Breaking News

Young CEO Reshapes 140-Year-Old Metals Exchange; ICE Completes Trayport Deal w/ TMX; America’s Inequality Is Sending the Dow Soaring

First Read

Hits & Takes
JLN Staff

Georgetown McDonough School of Business offers a new fintech class. John Jacobs, executive director of the school’s Center for Financial Markets and Policy, will teach the course along with Perianne Boring, founder and president of the Chamber of Digital Commerce.~JJL

The 2018 World Inequality Report is out. Spoiler alert – income inequality is increasing in “nearly all world regions in recent decades, but at different speeds.” Lots of graphics to parse through. The charts comparing Western Europe’s top 1% vs the U.S.’s top 1% on page 8 are pretty stunning.~SD

CME Group has published a video as part of a course at their institute, “What is Bitcoin.” You can take the course and view the video HERE.~JJL

Hank Mlynarski is now the acting CEO and advisor at LucidExchange, which aims to rock the trading world with a new disintermediation solution.~JJL

ISDA’s Financial Benchmark Conference takes place in Singapore on Feb. 7. The conference will review key events that led to benchmark reforms, the IOSCO principles on which the reforms are based, and the proposed FSB reforms. EU regulation of financial benchmarks will also be discussed. To register, you can go here.~SR

“Discover a new way to source liquidity: Eurex Exchange further expands its existing market structure with the electronic price discovery service Eurex EnLight that allows banks and brokers to selectively contact Market Makers with requests for quotes in order to find a trading counterparty.”~JJL

Happy birthday to MIAX – the exchange turned 5 yesterday.~SD

Yesterday’s JLN Options newsletter covered the problem with low volatility coverage in the media, ESMA’s direct electronic access bombshell and Cboe CEO and Chairman Ed Tilly’s comments on consolidation.~SD


Carolyn Leonard – Women In Finance

” I had brokers with very large decks telling me to my face that they’ve never traded with a woman, they weren’t going to trade with me and that I shouldn’t take it personally… A lot of those same guys became awesome friends, but we had a real rocky start.”

In this profile video from John Lothian News, Carolyn Leonard recalls her journey through the volatile world of trading at the Chicago Board Options Exchange beginning in the late ’70s. Leonard started trading after a divorce, with two young children in tow and in need of a fresh start. She had a friend at the CBOE, and after seeing the chaos of the trading floor firsthand she was hooked. Leonard took out a $250,000 loan to secure a seat at the exchange, where she was one of the few independent female traders to own a seat.

Leonard recalls some of her best trades, along with some of her losers. She says the hardest thing to overcome is the out of pocket education and watching money disappear. Leonard had a set of rules she lived by and maintains there’s no room for ego in trading. And if she was struggling she would reduce her trade size until she regained her confidence. Leonard liked trading volatile markets because she could sell more premium, which translates to more cushion.

Leonard’s latest endeavor, DyMynd, helps women in finance build trusting relationships with financial advisers so high net-worth women can safely invest their money. DyMynd has launched the 1920 campaign, which is a fundraiser for female-led startups in the Chicago area and surrounding Midwest. Leonard is spearheading the fight for equality for women in finance and shows no signs of slowing down any time soon.

Watch the video here »


Race to launch bitcoin futures stirs anger; CME and Cboe listings have raised concerns among regulators and brokers
Gregory Meyer in New York and Philip Stafford in London – FT
“Get Exposure to Bitcoin Price Moves without Holding Bitcoins,” the website of Cboe Global Markets says about the exchange’s new bitcoin futures, which began trading this week.

***** Nice recap of the tensions around bitcoin futures trading.~JJL


Warrington Asset Management names Edward den Dooven as Managing Director and Head of Strategic Business Development
Warrington Asset Management, a Dallas -based discretionary macro-hedge fund, announced today that Edward den Dooven has joined the firm as Managing Director and Head of Strategic
Business Development and Investor Relations. Mr. den Dooven is relocating to Dallas from New York.

**Cannot resist: den Dooven is movin’!~JK


Jim Hourihane – Careers in Compliance

“We’re trying to ensure market integrity, we’re trying to make sure investors are protected and we’re making sure all of our members are doing the right thing and following all the rules.”

In this video from MarketsWiki Education’s Intern Recruiting Event in Chicago, Jim Hourihane, compliance manager for the National Futures Association, breaks down how the NFA works and what kind of opportunities present themselves in compliance. With mountains of data in the financial sector, one of the goals of the NFA is to make sure that market and member data is safe and secure. Hourihane says the NFA’s new challenge is going international and making sure they can work within the structure of other countries’ regulations.

Watch the video here »


NFA Additional Reporting Requirements – Virtual Currency Products
Additional reporting requirements for IBs that solicit or accept orders in virtual currency products A number of CFTC-regulated trading venues have launched or announced plans to offer derivatives on virtual currency products, including bitcoin. Given the volatility in the underlying virtual currency products, NFA is requiring each IB to immediately notify NFA if it solicits or accepts any orders in virtual currency derivatives. Until further notice, this obligation will apply on a continuous basisóany IB that does not currently offer virtual currency derivatives must notify NFA if it begins soliciting or accepting orders in these products.

***** IBs should be made to fill out a form in triplicate, just because.~JJL


Division of Trading and Markets Deputy Director Gary Barnett to Retire
The Securities and Exchange Commission today announced that Gary Barnett, Deputy Director in the Division of Trading and Markets, will retire from the agency at the end of the year.

***** Gary was one of our speakers at the New York MarketsWiki Education series this summer at Nasdaq’s offices in Times Square.~JJL


Thursday’s Top Three
Our top read stories yesterday were led by Bloomberg’s piece on blockchain for commodities markets, in Bitcoin Points Way to ‘Massive Change’ for Commodity Businesses. Second went to the hard opinion piece from the Wall Street Journal,
Illinois Drives People Away. Third went to Financial News’ interview with Cboe CEO Ed Tilly in Chicago trading chief predicts more stock exchange mergers. Get ready for Bitcoin Monday, everyone.


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Lead Stories

Young CEO Reshapes 140-Year-Old Metals Exchange; Matthew Chamberlain is righting some recent missteps, but skeptics say he needs to formulate a long-term strategy for LME
Amrith Ramkumar – WSJ
Eight months ago, Matthew Chamberlain became the youngest chief executive in the 140-year history of the London Metal Exchange.

Intercontinental Exchange Completes Sale of Trayport to TMX Group, Acquisition of NGX and Shorcan Energy
Intercontinental Exchange announced it has completed the sale of Trayport to TMX Group in exchange for NGX, Shorcan Energy and £350 million cash.

America’s Inequality Is Sending the Dow Soaring
Craig Torres and Jordan Yadoo – Bloomberg
The Great Recession is a speck in the rear-view mirror for America’s financial markets. They’ve advanced far beyond pre-crisis levels. In fact, Goldman Sachs says you can go back a century before 2008, and still not find a “bull market in everything” like today’s.

A financial crisis in 2018? The danger signs are starting to emerge
Neil MacKinnon – City AM
It is 10 years since the last financial crisis, and it has taken that long for normality to return.

Billionaire Hedge Fund Manager Having the Worst Year of His Career
Saijel Kishan and Nishant Kumar – Bloomberg
Brevan Howard faces at least $1 billion of client withdrawals; Firm is experimenting with AI, to start fund services in 2018. Billionaire Alan Howard may be having the worst year of his career as a hedge-fund manager, but the 54-year-old isn’t ready to throw in the towel.

Impact investing for good and market returns; Charity is now about trying to harness capitalism and capital markets to promote change
Gillian Tett – FT
The mighty $12bn Ford Foundation announced last week that it has recruited Roy Swan, a senior Morgan Stanley banker, to run a portion of its investments. No surprise there, you might think: philanthropy is now such a multibillion-dollar “business” in the US, that foundations need plenty of financial savvy.

MiFID Bond-Price Rules a Gift for Traders as Just 1% Covered
John Glover and Silla Brush – Bloomberg
ESMA says less than 1% of bonds initially face disclosure rule; Finance Watch says this approach is ‘present to market makers’
With less than 1 percent of notes affected by rules on price disclosure when MiFID II kicks in next month, years of lobbying by the bond industry appear to have paid off.

HKEX moves closer to accepting dual share classes; Exchange’s rethink prompted by losing out on Alibaba’s IPO to the US
Emma Dunkley in Hong Kong – FT
The Hong Stock Exchange has moved a step closer to allowing dual share classes, paving the way for blockbuster listings three years after losing out on technology giant Alibaba’s flotation to the US.

You Can Thank Mr. Watanabe for Bitcoin’s Explosive Rally; Japanese men, historically engaged in leveraged forex trading, are now dominating the cryptocurrency market, Deutsche Bank says
Steven Russolillo – WSJ
Criminals, drug dealers, and crooks aren’t the ones driving the price of bitcoin higheróit is Japanese men.

Initial Coin Offerings Surge Past $4 Billionóand Regulators Are Worried; Some regulators say ICOs should be regulated like securities
Steven Russolillo – WSJ
Money raised from initial coin offerings has surged past $4 billion for the first time, even as regulators world-wide have escalated warnings about the new form of corporate funding.

Exchanges, OTC and Clearing

Cboe Data Shop Plans to Add FX Offerings, Spot and Futures Bitcoin Data
Cboe Global Markets, Inc. today announced Cboe Data Shop will add historical spot foreign exchange data from Cboe FX to its range of offerings beginning tomorrow, December 15. Cboe FX, Cboe’s foreign exchange market, has set several new market-share records, and volume and activity on the global platform has grown.

MarketFactory Enables Bitcoin Futures Trading on the CME With Whisperer FX API
Ashley Binford – MarketFactory
MarketFactory, the industry-leading foreign exchange technology platform, announced today that market participants using their ultra-low latency API for foreign exchange trading, Whisperer, can seamlessly trade Bitcoin futures on the Chicago Mercantile Exchange (CME) when they launch on December 18. Additionally, Whisperer provides access to Bitcoin market data.

Exchange Council approves changes to rules & regulations regarding MiFID II and the introduction of new products
On Thursday 7th December, the Exchange Council of the European Energy Exchange (EEX) held its fourth and final meeting of 2017 in Vienna. The meeting was chaired by Dr Michael Redanz, Managing Director of EWE Trading GmbH. In addition to approving changes to certain rules and regulations ahead of the introduction of MiFID II, the Exchange Council also granted approval for a number of new contracts including the introduction of a new Liquid Milk contract as well as the introduction of further short term power contracts.

Shaping the future of our IPO market
Today the Hong Kong market has decided to take a big step forward and secure our relevancy as a premier global capital formation centre. Following an extensive market consultation, we have reached a clear consensus that Hong Kong must broaden its listing regime and proactively embrace the new economy.

Trading Charity on the Frankfurt Stock Exchange brings 135,000 euros for two Frankfurt organizations
Deutsche Boerse
Deutsche Boerse and specialists donate stock exchange fees of St. Nicholas Day to the association Hilfe f¸r krebskranke Kinder Frankfurt eV and the Frankfurt Association for the Control of Tumor Diseases (FFBT) eV

Leading financial institutions rely on the Regulatory Reporting Hub of Deutsche Bˆrse
Deutsche Bˆrse
The number of sell and buy-side institutions using the Regulatory Reporting Hub service of Deutsche Bˆrse Group is growing. Following the entry into force of MiFID II on January 3, 2018, the Regulatory Reporting Hub (RRH) provides a platform for sell-side, buy-side, and system-integrating clients to easily and effectively meet regulatory obligations. Recently, the BaFin (Federal Financial Supervisory Authority) confirmed that the approved reporting mechanism (ARM) and the approved publication system (APA) of Deutsche Bˆrse AG meet all the relevant requirements of MiFID II.

MiFID II presents issuers with challenges in research
Deutsche Boerse
Joint paper by Deutsche Bˆrse and associations informs about effects / Especially small and medium-sized companies affected by regulatory changes

TMX Group Completes Acquisition of Trayport and Sale of NGX to Intercontinental Exchange
TMX Group Limited (TMX Group) today announced it has completed the acquisition of London-based Trayport Holdings Limited, and its U.S.-based affiliate, Trayport Inc. (collectively, Trayport), a world-leading provider of technology solutions for energy traders, brokers and exchanges from Intercontinental Exchange, Inc. (ICE) for £550 million / C$931 million in total consideration, including £350 million / C$592 million in cash (the Trayport Acquisition). The transaction was announced in October 2017.

HKEX Proposes Way Forward To Expand Hong Kong’s Listing Regime
Clear consensus on expanding listing regime to ensure Hong Kong remains competitive; Strong support for measures to help attract more listings by innovative companies; Exchange to consult market on rule changes to facilitate listings from three key groups; HKEX Chief Executive Charles Li blogs about the proposed changes to the listing regime, why they’re important, and how they will make Hong Kong more relevant and more competitive. (Includes video)

Exchange Publishes GEM Consultation Conclusions and Changes To GEM and Main Board Listing Rules
GEM and Main Board listing requirements will be aligned more closely; GEM will become a standalone market for small and mid-sized companies instead of a stepping stone to the Main Board

Oslo B¯rs upgrades Oslo Connect; Baymarkets delivers enhancements ready for MiFID II and MiFIR
Bay Markets
Oslo B¯rs, the Oslo Stock Exchange, and Baymarkets Technology AB (Baymarkets), a leading Nordic provider of FinTech and RegTech solutions to the global financial services industry, announced the implementation of the latest upgrades to the Baymarkets OTC system, used by Oslo Connect and developed by Baymarkets, providing Tailor Made derivatives and reporting OTC derivatives transactions. The updates support the changing regulatory requirements demanded by MiFID II and MiFIR which seek to ensure greater transparency and to enhance fairer, safer and more efficient markets.

Connamara has the Experience Needed by Cryptocurrency Exchanges
Cryptocurrency trading is exploding in popularity as demonstrated by established exchanges such as CBOE and CME launching Bitcoin futures trading this month and with Nasdaq and others announcing plans to soon offer cryptocurrency products.


A 2018 Prediction ó More Fintech
Howard Lindzon – Medium
I am blown away by the fintech explosion in 2017. I have been investing in financial startups (and creating a few) the last 11 years dreaming of a year like 2017. I have been trying to soak it all in and ponder what could happen in the coming years.

IBM recruits quantum computing partners; JPMorgan and others join effort to find uses for potentially revolutionary technology
Richard Waters in San Francisco – FT
IBM has signed up a group of big companies, universities and government research institutions to think up the first uses for quantum computing, as a technology once thought to be decades from practical application edges closer to the mainstream.

Greenkey Joins The Symphony Software Foundation
GreenKey, creator of patented voice software with integrated speech recognition designed for the financial markets, today announced the firm has joined the Symphony Software Foundation, a nonprofit organization fostering innovation in financial services through open source software (OSS). GreenKey will release a Community Edition of its voice software development kit (SDK) that will enable banks and other financial market firms to “voice enable” any web application.

What Does It Take To Launch A New Clearinghouse Platform?
Launching a new clearing platform for one of the largest stock exchanges in the world is no simple task. In fact, when B3 launched the second phase of their post-trade integration project (IPN) to transfer equities and corporate bonds to their new integrated clearing platform, it required over 600 people, 19 teams, and collaboration on both sides of the Atlantic.

World’s Biggest Pension Fund Says AI Will Replace Asset Managers
By Yuko Takeo and Shigeki Nozawa – Bloomberg
GPIF’s Mizuno: Google, Amazon could become largest managers; Traditional managers need to update business models, he says
Hiromichi Mizuno was named chief investment officer of Japan’s Government Pension Investment Fund, the world’s biggest manager of retirement savings, in 2014. He has since led a push to increase equity holdings and advocated for incorporating ESG, or environmental, social and governance, factors into investing.

What Is Bitcoin Really Worth? Don’t Even Ask.
Robert J. Shiller – NY Times
Dabbling in Bitcoin lies somewhere between gambling and investing. After all, true investing requires a rational appraisal of an asset’s value and that is simply not possible at present with Bitcoin. Real understanding of the economic issues underlying the cryptocurrency is almost nonexistent.

Litecoin: The Bitcoin rival whose price has risen five times faster than its big brother
Matthew Field – Telegraph
Bitcoin has continued its gravity-defying run in recent weeks, but another cryptocurrency has been catapulted into the public eye with an even more aggressive price spike.

Eze Software Bolsters Currency Hedging Risk Management With WISERISK
Globe Newswire
Eze Software, a global leading provider of investment technology, has partnered with Wise Trading Technologies to enhance its currency offering. With WISERISK, Eze OMS users will get more automation, visibility and precision in managing currency risk in real-time. WISERISK enables users to eliminate fragmented spreadsheets and mitigate laborious, error-prone manual processes. To complement the rich functionality of Eze Investment Suite, Eze Software partners with an extensive network of specialist providers to address the complex technology needs of investment managers.


Is the world becoming more unequal?; Piketty and colleagues seek to present global picture of income and wealth divergences
Gemma Tetlow in London – FT
As the issue of inequality moves up the political agenda, a group of researchers has sought to answer some basic questions about a phenomenon that to many is the defining characteristic of the age.

Deutsche Bank Had Flagged Manafort-Related Transactions; Transfers reflect bank’s role as global money conduit
Jenny Strasburg – WSJ
Deutsche Bank AG earlier this year flagged around $30 million in potentially suspicious transactions as part of an internal investigation into its role as a conduit for money involving Paul Manafort or people and entities connected to him, according to a person briefed on the matter.

Paul Ryan And Top Republican Lawmakers Could Reap Personal Windfall From New Real Estate Tax Breaks
David Sirota – International Business Times
As Congress races to finalize a landmark $1.4 trillion tax bill, key Republicans legislators directly overseeing the initiative could reap a personal windfall from provisions designed to reduce levies on so-called “pass-through” income, according to federal records reviewed by International Business Times. Those lawmakers ó including U.S. House Speaker Paul Ryan ó together have tens of millions of dollars invested in scores of real-estate related pass-through corporations and partnerships, collectively earning them millions of dollars of annual income that could be partially exempted from taxes, depending on how the final legislation is structured.

Greenwich councillors say Trump not “welcome” in Royal Borough during UK state visit
Follow Alys – City AM
If Donald Trump had been hoping to visit the O2 or the Royal Naval College any time soon, he’s out of luck.


Katten webinar surveys the vast legal and compliance landscape for cryptocurrencies
Brad Rosen – Jim Hamilton’s World of Securities Regulation
In a webinar titled Trading Bitcoin: Legal and Compliance Considerations for Trading and Facilitating Transactions in Bitcoin, a team of Katten Muchin Rosenman attorneys explored the vast, murky and ever-expanding terrain surrounding cryptocurrencies and CFTC, SEC, FinCen, and NY Department of Financial Services regulation. The Katten team also explored emerging litigation issues, as well as providing practical insights and advice to industry players dealing with these issues. Below are some highlights from the webinar:

FCM and RFED filing requirements for Christmas and New Year’s DayóReminder for upcoming holidays
This is a reminder that the following futures commission merchant (FCM) and retail foreign exchange dealer (RFED) regulatory filings will be impacted as follows by the Christmas and New Year’s Day holidays:

SEC Names Kenneth A. Johnson as Chief Operating Officer
The Securities and Exchange Commission today announced that Kenneth A. Johnson has been named the agency’s Chief Operating Officer (COO). Mr. Johnson has served as Acting COO since February 2017

Client’s Manipulative Orders Cost Interactive Brokers $250,000
Victor Golovtchenko – Finance Magnates
The Australian Securities and Investments Commission (ASIC) has penalized Interactive Brokers with a penalty of $250,000. The decision was taken by the watchdog’s Markets Disciplinary Panel (MDP).

Fed Should Improve Orientation for New Governors, Report Finds; Office of Inspector General recommendation comes at a time of heavy turnover on the board of governors
Harriet Torry – WSJ
The Federal Reserve could do a better job at showing the ropes to new members of its board of governors, the central bank’s Office of Inspector General said Thursday.

CFTC Divisions Extend Time-Limited No-Action Relief from the Swap Clearing and Trade Execution Requirements for Certain Affiliated Counterparties
The Commodity Futures Trading Commission’s (CFTC) Divisions of Clearing and Risk (DCR) and Market Oversight (DMO) today each extended previously-issued no-action relief from the swap clearing and trade execution requirements for certain inter-affiliate transactions (CFTC Letters 16-80, 16-81, and 16-84). As described further below, DCR is extending and modifying no-action relief that was previously provided, until the earlier of December 31, 2020, or the date on which amendments to relevant CFTC regulations take effect. Similarly, DMO is extending no-action relief that was previously provided until December 31, 2020, or the effective date of Commission action providing a permanent solution for the execution of inter-affiliate swaps.

CFTC Seeks Public Comment on Proposed Changes to Chicago Mercantile Exchange Inc. Rules Regarding Direct Funding Participants
The Commodity Futures Trading Commission (CFTC) is requesting public comment on proposed rule changes submitted by Chicago Mercantile Exchange Inc. (CME) under CFTC Regulation 40.10. Comments regarding the submission should be submitted on or before January 12, 2018.

Podcast: CFTC Talks EP022: Harvard Law Prof. Hal Scott
This week on CFTC Talks, we bring on Harvard Law Prof. Hal Scott, author of “Connectedness and Contagion.” We cover…

US regulators vow to be on guard for bitcoin risks; Financial watchdogs use first risk assessment of Trump era to focus on cryptocurrencies
Barney Jopson in Washington and Robin Wigglesworth in New York – FT
US regulators including several Trump appointees have vowed to be on guard for financial stability risks posed by bitcoin as its rocketing value triggers a wave of investor interest in cryptocurrencies.

The final countdown: MiFID II is coming, ready or not
Tony Freeman – City AM
With just three weeks to go before the implementation of the Markets in Financial Instruments Directive II (MiFID II), how close is the industry to being ready for the biggest change in financial markets infrastructure for decades?

Update on financial advice institutions fees-for-no-service refund programs
AMP, ANZ, CBA, NAB and Westpac have now paid or offered customers $215.9 million of an estimated $219.5 million in refunds and interest for failing to provide general or personal advice to customers while charging them ongoing advice fees.

ESMA provides overview of MiFID II deferral regimes
The European Securities and Markets Authority (ESMA) has today published a table compiling the supplementary deferral regimes applicable in different Member States for trading in non-equity instruments under the Market in Financial Instruments Regulation (MiFIR).

MiFID II: ESMA updates on commodity derivatives
The European Securities and Markets Authority (ESMA) has today updated its Questions and Answers (Q&As) regarding commodity derivatives under the Market in Financial Instruments Directive (MiFID II) and Regulation (MiFIR). This update relates to position limits and position reporting.

ESMA Consults on draft RTS for prospectuses
The European Securities and Markets Authority (ESMA) today launches a consultation on draft Regulatory Technical Standards (RTS) under the new Prospectus Regulation (Regulation (EU) 2017/1129).

A New Ordering System is Coming Soon!
FINRA is upgrading its system for ordering investor education publications and resources.

Jury Finds Technology Company Founder Liable for Misleading Investors About Energy-Efficient Computer Servers; Stephanie Avakian, Co-Director, SEC Division of Enforcement; Steven Peikin, Co-Director, SEC Division of Enforcement
“We are gratified by the jury’s verdict finding William E. Mapp III liable for misleading Servergy investors about the company’s business prospects. Corporate officers owe shareholders nothing less than the full truth, and we vigorously pursue executives who mislead people.”

Investing and Trading

Turning Coal Into Bitcoin? The Dirty Secret of 2017’s Hottest Market
Bloomberg News
Computers creating cryptocurrencies using up more electricity; China dominates bitcoin making and is world’s top coal burner
Bitcoin has a dirty secret. The cryptocurrency has wowed markets this year with breakneck gains as investors flocked to an asset that exists only in cyberspace. But the laborious creation of each digital bitcoin by private computer networks has real-world consequences in the form of massive energy use — including from fuels that cause the most pollution.

What to Expect When You’re Investing
John Gittelsohn, Bei Hu, Charles Stein and Yuko Takeo – Bloomberg
Top money managers weigh in on the biggest changes to come; This is the final story in a series on the future of investing
The rise of passive funds and computer-driven trading has brought us to an inflection point in the history of investing.

JPMorgan Sees S&P 500 Hitting 3,000, Warns on Tech Stocks
Lu Wang – Bloomberg
Another Wall Street firm says the bull market’s going to continue to run next year. But it won’t be because of tech shares.

Why Haven’t You Heard of This Artist That Investors Love?; Michael Krebber has prestigious galleries and a sterling reputation. His market, finally, is on the upswing.
James Tarmy – Bloomberg
Bloomberg Pursuits has been highlighting artists on the rise as part of an ongoing look at art as an investment.

Bitcoin for investors: what the experts think; This year’s stellar gains mask wild swings along the way
Hannah Murphy – FT
As the bitcoin price began to nosedive ó just a day after the cryptocurrency smashed through a $10,000 milestone ó Alfred Churchill was frantic.

Online lending platforms test investors’ faith; A model that promised to disrupt banking has disappointed as delinquencies mount
Ben McLannahan in New York – Ft
Tianqiao Chen still wants to be part of Lending Club. Last week, while shares in America’s biggest listed online lender were tumbling after another cut to profit forecasts, the chief executive of Shanda Group bought 4m more of them, further cementing his position as the company’s biggest shareholder.

Buying Bitcoin More Like Gambling Than Investing, Poloz Says
Chris Fournier and Kristine Owram – Bloomberg
True value is anyone’s guess, Bank of Canada governor warns; Suggests reading the fine print, says it’s no currency
Bank of Canada Governor Stephen Poloz, delivering his last speech of the year Thursday in Toronto, said currencies must act as a reliable store of value and should be able to be easily spent.


E*TRADE’s November Metrics Reaffirm Growth Trajectory for Accounts and DARTs
Aziz Abdel-Qader – Finance Magnates
E*TRADE Financial Corporation (NASDAQ: ETFC) has just released its latest tranche of monthly metrics. November 2017 featured positive metrics that collectively managed to secure a steady rise over yearly and monthly intervals.

Banks face losses from EUR1.6bn loan to Steinhoff billionaire Wiese; Debt was secured against Wiese’s shares that have dived in value after accounting woes
Arash Massoudi, Olaf Storbeck and Claire Jones – FT
Wall Street banks including Bank of America and Citigroup are facing potential losses of more than EUR1bn on loans made to the billionaire backer of Steinhoff International, the South Africa-based home retailer whose shares collapsed last week after disclosing accounting irregularities.

Beta Capital moves to self-clearing with help of Broadridge; Miami-based broker Beta Capital makes move to self-clearing with Broadridge Financial’s technology and guidance.
Hayley McDowell – The Trade
Beta Capital Wealth Management has enlisted the help of Broadridge Financial to provide technology to support its move to self-clearing.


North Korea’s Bitcoin Play; Cut off from the world economy by sanctions, Pyongyang is looking for ways to get its hands on cryptocurrency.
Dune Lawrence – Bloomberg
As the digital currency bitcoin traced one of its meteoric ascents, a plum job posting began circulating online: chief financial officer for a rapidly expanding bitcoin financial-services company based in London. Although the company was real, the job had been dreamed up by North Korean hackers, according to Secureworks Inc., a cybersecurity company that discovered a document with the fake job description in November. It was meant to circulate by email among people in the bitcoin world. If someone clicked on it, a prompt would explain that it was created by a later version of Microsoft Word and that the user needed to “enable editing” and “enable content.” Doing so would install a piece of malicious code. While many digitally savvy people would presumably know better, such attacks can pay off if they hit just a few distracted recipients.

How One of Australia’s Richest Men Lost $1 Million to Email Scam
Kaye Wiggins – Bloomberg
John Kahlbetzer’s administrator was tricked to make payment; Man accused of involvement in the fraud says he’s a victim too
The multi-millionaire founder of Twynam Agricultural Group Pty Ltd. lost $1 million in an email fraud, a London court heard Thursday. The British man who facilitated the theft says he’s a victim too.

Why cautious parents help drive Japan’s stock market; Japanese companies don’t IPO just to raise money ó the prestige helps attract talent
Leo Lewis – FT
On Wednesday, after holding out for 52 years as a private company, the parent of Japan’s second-largest parcel delivery company, Sagawa, took the plunge and listed on the Tokyo Stock Exchange. It was the biggest IPO of 2017, the shares began a 33 per cent surge from the outset and, by Thursday’s close, the company was worth nearly •700bn.

Tech groups jostle for advantage in Indonesian digital payments; Tencent-backed Go-Jek snaps up 3 fintech players as rivals push into burgeoning market
Ben Bland in Hong Kong – FT
Indonesian ride-hailing unicorn Go-Jek has acquired three local digital payments companies as it competes with Grab and other rivals to build market share in the nascent electronic payments sector in Southeast Asia’s biggest economy.

China’s HNA Keeps Striking Foreign Deals as Banks Wince and Investors Flee
Alexandra Stevenson – NY Times
With some investors in its bonds running for the exits and foreign banks increasingly skeptical about its prospects, HNA Group tried this week to reassure markets that it has access to the money it needs.

Germany Accuses China of Using LinkedIn to Recruit Informants
Javier C. Hernandez and Melissa Eddy – NY Times
German’s domestic intelligence agency has accused China of using LinkedIn and other social media sites to infiltrate the German government, a charge that the Chinese government promptly denied.


EU gives UK go-ahead for next phase of Brexit talks; Negotiations to start on trade after leaders endorse progress on divorce settlement
Mehreen Khan and Jim Brunsden in Brussels – FT
EU leaders have confirmed that “sufficient progress” has been made in the first phase of Britain’s Brexit talks, giving a boost to Theresa May, the UK prime minister, and paving the way for crucial discussions next year on trade.

Facebook Sees Little Evidence of Russian Meddling in ‘Brexit’ Vote
David D. Kirkpatrick – NY Times
Facebook, confounding expectations, said on Wednesday that the company had found no evidence of a significant Russian effort to interfere in the British referendum last year on leaving the European Union.

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