulations in place to enforce these policies. As a result, projects were shut down and investors left empty handed , the most notable being BitInstant and Mt. Gox , both of whom contributed to tarnishing the blockchain brand.
- Figure #1: Adel Ecosystem Limited’s Commitment to AML4 compliance
Crypto investors are quickly learning acronyms like KYC, AML and CTF. 2017 is the year of significant regulatory change. This is namely due to Directive (EU) 2015/849, informally known as the 4th Anti-Money Laundering directive (Figure #1), or AML4 which will be implemented on June 26, 2017 . To meet compliance requirements, crypto services must follow detailed auditing and compliance procedures, or risk closure due to regulatory violations.
Adel co-founder Gabriel Dusil says: “Our responsibility is to protect the blockchain brand. We think this is just as important as protecting our own. The foundation from which we built Adel is regulatory compliance and the desire to incubate long-term sustainable businesses. This legitimacy opens our doors to mainstream investors. It's not just about legitimizing the crypto community as an investment vehicle. It’s about creating innovative projects that will change the world. This alone has the potential to solidify the integrity of the blockchain brand.”
About the Authors
Gabriel Dusil
Gabriel is a seasoned sales and marketing expert with over twenty years of experience in senior level positions at companies such as Motorola, VeriSign (part of Symantec), and SecureWorks (part of Dell). His strengths lie in international business development and strategic partnerships, as well as the unique ability to translate complex ideas and technologies into language that decision makers can easily understand. Gabriel has a Bachelor’s degree in Engineering Physics from McMaster University in Canada and possesses expert knowledge in cloud computing, IT security, and video streaming technologies (Over the Top Content, OTT). Gabriel also runs his own company, Euro Tech Startups s.r.o., and manages two blogs: https://dusil.com/ and https://gabrieldusil.com/.
Jessica Allen
Jessica is a blockchain enthusiast and social media community expert with over 25 years of technology and 15 years of digital marketing experience. As a mother of two, Jess is passionate about blockchain’s potential to innovate industries, unite communities and create a sustainable global economy. She brings the ability to create conversations with anyone, at any level, about blockchain use cases and potential. Jess is active on social media @TheJessAllen and volunteers her time with the Isha Foundation to help share the benefits of yoga and meditation as fundamental tools for human transformation.
References
http://dontapscott.com/
http://www.bvdinfo.com/en-gb/blog/compliance-and-due-diligence/what-you-need-to-know-about-aml4
http://www.telegraph.co.uk/business/2017/04/16/regulating-bitcoin-new-frameworks-could-catalyst-cryptocurrencies/
https://coinlexit.wordpress.com/2016/07/06/bitcoin-aml-proposal-of-the-european-commission/
http://www.coindesk.com/70-bitcoin-scams-shut-new-york-law-enforcement/
http://www.businessinsider.com/report-ceo-of-major-bitcoin-exchange-arrested-2014-1?international=true&r=US&IR=T
https://en.wikipedia.org/wiki/Mt._Gox
https://www.bvdinfo.com/en-gb/blog/compliance-and-due-diligence/what-you-need-to-know-about-aml4
http://www.bvdinfo.com/en-gb/blog/compliance-and-due-diligence/what-you-need-to-know-about-aml4