Bloc10 @ Atlanta, GA 10/27/2018 — Bloc10 today has launched Total Cryptos University offering multiple courses about Crypto Currency, Blockchain Technology, and Day Trading Crypto. “We launched this program because there is a huge education factor in Crypto.” says Joseph Gelet, Chief Strategy Officer of Bloc10. “Like with anything new, there is a lot to learn. Not everyone spent their last 10 years on Wall St. or in Finance School. So we launched an online university.”
Courses come complete with actual products that can be used like trading signals, alerts, algorithmic trading systems ‘robots’ – books, software, and more. The plan is to offer members new strategies each week and each month. “We want to provide our members with the most value to maximize their trading potential. So we are going to launch new products every week.” he says.
The course uses the practical ‘hands on’ learning approach which means that students are provided products to use and trade with, rather than a ‘textbook method’ used in Universities. Practically, there aren’t Universities offering Blockchain or Crypto classes yet – but that will certainly change in the future. For now, we have Total Cryptos University.
Some snapshots of what you’ll learn inside the course:
The US legal system has a message for those who not only feel like manipulating the currency market, but have picked a delightfully appropriate name for their FX rigging operation: just do it.
Moments ago, the three former British currency traders who formed the core of the infamous currency rigging "Cartel", were found not guilty of using an online chatroom to fix prices in the $5.1 trillion-a-day foreign exchange market.
Chris Ashton, Rohan Ramchandani and Richard Usher
According to Bloomberg, a New York federal jury rejected the government’s claim that Richard Usher, Rohan Ramchandani and Christopher Ashton, better known as "The Cartel," rigged the market from 2007 to 2013 by coordinating trades and manipulating prices on the spot exchange rate for euros and U.S. dollars.
They wept in relief as the verdict was handed down in Manhattan federal court Friday after the jury deliberated for less than a day.
Usher, a former JPMorgan foreign-exchange trader, Ramchandani, former trader at Citigroup, and Ashton, the ex-head of spot FX trading at Barclays, were charged in January 2017. The case followed an investigation into conduct that was exposed by Bloomberg in 2013.
The three men faced as long as 10 years in prison had they been convicted, but since their conviction would make any future FX rigging that much more problematic, or simply because the government was incompetent and was unable to prove a slam dunk case, they are now free.
The acquittal is that much more bizarre because previously four banks, JPMorgan, Citigroup, Royal Bank of Scotland and Barclays all pleaded guilty to manipulating currency markets in 2015 and agreed to pay $2.5 billion in fines. At the time, UBS - which ratted everyone else out - received immunity from antitrust charges for being the first institution to report misconduct in the FX market, although it pleaded guilty to a related fraud and paid a $203 million penalty. Overall, more than a dozen financial institutions have paid about $11.8 billion in fines and penalties globally, with another $2.3 billion spent to compensate customers and investors.
As Bloomberg notes, The three men, who were based in London, waived extradition to New York to fight the single charge of conspiracy to restrain trade. None of the defendants took the stand to testify.
So how did they walk free when their own employers admitted to currency manipulation?
Matt Gardiner, a former currency trader at Barclays and UBS Group AG who helped organize the group, testified for the government in exchange for an agreement that he won’t be prosecuted. Gardiner said the group agreed on trading strategies and would congratulate each other when their bets paid off. He also testified that he had no idea the group was doing anything illegal until he began negotiating with U.S. prosecutors. In closing arguments, lawyers for the defendants urged jurors to reject his testimony.
Jurors heard testimony that the men spent almost all of their work days in the chatroom, where they exchanged market color, inside jokes and personal information.
Prosecutors showed transcripts of some of the chats, recorded phone calls and trading records which showed coordination among the group. The defense said the chats reflected innocent banter and that the traders sought to profit off one another. We profiled some of these exchanges previously in "Accused "FX Cartel" Members Joined Forces After Trying To "End" Each Other."
Speaking before the acquittal, Mayra Rodriguez Valladares, a former foreign-exchange analyst for the New York Fed, said that the verdict would "send a general signal to the market that the FX code is not going to be seen as having any teeth,” referring to the FX Global Code, a set of guidelines aimed at raising standards after the rigging scandal. "They’ll go back to same old, same old,” of the acquittal in an interview before the verdict. “It’s business as usual, everybody does it."
Especially the Fed, her former employer.
Javier Paz, founder of research and advisory firm Forex Datasource told Bloomberg before the verdict that the investigation has signaled to traders that “illegal actions carry a high risk of betrayal.” Whether the case will have a longer term impact remains to be seen.
“There’s definitely more awareness by clients of what could go wrong in trades, there is much more employer oversight, and, as we saw on this case, there’s government oversight and appetite to prosecute wrongdoers,” Paz said.
However, Pax was "under no illusion that banks and bankers will stop misbehaving long term. The kinds of lessons being experienced today have a way of being forgotten in a few years."
They certainly won't stop misbehaving if after years of documented manipulation, a jury of their peers finds them innocent.
As regulators' campaign to kill off Libor continues unabated, helping to squeeze the 3 month dollar Libor rate to its highest level since the financial crisis, federal prosecutors in New York have won convictions on charges of wire fraud and conspiracy against two former Deutsche Bank traders for rigging the benchmark rate that underpins the value of nearly $400 trillion in financial instruments denominated in a range of currencies.
Matthew Connolly, who supervised the bank's money-market derivatives desk in New York, and Gavin Black, who traded derivatives in London, were convicted on the basis of testimony from three junior traders (two of whom pleaded guilty, and a third signed an agreement to avoid prosecution in exchange for his testimony), who said Connolly and Black directed them to aid in the altering of the bank's Libor submissions to benefit the desk's trading positions. The illicit behavior for which the two men were convicted took place between 2004 and 2011, according to Bloomberg.
The convictions represent a major win for federal prosecutors, but they can't celebrate just yet; last summer, convictions won by the DOJ against two London-based Rabobank traders were reversed on appeal, dealing an embarrassing blow to prosecutors in New York and the DOJ. All told, global regulators have secured $9 billion in fines from a collection of some of the world's largest investment banks, including DB and Barclays.
But for the duration of the trial, it appeared that Connolly and Black would also beat the rap, as the judge treated the fumbling prosecutors with open hostility, particularly after one of the government's key witnesses was called out by the defense in open court for lying about his bonus in a federal plea agreement.
The defense had some success in portraying the three witnesses as liars who molded their stories to avoid prosecution.
The three former traders told jurors that, at the urging of the defendants, they altered the rate or pressured others to submit false data to benefit trading positions held by Connolly and Black. Parietti said Connolly ordered him to disclose positions to the submitters in London because Connolly believed his team was being undermined by others at the bank who were rigging the rate in their favor.
The defense argued that there were no clear guidelines on how banks should submit their rates for the calculation of Libor until at least 2008, and that they weren’t expressly forbidden from taking derivative trading positions into account when making the submission until 2013.
During cross-examination, attorneys for Connolly and Black attempted to portray the government’s witnesses as liars who initially defended their practices to investigators and changed their stories only in exchange for a deal with prosecutors.
All told, at least 10 former Deutsche Bank traders have been charged with rigging interest-rate benchmarks, including Libor and Euribor, in the US and UK.Christian Bittar, a former DB prop trader who was effectively directed by the bank to influence rates (and who was pushed out after DB clawed back some of his bonus and turned him into a convenient scapegoat), was sentenced to five years and four months alongside Barclays trader Philippe Moryoussef, who received 8 years but was sentenced in absentia because he chose to stay in France.
The challenge for the prosecution will now shift to ensuring that these convictions stick. But while prosecutors will no doubt hold up the scalps of Simon and Connolly as a warning to others who might dare to impinge upon the sacred integrity of markets, the fact remains that not a single senior executive was charged in the scandal (though it contributed to the downfall of former Barclays CEO Bob Diamond). In fact, regulators even stepped up to protect DB CEO Anshu Jain despite his bank's flagrantly illegal activity, after Bafin, the German securities regulator, declared in 2015 that Jain had no knowledge of the illicit trading despite a preponderance of evidence to the contrary.
TOKYO (Reuters) - If European Central Bank chief Mario Draghi appears slightly more downbeat at his regular news conference than before, it could foreshadow a possible move by to the bank to trim its monetary policy stimulus.
FILE PHOTO - European Central Bank (ECB) President Mario Draghi holds a news conference at the ECB headquarters in Frankfurt, Germany, March 7, 2018. REUTERS/Ralph Orlowski/File Photo
That’s the conclusion of two Japanese researchers who’ve used artificial intelligence software to analyze split-second changes in Draghi’s facial expressions at his post-policy meeting press conferences.
The findings follow a similar analysis by the same researchers of Draghi’s Japanese counterpart, Haruhiko Kuroda, last year, which claimed to have identified a correlation between patterns in his facial expressions and subsequent policy changes.
Yoshiyuki Suimon and Daichi Isami, the paper’s authors, think that subtle changes in Draghi’s facial expressions could reflect a sense of frustration Draghi might have been feeling before making policy adjustments.
Their study covered Draghi’s news conference from June 2016 to December 2017 and found signs of “sadness” preceding two recent major policy changes — when the central bank announced a dovish tapering in December 2016 and another quantitative easing cutback in October last year.
FILE PHOTO - European Central Bank (ECB) President Mario Draghi attends the 27th European Banking Congress at the Old Opera house in Frankfurt, Germany November 17, 2017. REUTERS/Ralph Orlowski/File Photo
However, Suimon noted changes in Draghi’s emotion scores were smaller than Bank of Japan Governor Kuroda’s, pointing to the European central banker’s greater degree of inscrutability.
“This suggests that Draghi is maintaining more control on his expressions, whether he is doing so consciously or not,” said Suimon, who is the lead author of the study.
In both the Kuroda and Draghi studies, screenshots of the policymakers’ faces were captured every half-second from video footage.
Suimon and Isami analyzed those images with a program developed by Microsoft called “Emotion API” that uses a visual recognition algorithm to break down human emotions into eight categories: happiness, sadness, surprise, anger, fear, contempt, disgust and neutral.
(For a graphic on Draghi's facial expressions click reut.rs/2HPNq0F)
They also examined the facial expression of ECB Vice President Vitor Constancio, who sits next to Draghi at his news conferences. Constancio showed more joy even when Draghi’s joy score dropped.
Slideshow (4 Images)
Kiyoshi Izumi, professor of the University of Tokyo, who specializes in financial data mining and artificial market simulation, said studying simultaneous facial expressions from a team of policymakers, such as Draghi and Constancio, provided stronger sample sizes.
“Some people — President Draghi, in this case – are better at poker facing than Governor Kuroda. So it’s interesting and worth analyzing the news conference as a whole,” Izumi said.
Suimon and Isami presented their latest findings to a meeting of the Japanese Society for Artificial Intelligence (JSAI) on Tuesday. The pair studied together at the University of Tokyo’s Graduate School of Frontier Sciences and did the research in their personal capacity.
Suimon said they have looked into Kuroda’s recent news conferences, and have not found any facial data to suggest an imminent major policy change. The BOJ kept settings unchanged at its last policy meeting.
In October, Kuroda laughed at the notion that artificial intelligence could analyze his face to predict changes in monetary policy, noting such studies would only prompt those being scrutinized to manage their facial expressions more carefully.
Oil is still the world’s leading energy source, with growing demand, a fluctuating pricing system, and much of its production in volatile regions. The oil market’s value is larger than the world’s valuable raw metal markets combined, with an annual production valued at US$1.7 trillion. A flourishing black market is no surprise, with about US$133 billion worth of fuels stolen or adulterated every year. These practices fund dangerous non-state actors such as the Islamic State, Mexican drug cartels, Italian Mafia, Eastern European criminal groups, Libyan militias, Nigerian rebels and more – and are a major global security concern.
The top five countries accused of oil trafficking – Nigeria, Mexico, Iraq, Russia, and Indonesia – are also producers. It is estimated that Nigeria alone loses US$1.5 billion a month due to pipeline tapping, illegal production and other sophisticated schemes. In Southeast Asia, about 3 percent of the fuel consumed is sourced from the black market, estimated to be worth up to US$10 billion a year. In Mexico, drug cartels launder drug revenues through the oil trade
Other countries are not immune. Turkey is not an oil producer yet serves as a major transit route for hydrocarbons flowing to Europe from OPEC countries like Iraq and Iran. As an energy hub, Turkey is strategically situated for the illegal trade and lost an estimated US$5 billion in tax revenue in 2017. An uptick in smuggling oil and other refined products began 2014, when ISIS took control of major Syrian and Iraqi oil fields.
As with most commodities, the volume of oil smuggling is primarily linked to fluctuating prices. With climbing oil prices, illicit trade is expected to increase. The European Union is a prime example on how price disparities of fuel within its own member state countries tend to incentivize illegal trade producing counterintuitive routes. Lower oil prices in Eastern Europe have created maritime smuggling routes to the United Kingdom and Ireland. Ireland estimates it loses up to $200 million annually with fuel fraud, while up to 20 percent of fuel sold in regular gas stations in Greece is illegal.
The legal complexities and ambiguities of the global oil and gas trade often create an opening for illegal activity.
In some cases, subnational actors openly export oil despite official prohibition by central governments. The Kurdistan Regional Government in Iraq maintains it is their region’s constitutional right to export oil independently, in defiance of the central government. With Baghdad withholding the region’s 17 percent of budget share, the regional government sought economic independence through hydrocarbons and found a degree of international sympathy, given its role in combatting ISIS and hosting 1.9 million refugees and internally displaced people. The unrefined product was sent via pipeline through Turkey’s Ceyhan port, loaded by various Greek shipping companies on tankers, then stored in Malta or Israel until buyers were found. Shifting routes of Kurdish oil tankers can be observed on sites like tankertrackers.com.
Authorities who benefit from the trade often stymie efforts to combat illegal trafficking, as seen in countries like Iraq or North Korea, with terrible consequences for citizens. Conflict and illicit trading near the Niger River Delta reduced overall foreign direct investment in recent decades.
With 90 percent of the world’s goods, 30 percent of which are total hydrocarbons, traded by sea, much of the illegal fuel trade is conducted on water. Two thirds of global daily oil exports are transported by sea, reports the UN Conference on Trade and Development, and a staggering 64 percent of international waters are areas beyond any national jurisdiction. Non-state actors offshore West Africa, Bangladesh or Indonesia take advantage of loopholes created by international law and the law of the sea. Transfer of illegal fuel is often done ship to ship on neutral waters – with one ship commercially legal, recognized as carrying legitimate imports at the final port of destination. Thus, illegal crude from countries such as Libya or Syria finds its way to EU markets. Recently Russian ships have been found involved in smuggling oil products to North Korea through ship to ship transfers.
Armed theft and piracy also occur. Hijackings off the coast of Somalia resumed in 2017, the first since 2012, after the international community reduced enforcement. Beyond jurisdictional issues, many governments are overwhelmed by other maritime security threats and cannot prioritize the illegal trade. In fact, fuel traders have reported that the problem is so pervasive that many companies calculate in advance for losses up to 0.4 percent of any ordered cargo volumes.
The industry runs on high risk tolerance.
Transparency International estimates that over the next 20 years, around 90 percent of oil and gas production will come from developing countries. The relatively low average salaries of state employees relative to the private sector in developing countries encourage the temptation to look for other income sources.
Consider Mozambique, where immense offshore natural gas reserves have been discovered. Emerging from decades of civil war, the country has a diverse wasta system – an Arabic term for bribing and asking for favours – along with strong political allegiances and state structures that struggle to withstand internal and external pressures. Estimates suggest that 54 percent of all cargo movements in the capital city, Maputo, involve bribes, and Mozambique risks following the path of Nigeria, a country in need of socioeconomic development despite vast oil and gas reserves under development since 1958. The country is reported to have already lost around US$400 billion since its independence in 1960 due to theft or mismanagement in its oil sector.
The Organization of Economic Co-operation and Development suggests that the impacts of the illegal oil trade go underestimated, and the affected countries suffer from the deteriorating rule of law, loss of biodiversity, pollution, degradation of critical farmland, increasing health problems and armed conflicts. Other opportunity costs include increased financial risk premiums for investors with billions of dollars lost annually due to illegal bunkering, pipeline tapping, ship-to-ship transfers, armed theft, adulteration of fuel and bribery. Illicit trade allows authoritarian states to maintain revenue flows for years despite international sanctions designed to weaken their rule. In the 11th year of UN oil sanctions, Iraq’s dictator Saddam Hussein had managed to become one of the world’s richest men, with an estimated US$3 billion in wealth
Some governments condone the illicit trade. An intertwining of regime structures and corruption – often supported by governments and corporations – is a major stumbling block for the international community’s attempts to contain illegal trading. So far, governmental and industry efforts to halt the practice have been ineffective – and it could be that the illegal oil trade offers enough benefits to consumers, producers and government officials to disincentivize investigation. Some officials suggest that condoning trade in illicit oil and petroleum products helps keep regional and local security intact.
The first global conference on fuel theft, held in Geneva in April, may be a watershed moment. The conference aimed at encouraging discourse among stakeholders within the hydrocarbons industry on how to tackle the scale of this global crime and was based on the work of Ian Ralby, I.R. Consilium and the Atlantic Council’s Global Energy Center, which produced Downstream Oil Theft: Global Modalities, Trends, and Remedies, the most extensive examination of illicit downstream hydrocarbons activity published to date.
Similar challenges confront the rapidly growing liquefied natural gas market. Strong international cooperation is required, or detrimental effects for global security, the environment and economic prosperity will continue. Unless monitored and addressed by robust policy and regulation, the illegal oil activities will remain a key funding source for terrorism, organized crime, authoritarian states and violent non-state actors.
Finance professor John Griffin, along with his doctoral student companion, Amin Shams, were the two academics that drew market-moving conclusions about bitcoin last year, while the digital currency was trading around $20,000. After sifting through 2 terabytes of trading data, they alleged that bitcoin was being manipulated by someone using the cryptocurrency Tether to purchase it. Tether remains a relatively little-known crypto, which is pegged to one US dollar. Part of its appeal is that it can "stand in" for dollars when necessary, according to Bloomberg.
Griffin and Shams authored a paper in June, with the results of their findings ultimately catalyzing many digital assets to move lower, despite the fact that the CEO of Tether publicly denied that its currency was used to prop up bitcoin.
Griffin works at the University of Texas at Austin, and has become quite an unpopular figure on Wall Street for similar work he has done in the past on ratings companies, the VIX and investment banks. In most of his findings, he claims that these well-known financial instruments and players are, in one way or another, rigged. And the professor seems to enjoy exposing precisely that: rigged, manipulated markets and shady players.
"I not only want to understand the world, but make it better," he told Bloomberg.
Griffin's work has become popular reading within the DOJ and the Commodity Futures Trading Commission, according to Bloomberg. These regulators – many of them low on resources, time and staff - welcome any additional help they can get (the SEC’s budget has forced it into a hiring freeze and the CFTC budget was cut by Congress in March of this year).
John Reed Stark, a former attorney in the SEC’s enforcement division, stated: “It’s incredibly helpful to have an expert of Griffin’s caliber."
After spending the beginning of his tenure as a professor tackling little-known and inconsequential parts of the market, he started to feel the need to take on bigger tasks. In fact, he claims that part of the Bible spoke to him, when he read a passage that motivated him. It stated “Have nothing to do with the fruitless deeds of darkness, but rather expose them.”
His targets – like the VIX index, owned by CBOE Global Markets - say that he misreads data. In response to work that he did on the VIX, CBOE stated his “...academic paper’s analysis and conclusions are based upon a fundamental misunderstanding about how VIX derivatives are traded and settled.”
In 2017, Griffin's work revealed that one or more market participants had been trading S&P 500 options in a way to artificially boost or depress the VIX, which would then have an impact on VIX futures. They argued that the volume of S&P 500 options would spike suspiciously at times, but only in the contracts that were used to help price the VIX. He claimed these trades simply didn’t make sense unless somebody was trying to manipulate the VIX.
And he’s not buying the explanation given to him by the CBOE: “There is no doubt we understand how the market works,” he said.
As a result, the CBOE has been sued many times over for this supposed manipulation. Meanwhile, riffin says he’s not going to work with any individual plaintiffs, but he does not rule out the possibility that he may work as a consultant in the future – if he can get paid.
Every time he publishes a new paper, he gets more attention. His paper on the alleged bitcoin manipulation has been downloaded more than 20,000 times and was cited by the SEC when the regulator rejected a bitcoin ETF that would have made it easier for retail investors to trade the crypto.
And as he continues to expose one fraud after another, Griffin - unlike Goldman - is truly doing God's work.
