CoinMetro 2nd November 2018 AMA Notes

VIDEO ARCHIVE OF THE AMA (YOUTUBE, FACEBOOK)

IN THE NEWS

#1. Indian Police Seize Unocoin’s ATM, Arrest Two Founders

• Anybody who follows crypto news, knows that India is the biggest fan of crypto. 
• Follow Kevin on Twitter! (@coinmetro_kevin)
• It’s much easier to seize physical property. 
• PR move?

#2. OKEx to Delist 50+ Trading Pairs Due to ‘Weak’ Performance

• I assume they mean low volumes?
• Poor performing assets can reflect badly on the exchange. 
• Doing a cleanup is a way of saving face. 
• Regulation doomhammer is coming! 
• It’s a good move in general, but it shows that there wasn’t enough planning when they listed the tokens.

#3. Small Canadian Bitcoin Exchange ‘Hacked,’ Says All Funds are Gone

• Was it an exit scam?
• Did they "hack" themselves? 
• Were they victims of the hack? 
• Either way, the fault is on them because their security procedures weren’t up-to-par. 
• The market is still immature, and it’s pretty easy to see these things get off the ground. 

#4. Mastercard Patent Claims Cryptocurrency Can Benefit From Fractional Reserve Banking

• LOL, “benefit.”
• MasterCard should define “benefit” in this case. 
• Certain countries would benefit from this more than others. 
• It may benefit crypto as in market cap and usage right now.
• But it would be 100% against the reasons why Bitcoin was created- it would be a slap in the face. 

#5. Crypto Exchange Bitstamp Acquired by Belgian Investment Firm in ‘All Cash Deal’

• Belgian investment firm with South Korean money.
• Bitstamp doesn’t have the highest volumes. 
• They weren’t anywhere close to the largest.
• But they’re the only one with a license. 
• Instead of going with someone like Kraken, they went with someone with a license.
• It’s interesting that these investors didn’t go with someone larger, but instead went with someone with a license.

#6. Crypto Exchange Service Helps Bithumb Recover 1 Million XRP After Massive June Hack

• There is a need for something to exist between exchanges, kind of like it happens in the FX world. 
• This is one of the things that the ECA (European Crypto Association) is trying to establish- a way to communicate these things between exchanges and other providers. 
• There really needs to be more camaraderie between exchanges, at least the ones that are compliant. 

#7. Morgan Stanley Report Says Crypto Now An Institutional Asset Class

• It’s not that new, and it is an asset class, and one day it will be an institutional asset class. 
• First you need retail books before you can sell them anything. 
• You need liquidity to sell them. 

#8. Hong Kong securities regulator to propose 'sandbox' for crypto exchanges

• “We talked to the CCO Danny about this”
• We’re looking to get into that Sandbox, and they are great. 
• It makes sense that you need to be licensed, and there should be a Sandbox license as well. 
• Definitely good news for the industry.
• We need places to test!

#9. Report: Bithumb Signs Deal with US Fintech Firm to Open Security Token Exchange

• There’s no such thing as a security token, anywhere in the world. 
• The only thing that can happen is a tokenized security.
• It’s still a security, but it has been tokenized for some of the blockchain advantages.
• Obviously tokenized securities have advantages.
• But it’s not yet the game-changer that people think it is.
• And by the way, ALL tokens are currently securities!

#10. Binance Freezes Funds on Multiple Accounts with Dubious Crypto Exchange

• Good on Binance!
• There needs to be a (hate to say this) centralized body to help communicate this information among exchanges.

REDDIT QUESTIONS

E-mail Leak?

• There was no hack.  
• There were was a list that the backend developers had access to, that they needed access to work on APIs. 
• There are lessons learned, which include segregation of data.
• This was stolen by one of the contractors. 
• It can even happen with Full-Time employees. 
• The contractors took copies of the data. 
• We have access controls to prevent this to happen, but they did not have access to the e-mails, they had access to the APIs. 
• The team has now segmented environments to protect data. 
• The team has already done several internal security audits, and an external audit. Before minting another audit will happen. 

Token Sale Burn

• There is no need to burn tokens, since we will mint only what is needed (what was sold).
• Once we mint, and the tokens are put into a vault, we cannot mint using that same smart contract. 

Potential Backdoors Planted by Malicious Devs?

• Near Zero. They did not have access to any of the critical code. 
• They did not have access to any external code, save for the e-mail code. 

Cash burn 

• Around $240k EUR/month. Mostly on head count. 
• We have equity-tied commitments of around $5Million EUR, but there is no timeline. 

Flash Sale

• No word yet on whether there will be one yet. The team is still discussing internally. 
• We want to have something unique, so we’re still mulling around. 
• There are still talks about how to properly structure the flash sales. (11:46)
• I would love to be able to offer the possibility of a swap into a tokenized security backed by the CoinMetro group of companies at the point that is legally plausible.

Kevin, what excited you most about CoinMetro?

• I don’t see exchanges out there with enough legs behind it that can be carried once we start to see all these regulatory changes. 
• Exchanges will have a hard time once fees are forced to be reduced by the market. 
• They don’t have other real revenue sources. 
• The plan itself, is what excites me the most. The regulatory footprint, IBAN, multi-asset trading, etc…
• There’s not a product like that out there, and no one is even trying to do it. 
• It’s about being one of the first companies to really push the idea that the word “bank” is going to change. 

Debit Card

• Yes, there will be tiered versions of Debit Cards.
• There’s no timeline for the release of Debit Cards, we have 6 providers in the talks at the moment, 3 of which are ready to roll. 

Bitcoin is 10, how do you think Satoshi is feeling?

• He would probably be pissed. 
• The ideals he had when he wrote the Bitcoin paper, are not being realized. 
• Tinfoil Hat Time - if this was made by an organization to bait and switch people into falsely thinking that Bitcoin is anonymous, and yet it’s designed to be trackable, then he’s happy. 

When will Dark Pool functionality be added?

• First we need a book, which may take a few months at the very minimum. 
• We do plan on instituting a button that says “desk” that will open up a ticket system. It’ll be similar to OTC systems. 

AMA QUESTIONS

Are you open to selling CoinMetro?

• Kevin is open to it, but not anywhere near in the near term, and it is not a goal. 

Will there be stats on the trading contest soon?

• Yes!
• Stats will probably posted after the contest ends.
• In subsequent contests, we’ll have widgets and leaderboards and will be more automated.

COINMETRO UPDATES

THE "COSMIN" SITUATION

• Cosmin Capitano was hired through UpWork, last last year.
• Cosmin has some public profiles and allegedly works for Adobe in Romania.
• Cosmin's team started the work on some design work for the website.
• Over time, the relationship grew and the Cosmin's team brought on more people.
• At some point there was about 7 people in the Cosmin's Romania office.
• Initially, CoinMetro paid them via PayPal, but as the payment amounts grew larger due to bringing on more team members, CM asked for banking info in order to wire the payments.
• CoinMetro was given excuses by Cosmin's team as to why they couldn't give them bank accounts.
• Eventually, Cosmin's team provided a partner company in China to route payments through and when CoinMetro tried wiring the funds, JP Morgan blocked the payment as they stated that the account was OFAC-sanctioned.
• CoinMetro checks every account to make sure that they are not on any OFAC lists, and Cosmin's accounts did not appear to be there when the CM team checked before the block. The team checked the OFAC list again after the block, and they still couldn't find Cosmin's accounts on that list.
• There was some confusion, they asked Cosmin and he said that it wasn't true.
• CoinMetro investigated, and they couldn't find anything, so they made some payments via crypto.
• Before making the next payment, the CM team checked the OFAC list again, and they indeed found them at this time.
• To sum it up, the company that Cosmin's team asked the CM team to send the money to was on the OFAC list for funneling money to North Korea to fund ballistic missile programs.
• They are correct in that there are 2 months worth of payments owed to them, but what they fail to mention is that they stole multiple identities, and lied about it. And at the end of the day, they are linked to an OFAC-sanctioned entity and the CM team cannot pay them.
• They have since issued death threats, and have created a ruckus about the whole situation.
• Reminder, please report any Cosmin posts, take screenshots and send them to the team. 

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Well, that's it for this week's AMA with CoinMetro Founder Kevin Murcko! Please join us next week on CoinMetro's Facebook at 2PM GMT for another round and make sure you submit your questions to the CoinMetro Subreddit!

As always, we're available to answer any questions you may have on our Telegram Group 24/7.