One of cryptos longest-running exchanges has been sold

One of the longest-standing crypto exchanges has new owners after Europe-based Bitstamp was sold to South Korea’s Nexon, marking the gaming firm’s second such acquisition.

The acquirer is NXMH, a Belgium-based PE and investment firm owned by NXC — the parent of Nexon — and it will take a majority 80 percent stake in the business for an unknown fee. The New York Times’ Nathaniel Popper suggested earlier this year that Bitstamp was in the process of being sold “to South Korean investors” for $400 million, but NXC declined to comment on the price when asked by TechCrunch.

NXC acquired 65 percent of Korea-based exchange Korbit one year ago for 91.3 billion KRW, or approximately $79.5 million at the time.

Bitstamp was founded in 2011 by Slovenian entrepreneur Nejc Kodrič with an initial €1,000 and it survived the heady early days of crypto, unlike a certain peer named Mt. Gox. Today, Bitstamp is ranked inside the world’s top 30 exchanges based on trading volume with more than 100 staff. Bitcoin and XRP are among its most traded tokens, according to data from Coinmarketcap.com.

The company has a license to do business across the EU but it also works with customers worldwide.

Bitstamp has been profitable since its early life, but Kodrič revealed the sale is down to the potential to work with NXC, which he sees as a like-minded partner.

Bitstamp has been regularly approached by suitors for quite some time. The reason why we finally decided to sell the company is a combination of the quality of the buyer, the quality of the offer and the fact that the industry is at a point where consolidation makes sense. A major factor in agreeing to the sale is that the mission, leadership and vision of the company remains the same.

We believe this acquisition is the logical next step in Bitstamp’s growth as a company and I look forward to the future with this team.

The Bitstamp CEO said business will continue as normal — he’ll retain his position as CEO and keep 10 percent of the company.

Interestingly, he told Fortune that regulatory compliance meant the deal took some ten months to close after first being agreed in December 2017 when crypto market valuations hit a peak — with Bitcoin, in particular, getting close to a record $20,000 valuation.

Bitstamp raised around $14 million in capital from investors along its journey, with U.S-based Pantera capital one of its major backers.

Note: The author owns a small amount of cryptocurrency. Enough to gain an understanding, not enough to change a life.

Coinbase is now worth more than all but three cryptocurrencies

With its shiny new $8 billion valuation, Coinbase is now worth more than all but the top three cryptocurrencies that trade on the platform.

That’s right, the only cryptocurrency assets that are worth more than the platform that trades them are Bitcoin, Ethereum and Ripple. Bitcoin Cash, the currency forked from Bitcoin, is a distant fourth in valuation at $7.3 billion.

Coinbase’s Series E is nearly three times as much as the company raised in its Series D, and the fresh cash brings Coinbase’s total-capital-raised-to-date to over $520 million.

That’s a lot of money. Indeed, if Coinbase’s capital raised figured is compared to the market cap of the world’s various cryptocurrencies and other similar assets, it would rank around 20th.

But the bet for investors is, and should be, that if cryptocurrencies are indeed the next big idea in the ways that humans determine value, then Coinbase should be worth far more than any of the assets that trade on its exchange.

The fact that it’s neither indicates how much farther the company has to grow, or the limits of the thesis that cryptocurrencies will take over the world.

It shows that the wager on a particular crypto company is looking like a better investment than putting money to work in nearly any of the other crypto assets that are for sale. During the last few crypto booms, some investors said that it was probably simpler to just invest in various tokens instead of companies working on blockchains — faster returns and your money would be more liquid, to boot.

However, at least in the case of Coinbase, that wager likely wouldn’t have worked. Coinbase is also the company that every investor has wanted to invest in; it’s been a known winner for a while now, so its performance isn’t a huge surprise.

And now with $300 million, Coinbase is well-capitalized to survive either a market downturn (one will come eventually), and the current Crypto Interregnum.

Coinbase’s chief executive certainly thinks the market will grow. As we noted, Coinbase currently allows trading to just a handful of cryptocurrencies, but it has long harbored ambitions to expand beyond that.

Speaking at TechCrunch Disrupt SF in September, CEO Brian Armstrong revealed that he sees a future in which every cap table will have its own token. Based on that, he said he believes that Coinbase could host hundreds of tokens within “years” and even potentially “millions” in the future.

Googles blanket ban of cryptocurrency ads ends next month

Google is rolling back its ban on cryptocurrency advertisements – following a similar move made by Facebook earlier this summer, CNBC reports. Google in March was among the first of the major platforms to announce it would no longer run ban cryptocurrency ads, due to an abundance of caution around an industry where there’s so much potential for consumer harm.

Facebook, Twitter, and even Snapchat had also banned cryptocurrency ads, for similar reasons.

But Facebook moved away from its blanket ban this June, when it said it would no longer ban all cryptocurrency ads, but would rather allow those from “pre-approved advertisers” instead. It excluded ads that promoted binary options and initial coin offerings (ICOs), however.

Google is now following suit with its own policy change. The update was announced today, we’ve confirmed.

Google’s policy still bans ICOs, wallets and trading advice, CNBC reports, citing Google’s updated policy page which points to a list of banned products.

But the October 2018 policy update says that “regulated cryptocurrency exchanges” will be allowed to advertise in the U.S. and Japan.

To do so, advertisers will have to be certified with Google for the specific country where their ads will run, a process that begins in October. The policy will apply to all accounts that advertise these types of financial products, Google says.

Banning cryptocurrency ads on the part of the major platforms was a good step in terms of consumer protection, due to the amount of fraud and spam in the industry. According to the FTC, consumers lost $532 million to cryptocurrency-related scams in the first two months of 2018. An agency official also warned that consumers could lose more than $3 billion by the end of the year, because of these problems.

But for ad-dependent platforms like Facebook and Google, there’s so much money to be made here. It’s clear they wanted to find a way to let some of these advertisers back in. Google parent Alphabet makes around 86% of its total revenue from ads, CNBC noted, and booked over $54 billion in ad revenue in the first half of the year.

Google has not yet responded to a request for comment.

Circle launches its stablecoin

When Circle raised its $110 million funding round, the company used this opportunity to talk about its stablecoin — USD Coin, or USDC for short. And you can now buy, sell and send USD Coins on Circle Trade and Circle’s exchange Poloniex.

But what is a stablecoin? As the name suggests, 1 USDC is worth 1 USD. Unlike traditional cryptocurrencies, you can be sure that the value of USDC isn’t going to fluctuate like crazy.

There are multiple reasons why you’d want to use stablecoins. First, if you want to short cryptocurrencies without cashing out, you can convert your bitcoins or ethers to USDC. This way, it’ll be easier to buy cryptocurrencies again in the future.

Second, if you want to avoid traditional financial institutions, you can send USDC to other people without going through a bank. Sending USDC is like sending any other token — you just need to tell your recipient to get a wallet and ask for their wallet address.

Third, I’m sure many people are going to use stablecoins to avoid taxation issues. It’s easier to hide a bunch of tokens than a big wire transfers hitting your bank statement.

Many people living in countries suffering from hyperinflation or chronic inflation, such as Venezuela or Turkey, could also rely on USDC to convert some of their savings. This way, you don’t have to open a bank account in another country.

USDC is an ERC-20 token, which means that it’s easy to add support for USDC if you’re running an exchange or a wallet. But Circle wants to make sure that issuers are not just printing money without any actual USD in their bank accounts.

Multiple companies partnered to create CENTRE, a consortium that is going to define policies around stablecoins and governance. If you want to issue USDC, you have to comply with a bunch of rules. In particular, you have to send monthly audited reports proving that you have as many USD on deposit as issued tokens.

Multiple companies have already announced that they will begin trading USDC soon, such as DigiFinex, CoinEx, KuCoin, OKCoin, Coinplug and XDAEX. On the wallet front, BitGo, Cobo, Coinbase Wallet, CoolWallet S, Elph, imToken, Ledger, Status and Trust will add native USDC support soon.

Blok.Party raises $10M, will adapt Settlers of Catan to its blockchain game console

Blok.Party, the company that built the upcoming PlayTable game console, announced today it raised $10 million in new funding. It’s also unveiling a big content partnership, where Blok.Party will create its own version of the popular board game Settlers of Catan.

I first wrote about Blok.Party and PlayTable earlier this year, when co-founder and CEO Jimmy Chen first laid out his vision to use blockchain technology to build a console that can recognize real-world objects (like figurines and cards), creating a hybrid between tabletop and video gaming.

The idea may have sounded a little abstract at the time, but it got a lot clearer when Chen dropped by the TechCrunch New York office to play a couple rounds of Catan with me.

I’ll admit that I hadn’t played in a while, but it was clear from the start that PlayTable saved us some setup time — instead of putting all the pieces of the physical board together, you play on a digital representation of the board. Most of the pieces are digitized too, and we used and traded our cards using smartphones. But there is a physical “robber” piece, because Chen said this allows the robber’s movement to remain “a very visceral experience … that a digital version can’t ever capture.”

It may not be too long before you get to try this out for yourself, at least if you’re among the 10,000 pre-orders Blok.Party has received so far. Chen said the company will start shipping its first devices this fall.

He added that Catan, like many of the other games built for PlayTable, will be priced at around $20.

“For us, it’s not about trying to compete based on price,” Chen said. “We’re trying to compete based on experience.”

The new funding comes from crypto fund JRR Capital and other investors. Chen said the company will use the money to continue scaling the product, including further software development and building out the library of games.

At the same time, he emphasized that although Blok.Party is manufacturing the initial devices, his vision is to achieve real scale through partnerships with hardware manufacturers, who will build their own PlayTable consoles. Apparently, some of those discussions are already underway.

“Our strategy is to always have [our own] hardware program running to continually do research,” Chen said. “What I’ve discovered is that keeping a hardware program running is not that expensive. The expensive part is when you try to scale the program.”