Spanish bank completes landmark loan transaction on blockchain

The promulgation of blockchain in everyday life continues with another success story. The latest evidence of its importance to commerce comes from Spain after international banking institution BBVA transacted a loan entirely across the blockchain.

BBVA used a private blockchain to conduct the loan from start to finish, according to the Financial Times. In doing so, it has now become the first global bank to enlist the technology in a loan operation. The €75-million ($91.4 million) loan, from initial negotiations to the completion of signing, was managed on a distributed ledger. Both the bank and the loan recipient were constantly updated on the progress, and the transaction time was reduced from several days to just a few hours. BBVA called it a “significant advance in the exploitation of [distributed ledger] technology.”

With this transaction successfully under its belt, BBVA is planning to conduct more blockchain-transacted loans. BBVA CEO Carlos Torres Villa was quoted by the news outlet saying, “Blockchain can offer clear advantages for all sides in the corporate loan market in terms of efficiency, transparency, [and] security… It’s another strong example of how disruptive technology can be used to add value to financial services, something that is central to our strategy.”

BBVA had some help in managing the transaction. Spanish telecommunications company Indra assisted to make sure communications channels and equipment were always working properly. Borja Ochoa, Indra’s director of financial services, said, “This pilot served as an opportunity to take part in the first corporate loan operation based on blockchain technology in the world. The operation strengthens the position of BBVA and Indra as leaders in the practical application of blockchain technologies.”

The blockchain is the perfect solution for industrial and corporate loans, which are oftentimes more delicate and require more input from various sources and need to be kept more secure than personal loans. BBVA used a private blockchain for the transaction, but all loans will be registered and completed on the Ethereum blockchain. In addition to corporate loans, BBVA is exploring the possibility of using blockchains for international lending and trade, as well as in foreign exchange transactions.

BBVA is one of only a few global banks to proactively embrace cryptocurrency and blockchain technology. It has already made several investments into both sectors, and just a couple of months ago successfully completed trials for cross-border payments using Ripple.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

Europol takes down Ukranian gang suspected of using crypto to launder $1.2B

Authorities in Spain have arrested the leader of a cybercrime group behind the Carbanak and Cobalt malware attacks, which targeted over 100 financial institutions around the world. The mastermind behind this heist was allegedly an Ukranian national called Denis K. The operation was conducted in conjunction with Europol.

The gang, composed of Russian and Ukranian nationals, would manage to gain access to bank servers and networks through a series of emails sent to employees, according to Europol. The emails would eventually infect their computers and target valuable security data such as passwords, resulting in the group gaining access to account balances which they changed and even gave instructions to ATMs to issue large quantities of cash.

Authorities said the Cobalt malware alone allowed the cybercriminals to steal up to €10 million (U$12.4 million) per attack. In total, the group reportedly infiltrated banks in more than 40 countries, resulting in the loss of over €1 billion (US$1.2 billion).

The group also managed to set up a cryptocurrency farm, which they use to launder money. According to Europol investigators, “The criminal profits were also laundered via cryptocurrencies, by means of prepaid cards linked to the cryptocurrency wallets which were used to buy goods such as luxury cars and houses.”

The mastermind behind the group, who was identified as Denis K, operated from Spain and had accumulated about 15,000 BTC worth about $120 million, authorities said.

The operation to catch this gang was quite massive and involved the police from several countries including the United States, Taiwan in Asia and Romania in Europe. Denis K was eventually arrested in the Spanish port city of Alicante.

The Spanish Interior Minister announced that three other gang members were arrested alongside a massive haul of jewels worth half a million dollars, two luxury cars and properties. Bank accounts belonging to the gang members were also frozen.

According to a statement by Europol, the individuals authorized fraudulent bank transfers, adjusted mule bank accounts and commanded ATMs to issue cash. Apparently the group worked with the Russian mafia up till 2016 but then began working with the Moldovan mafia. This massive operation enabled the gangsters to accumulate a staggering 15,000 BTC with the money being converted on cryptocurrency exchanges in Russia and Ukraine which would later be transferred to the group’s personal bank accounts.

This is not the first time that cryptocurrency has been used to launder money. A Turkish gang was involved in extortion to the amount of 450 BTC from a Turkish businessman while in February a Taiwanese gang was arrested for the theft of BTC worth up to $100,000.

Note: Tokens in the SegWit chain are referred to as SegWit1X (BTC) and SegWit Gold (SWG) and are no longer Bitcoin. Bitcoin Cash (BCH) is the only true Bitcoin as intended by the original Satoshi white paper.  Bitcoin BCH is the only public block chain that offers safe and cheap microtransactions.


Spain mulling ideas for blockchain, crypto companies’ tax breaks

European Union countries are looking favorably on blockchain and crypto currencies in an attempt to shore up their economy. After Malta announced that it was looking to provide a safe legal environment for the operation of blockchain technology, it is now the turn of Spain to actively consider providing tax breaks for blockchain-based companies and by extension, cryptocurrency exchanges.

Proposals to introduce tax exemptions for companies using blockchain technologies and cryptocurrency have been put on the table in Spain. The ruling People’s Party is preparing new legislation that will also offer incentives to entrepreneurs raising funds through ICOs. If lawmakers adopt the amendments, investors will not be required to report crypto assets under a certain threshold. This will undoubtedly provide an excellent environment for those companies who wish to pursue their business in blockchain.

The People’s Party intends to seek experts’ advice to finalize and push through the legislation in parliament. The ruling majority will also study developments in other countries that have advanced further in adopting their legal frameworks. Switzerland was mentioned as an example in that respect, where the Alpine country has already become a leader in Europe after establishing a Crypto Valley in Zug and enacting guidelines on initial coin offerings (ICOs). However, Switzerland is a different ball game since it is already known for its financial secrecy so such proposals are definitely more adaptable there.

The authors of the bill are considering proposals to entice businessmen to use blockchain for crowd fundraising through ICOs. The draft also introduces tax breaks for small companies specializing in sectors such as 3D printing or data processing.

The new legislation may also include a threshold below which entrepreneurs would not be required to report a cryptocurrency investment. Spain’s markets and securities regulator is reportedly preparing the provisions for crypto investor protection.

“We want to set up Europe’s safest framework to invest in ICOs” the Spanish deputy said.

In a post published on his website in December, Minister Teodoro Garcia Egea attempted to win support for his ideas by educating the public about blockchain technology, which he compared to the institution of the public notary.

“A notary is a highly qualified and independent professional, who provides guarantees for security and legality,” according to the lawmaker, noting that in the Internet, these characteristics can be attributed to blockchains.

The blockchain technology does not replace the notary, but provides reliability, transparency and traceability for contracts between individuals beyond what notaries can do, Garcia Egea wrote. Blockchains do not replace the services of legal professionals and from regulatory point of view, and the technology is not a threat but a great opportunity to do a better job, the lawmaker added.

Note: Tokens in the SegWit chain are referred to as SegWit1X (BTC) and SegWit Gold (SWG) and are no longer Bitcoin. Bitcoin Cash (BCH) is the only true Bitcoin as intended by the original Satoshi white paper.  Bitcoin BCH is the only public block chain that offers safe and cheap microtransactions.