Coin News

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The post The Lightning Network Now Supports Transactions Across Blockchains appeared first on Bitcoin Magazine.

The post The Lightning Network Now Supports Transactions Across Blockchains appeared first on Bitcoin Magazine.

• Comcast, Verizon, and Disney have reportedly approached 21st Century Fox to buy some of its assets. 
• Disney had approached 21st Century Fox to discuss a purchase of its movie and TV studio and some cable networks, according to reports last week. 
• 21st Century Fox shares gained 6% after-hours on Thursday. 

Comcast and Verizon have approached 21st Century Fox to buy at least part of the company, CNBC and The Wall Street Journal reported on Thursday. 

The news comes about a week after CNBC reported that Disney was recently in talks to buy most of 21st Century Fox.

It signals that the three companies may engage in a bidding war for the $54-billion owner of the Fox News Channel. The reported offers come amid rating declines across many large cable networks as more consumers opt for cheaper and more customizable web-based services.

A deal with Disney would have further trimmed 21st Century Fox's assets into a more focused slate of news and sports networks to better compete in a changing media landscape, the report said. 21st Century spun off News Corp., its publishing business, in 2013.

The acquisition would have excluded Fox News because Disney cannot own two broadcast networks. Disney bought ABC in 1996. 21st Century Fox would reportedly have kept its sports channels to avoid the regulatory scrutiny that would come with a tie-up with ESPN. 

Disney was reportedly interested in buying Fox assets including its studio division, partial ownership of the UK telecoms company Sky, and networks such as National Geographic and FX.

21st Century Fox shares jumped 6% in after-hours trading on the news, while Comcast rose 1%.

SEE ALSO: Disney has reportedly been in talks to buy most of 21st Century Fox

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NOW WATCH: $6 TRILLION INVESTMENT CHIEF: Bitcoin is a bubble

• Coinbase, the US cryptocurrency exchange, is wooing big hedge fund money with a new security platform.
• Coinbase Custody was built to meet the security needs of institutional investors like hedge funds and family offices, according to a Medium post by Coinbase CEO Brian Armstrong. 

The impressive appreciation of cryptocurrencies like bitcoin and Ethereum has finally piqued the interest of big money, but some still have their reservations about whether their crypto-investments will be secure.

Who can blame them? Just last week, an unidentified user accidentally deleted the code library required to use recently created digital wallets within Parity, a popular digital-wallet provider, and cryptocurrencies have long been associated with the chasms of the deep, dark web.

On Thursday, Coinbase, the San Francisco-based cryptocurrency exchange, announced a new platform that might quell the anxieties of big money investors looking to invest in crypto. The platform, called Coinbase Custody, was built specifically to meet the needs of such investors, including hedge funds and family offices, according to a Medium post by Coinbase CEO Brian Armstrong.  

"We are designing Coinbase Custody to meet the needs of institutional clients," Armstrong said in a Medium post highlighting the news. 

Some of the heightened security features, according to Armstrong include:

• "Dedicated account representatives and phone support."
• "Multi-user accounts with separate permissions."
• "Insurance (in some cases)."

The service will charge users a $100,000 startup fee. Armstrong said there will also be a monthly fee based on assets.

Coinbase, a unicorn company valued at more than $1 billion, is among the most visible cryptocurrency companies operating in the US. They store $9 billion worth of digital currencies and are backed by financial institutions such as the Intercontinental Exchange, which owns the New York Stock Exchange and Westpac. 

According to Maxime Boonen, a former interest rate swaps trader at Goldman Sachs who founded B2C2, a bitcoin trading firm, over-the-counter bitcoin trade sizes have increased this year as interest from institutional clients has buoyed. As such, larger million-dollar trades are more common at B2C2 than they were when the company was founded, according to Boonen. 

At the same time, cryptocurrency hedge funds have been opening up at an eye-popping rate, according to Autonomous NEXT, the fintech analytics firm. At last count, the firm said 126 cryptofunds have opened, managing approximately $2.3 billion. 

SEE ALSO: Bitcoin trading shops are hiring Wall Streeters to build out the 'next generation' of cryptocurrency trading

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NOW WATCH: MongoDB soars 33% on its first day of trading — the CEO explains how they plan to beat Oracle and Amazon

• The market for cryptocurrency is booming, and now trading firms are looking to build out a more mature market infrastructure for the space. 
• They will likely set their sights on Wall Street for talent to build out new cryptocurrency trading systems.

Bitcoin trading firms are seeking top talent to build-out the infrastructure for the booming cryptocurrency market. And that talent is likely to come from Wall Street. 

DRW's crypto trading division, Cumberland, provides the latest example.

The firm recently brought on Helin Goa, a former swaps trader from Goldman Sachs, according to an email seen by Business Insider sent out to employees of Cumberland by Bobby Cho, head of over-the-counter trading. And the firm is seeking to build out the unit, advertising currently for two different positions: one trader and one developer. 

Cumberland, which launched officially in 2014, trades electronically and over-the-counter, receiving calls to execute bitcoin large bitcoin trades in the multi-millions of dollars. 

Hehmeyer Trading, a Chicago-based prop trader, is also hiring a developer. According to a LinkedIn ad, the company is looking for someone to "build and maintain trading systems and strategies for use in cryptocurrency markets." A representative from Hehmeyer could not be reached for comment by the time of publication. 

DV Chain, the cryptocurrency division of Chicago prop trading firm DV Trading, is another marketmaker in the space. It has been advertising a position for a cryptocurrency software engineer on LinkedIn to help build out the firm's "next-generation" trading platform. 

DV Chain's CEO Garrett See told Business Insider he's not necessarily looking for folks with "blockchain" or "crypto" on their CV. 

"Middle-office, trading software, trading, order management, traditional programming, are the backgrounds we are looking for in people," See said. Those folks often come from Wall Street, he says. 

Applying Wall Street tech to cryptocurrencies

See said the firm is focusing on how it can improve the interface between his trading desks and cryptocurrency exchanges like Coinbase, which lack the capabilities of traditional capital markets players like Nasdaq or the New York Stock Exchange. 

"We have been adapting the software we use on the traditional side and applying them to cryptocurrency markets," See said. 

See said crypto exchanges work differently and in a sense are still "websites" that lack "the industrial scale" of traditional exchanges. And with cryptocurrency volumes topping as much as $26 million in a single trading day, trading shops are under pressure to enhance their technology.  

Kraken, a cryptocurrency exchange, has been trying to recover from a server crash over the weekend triggered by a spike in usage, for instance.  The exchange is also looking for someone who will "take ownership of active trader products (professional trading platform & APIs)." 

Josiah Hernandez, the chief strategy office of CoinSource, a maker of bitcoin ATMs, expects these positions to be filled by former Wall Streeters.

"Not many folks from the tech space are able to develop skill sets quickly and hit the ground running as it relates to building markets and providing liquidity," he said. "Fintech and capital markets/[Wall Street] folks usually are though."

Meanwhile, exchanges like Cboe and CME have announced they are preparing bitcoin futures products, which will allow traders to bet on the future price of bitcoin. 

The launch of bitcoin futures by establishment firms is likely to to open the door to wider participation in bitcoin trading by other Wall Street firms.

"The CME announcement provides the first step in legitimizing the ever-growing crypto space as a true financial asset," Dave Johnson, the CEO of Latium, a cryptocurrency technology company, told Business Insider. "For market makers this presents access from a known and trusted party into a $94 billion marketplace."

Business Insider previously reported Virtu Financial and DRW are looking to provide liquidity in bitcoin futures markets. Other traders such as Quantlab and Jump Trading are waiting to see how such a market plays out before jumping on the bandwagon, Business Insider previously reported. 

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NOW WATCH: TOP STRATEGIST: Bitcoin will soar to $25,000 in 5 years

US stocks soared to their biggest gain in two months as the House passed their version of a plan that would cut taxes for corporations, which many expect to boost the bottom lines for US companies.

The S&P 500 climbed 0.8%, led by consumer staple shares that got a huge boost from Walmart's earnings report. The Dow Jones Industrial Average increased 0.8%, while the more tech-heavy Nasdaq Composite index surged 1.4%.

First up, the scoreboard:

• Dow: 23,454.29, +183.01, (+0.79%)
• S&P 500: 2,585.68, +21.06, (+0.82%)
• Nasdaq: 6,793.29, +87.08, (+1.30%)
• US 10-year yield: 2.36%, +0.03
• WTI crude oil: $55.15, -0.18, -0.33%

1. Walmart beats and raises guidance as online growth explodes. America's largest brick-and-mortar retailer said US comparable-store sales rose by 2.7% versus a year ago, making for the 13th straight quarter with positive results.

2. Tesla's sinking stock has made short sellers almost $1 billion. After nine months of having their bets annihilated by Tesla's surging stock price, short sellers are finally making some of that money back. 

3. There's a $300 billion reason why every automaker should be seriously looking into self-driving trucks. With Tesla set to reveal its first all-electric truck on Thursday, Bernstein says that full automation of the trucking industry could save $300 billion in labor costs.

4. A recount shows billionaire investor Nelson Peltz won the biggest proxy battle in history. He'll now have a seat on Procter & Gamble's board after he was initially reported to have lost the vote by a slim margin.

5. Cisco beats analysts' expectations and finally sees its way out of an 8-quarter revenue decline streak. The company posted a steady $12.136 billion in revenue for the first quarter of 2018, compared to the quarter before when it saw $12.133 billion come in.

ADDITIONALLY:

Barnes and Noble spikes after being approached about going private

Airbnb just bought Accomable, a startup that helps travelers with disabilities find places to stay

The average bitcoin investor doesn't plan to sell their coins until they hit more than $190,000

The Senate tax bill could lead to tax increases on people making $75,000 or less — while the wealthy get a tax cut

The world's largest sovereign wealth fund wants to dump oil and gas stocks

Silicon Valley has turned into the place it hates the most

SEE ALSO: Tesla's sinking stock has made short sellers almost $1 billion

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NOW WATCH: $6 TRILLION INVESTMENT CHIEF: The next recession is years away

The post A Beginner’s Guide to Claiming Your Bitcoin Gold (and Selling It) appeared first on Bitcoin Magazine.

The post A Beginner’s Guide to Claiming Your Bitcoin Gold (and Selling It) appeared first on Bitcoin Magazine.

• Tesla is set to unveil its new all-electric semi-truck on Thursday.
• The company is still struggling to produce its Model 3 vehicles.
• Watch Tesla's stock price move in real time.

Tesla shares are up 1.18% to $314.90 on Thursday ahead of the company's big semi truck event.

Tesla is set to unveil its semi truck at 11 p.m. EST at its design studio in Hawthorne, California. The truck is rumored to be all-electric, and have a range of about 300 miles on a single charge.

Details from the company are sparse ahead of the event, but Morgan Stanley thinks the truck could cost about $100,000. To accomplish long-range shipping, Tesla could make the batteries swappable, so a truck could pull into a Tesla station that could automatically change exhausted batteries for fully-charged ones. 

Tesla has had to delay the announcement event several times thanks to its ongoing problems ramping up Model 3 production. The first mass-marketed car from Tesla is way behind the company's original production schedule. In its most recent earnings report, Tesla pushed back its 1,500-vehicles-a-week goal from December to the end of its first quarter next year.

The battery production at the company's Gigafactory in Nevada had faced issues that forced some parts of the batteries to be assembled by hand. The company recently found the source of the problem and said it is on pace to solve the bottleneck which could significantly increase production.

Tesla fans will be able to watch the unveiling on the semi truck via the company's live stream on its website.

Tesla is up 46.44% this year.

Learn more about the company's unveiling here.

SEE ALSO: Elon Musk will unveil Tesla's first semi-truck on Thursday - here's how to watch

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NOW WATCH: $6 TRILLION INVESTMENT CHIEF: Bitcoin is a bubble

Welcome to Finance Insider, Business Insider's summary of the top stories of the past 24 hours. Sign up here to get the best of Business Insider delivered direct to your inbox.

House Republicans took a huge step forward on their plan to overhaul the tax code Thursday with the passage of the Tax Cuts and Jobs Act.

The TCJA passed fairly easily along a mostly party-line vote 227 to 205, with two Democrats not voting. 13 Republicans voted against the bill. Here's what you need to know. 

In related news, the "Team Trump takeover" of government regulation is now complete. Steven Mnuchin showed off the first dollar bills with his signature — and the internet had a field day.

In deal news, Emerson Electric upped its takeover bid for Rockwell Automation to $29 billion — 5% higher than the $27.6 billion bid Rockwell rejected last month. And Mattel snubbed Hasbro's latest attempt to create a giant toy company. Here's our story on the latest in M&A.

In other news, Nelson Peltz appears to have won the biggest proxy battle in history after a recount. And Tesla's sinking stock has made short sellers almost $1 billion.

Lastly, go inside the pawn shop where Wall Streeters and other New York elite sell their Rolexes and Birkin bags.

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NOW WATCH: I spent a day trying to pay for things with bitcoin and a bar of gold

Users can't accept or make payments using the cryptocurrency, however.

The price of bitcoin is spiking, climbing above $7,700 for first time since Nov. 8.

• Barnes and Noble's shares are up 11.4% to $7.35 after a report from the Wall Street Journal says the company has been approached about going private.
• The proposal came from activist investor Sandell Asset Management, with a potential deal offer of $750 million, including debt.
• There are multiple hurdles to overcome if the proposal is to work, including arranging $500 million in debt financing.
• Chairman Leonard Riggio, who owns 18% of the company, has said he opposes the deal, according to the WSJ.
• Sandell said it doesn't have the financing in place or agreements with other investors, but thinks it could arrange both.
• Barnes and Noble is down 34.51% this year including the post-proposal bump.

SEE ALSO: The live price of Barnes and Noble shares

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NOW WATCH: $6 TRILLION INVESTMENT CHIEF: Bitcoin is a bubble

[…]

The post BitMEX is Dumping Bitcoin Cash and Crediting Users With Bitcoin appeared first on CryptoCoinsNews.

New survey data highlights the ideological – and economic – factors driving some investors to purchase bitcoin.

• Bitcoin has been on a tear, trading up more than 500% this year. 
• But it doesn't look like bitcoin investors plan on giving up their coins just yet, according to a new LendEDU survey of 564 American bitcoin investors. 
• The survey found the average bitcoin investor doesn't plan to sell until bitcoin reaches $196,165.

Bitcoin fanatics often tout the motto "hodl" with pride. 

The phrase, which is just a misspelling of hold, is said to derive from the chasms of Reddit during the earliest days of crypto. Today #hodl litters crypto-Twitter with traders pledging to their followings that they are in it for the long-haul. 

It doesn't look like those investors are kidding, according to a new LendEDU survey. The survey found the average bitcoin investor doesn't plan to give up their bitcoin until the cryptocurrency reaches $196,165, or 26 times its current value. 

Just 32% of investors surveyed said they have ever sold some of their bitcoin holdings. 

Bitcoin was trading at 7,682 on Thursday, although like a roller coaster it is subject to dramatic peaks and valleys.

LendEDU also asked investors how long they plan to hold their bitcoin. By the looks of it, they expect the price to skyrocket in the short-term. Take a look:

SEE ALSO: We just got a glimpse of how bitcoin futures will work

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NOW WATCH: Why this New York City preschool accepts bitcoin but doesn't accept credit cards

[…]

The post Bitcoin is “By Definition Speculative”, Says Morgan Stanley CEO appeared first on CryptoCoinsNews.

The post (+) Altcoins – Know When to Hold Em appeared first on CryptoCoinsNews.

Bitcoin's astonishing price rally this year continues to attract skeptics, including the CIO of Japan Post Bank.

• Full automation of the trucking industry could save $300 billion in labor costs, according to Bernstein. 
• The net savings are likely to be between $100 billion-$125 billion, because the costs of using self-driving trucks would offset some of the savings from wages. 
• Tesla on Thursday is expected to reveal its first all-electric truck, which could have self-driving technology similar to Autopilot. 

The trucking industry could save hundreds of billions of dollars in labor costs annually if it continues to embrace self-driving technology.  

Tesla on Thursday is expected to reveal its first all-electric truck. The truck is expected to have self-driving technology that allows it to drive autonomously while traveling in platoons. CEO Elon Musk has said the company would most likely reach full-scale production for the truck in 18 months to two years, while Morgan Stanley estimates deliveries will start in 2020.

The startup Embark is already operating autonomous trucks between Texas and California, although with a human rider. Mercedes Benz first put a self-driving big-rig on a public road in 2015, and Uber started its efforts in the space a year later.   

"At face value, full automation of the $719B trucking market results in ~$300B in potential labor savings," said a team of Bernstein analysts including David Vernon in a note on Wednesday. "This benefit is expected to grow due to structural challenges in the labor market." The challenges include a rise in trucking rates after 2000 partly caused by labor shortages and regulatory changes.

Nearly half of the trucking industry's costs — 43% — go towards labor, according to Vernon. Fuel is the second-largest cost, at 21%. 

"The gains from automating heavy truck activity have far reaching implications across the broader transportation landscape," Vernon said. "Companies in our coverage that will benefit from this include UPS (high cost union truck labor in line haul and feeder operations), FedEx (truck intensive ground network), J.B. Hunt Transportation Services (across services)."

However, cost savings from operating without drivers would likely be put back into what it takes to replace them. That means the net savings for the industry are likely to be between $100 billion-$125 billion, Vernon said.

"While the savings potential is large, new costs will be created out of automation (e.g.: IT maintenance fees, more working hours dedicated to truck maintenance, higher taxes to fund the highway cost infrastructure) that will offset some of the potential cost benefits," Vernon said. 

Vernon added that the lower costs may not necessarily pass through in the form of lower trucking rates. That's because the biggest beneficiary of cost savings would be large, better capitalized firms that have the resources to dive into the new technology. Smaller firms, which have a marginal influence on market rates, may be left with higher costs that they'd continue to pass on to their clients. 

In all, the effect of the savings may still be too far out in the future for investors to take advantage of right now, Vernon said. Partially automated platoons of trucks following each other closely could be rolled out over the next 5-7 years. But the technological changes that would save companies the big bucks could take up to 20 years to be fully implemented, he said. 

SEE ALSO: Tesla's sinking stock has made short sellers almost $1 billion

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NOW WATCH: $6 TRILLION INVESTMENT CHIEF: Bitcoin is a bubble

[…]

The post Bitcoin Gold Controversy Continues as Developer Allegedly Hides Mining Code, Pool Shuts Down appeared first on CryptoCoinsNews.

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• Billionaire investor Nelson Peltz won a preliminary recount of a board of directors election at Procter & Gamble.
• The investor wants to shift, but not radically change, P&G's strategy.
• Whether Peltz comes out with a board seat or not, the company is set to be on a path higher, according to one analyst.
• Watch Procter & Gamble's stock price move in real time.

On Wednesday, a recount of votes in a board of directors election at Procter & Gamble reversed the previous outcome and gave activist investor Nelson Peltz a board seat by the narrowest of margins.

Shares of Procter & Gamble rose 1.07% to $89.17 after the results of the recount were released. Peltz won the recount by about 43,000 shares or just 0.002% of the total vote. The results are not final, and a certified report of the result is set to be released in the coming weeks by the firm conducting the recount.

"We view P&G’s strategy to be appropriate and its management team as extremely capable; however, we also believe Mr. Peltz's involvement - while an unwanted distraction from P&G's perspective - sets up a 'win-win' for its shareholders," Kevin Grundy, an analyst at Jefferies, said in a note to clients.

Grundy argues that either way the final vote goes, Procter & Gamble has a strong future ahead of it. With its current leadership, the company could continue to deliver at or slightly above Wall Street's expectations without radical changes, or Peltz could gain a board seat and ask for a few changes that would return more value to shareholders. Either outcome is good for P&G, Grundy says.

Peltz' plan for P&G does not involve radical transformations. Peltz says he mostly would like to increase accountability and transparency at the company, rather than ushering in a new financial structure, Grundy said.

Because of the two positive paths forward, Grundy is bullish on the stock and rates it a buy with a price target of $99, about 10.9% higher than the current price.

Procter & Gamble is up 6% this year.

Read more about Proctor & Gamble's proxy vote.

SEE ALSO: It looks like billionaire investor Nelson Peltz might have won the biggest proxy battle in history after a recount

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NOW WATCH: $6 TRILLION INVESTMENT CHIEF: Bitcoin is a bubble

• Goldman Sachs CEO Blankfein tweets his support for a second Brexit referendum.
• Blankfein said he favoured a "confirming vote" on what he called a "monumental and irreversible decision" by the British people.
• Blankfein has now intervened several times on the Brexit debate through Twitter.

LONDON — Goldman Sachs CEO Lloyd Blankfein on Thursday hinted at support for a second Brexit referendum in a 264-character tweet.

Taking advantage of Twitter's new 280-character tweet limit, Blankfein said he favoured a "confirming vote" on what he called a "monumental and irreversible decision" by the British people.

"Here in UK, lots of hand-wringing from CEOs over #Brexit. Better sense of the tough and risky road ahead. Reluctant to say, but many wish for a confirming vote on a decision so monumental and irreversible. So much at stake, why not make sure consensus still there?" — Blankfein tweeted.

The British government has consistently said that there will be no second Brexit vote, and the opposition Labour Party's official position is that it does not want a second referendum. However, the smaller Liberal Democrat party has consistently called for a second vote, and fought June's general election with another vote as it's main policy.

Thursday's tweet is the third time in just a few weeks that Blankfein — one of the most influential figures in banking — has taken to the microblogging site to comment on Britain's upcoming exit from the EU.

In mid-October Blankfein spelled out the bank's post-Brexit plans for Europe in a Tweet.

"Just left Frankfurt," he tweeted. "Great meetings, great weather, really enjoyed it. Good, because I'll be spending a lot more time there. #Brexit."

Eleven days later he posted again about the bank's post-Brexit plans in the UK, saying that "so much" is outside its control when it comes to the UK's exit from the bloc.

"In London. GS still investing in our big new Euro headquarters here. Expecting/hoping to fill it up, but so much outside our control.#Brexit" — he said in the tweet.

Blankfein's 264-character tweet appears to contradict his own views on Twitter doubling its character limit last week. On November 7th, he said he liked "the discipline of 140," alluding to Twitter's old character limit.

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NOW WATCH: I spent a day trying to pay for things with bitcoin and a bar of gold

The CFO of mobile payments firm Square has explained why the company launched a bitcoin pilot scheme.

[…]

The post Bitcoin Price Rally Continues as Crypto Market Cap Eyes $220 Billion appeared first on CryptoCoinsNews.

• Short sellers betting on a decline in Tesla's stock have made almost $1 billion in the fourth quarter.
• Tesla's recent stock woes stem from a bottleneck hurting production on its hotly anticipated Model 3 vehicle.

Elon Musk can't be happy about this.

After nine months of having their bets annihilated by Tesla's surging stock price, short sellers are finally making some of that money back. They've raked in $890 million in mark-to-market profits since the start of the fourth quarter, according to data compiled by the financial-analytics firm S3 Partners.

It's a redemption story of sorts for Tesla bears, who stubbornly clung to short wagers as shares spiked as much as 80% this year. Now, on the heels of a disappointing earnings report and in the face of a production bottleneck for its hotly anticipated Model 3 vehicle, Tesla shares are down 8.7% since the end of September.

The windfall for short sellers is sure to draw the ire of Musk, Tesla's CEO, who has forged a combative relationship over time with those betting against his company's shares. In a recent Rolling Stone profile, Musk called Tesla short sellers "jerks who want us to die" and described their behavior as "hurtful."

It echoed a tweet Musk fired off on June 8 in which he said the group of investors "want us to die so bad they can taste it." In early April, after a period of considerable stock strength, the CEO even went as far as to taunt Tesla's detractors, tweeting, "Stormy weather in Shortville."

Tesla remains the most popular short in the US equity market, a designation it has had for much of this year. Short interest — a measure of bets that a stock will drop — sits at a whopping $8.6 billion, outpacing the next-most-shorted company, AT&T, by more than $500 million, S3 data shows.

While Tesla certainly has its share of skeptics, another explanation for the exorbitantly high level of shorting activity is that the company and its mega-cap tech peers are being used as proxies to hedge against the broader stock market, according to S3.

That includes the likes of Apple, Amazon, Netflix, Microsoft, Facebook, and Alphabet, which are all included in the most-shorted list above. The wisdom behind the hedging strategy is that as these huge, influential stocks go, so does the market — so taking a short position in them means protecting against an index drop.

Still, Tesla is a special case, with its CEO so publicly at war with the short sellers betting on it to fail. At this point, if Musk wants to regain the upper hand, he's going to have to figure out the Model 3's production issues.

In the meantime, Tesla enthusiasts will be waiting with bated breath for the reveal of the company's electric big-rig, expected to be unveiled at 11:30 p.m. ET.

SEE ALSO: THE HINDENBURG MEETS THE TITANIC: Stocks are flashing an ominous signal not seen since the financial crisis

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NOW WATCH: $6 TRILLION INVESTMENT CHIEF: Bitcoin is a bubble

Bitcoin cash has lost 20 percent in the last 24 hours, but looks to have found a new bottom around $1,000.

[…]

The post Billionaire Brokerage Chief: Bitcoin Should Stay Away from the ‘Real Economy’ appeared first on CryptoCoinsNews.

• Treasury Secretary Steven Mnuchin and his wife, Louise Linton, unveiled the first dollar bills bearing his signature.
• The internet is having a field day.

Treasury Secretary Steven Mnuchin and his wife, Louise Linton, caused a stir on the internet Wednesday as they unveiled the first $1 bills bearing the signatures of both Mnuchin and US Treasurer Jovita Carranza.

The signature will go on the bottom right of all newly minted bills, replacing former Treasury Secretary Jack Lew's name. 

Previously, Mnuchin told CNBC's Becky Quick he changed his signature to make it more legible for the currency. 

Here's what people are saying on Twitter:

Here's a look (The top signature is Mnuchin's old one; the bottom signature is the new one):

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NOW WATCH: $6 TRILLION INVESTMENT CHIEF: Bitcoin is a bubble

• There is a growing sense that America's tech entrepreneurs are no longer making useful things that solve difficult problems. 
• Worse than that, Silicon Valley is exhibiting some of Wall Street's amoral behaviors.
• Ankur Jain, of Kairos Ventures, is raising a fund to counter that. Its aim to solve big problems that are particularly tough on middle-class Americans.

At some point in between coming up with the tagline "Don't be evil," and bringing Soylent into this world; between building the cloud and cheerleading the disaster that is Theranos, Silicon Valley became a place it hates.

Silicon Valley became Wall Street.  

Now I don't cover Silicon Valley. But I do cover Wall Street. I know Wall Street.

And it takes one to know one. I also know that in private and not-so-private conversations, the two centers of capitalism see themselves as symbiotic rivals.

Over the last few years, the Ivy League graduates who used to pour into Wall Street have started opting for Silicon Valley instead. So have some of the Wall Streeter's themselves. Stanford has outshone Harvard, and America's business hero has become Amazon's Jeff Bezos, not JP Morgan's Jamie Dimon. It's not hard to see why. Like Silicon Valley's technology, Bezos has managed to reach his business into almost every facet of daily American life.

All this said, what's most important for this story is that throughout that process the purported ethos' of the two places couldn't be more different. Wall Street stands practically naked in its acknowledgment that greed is the main driver for a great number of its dealings.

Silicon Valley, on the other hand, has always sold itself as a place that made things  — good things that help the world and solve problems.

And this is where it has now run into problems.

At the moment it is not difficult to argue that Silicon Valley is not living up to its own ideals — that its former ethos is just a veneer over what has become a bubble of tone-deaf ideas and money chasing money for money's sake. At dinners with venture capitalists, investments are measured not by the brilliance of the idea behind them or the scope of the problem they solve, but by how much money they've managed to raise. 

Every guy wearing Louis Vuitton sneakers at The Battery — a members-only San Francisco club for the Valley's elite — wants to interrupt your conversation to talk about the growth metrics he's seeing on his Bitcoin sticker company. 

Let me tell you something. It sounds a lot like a guy in Gucci loafers at the Hunt and Fish Club in New York City bragging about how much money his hedge fund raised.

Meanwhile, since the 2016 Presidential election, Facebook, Google and Twitter have managed to anger just about every single American with a smartphone. 

"Silicon Valley has gotten out of touch in a time when it's more powerful than ever and the work that it does affects more people than ever," said Ankur Jain, the 27 year-old founder of venture capital fund Kairos Ventures. "Ninety percent of VC funds say they want to change the world and they don't."

In that sense, Wall Street has Silicon Valley beat. At least Wall Street is doing what it set out to.

What good is a maker?

It's not just making something that matters. It's what you make.

Perhaps you took a look at the Forbes 30 Under 30 list for startups. If you didn't, let me tell you about some things you'll find there. On the list you'll find a company that's like AirBnB but for pets, a glorified catering service for Silicon Valley startups, an app that helps you decorate, and a point of sale platform that can help you finance that jet ski you've always had your eye on.

America has so many big problems, and part of Silicon Valley's pride was helping us solve them.

Of course, there's nothing wrong with getting an AirBnB for your labradoodle. But this isn't just about startups.

Apple is a tax avoider, and Google, Facebook and Twitter — where to even start with them? We'll call them the big three. Last month at a Senate hearing on how Russian bots used social media to spread misinformation during the 2016 election, Senator Al Franken (D-MN) couldn't get any of the lawyers representing the big three to say they wouldn't accept payment for US political ads in foreign currency.

And by the way, shout out to the big three CEOs for sending their lawyers and not answering questions about a hostile foreign power on their platforms themselves. That beats Wall Street too, actually. Every major US Wall Street bank head has had a turn in the hot seat in Congress — but I guess the seat's too hot for Mark Zuckerberg. 

Slowly, the big three have been trickling out troubling data about the number of people who've seen misinformation on their platforms. First Facebook was throwing around numbers like 10 million, then it hiked that up to 126 million.

It's like when JP Morgan Jaime Dimon says "open kimono" and every journalist on Wall Street shudders knowing that whatever ugly thing is under there, the reality is probably ten times worse.

Google, Facebook, and Twitter never wanted the responsibility of patrolling their platforms. They just wanted to sell your data. The problem with that, of course, is that they run spaces that need to be filled with something — anything good or whatever. That has consequences. The opposite of good isn't nothing, it's evil. And in the absence of good, that is what will often fill the void.

Put more simply: "Don't be evil" is no longer enough. (Google, incidentally, dropped it a few years ago as a motto.)

How to get back to good

What has happened, it seems quite clear, is that instead of innovating for America or the world, Silicon Valley is innovating for itself. Instead of asking the question, "what does the world need?" — a big, bold question if there ever was one — more often it's asking the question, "what do I want?"

And "I" — a wealthy, tech-savvy urban dweller — would like an app that delivers a burrito to me on command, or a $400 dollar juicer. 

Enter Jain, who has decided that all of this is enough. At a time when middle-class America — a massive market as he pointed out to me, is hurting more than ever — it's time for Silicon Valley to be bold. It's time for it to be useful. It's time for it to be what it says it is.

"The everyday person is getting squeezed at every phase of their life," he told me. And not just middle class people.

"The decision-makers [in Silicon Valley] assume their engineers are just fine, but when rent is 50% of your after-tax income, you're struggling." 

On Thursday, Jain announced that he will raise a fund dedicated to fixing the following big problems in America, which — as he reminded me more than once — serve massive markets.

• Student debt
• Sky high rent in urban centers
• Childcare
• The cost of unemployment (for you, the unemployed) and retraining
• Retirement income

The fund's board includes former President and First Lady of Mexico, Vicente and Marta Fox; Mark Thompson, the CEO of The New York Times; Bobbi Brown, founder of Bobbi Brown Cosmetics; Roger Goodell, Commissioner of the National Football League and more. There are, however, no venture capitalists.

"We're going to feel deal flow FOMO  by passing up deals everyone is working on, but we're going to have to do that to stay focused," Jain said.

Now a place where money likes to follow money, Silicon Valley has become risk averse and cowardly. On Wall Street we call this a herd.

And like I said: Silicon Valley, welcome to Wall Street.

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• Terry Duffy, the head of exchange giant CME, told the Financial Times that the exchange's bitcoin futures product will take into consideration bitcoin's wild price swings.
• Duffy said the product is a "client-acquisition play" that'll attract young people to the futures market.
• The exchange is preparing to launch a bitcoin futures product by the second week of December.

Terry Duffy, the head of exchange giant CME, is defending a new bitcoin futures product the firm is preparing to launch by the end of the year.

The exchange operator told the Financial Times that the new product, which will allow traders to bet on the future price of the cryptocurrency, will take into consideration the extreme price swings of bitcoin.

“Listen, it’s no mystery, this is a different product,” Duffy told the FT. “We want to get out something that’s safe.” 

As such, the product will subscribe to two mandates designed to help dampen its volatility. They are as follows, according to the FT:

1. Bitcoin futures will not be able to trade 20% below or above the price of settlement the previous day.
2. Bitcoin futures traders will have to put up approximately 30% collateral in the event they lose the bet.
   

Thomas Peterffy, the chairman of Interactive Brokers, the largest electronic brokerage firm in the US took out a full page ad in The Wall Street Journal Wednesday to warn regulators about the dangers bitcoin futures could present to traditional capital markets. 

Peterffy said bitcoin's unbridled volatility could have a dangerous impact on other futures products trading on the market. He also said CME's plan to margin bitcoin futures — require traders to put up that high collateral — wouldn't work.

“Margining such a product in a reasonable manner is impossible,” Mr Peterffy said.

"A large cryptocurrency price move that destabilizes members that clear cryptocurrencies will destabilize the clearing organization itself," he added.

Duffy said bitcoin futures would bring a new age of traders to the futures markets, which aren't as sexy as the more popular market for stocks.

“I . . . look at it as a client-acquisition play,” he told the FT. “There’s clients who trade our products, but may not trade as often, who are intrigued by this. There’s a lot of young people that will like this type of marketplace, and they don’t even know what futures are today.”

Read the full report at the FT >>

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American Express just had its "Charles Lindbergh moment," using Ripple's blockchain to connect Santander clients in Europe and the U.S.

• Emerson Electric raised its bid for Rockwell Automation to $29 billion.
• It's the company's third attempt to buy Rockwell.

Emerson Electric sweetened its offer to acquire Rockwell Automation, sending the target company's shares surging as much as 10% in pre-market trading.

Emerson is now proposing to pay Rockwell about $29 billion, a 4.7% increase over its $27.6 billion offer last month, which was rejected. This marks the third time Emerson has approached Rockwell with new deal terms.

The new offer is to acquire all outstanding shares of Rockwell for $225 apiece, consisting of $135 per share in cash and $90 per share in Emerson shares.

Since Rockwell is a major supplier of software and controls for assembly lines, the deal would bolster Emerson's operations in the area and help improve the company's position in the automation market.

"The industrial logic for this combination is clear. A combination of Emerson and Rockwell would create a leader in the $200 billion global automation market," Emerson said in a statement.

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Here is what you need to know.

Stocks are flashing an ominous signal not seen since the financial crisis. Stock market dispersion is widening, and some technical indicators are flashing simultaneously for the first time since early in the financial crisis.

Euro-area inflation slows down. Inflation slowed to an annual rate of 1.4% in October as telecommunication, garments, and social protection had the biggest downward impacts, Eurostat data released Thursday showed.

Theresa May is prepared to double the size of Britain's Brexit divorce bill. UK Prime Minister Theresa May is prepared to offer 40 billion pounds to the European Union for its divorce, according to reports.

Canada is stepping up its lobbying efforts to block a US pullout from NAFTA. “You need the full-court press because it's both a Democrat and Republican issue — it's as much about workers as it is big business," a source who requested anonymity told Reuters.

Nelson Peltz won the biggest proxy battle in history. A recount shows Peltz won his proxy battle for a seat on Procter & Gamble's board by 43,000 votes — a 0.002% margin — both CNBC and Bloomberg report.

The Koch brothers are reportedly backing a deal between Time Inc. and Meredith. The Koch brothers have tentatively agreed to support Meredith's offer for Time Inc. by investing more than $500 million, The New York Times says.

Cisco ends its streak of 8 consecutive quarters with declining revenue. Cisco Systems announced first-quarter revenue of $12.136 billion, a slight uptick from the prior quarter's $12.133 billion. But revenue still fell versus a year ago.

Stock markets around the world are higher. Japan's Nikkei (+1.47%) was out front in Asia, and France's CAC (+0.64%) leads in Europe. The S&P 500 is set to open up 0.39% near 2,575.

Earnings reports keep coming. Best Buy and Walmart report ahead of the opening bell, while Gap and Ross Stores release their quarterly results after markets close.

US economic data is heavy. Initial claims and the Philly Fed will be released at 8:30 a.m. ET before industrial production and capacity utilization cross the wires at 9:15 a.m. ET. Data concludes with the NAHB Housing Market Index at 10 a.m. ET. The US 10-year yield is up 4 basis points at 2.36%.

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• It has been a week of troubling data for the British economy.
• Inflation remained at a five-year high of 3%.
• Employment fell by 14,000 people. Employment figures have been almost universally positive for the last two years.
• Retail sales witnessed their first year-on-year slump for four years.

LONDON — On three consecutive days, the Office for National Statistics released vital data about the health of Britain.

And the picture that data painted was, in a word, worrying.

On Tuesday morning, the ONS showed that inflation remained at a five-year high of 3% in October. Sure, it didn't go up from the previous month, but it remains a whole percentage point above the government's official inflation target and analysts expect a further rise before the end of the year.

High inflation might be manageable for regular Brits if wages were keeping up. Unfortunately, they aren't. Wage numbers released on Wednesday showed nominal wages grew by 2.2% over the most recent data period. This effectively means that the amount Brits have to spend is falling. In a healthy economic climate, this should be the opposite.

Slowing consumer spending and overall household consumption are widely acknowledged to have been behind the slowdown in the wider British economy this year, which has pushed the UK to the bottom of the pile in terms of GDP growth in major economies.

The extent of the consumer slowdown was brought into further contrast by news on Thursday morning that retail sales shrunk during October compared to last year. As Ian Gilmartin, head of retail and wholesale at Barclays Corporate Banking pointed out, this is the "first dip in year-on-year quantity sold for several years." In fact, the last time there was a year-on-year drop like this was in September 2013.

Retail sales represent around one-third of consumer spending, and provide a good indication of how people are feeling about the state of their finances. As Pantheon Macroeconomics' Samuel Tombs explained, the most recent data "shows consumers’ cautious mindset."

"While today’s number has beat expectations, it comes after a clattering fall in September and does nothing to ease concerns that the High St is under severe pressure heading into the only time of year that it makes any money," Jeremy Cook, chief economist at WorldFirst said.

"The real wage picture is not supportive of consumption, neither is the consumer credit outlook. Therefore we remain very concerned for consumer focused businesses and their wider contribution to growth."

So, inflation is high, wages aren't growing quickly enough to keep up, and people are buying less in the shops. But what about employment — the jewel in the crown of Britain's economic recovery since the financial crisis?

After several years of falling, it finally looks as if a reversal might be coming in the British jobs market. Wednesday's jobs data may have showed another small fall — 59,000 fewer people out of work — but for the first time in a long while, the number of people in work fell as well, dropping by 14,000 between July and September.

"After two years of almost uninterrupted growth, employment has declined slightly on the quarter," senior ONS statistician Matt Hughes said.

This doesn't appear to be a blip, Tombs argued on Wednesday, saying that "the stagnation of job vacancies indicates that employment growth will remain weak over the coming months."

A glimpse of positivity?

To be fair, Wednesday also saw the announcement of an increase in the UK's average output per hour — a key measure of productivity. Output grew at its fastest rate since 2011, according to the ONS' flash estimate. 

Productivity growth in the UK since the financial crisis has been virtually non-existent, leading Bank of England Governor Mark Carney in December 2016 to describe the last 10 years as "the first lost decade since the 1860s" when "Karl Marx was scribbling in the British Library."

Philip Wales, the ONS' head of productivity, urged caution on Wednesday's data, saying that "the medium-term picture continues to be one of productivity growing but at a much slower rate than seen before the financial crisis."

Later in the day, Ben Broadbent, the Bank of England's Deputy Governor for Monetary Policy also issued a warning on productivity, saying it is not "inconceivable" that Brexit could lead to a "sharp step down" in the UK's output growth, and comparing it to the financial crisis in terms of potential downside.

"We saw a sharp step down in productivity growth after the financial crisis. And I think there are things involved in Brexit that, once one digs below the macro-economic surface, could potentially do the same," Broadbent said, adding that the crisis led to a slowing of productivity growth for a "painfully long time."

So even the one glimmer of hope in the British economy is something of a false positive.

Growth will slow further

All of these negatives mean that overall GDP growth is also set to slow further, having already taken a leg lower since last summer.

UK growth will lag behind virtually every other major European nation for the next handful of years, according to estimates from the European Commission released last week.

The commission's figures suggest that by 2019, UK economic growth will have slowed to just 1.1%, slower than Italy, Spain and Greece.

Here's the chart:

"The European Commission’s latest set of forecasts does not make for particularly pleasant reading for UK policymakers, showing as it does a continued slowdown in UK GDP growth," said Commerzbank’s top UK economist Peter Dixon.

Growth, the commission points out, has already slowed significantly in the UK in the last couple of years, falling from 2.3% in 2017, to just 1.8% in 2016. By the end of 2017, growth will likely be around 1.4%-1.5%. That will get even worse in 2018 and 2019, as continued uncertainties surrounding the shape of Brexit take hold.

"Given the ongoing negotiation on the terms of the UK withdrawal from the EU, projections for 2019 are based on a purely technical assumption of status quo in terms of trading relations between the EU27 and the UK. This is for forecasting purposes only and has no bearing on the talks underway in the context of the Article 50 process," the European Commission's forecasts note.

"Under this assumption, GDP growth is still expected to remain subdued at 1.1%. Lower consumer price inflation in 2019 is expected to support private consumption but this may be partially offset by a marginal increase in the household savings rate.

Let's be clear, there may be issues with the British economy that existed before Brexit. Productivity, for example, hasn't simply stopped growing because of the referendum.

However, Brexit is pretty much the only game in town when it comes to the economy and companies' investment decisions, and it is now virtually impossible to deny the negative impact it is having on the economic fortunes of regular Brits and the wider nation.

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LONDON — Media reports have blamed financial problems of millennials on everything from narcissism and laziness to their sandwich-buying habits.

In fact, Britain's so-called millennial generation — those born from 1981 — have fallen victim to a long-term trend of chronic wage stagnation. Take a look at this chart:

It shows millennials are the first generation who have failed to improve upon >the living standards of the preceding "Generation X."

That is an unprecedented break from the generational progress that defined the 20th century. The "Silent Generation" enjoyed consistently higher average wages than the preceding "Greatest Generation," and "Generation X" incomes trended consistently above those of "Baby Boomers." Millennial's incomes, however, sit below the average income of Baby Boomers at the same ages.

To make matters worse, house prices have increased at a much faster rate than wage growth: the average house price rose in London rose from £79,000 in 2016 to its current £488,000 — a 518% increase.

Analysts at Oxford Economics said this could prompt Chancellor Philip Hammond to promote "millennial-friendly" policies when he announces next week's Autumn Budget, including a freeze on stamp duty — a property purchase tax — and a freeze on fuel duty.

Hammond is reportedly also considering extending the 16-25 Railcard, which discounts all UK rail fares by a third, to those under 32.

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• Prime Minister Theresa May's husband works for a firm named in the Paradise Papers data leak, according to emails seen by Private Eye magazine.
• Philip May works for investment management firm Capital Group, which reportedly used offshore-registered funds to make investments in a Bermuda-registered company.
• The use of offshore tax havens to legally avoid tax has come under increased criticism in recent years.

LONDON — The firm that employs Prime Minister Theresa May's husband was named in the Paradise Papers data leak, according to a report by Private Eye magazine.

Philip May is a relationship manager at investment advisors Capital Group, which used offshore law firm Appleby to arrange investments in tax havens, Private Eye reported, citing leaked emails.

Capital Group's Cayman Islands funds, CGPE V LLP and Capital International Private Equity Funds (CIPEF) V LP, invested in a Bermuda-registered South American agriculture company, called El Tejar, the report said. Both the Cayman Islands and Bermuda are offshore jurisdictions, known for their zero rates of tax.

The leaked emails are part of the cache of documents stolen from Appleby last year, and given to the International Consortium of Journalists (ICIJ). The documents, which detail the complex financial arrangements of some of the world's richest individuals, have been dubbed the "Paradise Papers."

The use of offshore tax havens to register companies and make investments has come under increased criticism by activists and politicians in recent years, including Labour leader Jeremy Corbyn. However, there are many legal means by which companies and individuals can structure their finances via offshore jurisdictions to avoid tax. Capital Group is not accused of any wrongdoing. 

According to a Capital Group presentation from 2011, one of its other international funds, Capital International Private Equity Funds IV — also incorporated in the Cayman Islands — had El Tejar in its portfolio in December 2010.

Capital Group didn't immediately respond to emails seeking comment. 

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• Pub chain Young's is "concerned" about the impact of Brexit negotiations are having on its ability to attract and retain staff.
• "We remain concerned around the impact that the Brexit negotiations are having on the pub industry, especially in relation to attracting and retaining the best people in our pubs," said the statement.

LONDON — Pub chain Young's is "concerned" about the impact of Brexit negotiations are having on its ability to attract and retain staff.

In a half-year trading update on Thursday, the group said it had a "strong start" to its financial year but echoed warnings from other business leaders that the government's rhetoric on curbing immigration after Brexit could be deterring European workers, on which the UK's service sector is dependent.

"We remain concerned around the impact that the Brexit negotiations are having on the pub industry, especially in relation to attracting and retaining the best people in our pubs," said the statement.

"The political environment remains unpredictable and this ongoing uncertainty is unhelpful when it comes to the strength of the broader economy."

The group said year-on-year revenue was up 6% to £144.1 million for the 26 weeks to October 2, while operating profit was up 0.4% to £25 million. Shares were flat in early-morning trading.

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• UK Finance calls on UK and EU to agree continued free movement for financial workers after Brexit.
• Any Brexit deal for financial services should be "based on mutual acceptance of regulatory and supervisory co-operation and reciprocity," the report says.
• Recommendations come two days after Brexit Secretary David Davis hinted strongly that a similar travel arrangement might be agreed during Brexit talks.

LONDON — One of Britain's biggest financial lobby groups has called for continued free movement across Europe for bankers and other financial services workers after Brexit in a new report released on Thursday.

UK Finance's report, titled "Supporting Europe’s Economies and Citizens," argues that any free trade agreement between the UK and EU should be based on the "based on mutual acceptance of regulatory and supervisory co-operation and reciprocity," arguing that both the UK and EU must continue to allow cross-border trade in financial services, or risk major disruption to the industry.

"The UK’s exit from the EU will transform the provision of financial services between the two parties from a relationship based on a deeply integrated EU single market finance supply chain to one based on trade between two separate jurisdictions," the report's foreword says.

"For the tens of thousands of EU and UK customers and millions of financial transactions currently relying on cross-border services, this is a significant and potentially disruptive change."

Ensuring that the trade in financial services can continue will rely heavily on continued free movement of workers, the report argues, saying: "All services are delivered by people, and the freedom of people to move between countries will often be integral to realising the kinds of commitments to open trade [mentioned in the report]."

"An EU-UK FTA should provide for comprehensive agreements on temporary movement between the two markets for business purposes, unless such short-term travel to, and temporary presence in, the other market is covered by a wider agreement between the EU and the UK on freedom of movement of persons between the two sides," it continues.

UK Finance's report comes as major financial institutions make plans to shift staff out of the UK as a result of the expected loss of Britain's so-called financial passport.

The passport is effectively a set of rules and regulations that allow UK based financial firms to access customers and carry out activities across Europe. Many non-EU lenders use the passport to operate a hub in the UK and then sell services across the 28-nation bloc.

Once Britain leaves the EU, however, it is almost certain to lose passporting rights, which are tied strongly to membership of the single market, a marketplace the UK intends to leave as part of Brexit. This means that to continue providing clients with comprehensive services across the EU after Brexit, many lenders will need new branches.

The report is released in the week that Brexit Secretary David Davis hinted strongly that a travel arrangement similar to UK Finance's proposal might be agreed during Brexit talks.

In a speech at Swiss bank UBS' annual European Conference, Davis told an audience of UBS staff and clients that the UK government wants to ensure that the City of London remains at the heart of Europe's financial services sector, and will place special emphasis on the City as Brexit talks continue. 

"We want to ensure that our new partnership with the EU protects the mobility of workers and professionals across the continent," he told the audience at London's Landmark Hotel.

"Whether this means a bank temporarily moving a worker to an office in Germany or a lawyer visiting a client in Paris, we believe it is in the interests of both sides to see this continue."

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• Innovate Finance has published its annual Women in Fintech Powerlist.
• The list is meant to encourage women in the sector by providing positive role models.
• But Innovate Finance CEO says: "We've still got work to be done," with women representing just 23% of staff in the sector.
  

LONDON — Trade body Innovate Finance has published its annual list of women in fintech, aiming to give role models to young women thinking of entering the sector.

Over 300 women in the global fintech industry are featured on the list, including TAINA Technology CEO Maria Scott, the cofounder of WorldRemit Catherine Wines, and Sophie Bialaszewski, head of innovation culture and events at Lloyds Banking Group. The list was compiled in partnership with Lloyds and law firm Hogan Lovells.

Innovate Finance CEO Charlotte Crosswell told Business Insider the list is meant to "show that there are actually significant amounts of women in fintech and create the network for people to learn from their experience and understand it."

However, Crosswell admitted: "We’ve still got work to be done. When you look at statistics of women in fintech — it’s not there yet. What we have to do is a shine a light on it, work out why we’re not quite there yet, and how do we therefore influence that going forward."

A "fintech census" carried out by EY and Innovate Finance in September found women represent just 29% of staff in the sector.

Caroline Plumb, the CEO and founder of cash management startup Fluid.ly, told Business Insider: "It definitely feels like a less diverse environment to industries I’d previously been in, which were a bit more marketing/services oriented."

Anne Boden, the CEO and founder of digital challenger bank Starling, told BI: "There are not many women in finance, there are not many women in technology, and there are not many women entrepreneurs."

Just 26 of Innovate Finance's more than 275 member companies are led by women.

"It’s very disappointing because it’s not getting any better," Boden said. "I think we all have to try harder. It’s not because there is a lack of female talent and it’s not because women have other responsibilities at home. We as organisations have to work together to find the talented women out there and make sure they are visible in organisations and they get promoted."

Part of the problem is a shortage of women graduating from STEM subjects: science, technology, engineering, and maths.

Crosswell said: "You look at the entrepreneurial side and take it all the way back to education, we are seeing less women coming through schools with STEM skills. How do we make it attractive? How do we promote those skills for girls at school so that they come through as the next phase? We haven’t got the funnel."

Boden said: "I was a computer scientist coming out of university in 1981. There were very few women in computer science when I was studying. I was very much expecting that, as my career progressed, there’d be more women. But there never were."

Boden and Plumb both said that companies should address gender diversity not because of any sense of moral duty but in order to improve organisations.

"Stop trying to think of this as a women’s issue," Boden said. "Stop trying to think of this as something we must do for women. This is a question of fixing organisations.

"I think it is harder for women to get promoted, harder for women to climb the ladder. We have to be aware of that and do our best to give everyone a fair and equal opportunity to get to the top of organisations."

Plumb said: "It’s not a matter of opinion. There’s a tonne of evidence from McKinsey and Harvard Business School that diverse teams make better decisions."

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• Saudi Arabia has long maintained a social contract whereby citizens enjoy state subsidies and handouts in return for loyalty to the regime.
• This contract is increasingly unsustainable, as oil prices remain low, the population booms and the government's resources are depleted.
• Diversifying the economy and unravelling years of "social experimentation" is likely to cause "dissatisfaction" and "disappointment."

LONDON — On December 28 2015, queues formed outside petrol stations in Saudi Arabia following an official announcement that fuel prices would soon be hiked 40%, to $0.24 per litre, as the Kingdom's economy struggled to adjust to plummeting global oil prices.

The move symbolized a change in the social contract between Saudi Arabia's absolute monarchy and its people.

This delicate balance has long been characterised by state handouts and subsidies in return for loyalty, but has become less and less tenable.

Consequently, the Saudi government is now trying to "unravel the many years of social experimentation," Mihir Kapadia, CEO of Sun Global Investments, tells Business Insider. Although the delicate balance "worked for a while," he says, low oil prices "threw the entire mechanism out of whack."

"The government are spending far too much money"

Many goods in Saudi Arabia are still exempt from the standard VAT rate of 5%, and a high proportion (67% in 2016, excluding non-Saudi nationals) of the workforce is employed by the public sector — which paid almost double private sector wages, on average, in 2015.

In response to the Arab Spring in 2011, the Saudi government increased its spending by 25% on the previous year to quell potential dissent, which included around $130 billion of social spending, higher pay and bonuses for public sector workers.

But the kingdom's economy is heavily reliant on oil. Prices fell sharply in 2014, and in 2015 the International Monetary Fund predicted Saudi could run out of resources within five years, if its rate of spending and the oil price slump continued. In January 2016, crude oil plunged to a low of $33.62 per barrel, and is yet to recover to anywhere near 2013's high of $107.65.

"To manage the expectations of their citizens, the government is spending far too much money," says Kapadia.

Diversifying the economy

The Saudi government is now pursuing its Vision 2030 strategy, a state-led drive to diversify the economy away from oil, encourage international investment and change the media perception of the country as a "closed, desert kingdom."

"Huge tracts of the economy" are being privatised, says Mark O'Connell, CEO of investment advisory firm OCO Global, which will mean fewer highly-paid public sector workers.

According to O'Connell, well-paid public sector workers currently visit "all of the restaurants in Riyadh — there are hundreds of them" on a quarterly basis, to carry out hygiene and compliance inspections.

"You can imagine that's deeply inefficient and very expensive," he says.

The government also plans to publicly float state oil giant Saudi Aramco, worth an estimated £1.5 trillion ($2 trillion), in 2018. But this has created the unwelcome impression among some Saudis, says O'Connell that the "family silver is up for sale."

A booming population

In addition to oil price woes, the Saudi population has mushroomed over the last 25 years. A large proportion is now under 30, and the median age is 27.5.

"25, 30, 40 years ago, the rural population was probably a quarter of what it is now," says Kapadia, which made maintaining the social contract "much easier."

To boost the economy, he says, "what is required is a change of mindset." The Saudi government must invest in skills development and encourage private investment, he says, both from foreigners and Saudi businesses and individuals.

A "rebalancing act"

According to Chatham House's Vision 2030 and Saudi Arabia's Social Contract report, if the Saudi government is unable to continue distributing subsidies and gifts to its population, "it will need to focus on alternative sources of legitimacy."

"This could mean greater consultation and public involvement in decision making, or, perhaps more likely, emphasising the importance of royal rule as a bulwark against insecurity, terrorism and chaos, while maintaining or intensifying an authoritarian model of rule," it said.

If the government pulls back on financial incentives without tempering its autocratic nature, says Kapadia, "there will certainly be some dissatisfaction. Certain people who are used to a certain way of life, living on... subsidies and handouts... will be disappointed," he says.

But this system was "going to come to an end anyway," he says, "it was not sustainable."

"We've seen these social experiments fail significantly in Russia and the Eastern Bloc, and even China has since moderated its communist philosophy and allowed for private enterprise to grow," he says. Countries with "extremes of governance" routinely go through such "rebalancing acts," says Kapadia, largely as a result of economic conditions that are "forced upon them."

The good news for Saudi, he says, is that the young understand "there have to be certain changes," and are starting to look for work with new urgency. As part of this new interest in building careers, he says, young Saudis have much greater work-related aspirations than their parents' or grandparents' generations did.

Government subsidies, says Kapadia, have become a type of "social security." In their absence, it is "imperative" that new jobs are created, to accommodate this new workforce and fulfill their aspirations.

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Good morning! Here's what you need to know in markets on Thursday.

1. Britain has suddenly woken up to the prospect that Russia may have interfered in last year’s EU referendum. These questions have been bubbling away for months and, as US investigators make progress in establishing whether Russian influenced last year's presidential election, they have risen to the surface in the UK as well.

2. Labour shortages are growing in the UK's vital construction industry, according to the Royal Institute for Chartered Surveyors. A survey from RICS found skills shortages are holding back the sector, with 62% of surveyors citing it as an impediment to growth. That figure is up from 40% in 2012 when RICS began its quarterly UK Construction and Infrastructure Market Survey. 

3. Zimbabwe is on edge after its military seized power. While the military has denied its actions are a coup, the country's President Robert Mugabe remains under house arrest, but relatively little information has been released.

4. Zimbabwe's instability had a bizarre side-effect: the nation's bitcoin market went bonkers. The highest price paid on a cryptocurrency exchange in Zimbabwe overnight was $13,499 — almost double prices in the US. Zimbabwe doesn’t have its own currency, with the US dollar and South African rand both accepted as legal tender since 2009 after hyperinflation left the previous currency worthless.

5. Canada is increasing its lobbying efforts to block Trump from pulling out of NAFTA. Canadian officials have become increasingly concerned Trump will follow through on his promise to pull out of the trade pact.

6. Stocks are flashing an ominous signal not seen since the financial crisis. Stock market dispersion is widening as technical indicators show sell signals, suggesting a turbulent road ahead for equities. John Hussman, an investment manager, says these indicators haven't flashed simultaneously since early in the financial crisis.

7. Oil markets on Thursday were weighed down by rising U.S. crude production and inventories, but prices were prevented from falling by expectations that OPEC will extend an ongoing production cut during a meeting at the end of this month. Both crude benchmarks have lost almost 5% in value since hitting 2015 highs last week.

8. One of the Bank of England's most senior officials has warned that Brexit could cause a deepening of the productivity crisis that has plagued the British economy in the past decade. In a speech at the London School of Economics on Wednesday, Ben Broadbent, the bank's Deputy Governor for Monetary Policy, said it is not "inconceivable" that Brexit could lead to a "sharp step down" in the UK's productivity.

9. Venezuela won easier debt terms from Russia. Venezuela, which has a depressed economy, has borrowed billions of dollars from Russia and China and promised to honor its debt.

10. UK unemployment remained at its lowest level since 1975, while productivity finally started to pick up, according to the latest data from the Office of National Statistics. The unemployment rate was 4.3% in the three months to September, unchanged from the previous reading. While the headline rate didn't change, unemployment did fall in the three months to September, with 59,000 fewer people out of work.

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The court asked India's central bank and several government agencies to respond to a petition that expressed concern about tax dodges and ransomware.

• Tesla is opening up two of its largest-ever Supercharger stations in California, featuring 40 Superchargers in Kettleman City and Baker.
• The Kettleman City location also has an ultra-modern private customer lounge.
• The two new stations will serve heavily traveled routes between San Francisco, Los Angeles, and Las Vegas.

Tesla on Wednesday announced its newest, largest Supercharger stations in the US. The two new California hubs — one in Kettleman City and the other in Baker — have 40 Supercharger stalls and some creature comforts for Tesla drivers traveling on the open road.

The new stations are situated off highways along the heavily traveled Los Angeles-to-San-Francisco and Los Angeles-to-Las-Vegas routes, and the one in Kettleman City, a common midpoint for traveling moving between Southern California and the Bay Area reimagines the traditional American rest stop.

Tesla built a private customer lounge, family recreational space, and a separate area for pets at the Kettleman City location. There is solar covered parking on-site, food and drinks, restrooms, Wi-Fi, and an apparel shop as well. To ensure the Kettleman City lounge is a Tesla-only club; an access code will be delivered via your Tesla touchscreen.

The new stations serve a clearly functional purpose, especially as a new generation of Tesla owners prepare to hit the road in the mass-market Model 3. The new stations are also part and parcel of Tesla's top-shelf luxury sensibilities, as CEO Elon Musk noted previously.

At the time of this writing, there are more than 1,040 Supercharger stations worldwide. There are Supercharger stations coast-to-coast in North America, and in Europe, the Middle East, and Asia — with many more to come.

In the US, Tesla has also focused on bringing more charging stations to urban areas and cities typically underserved in the electric-vehicle market.

SEE ALSO: An anecdote about Elon Musk and Tesla's big-rig reveals why people are obsessed with his company

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• The Royal Institute for Chartered Surveyors has warned of a growing skills gap which some believe could decimate the UK construction industry
• 62% of surveyors now believe the problem is hampering growth.
• The gap has grown due to an ageing population, and will grow further once Britain leaves the European Union.

LONDON — Labour shortages are growing in the UK's vital construction industry, according to the Royal Institute for Chartered Surveyors.

A survey from RICS found skills shortages are holding back the sector, with 62% of surveyors citing it as an impediment to growth. That figure is up from 40% in 2012 when RICS began its quarterly UK Construction and Infrastructure Market Survey. 

RICS said "respondents continue to highlight Brexit-related uncertainties as weighing on investment decisions and the lack of sufficiently skilled workers also remains an obstacle for many businesses."

The labour figures are stark. An ageing population and a lack of new skilled workers to the sector mean the industry faces a "ticking time bomb" of labour shortages, according to a recent report from construction consultant Mark Farmer.

Charts featured in the report, which was titled "Modernise or Die," demonstrate the chronic shortage of workers compared to the amount required to keep Britain's construction industry afloat:

Brexit-related uncertainty

Farmer calculated in 2015 that the industry needed 700,000 new workers simply to replace those retiring or moving to other industries, and a further 120,000 to deliver capacity growth in the sector.

That was before the UK voted to leave the European Union, and the the government's promise to cut immigration significantly, which carries its own threat to construction: around 45% of the UK's 270,653 migrant construction workers are from EU countries.

Some builders employ significantly more EU workers than that: Tony Pidgley, chairman of housebuilder Berkeley Homes, said last year that 50% of his subcontractors are from Eastern Europe, and warned Brexit would cause "even more pressure in terms of skills shortages."

"If you ask any housebuilder what their main challenge is, they say it’s labour availability," he said.

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• Bitcoin was on a tear Wednesday after mobile payments company Square confirmed it was letting some people buy and sell bitcoin on its Cash app. 
• Bitcoin was trading up more than 10% at 5:18 p.m. ET. Square, on the other hand, ended the trading day up 2.3%.

Square, the mobile payments firm, is running a trial that allows some users of its Cash platform to buy and sell bitcoin. 

The news, which was reported by TechCrunch, sent Square's stock to an all-time high of $41.80 per share soon after the markets first opened. It gave up some of those gains during the rest of the trading day and closed at $40.66 per share, up 2.3%.

Bitcoin is also in the green today. The cryptocurrency, known for its wild price swings, was trading up more than 10% at 5:18 p.m. ET, according to data from Markets Insider. 

Square added the feature to Cash, a rival to Venmo, because users asked for it, the company said in a statement. The company is still trying to figure out how to make it "faster and easier" and is only offering it to a "small number" of Cash users, it said.

The new feature will allow Square to compete with cryptocurrency exchanges such as Coinbase and Gemini.

A research note penned by Credit Suisse analysts Paul Condra and Mrinalini Bhutoria said the move could be a tailwind for the company, despite some hurdles. Here's the bank (emphasis ours):

"Given SQ’s tendency to move judiciously into new technologies, we expect it will do the same with bitcoin purchases. We believe the largest risk is regulation, which could limit its ability to provide the service or outright ban it. SQ is also exposed to liquidity and counterparty risk as it must source bitcoin for users either by pre-buying or using an exchange. Despite these risks, the upside could be significant if crypto currencies become more mainstream."

As for bitcoin, the Square news is the latest example of a mainstream financial services firm showing interest in the profit opportunities in the booming cryptocurrency space.

Simon Yu, CEO of StormX, a blockchain technology company, said the news is a "fantastic development" for the cryptocurrency ecosystem.

He said it will "undoubtedly be a call to action to invite other forward-thinking firms in embracing the new token economy.”

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