Category Archives: FinTech and Alternative Finance

Toronto Fintech & Funding Networking Event (Jul 11, 2018): 4th Annual NCFA Summer Kickoff!

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NCFA Canada | Craig Asano | June 18, 2018

2018 Fintech & Funding Summer Kickoff Networking - PATIO TIME!

Join the National Crowdfunding & Fintech Association of Canada, Pegasus Fintech Inc., Fintech Growth Syndicate, Nikola Tesla Unite Ltd. and partners, affiliates and a leading Fintech & Funding community in the heart of upscale Yorkville, on the InterContinental's PATIO and Proof Bar for a night of revelry and prime networking mixer.  Interested in disrupting the finance industry, raising capital or participating in Canada’s growing alternative finance and fintech sectors? Here's a perfect opportunity to connect with emerging fintech startups (stealth mode) and experts, strategize with partners, pitch investors and mingle with Toronto’s burgeoning fintech ecosystem.

EVENT DETAILS:

Wednesday, Jul 11, 2018

~5:30 PM - 9:00PM+

InterContinental Yorkville (PATIO & Proof Bar)

220 Bloor Street West, Toronto, M5S 1T8 (map)

 

LIMITED TICKETS - GET'M BEFORE THEY'RE GONE!

$25 Early / $35 Standard / $50 Late

  • All include entrance to private event, a complimentary drink, o'hordeurves, prizes and prime networking
  • Taxes and fees extra.  No refunds 7 days before the event (after Jul 4).  Ticket transfers ok.
  • If it rains the event will take place inside the Proof Bar
  • Checkout photos from last year's Summer networking event here

All ticket registrations by July 3 will be automatically entered into a July 4th draw taking place 6pm at Yonge and Dundas square at driver/showcase event to WIN 2 VIP tickets:

  • Draw will take place July 4th at 6pm at Yonge and Dundas Niko race car driver/showcase event.
  • 1 winner will be drawn and receive 2 x tickets entrance with VIP pit passes for Saturday, July 7 at the Mobil 1 Sportscar Grand Prix sponsored by event partner NIKOCoin

Those who are crazy enough to think they can change the world usually do - Steve Jobs

 

This event is for the Fintech & Funding Community

Innovators and investors interested in financial innovation, networking and collaborating with startups, investors, angels, early stage-focused VC's and industry experts in alternative finance, crowdfunding, fintech, payments, crypto-currency, blockchain, ICOs / STOs, Artificial Intelligence-driven investing and other financial innovation sectors.

  • Companies actively raising capital
  • Investors and syndicates interested in investing
  • Fintech advisors, consultants, and development experts (startups, institutions, researchers, academia, government)
  • Financial innovators looking to partner or collaborate
  • High growth fintech start-ups (stealth mode) and scale-ups.  Private or public.
  • Developers looking for opportunities and to connect with businesses
  • Funding platforms, dealers, providers and their client networks
  • Anyone interested in emerging fintech trends, regulations and industry developments

 

Venue (Patio and covered Proof Bar)

 

Event Host and Partners:

The National Crowdfunding & Fintech Association of Canada (NCFA Canada) is a non-profit actively engaged with cryptocurrency, blockchain, crowdfunding, alternative finance, fintech, P2P, ICO/STO, and online investing stakeholders globally. NCFA Canada provides education, research, industry stewardship, services, and networking opportunities to thousands of members and subscribers and works closely with industry, government, academia, community and eco-system partners and affiliates to create a strong and vibrant crowdfunding and fintech industry. Join Canada's Fintech & Funding Community today FREE, or become a valued contributing member and get perks.

For more information, please visit: ncfacanada.org

 


Pegasus Fintech, Inc.focuses on supporting innovative solutions in the Financial Services, Technology, Blockchain and Cryptocurrency communities.  Pegasus has developed a full-service process for assisting organizations who want to do an Initial Coin Offering (ICO).  Together with our team of highly skilled industry professionals and partners we create, with our clients, the necessary business, legal, accounting, technology development, capital and funding strategies, whitepapers, roadmaps, marketing and sales processes to deploy successful and compliant ICOs.  Pegasus also has created an integrated network platform, called the Pegasus Matrix, supporting interactivity through Pegasus supported ICO use cases.  Pegasus is a partner of Polymath and is the first North American Sponsor Firm of the Gibraltar Blockchain Exchange (GBX).

For more information, please visit:  pegasusfintech.com


FinTech Growth Syndicate (FGS) is a business accelerator that accelerates sales, partnering and marketing strategies for new and growing FinTech companies and implements internal or external innovation strategies and projects for financial institutions and technology incumbents.  We are deeply connected to the FinTech community and stakeholders and help organizations find partners and build awareness within the FinTech ecosystem.

For more information, please visit:  fintechgrowthsyndicate.com

 


INTERESTED IN GETTING INVOLVED?

Contact us to learn more:  casano@ncfacanada.org / 416-618-0254

SEE YOU THERE!

 

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Ethereum Rises on Positive Comments by the SEC

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Crowdfund Insider | JD Alois | Jun 14, 2018

Ethereum rose dramatically today following the comments of William Hinman, Director of the Division of Corporate Finance at the Securities and Exchange Commission (SEC), who inserted a statement in a speech today that ended the question of Ethereum being a security. Hinman told an audience at Yahoo Finance in San Francisco;

“And putting aside the fundraising that accompanied the creation of Ether, based on my understanding of the present state of Ether, the Ethereum network and its decentralized structure, current offers and sales of Ether are not securities transactions.”

The reassuring comments not only helped Ethereum, but other cryptocurrencies followed higher in its wake.

CoinList co-founder and President Andy Bromberg commented on the news from the SEC that it doesn’t consider Ether or Bitcoin – for that matter, a security:

“The SEC’s recent comments are a validation of the possibility of non-securities tokens and a big step towards more definitive guidance on how and when individual tokens can be defined as non-securities. The precedent they are indicating here is a powerful one that will enable new projects to continue to flourish in the space.”

Of course, the comments by the SEC does not mean that Ethereum based initial coin offerings (ERC20 – ICOs) are in the clear. Most all of these offerings are more than likely securities when looking at recent comments by SEC Chair Jay Clayton. But what is encouraging is the fact that the agency is willing, and interested, in enabling crypto-innovation. Echoing comments by other staff members of the SEC, Hinman encouraged blockchain entrepreneurs to reach out to them before proceeding.

“We are happy to help promoters and their counsel work through these issues. We stand prepared to provide more formal interpretive or no-action guidance about the proper characterization of a digital asset in a proposed use. In addition, we recognize that there are numerous implications under the federal securities laws of a particular asset being considered a security...

Continue to the full article --> here

 

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NCFA Canada | Craig Asano | June 18, 2018 2018 Fintech & Funding Summer Kickoff Networking - PATIO TIME! Join the National Crowdfunding & Fintech Association of Canada, Pegasus Fintech Inc., Fintech Growth Syndicate, Nikola Tesla Unite Ltd. and partners, affiliates and a leading Fintech & Funding community in the heart of upscale Yorkville, on the InterContinental's PATIO and Proof Bar for a night of revelry and prime networking mixer.  Interested in disrupting the finance industry, raising capital or participating in Canada’s growing alternative finance and fintech sectors? Here's a perfect opportunity to connect with emerging fintech startups (stealth mode) and experts, strategize with partners, pitch investors and mingle with Toronto’s burgeoning fintech ecosystem. EVENT DETAILS: Wednesday, Jul 11, 2018 ~5:30 PM - 9:00PM+ InterContinental Yorkville (PATIO & Proof Bar) 220 Bloor Street West, Toronto, M5S 1T8 (map) LIMITED TICKETS - GET'M BEFORE THEY'RE GONE! $25 Early / $35 Standard / $50 Late All include entrance to private event, a complimentary drink, o'hordeurves, prizes and prime networking Taxes and fees extra.  No refunds 7 days before the event (after Jul 4).  Ticket transfers ok. If it rains the event will take place inside the Proof Bar Checkout photos from last year's ...
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Toronto Fintech & Funding Networking Event (Jul 11, 2018): 4th Annual NCFA Summer Kickoff!
Bitcoin.com | Avi Mizrahi | Jun 11, 2018 Canadian bitcoin investors and cryptocurrency traders are going to be subjected to an increased level of market surveillance soon if the government has its way. Once the proposed regulations are implemented, every transaction above $10,000 CAD will have to be reported. Crypto Exchanges to Report as MSBs The Department of Finance Canada has issued a Regulatory Impact Analysis Statement regarding proposed amendments to the country’s AML/ATF regime. The statement suggests that Canadian crypto exchanges will be treated as money service businesses (MSBs) and will have to report trades over a certain amount. According to the proposed amendments published in the Canada Gazette, “Persons and entities that are ‘dealing in virtual currency’ would be financial entities or other entities deemed domestic or foreign MSBs, as the case may be. These ‘dealing in’ activities include virtual currency exchange services and value transfer services. As required of all MSBs, persons and entities dealing in virtual currencies would need to implement a full compliance program and register with FINTRAC. In addition, all reporting entities that receive $10,000 or more in virtual currency (e.g. deposits, any form of payment) would have record-keeping and reporting obligations.” See:  Canada ...
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Canadian Exchanges to Report Transactions Over $10k per Proposed Regulations
Crowdfund Insider | JD Alois | Jun 14, 2018 Ethereum rose dramatically today following the comments of William Hinman, Director of the Division of Corporate Finance at the Securities and Exchange Commission (SEC), who inserted a statement in a speech today that ended the question of Ethereum being a security. Hinman told an audience at Yahoo Finance in San Francisco; “And putting aside the fundraising that accompanied the creation of Ether, based on my understanding of the present state of Ether, the Ethereum network and its decentralized structure, current offers and sales of Ether are not securities transactions.” The reassuring comments not only helped Ethereum, but other cryptocurrencies followed higher in its wake. CoinList co-founder and President Andy Bromberg commented on the news from the SEC that it doesn’t consider Ether or Bitcoin – for that matter, a security: “The SEC’s recent comments are a validation of the possibility of non-securities tokens and a big step towards more definitive guidance on how and when individual tokens can be defined as non-securities. The precedent they are indicating here is a powerful one that will enable new projects to continue to flourish in the space.” Of course, the comments by the SEC ...
Read More
Ethereum Rises on Positive Comments by the SEC
IT Business | Bret Conkin | June 12, 2018 Real estate and fintech have been integrating in exciting new ways in recent years. Real estate online investment or crowdfunding has been a sector that has attracted significant interest in the U.S. over the last several years, with more than 100 portals launched to serve rapidly growing developer and investor interest. In fact, industry research hub crowdsourcing.org estimates that the industry will be worth more than $300 billion USD by 2025. Why would developers consider an online and alternative financing route? A big reason, beyond the capital, is the significant marketing benefits that campaigns can generate, including community building. Check out:  GAME-CHANGERS: Crowdfunding real estate projects in the GTA To investigate where the Canadian market for real estate crowdfunding is going in the next 12 months, we interviewed the two leading portals in Canada, online investment platform NexusCrowd and private equity firm R2 (though R2 notes that they position themselves as an online marketplace or fintech in commercial real estate, not as “crowdfunders”). Learn more below. Bret Conkin: How many projects and capital were raised via your portal in 2017? To date in 2018? Amar Nijar, CEO of R2 Capital & ...
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Real estate crowdfunding in Canada: portal insights for 2017/18
Baer & Karrer | By Daniel Flühmann and Peter Hsu | May 23, 2018 The Fintech Landscape 1.1 Please describe the types of fintech businesses that are active in your jurisdiction and any notable fintech innovation trends of the past year within particular sub-sectors (e.g. payments, asset management, peer-to-peer lending or investment, insurance and blockchain applications). The Swiss fintech landscape has evolved significantly over the past few years and Switzerland continues to be an attractive base for innovators in the financial sector. Approximately 200 active companies in various sub-sectors form the core of the diverse Swiss fintech ecosystem. The total number of fintech-related businesses, however, is much higher. Many established financial institutions and other established financial market players have entered the fintech space in the recent past and, as a result, the distinction between fintech and traditional financial services has become increasingly blurred. Swiss-based fintech businesses include robo-advisory and social trading services, crowdfunding and crowdlending platforms as well as payment systems and businesses active in the area of collective investment schemes. One of the key focus areas in the past year has been driven by blockchain-based businesses, in particular in the areas of cryptocurrencies and decentralised transaction platforms (e.g. Ethereum ...
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Comprehensive Overview of Fintech in Switzerland H1 2018
CSA | Staff Notice 46-308 | June 11, 2018 Montréal – The Canadian Securities Administrators (CSA) today published CSA Staff Notice 46-308 Securities Law Implications for Offerings of Tokens, which provides additional guidance on the applicability of securities laws to offerings of coins or tokens, including ones that are commonly referred to as “utility tokens.” “Since publishing initial guidance, we have engaged with numerous businesses considering token offerings and have found that most of these offerings involve securities,” said Louis Morisset, CSA Chair and President and CEO of the Autorité des marchés financiers. “Our notice sets out additional guidance based on situations we have seen to date and common inquiries we have received from businesses and their advisors.” CSA Staff Notice 46-308 outlines specific situations that may have an implication on the presence of one or more of the elements of an investment contract in the context of an offering of coins or tokens. This notice supplements the CSA’s August 2017 publication of CSA Staff Notice 46-307 Cryptocurrency Offerings, which outlines how securities law requirements may apply to initial coin offerings, initial token offerings, cryptocurrency investment funds and the cryptocurrency platforms trading these products. See:  State and Provincial Securities Regulators Conduct Coordinated International ...
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Canadian securities regulators provide additional guidance on securities law implications for offerings of tokens
Canadian Innovation Exchange | Peter Jones | June 8, 2018 NCFA Canada is a proud Community Partner of CIX, Canada's most curated startup investment conference. Invited attendees are founders of Canada's most innovative early- and growth-stage tech companies and global investors and corporates. CIX takes place over two days, Oct 22-23, 2018, in downtown Toronto. The 11th annual CIX Top 20 program is now open for submissions. The CIX Top 20 program is Canada's largest national showcase of the nation's hottest and most innovative tech companies. CIX Selection Committee evaluates all submissions and selects 20 to present at CIX, taking place on October 22 & 23 in Toronto. Register online and use code KICKOFFCIX by Friday, July 20th, or reach out to Joel Pinto at jpinto@brunico.com for further registration inquiries Visit the CIX website --> now The National Crowdfunding & Fintech Association of Canada (NCFA Canada) is a cross-Canada non-profit actively engaged with cryptocurrency, blockchain, crowdfunding, alternative finance, fintech, P2P, ICO, and online investing stakeholders globally. NCFA Canada provides education, research, industry stewardship, services, and networking opportunities to thousands of members and subscribers and works closely with industry, government, academia, community and eco-system partners and affiliates to create a strong and vibrant crowdfunding ...
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Conference Toronto (Oct 22-23):  11th Annual Canadian Innovation Exchange (CIX)
Race Tech Development Group | Dean Jessop | Jun 8, 2018 Nikola Tesla Unite is new to the cryptocurrency market, but cryptocurrency is not new in the minds of the founders. Working for many years to bring the concept and idea to market, NIKO Coin is set to be one of the major players in not only digital currency, but also business-to-business programs through their partnership with Alianza Motorsports. “This is a true partnership,” explained Alianza Motorsports’ Lorne Kelly. “We are working together both on and off the track. NIKO Coin promotion is being done on the side of our racecar, race hauler and with trackside functions and displays while we all work hand in hand to educate fellow teams, drivers and racing enthusiasts on the advantages and benefits of using digital currency. We have had several meetings with suppliers, other team partners, series and organizations on how we can help them get in on the ground floor of the digital currency market all with the help of NIKO Coin.” With a digital wallet offered by NIKO Coin and that can be downloaded from the Google Play Store, NIKO Coin can now connect with a wider demographic of users. See:  ...
Read More
Nikola Tesla Unite to use Alianza Motorsports to Educate Race Fans on Crypto
Grow VC Group | Jouko Ahvenainen | Jun 2018 Data and AI started to come fundamental components for FinTech in 2017. There are several reasons for this development, for example, the development of machine learning and data analytics solutions, growth of FinTech services to have enough data, and new cloud based infrastructures that make it easier to use data. We can expect this development continues and accelerates in 2018. At the same time, blockchain, distributed finance models and increasing privacy concerns will change data requirements and models. Data is coming a fundamental enabling component in the finance services, and it will give also more power to customers. Data to enable customers Everyone today knows data has a lot of value. “We try to collect all possible data, and then we find a model to monetize it, maybe sell to advertisers,” is a common sentence in many business plans. “We help companies monetize their data,” is another typical value promise. “Let’s offer our solutions for free, if we can get the data,” is a ‘sales strategy’. Is it so simple that you offer software, apps, and services to consumers and companies, utilize their data and create a big business? It really ...
Read More
The world's new oil and AI's imminent impact on the future of Fintech
VentureBeat | Khari Johnson | Jun 7, 2018 It’s no exaggeration to call Element AI one of the top startups in the world right now. With the help of deep learning pioneer Yoshua Bengio, the company is making AI-powered products for the enterprise. And from its beginning in October 2016, Element AI has broken the rules of what to expect from a startup. In December 2016, Element AI was the very first company to receive funding from Microsoft Ventures. Six months later, the company raised a $102 million series A round. Element AI has yet to release a single publicly available product, but the company is already working with customers, has opened offices in Singapore, South Korea, Toronto, and London, and already plays an advisory role to startups that receive funding from the Global AI Fund in South Korea. At the creative tech conference C2 in Montreal last month, VentureBeat sat down with CEO Jean-François Gagné to talk about challenges enterprise customers face in implementing AI, his company’s first publicly available products, and why he believes AI is allowing startups to challenge incumbent businesses in tech and finance. This interview has been edited for brevity and clarity. VentureBeat: Are there any ...
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Element AI: The market is still figuring out how to share data with enterprise AI startups

 


The National Crowdfunding & Fintech Association of Canada (NCFA Canada) is a cross-Canada non-profit actively engaged with cryptocurrency, blockchain, crowdfunding, alternative finance, fintech, P2P, ICO, and online investing stakeholders globally. NCFA Canada provides education, research, industry stewardship, services, and networking opportunities to thousands of members and subscribers and works closely with industry, government, academia, community and eco-system partners and affiliates to create a strong and vibrant crowdfunding and fintech industry. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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Canadian securities regulators provide additional guidance on securities law implications for offerings of tokens

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CSA | Staff Notice 46-308 | June 11, 2018

Montréal  The Canadian Securities Administrators (CSA) today published CSA Staff Notice 46-308 Securities Law Implications for Offerings of Tokens, which provides additional guidance on the applicability of securities laws to offerings of coins or tokens, including ones that are commonly referred to as “utility tokens.”

“Since publishing initial guidance, we have engaged with numerous businesses considering token offerings and have found that most of these offerings involve securities,” said Louis Morisset, CSA Chair and President and CEO of the Autorité des marchés financiers. “Our notice sets out additional guidance based on situations we have seen to date and common inquiries we have received from businesses and their advisors.”

CSA Staff Notice 46-308 outlines specific situations that may have an implication on the presence of one or more of the elements of an investment contract in the context of an offering of coins or tokens.

This notice supplements the CSA’s August 2017 publication of CSA Staff Notice 46-307 Cryptocurrency Offerings, which outlines how securities law requirements may apply to initial coin offerings, initial token offerings, cryptocurrency investment funds and the cryptocurrency platforms trading these products.

See: 

Any business planning to raise capital through an offering of coins or tokens should consider whether it involves the distribution of a security. In order to avoid costly regulatory surprises, businesses are encouraged to consult qualified securities legal counsel about the potential application of, and possible approaches required to comply with, securities legislation. Businesses should also contact their local securities regulatory authority to discuss possible flexible approaches to complying with securities laws, including time-limited exemptive relief.

The CSA Regulatory Sandbox is an initiative of the CSA to support financial technology (fintech) businesses seeking to offer innovative products, services and applications in Canada. The CSA has granted, through the CSA Regulatory Sandbox, exemptive relief from certain securities law requirements to firms in the context of offerings of coins or tokens that involve the distribution of securities, subject to conditions to ensure adequate investor protection.

CSA staff monitor cryptocurrency offerings activity and will continue to take action against businesses that do not comply with securities laws.

The CSA, the council of the securities regulators of Canada’s provinces and territories, co-ordinates and harmonizes regulation for the Canadian capital markets.

Source:  Security law implications for Offerings of Tokens

Download CSA Staff Notice 46-308 --> here

 


The National Crowdfunding & Fintech Association of Canada (NCFA Canada) is a cross-Canada non-profit actively engaged with cryptocurrency, blockchain, crowdfunding, alternative finance, fintech, P2P, ICO, and online investing stakeholders globally. NCFA Canada provides education, research, industry stewardship, services, and networking opportunities to thousands of members and subscribers and works closely with industry, government, academia, community and eco-system partners and affiliates to create a strong and vibrant crowdfunding and fintech industry. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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Nikola Tesla Unite to use Alianza Motorsports to Educate Race Fans on Crypto

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Race Tech Development Group | Dean Jessop | Jun 8, 2018

Nikola Tesla Unite is new to the cryptocurrency market, but cryptocurrency is not new in the minds of the founders. Working for many years to bring the concept and idea to market, NIKO Coin is set to be one of the major players in not only digital currency, but also business-to-business programs through their partnership with Alianza Motorsports.

“This is a true partnership,” explained Alianza Motorsports’ Lorne Kelly. “We are working together both on and off the track.

NIKO Coin promotion is being done on the side of our racecar, race hauler and with trackside functions and displays while we all work hand in hand to educate fellow teams, drivers and racing enthusiasts on the advantages and benefits of using digital currency.

We have had several meetings with suppliers, other team partners, series and organizations on how we can help them get in on the ground floor of the digital currency market all with the help of NIKO Coin.”

With a digital wallet offered by NIKO Coin and that can be downloaded from the Google Play Store, NIKO Coin can now connect with a wider demographic of users.

See:  Highlights from FFCON18: VELOCITY – Blockchain, Cryptocurrency, Alternative Investing Conference (March 5-6, Toronto)

Kelly continued, “With NIKO Coin, the general public can conduct peer-to-peer transactions and trade cryptocurrency at local NIKO Coin outlets. The whole idea seems futuristic but the writing is on the wall and we are definitely headed to a more digital society. Alianza Motorsports is happy to have this connection to cryptocurrency and we are excited to help bring it to the world of motorsports.”

“Our mission is to facilitate fundamental change in societal interactions while having a significant impact on many of the ways our world functions by building solutions that will have a profound impact on how global society interacts,” explained Dean Jessop of Nikola Tesla Unite. “

Our values of community, decentralization, and inclusion are all closely and deeply aligned with our belief in the forthcoming digital economy. A future where the people and technology will be a part of a fully liquid system open to everyone. Our group is advancing this state of technology and pushing it forward through innovative development. We are building solutions that will have a profound impact on how global society interacts. Leveraging a top-tier network of global providers, we are building an ecosystem more robust and far-reaching than anything to date.”

While the next on track action is still six weeks away, Alianza Motorsports continues to prepare for their home event at the Canadian Tire Motorsports Park. Taking on the Mobil 1 SportsCar Grand Prix during the July 6-8 weekend, this will be the home event for team driver Anthony Simone and provide the perfect backdrop for NIKO Coin to educate potential users of cryptocurrency.

For more information on Nikola Tesla Unite and the NIKO brand of cryptocurrency, please contact Jane Anderson at 1.833.TESLA 56 or via e-mail to Media@NIKO.eco. To visit them online, please visit www.NIKO.eco. or www.nikolateslaunite.com.

Photos: Alianza Motorsports

View the original article --> here

 


The National Crowdfunding & Fintech Association of Canada (NCFA Canada) is a cross-Canada non-profit actively engaged with cryptocurrency, blockchain, crowdfunding, alternative finance, fintech, P2P, ICO, and online investing stakeholders globally. NCFA Canada provides education, research, industry stewardship, services, and networking opportunities to thousands of members and subscribers and works closely with industry, government, academia, community and eco-system partners and affiliates to create a strong and vibrant crowdfunding and fintech industry. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

 

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The world’s new oil and AI’s imminent impact on the future of Fintech

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Grow VC Group | Jouko Ahvenainen | Jun 2018

Data and AI started to come fundamental components for FinTech in 2017. There are several reasons for this development, for example, the development of machine learning and data analytics solutions, growth of FinTech services to have enough data, and new cloud based infrastructures that make it easier to use data. We can expect this development continues and accelerates in 2018.

At the same time, blockchain, distributed finance models and increasing privacy concerns will change data requirements and models. Data is coming a fundamental enabling component in the finance services, and it will give also more power to customers.

Data to enable customers

Everyone today knows data has a lot of value. “We try to collect all possible data, and then we find a model to monetize it, maybe sell to advertisers,” is a common sentence in many business plans. “We help companies monetize their data,” is another typical value promise. “Let’s offer our solutions for free, if we can get the data,” is a ‘sales strategy’.

Is it so simple that you offer software, apps, and services to consumers and companies, utilize their data and create a big business? It really isn’t that simple anymore, because

  • so many parties want that data,
  • most users are becoming smarter with their data and asking more questions about their data,
  • data doesn’t have uniform value,
  • authorities create rules about the use of data, and especially
  • most data utilization is marginal optimization, not real value to customers.

Finance institutions and credit scoring companies collect data specifically to manage risks, for example, to decide, if a customer is allowed to get a loan. There are several new credit scoring companies, especially in the emerging market, but also in developed countries, that collect much richer data, e.g. social media, mobile and finance apps data. Typically, consumers don’t even exactly know what data is collected and how it is used. Or the consumer learns about the data when hackers steal it, like from credit rating agency Equifax. One could also say that the use of this data is very one-sided. Finance institutions use this to make decisions about customers and product offering for them, but it doesn’t really help customers to find the best deals.

See:  Convenience vs Privacy: Here are 4 tips to protect your data from being shared on Facebook

These above examples are about cases involving companies collecting customer data and wanting to utilize it make better business by optimizing some of their operations like marketing, risk management or product offerings. But the real value for those customers is often very limited. This means those companies can improve their business a few percent, but it is not disruptive or game changing. Google changed the game, it collects a lot of data, but its services have been also much more direct value to users than analytics from many other companies.

Many companies still see that the way to utilize data is to optimize their own operations to generate more revenue or cut costs. They don’t want to empower customers properly to utilize that data in the services that customers could get direct value. For example, finance data should not be used only by a lender to make a loan decision and adjust interest rates, but it should enable a customer to have a better user experience and find the best loan and interest rate.

Data is the black gold, but to get the full value, it cannot only be a one-sided marginal optimization. All parties must be able to utilize it and build totally fresh solutions. If oil companies had used oil only internally to offer transportation services, it wouldn’t have changed the world, created free mobility and huge businesses. Oil became the black gold when people got cars and other vehicles and got freedom to move based on their own needs. The data business must learn to be an enabler, not just a one-sided optimization tool.

Customer control and distributed models

Regulators, authorities and law makers have become more interested in the use of data. One example is EU’s General Data Protection Regulation, GDPR, that gives more power to consumers to know his/her data and control the use of them. Generally, authorities and consumers see it as more acceptable to collect and use data if the consumer can see and control the data, and if consumers also get real value from it.

The question about ownership of certain data is not simple. One can argue that an individual should own all the data that is from her or him. Someone else can argue that if you use a bank account or credit card, the bank or credit card company in question owns the data linked to those accounts. It is a little bit like, if two parties have a phone call, is it both of them or neither of them that own the rights to the call and can for example publish it?

Probably the fundamental question isn’t who owns the data. The question is, who can use it and for which purposes. Now the situation is not in balance. Companies collect all kinds of data from individuals, sell it to other companies, combine it with other data sources, and utilize it for their own business. At the same time, consumers often cannot even have their own copies of this data, don’t know to whom their data is sold, and how it is combined with other data sources. When all the data was in paper form, the situation was probably better for consumers, they at least had their own papers at home.

Finance services and health care are two areas where companies have a lot of data from people. It is often also very sensitive information in nature. There are many companies in those industries, and people often use services from several companies. It is often valuable too for the consumer that companies can share information between them. For example, when you go to a doctor or hospital, it can help in your treatment that they know your medical history, and when you apply for a loan or use wealth management services, your finance history helps to find the right products and make decisions. But it must be consumer’s decision to share this data.

More:  Europe’s banks brace for a huge overhaul that throws open the doors to their data

Consumers should also have their own copy of their data and the ability to use it when it offers value for them. For example, they could go to a new hospital and insurance company with their personal medical history, or apply for a loan or make personal finance planning with their own data.

We have had two parallel, but slightly opposite, developments with the internet. While each individual can generate more activity - for example publish his or her photos, articles and have their own e-commerce site - the data is concentrating more to some central places, such as to big companies, data aggregators, and data processors (for example Equifax or online marketing platforms). Now we can see developments that we could move to more distributed models with data too and individuals could get better control over their data.

This technically is also linked to blockchain development that particularly has an impact on the finance industry. Blockchain basically distributes finance data, transactions and authority around the Internet, to individuals and their nodes. A person can have her or his own bitcoin and cryptocurrency wallet, which is not the account of a bank or finance institution. Now we will see solutions where people can have their own safebox for their finance, health care, and other data.

Lawmakers will probably try to give further rights to consumers to control their own data; in some countries sooner, some later. But new distributed ledger and data models can empower consumers sooner to take control and impact the balance. In finance and data services we can see development that the control and databases will be distributed. It is not anymore a hierarchical centralized model to manage data, but it will be a distributed model with the consumers in control.

Case: Real time data in SME lending

SME lending can be profitable but at the same time a bad business for banks. The reason is that SME loans are seen as a high-risk liability, and have an impact on capital ratios and the price of capital. The 2007 finance crisis also demonstrated, how the packaging of loans contains significant risks and removes transparency from the debt market. Fintech and data analytics can change this.

Decades ago banks and other lenders typically knew their customers better. Now data analytics makes it again possible. For example, the accounting data with other data sources can be used directly for lending decisions, and the data can be also be used to price loans on the secondary market.

The main data sources are 1) 3rd party data providers, and 2) borrowers, especially their online accounting systems. Data makes loans more transparent in the secondary market and helps price them and also attract investors in the loans. It is possible to develop solutions, with true real-time pricing for each loan in the secondary market. It is also decreases risks of the traditional securizitation.

Data oriented SME loans will change the market. SME lending is a significant business opportunity for banks, but also for alternative finance lenders and p2p lending services. Data oriented SME lending framework offers the leading solution to implement lending services that fully utilize available data, offer better value for SME companies, lenders and loan investors. It also improves bank’s opportunities to operate in this market due to capital ratio requirements.

Also:  Element AI: The market is still figuring out how to share data with enterprise AI startups

Summary

Data analytics and AI will change many finance services. They will replace work as they have done already to analyze agreements, make trading and analyze investment opportunities. The significant change is that data and AI enable customers in a new way in the finance services. Data analytics and AI come also to all daily services, especially for the lending business, and daily customer services. Cryptocurrencies, distributed ledger ecosystems and cloud based services will changes implementation, architecture and business models of many finance services, and they will have impact on models to use and utilize data too. As a whole data and AI service development is one of the most important FinTech components in 2018.

 

Jouko Ahvenainen is a serial-entrepreneur, e.g. co-founder of Grow VC Group, a pioneer in new funding solutions, including equity p2p investments. He participated in changing US finance regulation, getting the Senate and President to allow crowdfunding and has worked with EU finance regulation. Jouko started his work with crowdfunding models in 2008.  Jouko is a founder, partner and board member in several innovative digital finance companies. Jouko is also an advisor for US, European and Asian investing and finance programs. He has especially worked to plan and implement models to get crowd investing and institutional investor models to work together.


The National Crowdfunding & Fintech Association of Canada (NCFA Canada) is a cross-Canada non-profit actively engaged with cryptocurrency, blockchain, crowdfunding, alternative finance, fintech, P2P, ICO, and online investing stakeholders globally. NCFA Canada provides education, research, industry stewardship, services, and networking opportunities to thousands of members and subscribers and works closely with industry, government, academia, community and eco-system partners and affiliates to create a strong and vibrant crowdfunding and fintech industry. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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Element AI: The market is still figuring out how to share data with enterprise AI startups

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VentureBeat | | Jun 7, 2018

It’s no exaggeration to call Element AI one of the top startups in the world right now. With the help of deep learning pioneer Yoshua Bengio, the company is making AI-powered products for the enterprise. And from its beginning in October 2016, Element AI has broken the rules of what to expect from a startup.

In December 2016, Element AI was the very first company to receive funding from Microsoft Ventures. Six months later, the company raised a $102 million series A round.

Element AI has yet to release a single publicly available product, but the company is already working with customers, has opened offices in Singapore, South Korea, Toronto, and London, and already plays an advisory role to startups that receive funding from the Global AI Fund in South Korea.

At the creative tech conference C2 in Montreal last month, VentureBeat sat down with CEO Jean-François Gagné to talk about challenges enterprise customers face in implementing AI, his company’s first publicly available products, and why he believes AI is allowing startups to challenge incumbent businesses in tech and finance.

This interview has been edited for brevity and clarity.

VentureBeat: Are there any specific kinds of challenges companies encounter in terms of implementation of AI? When you come in the door of a business, what’s stopping them from implementing AI?

Gagné: We’re still all trying to figure out how the IP, data access, and learning component of the technology is going to play out. The market is currently trying to figure that out. The big dynamic that we see is all the conversations about “What piece of IP will your AI keep?”

See:  The forces of change are trumping banks and regulators

Because we totally understand that large chunks of the IP we build on top of the data of our customers is their own, but there is stuff that needs to flow back to our platform so we make the product better. And defining that has been something where we need to spend a lot of time every time educating the customers, making sure they see it’s transparent and understand what are they going to own, what are we going to own, and this is one thing that is right now a big puzzle for the industry to solve as a whole. And because we’re one of the first to really do that at scale, I think we’re opening the way there, and that’s one thing that comes to my mind.

VentureBeat: Lately I’ve heard a fair deal of companies talk about how they want to build common sense and perception into AI; it just keeps coming up as part of some evolution to go beyond narrow applications of artificial intelligence. Where do you think we’re going on that?

Gagné: So here’s the thing: Google doesn’t want to interact with the customer. They want their system to run by their own, so the way they’re approaching the problem is by wanting the assistant to have some sort of common sense and figure things out by themselves, and we have a very different opinion there. We believe in human-in-the-loop systems that are highly efficient, highly flexible, highly agile, but where people are still driving and are in control of the governance, still involved in the decision process.

You look at the work they’re doing with DeepMind and everything, where things are just going to take off by themselves eventually — and first, I don’t believe that this is going to happen anytime soon. The black box effect this creates, going down that road and all the potential downside of having people think that they don’t need to look at what’s going on, is extremely bad given the state of the industry, so I don’t think it’s the right way to go at it.

VentureBeat: They say they want to be more transparent.

Gagné: They don’t want to be evil, they want to be transparent … what matters are the actions. What are people really doing? We have to actually look at that concretely, so the way we’re going at this is really to make sure that we maximize explainability [and] transparency as we’re deploying this, to enable our customers and people who are using our tools to have the right governance on top.

So [we] invest tons of money in all the monitoring systems and explainability of the models.

There’s more effort put in this than in the models themselves, generally speaking, in whatever product we do, whatever thing we roll out, and so of course they don’t want that. They’re at the top already, so they want to make sure that they maintain that edge, so that’s why you’re hearing that from them.

More:  The Age of Artificial Intelligence in Fintech

VentureBeat: So then what should people expect from Element AI in the next six months?

Gagné: At this point it’s all about scale, like we’re literally in the bottom of the hockey stick looking to be 500 people before the end of the year, 1,000 next year, so we’re really starting to hit that phase. And then for us it’s all about repeatable deployments: successful, repeatable deployments. It’s just about repeatability, getting our cybersecurity product out there, our product for insurance, banking, and we’ve got stuff coming for logistics companies.

VentureBeat: You guys are in a bit of a different position than most companies, but do you feel like the monopoly that large companies have stifles the innovation that could be happening in the AI startup ecosystem?

Gagné: No longer, actually. I think they’re [banks] getting challenged to the point that if they don’t do something about it, they know their business is going to start to — their margins and everything are going to start to diminish, and in the financial sector it’s definitely there.

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The National Crowdfunding & Fintech Association of Canada (NCFA Canada) is a cross-Canada non-profit actively engaged with cryptocurrency, blockchain, crowdfunding, alternative finance, fintech, P2P, ICO, and online investing stakeholders globally. NCFA Canada provides education, research, industry stewardship, services, and networking opportunities to thousands of members and subscribers and works closely with industry, government, academia, community and eco-system partners and affiliates to create a strong and vibrant crowdfunding and fintech industry. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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SEC chief says agency won’t change securities laws to cater to cryptocurrencies

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CNBC | | Jun 6, 2018

  • The head of the Securities and Exchange Commission Chairman made it clear Wednesday that the agency won't be bending the rules for cryptocurrency when it comes to defining what is or what isn't a security.
  • "We are not going to do any violence to the traditional definition of security that has worked for a long time," SEC Chairman Jay Clayton told CNBC Wednesday.
  • The agency is also not adjusting rules for initial coin offerings, and Clayton underlined that tokens or digital assets used in that fundraising process are securities.

The head of the Securities and Exchange Commission made it clear Wednesday that the agency won't bend the rules for cryptocurrency when it comes to defining what is or what isn't a security.

"We are not going to do any violence to the traditional definition of a security that has worked for a long time," U.S. Securities and Exchange Commission Chairman Jay Clayton told CNBC Wednesday. "We've been doing this a long time, there's no need to change the definition."

Clayton said the U.S. has built a $19 trillion securities market that's "the envy of the world" following the current rules.

See:  Don Tapscott urges ‘sensible’ cryptocurrency regulations

The agency is not adjusting rules for the fundraising process known as initial coin offerings, or ICOs, either, he said. ICOs have raised $9.1 billion this year alone, according to the latest research from Autonomous Next.

"If you have an ICO or a stock, and you want to sell it in a private placement, follow the private placement rules," Clayton said "If you want to do any IPO with a token, come see us."

The SEC is "happy to help you do that public offering" if issuers take the responsibility SEC laws require, he said.

The chairman also addressed a growing debate over which cryptocurrencies should fall under SEC jurisdiction.

"Cryptocurrencies: These are replacements for sovereign currencies, replace the dollar, the euro, the yen with bitcoin," Clayton said. "That type of currency is not a security."

A token, or a digital assets used in a fundraising process known as an initial coin offering, or ICO, are securities by Clayton's definition.

"A token, a digital asset, where I give you my money and you go off and make a venture, and in return for giving you my money I say 'you can get a return' that is a security and we regulate that," Clayton said. "We regulate the offering of that security and regulate the trading of that security."

Whether an asset is a security right now follows the "Howey Test." The ruling comes from a 1946 U.S. Supreme Court case that classifies a security as an investment of money in a common enterprise, in which the investor expects profits primarily from others' efforts.

Clayton made it clear in March that all ICOs constitute securities, and reiterated that Wednesday saying "if it's a security, we're regulating it."

But companies tied to those cryptocurrencies have argued that some should be fall under a different category, in many cases because of their utility.

The financial watchdog has been balancing consumer protection and innovation in what has become multi-billion dollar cryptocurrency market. The market capitalization of bitcoin alone is more than $130 billion, according to CoinMarketCap.

On Tuesday, the SEC picked a new leader for its emerging cryptocurrency division. Valerie Szczepanik, who already worked at the agency, was promoted to a role that didn't exist until this week: Associate Director of the Division of Corporation Finance and Senior Advisor for Digital Assets and Innovation.

Continue to the full article --> here

 


The National Crowdfunding & Fintech Association of Canada (NCFA Canada) is a cross-Canada non-profit actively engaged with cryptocurrency, blockchain, crowdfunding, alternative finance, fintech, P2P, ICO, and online investing stakeholders globally. NCFA Canada provides education, research, industry stewardship, services, and networking opportunities to thousands of members and subscribers and works closely with industry, government, academia, community and eco-system partners and affiliates to create a strong and vibrant crowdfunding and fintech industry. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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