Europe attracts half of funds raised in coin offerings

The value of bitcoin has soared by 1,000 percent since the start of the year, despite a sharp fall yesterday. (Reuters)
Updated 01 December 2017
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Europe attracts half of funds raised in coin offerings

LONDON: Nearly half of the cash that has poured into newly issued cryptocurrencies in recent years has been raised in Europe, research published on Thursday showed.
The report by Atomico, one of Europe’s leading venture capital firms, found European-based entities have raised $1.76 billion through so-called initial coin offerings, or ICOs, since 2014, representing 46 percent of funds raised globally.
ICOs have become a bonanza for digital currency entrepreneurs. They have provided the fuel for a rapid ascent in the value of cryptocurrencies this year that has raised fears of a bubble that could burst, with bitcoin soaring more than 1,000 percent since the start of 2017.
Atomico’s research is based on data compiled by California-based TokenData and stretches back to 2014, although more than 90 percent of ICO activity has taken place this year, researcher Ricky Tan said.
Switzerland drew in nearly half of Europe’s total — $828 million or 47 percent of ICO funds in the region, mainly through firms registered in Zug, a low-tax region near Zurich that is also the domicile for many top commodities traders, Tan said.
By contrast, North America drew in $1.08 billion of ICOs, or 28 percent of a global market that raised around $3.8 billion through the issuance of new types of digital currency.
The report predicts that larger European venture firms will begin to participate in ICOs next year, reversing their historic resistance to what many have seen as unregulated competition to traditional venture funding.
Already, top-tier US venture capital firms such as Andreesen Horowitz and Union Square Ventures have actively invested in ICO fundraisings, along with some newer European funds such as Blueyard Capital of Berlin.
“But the region’s most established funds have yet to participate,” the Atomico report states. “This will change in 2018.”
ICOs function as an alternative to traditional, regulated means of fundraising through public stock market flotations or private investments by venture capitalists or other investors.
The new fundraising mechanism has flourished in unregulated markets where investment capital is scarce. China and South Korea have banned digital coin sales, while the US Securities and Exchange Commission is weighing up tougher rules.
Switzerland, along with Germany and Austria dwarf other parts of Europe with $976 million raised in terms of capital — three times the funding ICOs attracted in Central and Eastern Europe and four times greater than Britain and Ireland.
But when it comes to the number of ICO projects launched, Central and Eastern Europe are way ahead with 162 of the rest of the region, followed by 90 projects in Britain and Ireland.
 


OPEC may cancel April meet, but hold steady on oil output: Saudi energy minister

Saudi Arabia’s energy minister Khalid Al-Falih that April may be premature to make any production decision for the second half. (Reuters)
Updated 23 min 27 sec ago
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OPEC may cancel April meet, but hold steady on oil output: Saudi energy minister

  • ‘As long as the levels of inventories are rising and we are far from normal levels, we will stay the course guiding the market toward balance’
  • ‘The consensus we heard ... is that April will be premature to make any production decision for the second half’

BAKU: OPEC and its non-OPEC partners need to reconsider if there is a need for a meeting in April, Saudi Arabia’s energy minister said on Monday, adding that there was no pressure from the United States to increase supply.
“We are not under pressure except by the market,” Khalid Al-Falih told reporters ahead of a meeting of the Joint Ministerial Monitoring Committee (JMMC) in Baku, the capital of Azerbaijan.
“As long as the levels of inventories are rising and we are far from normal levels, we will stay the course guiding the market toward balance.”
The JMMC includes major oil producers Saudi Arabia and Russia and monitors the oil market and conformity levels with supply cuts.
“There is a consensus that has also emerged that no matter what, we should stay the course until the end of June.”
Asked whether he was updated on whether the United States administration would extend the waivers it granted to buyers of Iranian crude, which are due to end in May, Al-Falih said: “Until we see it hurting consumers, until we see the impact on inventory, we are not going to change course.”
The oil producers are due to meet next in April in Vienna, but Al-Falih said this may not happen.
“The consensus we heard ... is that April will be premature to make any production decision for the second half,” Al-Falih said.
“We may not have a meeting in April,” he said, adding that the JMMC may recommend this later on Monday.