ASX-listed IOT Group partnered with Hunter Energy through a binding agreement to develop a Blockchain Application Center adjacent to a power station. The Initiative is to explore and gain exposure to the rapidly growing area of the Internet of Things (IoT).
Blockchain Application Center Initiative
is currently working to recommission a Redbank power plant near Singleton, Australia with the aim to start in the first quarter of 2019. If it goes according to plan, the can receive wholesale rates for power, without having to pay for grid costs, poles, and wires.
The project can, therefore, cut significant operational costs for international blockchain activity. Hunter Energy and IOT Group are announcing more information about the project over the next 90 days.
By reducing the costs of any blockchain-based activity, the IOT group can operate its blockchain business using more cost-effective means. According to , Hunter Energy will grant the IOT group the right to construct its Blockchain Application Centre (BAC) in the proposed site in consideration for ten percent of the net profits of the IOT BAC.
“This will be a first in and has good prospects of attracting interest from Australian and international blockchain operations looking to locate where they have surety of sovereignty and the benefits of low cost power,” Sean Neylon, IOT Group executive director, and founder.
Additionally, the IOT Group mentioned that it also has plans to build a new data center at the site. The company is in the process of negotiation with a “major data complex builder/developer” to make the center’s construction a reality.
To be specific, Hunter Energy will provide the power for blockchain-based operations, and IOT will provide its blockchain-powered services to users. However, the deal is currently incomplete, and there are many points of consideration to be agreed by both parties.
Nevertheless, the public responded positively to the news. Following the announcement, IOT Group’s shares rose by 20 percent and traded at $0.06 in early morning trade on the .
Blockchain Technology with the Internet of Things
IOT Group is thinking about integrating both blockchain and the Internet of Things into its strategic vision for the future. According to Neylon, the “IOT Group needs to follow the [IOT] trends and develop IOT businesses and opportunities to benefit IOT Group shareholders.”
Furthermore, the company believes it has a competitive advantage regarding operational costs for blockchain-based activities. “To make crypto work you need cheap power and IOT will change that. IOT has created the biggest and only opportunity for global crypto miners to come to Australia,” said a spokesperson from the company.
It is, however, uncertain whether the combination of these technological trends will pan out in the future since they are still in early stages. Whether the approach is feasible or not, however, remains highly questionable.
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Block trading appears to be the latest focus of big players in the crypto market. With institutional investors looking to make substantial trades in the market, providing crypto block trading services can be a profitable proposition. In March 2018, Independence Reserve, an Australian crypto exchange platform launched an that is targeted at offering block trading services to big-time crypto traders. Now, it appears that Gemini, the crypto exchange platform owned by the is about to do the same.
The service will enable big trades to occur outside of the platform’s order books.
The Gemini Block Trading Service
A block trade, also known as a block order, is an order or trade submitted for the sale or purchase of a large number of securities. A block trade involves a significantly large number of equities or bonds being traded at an arranged price between two parties, sometimes outside of the open markets, to lessen the impact on the security price. (Definition from)
is looking to compete with platforms that cater to institutional investors by launching a service that can allow traders purchase a significant amount of cryptos. Already, many of such platforms have begun to spring up in markets like Australia and Hong Kong. Crypto block trading is suddenly becoming the new hot spot in the crypto market due to the increasing demand for cryptos from hedge funds and other institutional investors. Already, it has been noted that the participation of institutional investors in the Asian crypto market was one of the reasons for the in late 2017. Experts believe their American counterparts might be joining in soon as shown by the crypto purchases being made by some notable firms in the mainstream American finance landscape.
The Gemini crypto block trading service will come online by 9:30 a.m. local time in New York on Friday, April 12, 2018. According to a released on the company’s website on Monday, April 9, 2018, the service will make electronic broadcasts informing potential investors simultaneously. The post also revealed that information regarding any trades would be published on the market feed 10 minutes after execution.
Importance of Block Trading in the Crypto Market
Most cryptocurrency exchange platforms list trading contracts on a central limit order book. Traders use this order limit book to monitor useful signals that indicate where the market is heading. However, this only works within certain limits. When orders are placed that are beyond those limits, the market may move in a direction that is tangential to the interest of the trader or incites a market-wide panic. To avoid this type of situation, block trades are used for significantly high-value trades. All the negotiations concerning the trade are done in private before being announced to the market. The sudden nature of the announcement of the deal plus the time delay helps to prevent any unwanted price effect on the market.
Before the entry of crypto exchange and trading platforms, crypto block trading to limited to informal OTC transactions. As a crypto exchange platform that makes use of a limit order book, Gemini is combining equity and futures by offering a block trading service.
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