Governments race to beat Facebook’s cryptocurrency, libra, at its own game: Don Pittis – CBC.ca

Facebook's scheme to create its own money in the form of the libra digital coin has set off a globalrace to beat the social media colossus at its own game, and Canada maybe an importantplayer.

Since the initialmild reaction from U.S. Federal Reserve chair Jerome Powell the day after thelibraproject was announcedin June, the world's governments and central banks have realized what somesuggested at the time, that with its global reach and technological savvy, Facebook was blazing a path to dominate money.

Canada has been one of theleaders in researching how to create and managea digital coin backed by a national central bank. But the arrival of thelibra idea, with its persuasive scheme to launch what was essentially a credible new global currency, kicked off a flurry of fresh activity that could transform the way we think of money.

Not only are the world's governments gathering at bodies such as the International Monetary Fund, theBank for International Settlements and the G7 group of large industrial economies toworkon the idea, but there are signs that individual governments, notably China, are racing to be the first to create a functional, tradable government-backed digital coin.

And while the final results are difficult to predict, it is not clear that ordinary citizens, who have grown used to money in its current form,will be happy with the outcome.

"It's interesting how exciting these developments can be," enthused Bank of Canada senior deputy governor Carolyn Wilkins at last week's monetary policy news conference.

Introduced by her boss, bank governor Stephen Poloz, as "one of the world's foremost experts" on the subject,Wilkins has attended global conferences, armed with several years of groundbreaking Canadian research.

As Wilkins explained, what central banks hope to create is not a digital coin like bitcoin and its many imitators. With thatcurrency rising and falling as inexperienced investors triedto make a killing, critics, including me, pointed out years ago that the volatility of such cryptocurrenciesmade pricing goods in bitcoin impractical.

Far more interesting and functional, according to people like Wilkins, is a kind of digital money called a "stablecoin," which is how the libra is conceived. Rather than shooting up in value and plunging like bitcoins, a stablecoin is managed to maintain a relatively constant value.

"There's a whole class of crypto assets called stablecoins," said Wilkins last week. "What's exciting about it is the fact that these kinds of innovations can address what I think are important issues in global payment systems, particularly the cost of cross-border payments."

Wilkins suggested a stablecoin could be used, for example, for people from the Philippines trying to send money home from elsewhere in the world. And in developing countrieswithout a stable banking system it mightbe used domestically as a reliable unit of exchange.

That innovation is exactly what the libraproject has proposed, offering a service to millions of the world's "unbanked" so that they too can buy and sell and save up the value of their labour in a place they know won't be wiped out by inflation or governmentmismanagement.

But the more the world's central banks and the governments they represent thoughtabout the libra, theless they liked it.

To oversimplify, the two main objections to having a private company with such monetary clout were the wrenchingof monetary power out of the hands of central banksand the worry that eventually, without the backstop of a government, a private sector currency would collapse, creating global chaos.

"We know that innovations never come without risk," said Wilkins.

There are benefits to such a stablecoin system, but there are dangers: "The costs that we all know that are related to money laundering and terrorist financing, but also, with respect to safeguarding the value of that stablecoin properly, as well as potentially getting in the way of monetary sovereignty of different countries," she said.

By current thinking, that sovereignty is important. With people using something like libra, the currencies ofsmaller countries such as those in the Caribbean, or notoriously unstable currencies such as those of Rwanda or Argentina would be completely upstaged, aspeople use libra as a better alternative.

"I think Facebook hadn't thought through carefully how important control of currencies is for governments and central banks," said longtime U.S. central banker Simon Potterin an online video interviewby the Financial Times.

Globally, digitization of nationalcurrencies is already underway. Sweden is well on the road to phasing out conventional cash. Canadians have been world leaders in paying with alternatives like chip cards.China, with its powerful centrally controlled state, is ideally placed to push through a digital stablecoin that will also help it keep track of themoney flows of everyone who uses it.

Watch the International Institute of Finance discuss the future of money:

As reported by CBC Radio's The Current, access to information requests by the tech news site The Logicshow that the Bank of Canada has looked into the possibility of following Sweden and gradually eliminating those polymer bills, but such a plan would require a decision of the federal government to proceed.

Unlike China, a Canadian government might be unwilling to take such a radical step when such obvious moves asreplacing low-denomination bills by coins and eliminating the penny attracted such popular wrath.

But the difficulty for governments is that commercial stablecoins such as libra arenot the only competition. If one country creates a functioning state-backed digital stablecoin, it may be difficult to stop thecitizens of other countriesfrom using it.

For Wilkins, no doubt, working out a solution is part of what makes it all so exciting.

But whatever the final outcome, it does seem that our concept of money is changing. Just last month, Bank of Canada deputy governor Timothy Lane participated in a discussion at the International Institute of Finance titledThe Future of Money. The fact is, as cash disappears, digital stablecoins may become an essential alternative for certain purposes.

Lane pointed out that as merchants, banks andconsumers increasingly stop using bank notes for transactions, we may reach a tipping pointwhere those notes effectivelydisappear from circulation so that even people who want to use bills don't have the option.

"In the immortal words of Joni Mitchell," quipped Lane, "'You don't know what you've got till it's gone.'"

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Governments race to beat Facebook's cryptocurrency, libra, at its own game: Don Pittis - CBC.ca

Bitcoin and Cryptocurrency mining industry still has a future in China – FXStreet

The final catalogue released by the National Development and Reform Commission (NDRC) of China has excluded the crypto mining industry. The list titled "Industrial Structure Adjustment Guidance Catalog" is released by the agency to encourage support for certain industries while advising elimination of other industries.

The agency had included crypto mining in a draft of the same cataloguein April. The current catalogue excludes Bitcoin from the industries to scrapped and is set to come into effect on January 1, 2020.

The Chinese region hosts some of the largest Bitcoin and crypto mining plants in the world including Bitmain, Canaan and Ebang. The development is massive gesture towards the crypto industry for a country that has a selective preference for the industry.

This also comes after the President of China Xi Jinping pledged support for the blockchain technology. Jinping told industry players to take advantage of blockchain, however, China still discourages speculation.

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Ron Paul: No, cryptocurrency is not something the Fed should be getting its ‘hands around’ – Fox Business

NYU School of Business professor Scott Galloway discusses Facebook CEO Mark Zuckerberg's threat of China launching a similar version of cryptocurrency before Facebook's Libra can start.

PayPal is perhaps the best way ever designed to move money from one person to another. Yet it started in failure.

In his book, Zero to One: Notes on Startups, or How to Build the Future, founder Peter Thiel explains that PayPal was originally intended to allow owners of PalmPilots to beam money to each other. That idea did not work, but it evolved into using similar technology on eBay auctions.

The point is that PayPal was a private company competing in the market economy. That meant it was subject to market discipline. It had to develop an effective product or it would go out of business. The same thing cannot be said of the federal government.

In its latest bad idea, movement is building for the Federal Reserve to establish its own cryptocurrency exchange to compete with others in the marketplace and even replace physical cash.

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It is inevitable, Federal Reserve Bank of Philadelphia President Patrick Harker reportedly said at a recent conference. I think it is better for us to start getting our hands around it.

Its an apt metaphor, since what the Fed always wants to choke off is any competition to its monetary monopoly. This comes hot on the heels of another bad idea, called FedNow, which is supposed to speed up the processing of financial transactions.

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Speed is great, of course. It can take a full business day for transactions to clear. Thats too slow in our 21st century world of instant communication.

But the Fed is late to the party. The Clearing House launched a real-time payment system two years ago that now reaches half the banks in the country. Its expected to be everywhere by next year.

Judging by the non-answers that the central bank has given to members of Congress on its interoperability with private sector systems, FedNow would seemingly not compete on a level playing field; it would simply use the power of the federal government to crush a private-sector competitor.

Proponents of a Fed-run crypto exchange argue that such an exchange could stop the current delays in the U.S. bank transfers entirely on its own. This thought proves just how bad the Fed is at making good investments, anticipating changes in technology, and keeping up with the speed of innovation.

If board members of the central bank believe that blockchain may soon supplant the need for real-time payment services like FedNow, why the Fed would spend the next 3-5 years building FedNow from scratch when The Clearing House already offers the same type of service is beyond me.

If board members of the central bank believe that blockchain may soon supplant the need for real-time payment services like FedNow, why the Fed would spend the next 3-5 years building FedNow from scratch when The Clearing House already offers the same type of service is beyond me.

The Fed should stay out of the wayand let the private sector blockchain and real-time payments marketplaces settle this debate. Instead, the central bank seems poised to set itself up as both the regulator of all monetary exchanges and a participant in that business.

Without assurances on interoperability from the central bank, businesses will always choose the Feds offerings instead of a private companys, since doing so would make the business look better to its regulator.

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The Fed cannot handle real competition, and so it is trying to shut it down. It worries about Bitcoin, it worries about The Clearing House, and it will be worried about the next bright idea for money sharing that comes along. Its got a monopoly to protect.

We need to open up the field for new forms of money. While I served in Congress, I introduced the Free Competition in Currency Act, which would have defined money as whatever people are willing to trade with each other, whether thats paper, tokens of some sort, or direct barter. It would have ended the Feds power to declare that only certain pieces of paper are currency.

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Lets allow companies to compete, and let the market set the value. Thats where the next PayPal will come from, and consumers everywhere will be the winners.

Dr. Ron Paul, a former congressman from Texas, is the chairman of Campaign for Liberty.

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Cryptocurrency market update: Bitcoin, Ethereum and Ripple get ready the weekend action – FXStreet

Bitcoin has remained relatively unchanged from the time the price prediction was published. Besides, the entire market is lethargic and showing signs of longer consolidation periods. The few conspicuous cryptos in the green are Stellar (XLM) and Chainlink (LINK).

Bitcoin is struggling to hold above $9,100 (short-term week support). The buyers are looking forward to breaking above $9,200. However, the prevailing selling pressure coupled with the high volatility suggests thatBitcoin is likely to trend towards $9,000.

Meanwhile, Bitcoin is trading at $9,110 and battling the resistance at the 50 Simple Moving Average (SMA) on one-hour chart. The 100 SMA together with the descending trendline is in line to limit movement as well.

Ethereum, on the other hand, is working hard to stay above $180. Despite the high volatility levels, the price has only managed to touch highs of $183.28 and lows of $180.65. This shows that bulls are present and only hat they lack a catalyst or a technical breakout to push Ether to higher levels.

The one-hour chart shows support emanating from the ascending trendline. Like Bitcoin, Ethereum is in consolidation ahead of the weekend session.

Ripple is also stuck in a narrow range between $0.29 and $0.30. The upside is capped by the 50 SMA on the 2-hour chart. Moreover, rapid movements can be expected on either side as the Relative Strength Index (RSI) is moving horizontally beneath 50. The 61.8% Fib retracement level continues to offer support. The risk of approaching $0.25 support is quite high.

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Cryptocurrency market update: Bitcoin, Ethereum and Ripple get ready the weekend action - FXStreet

The Bitcoin time-traveler Reddit post has been edited, but nobody knows who did it – The Next Web

A mystery is playing out on the Bitcoin BTC subreddit: the infamous Bitcoin time traveller post has been edited, and nobody knows who did it.

In 2013,a Reddit user appeared to present a bleak outlook of the year 2025, where rampant inequality and parabolic Bitcoin value has pushed the world to the brink of collapse.

Thepost is absolutely ridiculous, but surprisingly, it appears someone has recently doctored it to read as if OP themselves returned to edit the post, despite their account being deleted years ago.

Strangely, its now prefaced with: Well gee, this blew up, Bitcoin should not be treated as an investment, it should be recognized as a speculative negative-sum game.

The editor then launches into scathing attacks on its mining infrastructure and the software developers that maintain its code.

As a self-professed time-traveler, OP claimed that on average, the value of Bitcoin would increase by about a factor ten every year: from $0.10 in 2010, to $1 in 2011, to $10 in 2012, and so on.

This trend would eventually lead a single Bitcoin to be worth $1 million by 2021. From then, there will be apparently no good way to express Bitcoins value in dollars, as the dollar is no longer used. In this version of the future, land and cryptocurrency will be the only relevant assets of value left.

In my world, soon to be your world, most governments no longer exist, as Bitcoin transactions are done anonymously and thus most governments can enforce no taxation on their citizens. Most of the success of Bitcoin is due to the fact that Bitcoin turned out to be an effective method to hide your wealth from the government. Whereas people entering rogue states like Luxemberg, Monaco, and Liechtenstein were followed by unmanned drones to ensure that governments know who is hiding wealth, no such option was available to stop people from hiding their money in Bitcoin.

OPs post is also the origin of Bitcoin Citidels, automated future-cities formed by the Bitcoin rich to protect themselves (as well as their worth) from no-coiners.

Bitcoin Citadels have evolved into a permanent part of the Bitcoin vernacular; a meme to help imagine what life would be like post-hyperbitcoinization.

The moral of the original post was to implore the reader to reconsider theirinvestment, as widespreadBitcoin adoption is tosupposedly ruin the world beyond repair.

Sadly, this piece of Bitcoin history now has an ironic problem with legitimacy. If the OPs account is deleted, how can they return to edit it something Redditors have been quick to highlight.

Hard Fork has reached out to thesubredditsmoderators to learn more and will update this piece should we receive a reply.

Still, its certainly possible to access the original post via archive links, but one must wonder: why the hell is this happening to one of the mostpopular Bitcoin shitposts of all time, and why now?

Update 07:31 UTC, November 5: A /r/Bitcoin moderator has since contacted Hard Fork to shed some light on the status of OPs account.

The post was originally made on August 31st, 2013 and was edited by the original account onOctober 27th, 2019, they said.

It is unclear when or why the original account became inactive. The account was never banned by moderators of ther/Bitcoinsubreddit, and such site-wide actions can only be performed by reddit site administrators, they added.

The moderator then went on to explain that there could be a number of reasons for the current status of OPs account.

Spam, malware, vote cheating, or ban evasion were listed as possibilities. It couldve also been flagged as compromised, and the site took action to disable it.

However, depending on the technique that Reddit admins used to disable the account, the account holder is not prevented from editing previously posted threads and comments, said the moderator.

It should be noted that there is no indication whatsoever that any time travel is involved, and that the original unedited post was held in high regard solely as an imaginative piece of fan-fiction. It is also unclear whether the original thread was intended to be an ominous warning about Bitcoin as the edit portrays, or if the account holders motive and outlook shifted since 2013. It also seems unlikely that one could contact the account holder directly since there is no way to send them a private message, they noted.

The moderator then concluded by highlighting that there are more exciting things happening in Bitcoin than a six-year-old post that had recently been edited.

Published November 4, 2019 17:00 UTC

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Cryptocurrency saves a 110-year old power plant from demolition – The Next Web

A US power plant thats more than 100 years old, and is of significant historical value, is being saved from demolition by cryptocurrency.

The 110-year old power plant, Old Rainbow, is being allowed to become a cryptocurrency mining farm, after being granted approval by the Federal Energy Regulatory Commission (FERC).

Proposal documents submitted to the FERC say the mining machines will be placed in just one part of the building, and there are plans to expand; presumably if the endeavor proves profitable.

Cryptocurrency mining operations at Old Rainbow will be staffed and run 24 hours a day, 365 days a year.

Theres perhaps a subtle irony in the fact that Old Rainbow used to produce clean, hydroelectric power but will now participate in an industry thats incredibly resource hungry. The proposal doesnt state how the new mining center will be powered, though.

However, in 2013 a new hydroelectric plant was constructed further down the river that Old Rainbow is based on, and used to generate electricity. Hopefully the data center will be powered by this hydroelectric renewable energy.

As it happens, when plans for this new power plant were announced in 2009, the FERC demanded Old Rainbows owners to find a new use for the building or to take it out commission.

The Old Rainbow power plant, located in Montana, completely ceased operations in 2013 and since then has been the focal point in a series of discussions over what to do with it. Montanas locals however, are hesitant to demolish it because of its cultural and historic value to the local community.

Importantly for some locals, the plan to turn the building into acryptocurrencyminingfarm means it will remain largely unchanged. The proposed data center will have minimal impact and maintain the historic character of the building, the proposal states.

H/T The Block

Published October 30, 2019 10:17 UTC

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US fines founders of worthless cryptocurrency over $4.25M binary options scam – The Next Web

A US federal court has ordered defendants to pay $4.25 million in penalties as a result of operating a virtual currency scam known as ATM Coin.

Blake Harrison KantorandNathan Mullins, both from New York and corporate entities Blue Bit Banc, (UK); Blue Bit Analytics, (Turks and Caicos); andMercury Cove Inc and G. Thomas Client Services, (New York) are accused of committing fraud and misappropriating customer funds.

According to the court, Kantor, Blue Bit Analytics, and G. Thomas Client Services, took customer funds and illegally actedas Futures Commission Merchants without having registered with the Commodity Futures Trading Commission (CFTC).

The case was first submitted in April last year and charged the defendants with fraud in connection with a binary options scam.

The CFTC said defendants asked public customers to invest in binary options,promising the opportunity to earn predetermined amounts based on the price of the commodities at specific points in time.

Although customers could trade for themselves, or have a Blue Bit Ban representative do so for them, Mullins and Kantor failed to tell customers that a computer software program used by Blue Bit Banc fraudulently changed the data associated with their binary options investments.

This meant that the probability of customers earning a profit favored Blue Bit Banc, rather than investors.

Kantor and Mullins told most investors to transfer their funds to a bank account located in the island nation ofSt. Kitts and Nevis, making it harder to trace investor funds.

In addition, the defendants also converted Blue Bit Banc investments into ATM Coin, a worthless cryptocurrency that Kantor had misleadingly told victims was worth a substantial amount.

Even though prosecutors have indeed ruled against the dodgy firm, it might not mean much for victims, with the CFTC warning them that the wrongdoers may not have sufficient funds or assets to reimburse their losses.

Published November 4, 2019 11:39 UTC

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US fines founders of worthless cryptocurrency over $4.25M binary options scam - The Next Web

Inside the Icelandic Facility Where Bitcoin Is Mined – WIRED

Less than two miles from Icelands Reykjavik airport sits a nondescript metal building as monolithic and drab as a commercial poultry barn. Theres a deafening racket inside, too, but it doesnt come from clucking chickens. Instead, tens of thousands of whirring GPUs perform the complex, exhaustive calculations needed to verify cryptocurrency transactions and add them to the public record, otherwise known as the blockchain. Hundreds of thousands of fans blast cold air to keep the machines from overheating, aided by six giant ceiling turbines that spin with the collective force of 360 washing machines.

The facility, called Enigma and established by Genesis Mining in 2014, is easily the loudest environment that British photographer Lisa Barnard has ever documented. She visited two years ago while shooting her project Bitcoin. "The biggest thing I remember was just the noise and the flashing lights and wiring," Barnard says. "It was like being inside a computer."

The high-tech barn seems worlds away from the geysers, waterfalls, and lagoons that inspire 2.3 million tourists each year (not to mention a few Bjrk lyrics), but its as much a product of Icelands unique geology as any of those. The Nordic island country straddles the Mid-Atlantic Ridge, where the Eurasian and North American tectonic plates meet, molding a volcanic terrain webbed by glacial rivers and studded with gemstone-aquamarine lakes. The abundant water and underground heat is harnessed by hydroelectric dams and geothermal power stations to produce cheap, green electricity that facilitates the energy-intensive process of confirming cryptocurrency transactionscalled mining, since miners are rewarded for their efforts with newly minted and extremely volatile coins. The fact temperatures rarely top 57 degrees Fahrenheit also helps.

It wasn't long after Bitcoin's creation, on January 3, 2009, that cryptocurrency companies began moving to Iceland. In 2016, large data centers accounted for nearly 1 percent of its GDP, with cryptocurrency mining operations making up 90 percent of those. They now use more electricity than all of Icelands homes combined, with electric bills at Enigma running more than $1 million per month. But however green the energy, miners still cant escape a dilemma as old as picks and shovels: how to extract resources without marring the landscape. According to local experts cited by The Wall Street Journal, keeping up with demand for electricity requires building more dams and power stations that could alter Icelands unique, sensitive environment.

That tension intrigues Barnard. She became interested in cryptocurrencies while working on her new book The Canary and the Hammer, a visual exploration of gold. It piqued her interest in digital gold that isnt controlled by a central bank, leading her from Bitcoin meet-ups in Japan, the first country to officially recognize cryptocurrencies, to data centers in Iceland, where theyre mined on an industrial scale. I was interested in this idea of it being an equitable currency, Barnard says, and yet it has the potential to be very destructive as far as the land is concerned.

So, after photographing Enigma, she also ventured out to Svartsengi geothermal power station (which supplies electricity to crypto-miners and water to the Insta-famous Blue Lagoon) and other sites of thermal activity. Standing before ethereal, bubbling pools, she felt an almost palpable connection to the inner workings of the earth, both terrifying and beautiful at the same time, she says. The sulphur-smelling waters steamed and hissed, many decibels below the crypto-digital roar to which theyre weirdlyand maybe inextricablylinked.

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The never-ending Mt. Gox saga: Cryptocurrency recovery deadline pushed back (again!) – The Next Web

I hate to be the bearer of bad news, but victims who lost money as a result of Mt. Goxs implosion will have to wait even longer to get their refunds.

The news comes after the trustee, tasked with refunding users, again decided to extend the submission deadline for claims.

In a statement released earlier this week,Nobuaki Kobayashi said a Tokyo District Court had issued an order to extend the deadline until March 31, 2020.

Kobayashi announced the deadline extension just one day before the current one, which was agreed in April, expired.

When it collapsed in 2014, Mt. Gox was the biggest cryptocurrency exchange in the world, handling approximately 70 percent of all Bitcoin transactions.

It officiallyfiled for liquidationin April 2014, claiming750,000 BTC had been lost, although 200,000 BTC was later recoveredfrom a forgotten wallet.

Nobuaki Kobayashi was appointed a trustee after former CEO Mark Karpeles failed to safely operate the exchange.

Last summer, apress releasewas published on the Mt. Goxwebsite alongside anonline toolfor submitting claims, signaling it was readyingto return$1 billion in stolencryptocurrency.

As frustrating as it must be for victims, it seems they have no other choice but to sit and wait for their cryptocurrency to be returned.

Published October 31, 2019 13:39 UTC

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The never-ending Mt. Gox saga: Cryptocurrency recovery deadline pushed back (again!) - The Next Web

Startup Targets Cryptocurrency Crime – But Will The Big Banks Come On Board? – Forbes

Will cryptocurrencies ever be considered mainstream? Millions of people around the world are invested in Bitcoin and its rivals, of course, but from the point of view of governments, regulators and financial institutions, virtual coins and tokens are still viewed with a considerable degree of suspicion.

Witness the stormy weather that is currently being encountered by Facebook as it presses ahead with plans for its Libra project. Earlier this month, Visa, Mastercard and eBay announced their intention to walk away from the association of companies and institutions that originally agreed to develop and support the new virtual currency. A few days later, ING chief executive, Ralph Hamers told the Financial Times that an ongoing commitment to Libra might prompt banks to cut ties with the social media giant unless it addressed the money laundering concerns expressed by regulators.

And as Dr. Tom Robinson sees it, financial institutions remain extremely wary of exposing themselves - and by extension their clients - to the risks they perceive in the cryptocurrency market. Indeed, hes witnessed that wariness at first hand. Having read about Bitcoin in 2012, he and university friends, Dr. James Smith and Dr. Adam Joyce quit their jobs to set up a company - Elliptic - providing cryptocurrency security solutions. We tried to get institutions interested, he recalls. But they were very concerned about the associations between virtual currency and criminal activity.

Creating A Safe Space

But the worries expressed by financial institutions also pointed to an entrepreneurial opportunity. Banks and fund managers were seeing the emergence of a new investment class that promised rich rewards for those with strong nerves. To be more precise, they were seeing their clients buying into Bitcoin and other currencies. Having initially started out by providing secure custody services for investors, Elliptic developed a solution that would enable institutions to provide cryptocurrency-related services to their customers while steering clear of any association with trading activities that might tarnish their reputations or see them falling foul of regulators and law enforcement.

The demand use case for cryptocurrencies is speculation," explains Dr. Robinson. Thats especially true after the 2017 Bitcoin bubble - even taxi drivers were talking about that. Banks wanted to give their clients access to crypto-assets.

Against that backdrop, Elliptics team developed a system to analyze blockchain trades and identify non-legitimate trading.

Essentially, Elliptics technology tracks the activity on the blockchain and - to put it simply - strips away the anonymity that has been a traditional feature of virtual currency transactions. We link transactions to known entities, says Dr. Robinson. And once these entities are visible, it is possible to assess the risk of a transaction being linked to, say, money laundering, illegal arms trading or the payment of ransomware.

Bypassing Banks

This, in turn, opens the way for financial institutions to engage more confidently with virtual currencies, says Dr. Robinson. And enhanced security, he argues, will be a key factor in opening up a new era of financial services provisions. For the first time, we have an open financial system, he says. Nowadays, you dont have to go to a bank to carry out a transaction. And if you want, you can create your own bank.

But as the high-profile withdrawals from Facebooks Libra project demonstrate, there is still a long way to go before everyone is convinced that the virtual currency marketplace is a safe environment for institutions.

To date, the company has assessed risk on around $1 trillion of transactions. However, it has had more success in providing its security solutions to organizations within the blockchain sector than to mainstream institutions. We have more than 100 customers now, says Dr. Robinson. Most are exchanges and wallet providers but we are also seeing banks, hedge funds and asset managers coming on board. The financial institutions represent a minority, but it is a growing minority.In addition the company has worked with U.S. law enforcement agencies. To

And Dr. Robinson believes more widespread uptake of virtual currencies is on the way. Even if Libra doesnt succeed, I think something similar will emerge. There is real scope to provide services around international remittances and e-commerce. And blockchain analysis will become standard.

Potentially good news for Elliptic, which just raised $23 million in Series B funding to finance its expansion into Asia and the US. The longer-term question revolves around who will dominate the blockchain security market. Entrepreneurial companies such as Elliptic or the bigger players in the digital security space.

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Startup Targets Cryptocurrency Crime - But Will The Big Banks Come On Board? - Forbes

Major Bitcoin Miner Warns The Cryptocurrency Needs Better Privacy – Forbes

Bitcoin mining machines operate at a mining facility by Bitmain Technologies Ltd. in Ordos, Inner ... [+] Mongolia, China, on Friday, Aug. 11, 2017. (Qilai Shen/Bloomberg)

The CEO of one of the top three Bitcoin mining pools recently stated that Bitcoin needs better privacy in order to avoid a potential regulatory clampdown. The comments were made by Poolin CEO Kevin Pan in an interview with Bitcoin Magazine.

While Poolin is barely a year old, it already accounts for a significant portion of the total Bitcoin network hashrate. The mining pool was created by Pan, COO Fa Zhu, and CTO Tianzhao Li, all of whom were previously at the Bitcoin mining giant Bitmains subsidiary BTC.com.

Bitcoins Need for Better Privacy

Although those who havent researched Bitcoin deeply often think it is some sort of anonymous online currency, the reality is Bitcoins privacy features are quite poor. Over the years, this lack of privacy has been pointed out as a serious issue in terms of the cryptocurrencys fungibility, which is a key property of money.

Developers have proposed a wide variety of Bitcoin privacy improvements over the years, but many of these proposals come with trade-offs in the areas of scalability, security, and other important areas. For example, the introduction of Confidential Transactions, which masks the amounts involved in Bitcoin transactions, at the base protocol level could weaken the guarantees associated with the public verifiability of Bitcoins current supply.

While scaling is often brought up as the most pressing issue facing Bitcoin today (just look at the block size wars from previous years), Pan views privacy as the most important area of development for the crypto asset.

The real problem with Bitcoin may be privacy, Pan told Bitcoin Magazine. There is no other big question if the privacy issue is solved.

Pan went on to describe the normal issues surrounding fungibility that are often discussed in Bitcoin circles, but then the Poolin CEO brought up another problem that is often overlooked by those who promote Bitcoins usefulness for censorship-resistant transactions.

What is more troublesome now is if government or law enforcement departments begin to create a blacklist of transaction addresses, it will make certain transactions unable to be packaged, said Pan. In fact, these can be done. But if there is privacy, you can't know who the address belongs to, and you can't determine how much the amount is, and there is no way to control the currency system. So for me, Bitcoin is basically no problem if the issue of privacy can be solved.

The problem Pan brought up here has to do with government entities potentially telling Bitcoin miners to block transactions coming from or going to specific addresses. A Bitcoin users money could be effectively frozen if 51% of miners decide not to process transactions originating from that users known Bitcoin addresses. With less than 51% support from miners, these transactions would simply be slowed down rather than completely blocked.

This issue raised by Pan is closely related to the issue of Bitcoin mining centralization, as this sort of censorship attack is only possible if government officials are able to identify and coerce 51% of the network hashrate. Progress is also being made on this greater issue of mining centralization. New mining protocols can further decentralize the transaction selection process, and more mining centers, such as the ones recently revealed by Bitcoin technology startup Blockstream, are popping up in jurisdictions other than China.

Transaction censorship is also easy to enforce via centralized services built on top of the Bitcoin network, such as exchanges, where the vast majority of Bitcoin activity takes place.

Taproot, which is an in-development improvement for Bitcoin, is expected to enable vast improvements to the current level of privacy offered to the cryptocurrencys users. For now, there are wallets like Wasabi Wallet and Samourai Wallet available for those who desire a higher degree of privacy.

Pan also mentioned that the privacy issue he brought up does not exist for some experimental altcoins, specifically Monero and Grin. Its possible that some of the features associated with these privacy-conscious altcoins will eventually find their way into Bitcoin.

In terms of other potential issues facing Bitcoin, two of the developers behind key Bitcoin software recently shared two of the biggest threats that face the digital currency.

Excerpt from:

Major Bitcoin Miner Warns The Cryptocurrency Needs Better Privacy - Forbes

Why Cryptocurrency is in The Spotlight For More Central Banks – newsBTC

For most of its short life Bitcoin has been a plaything for computer geeks and largely ignored by banks and governments. That all changed in late 2017 when an epic rally sent prices soaring to new peaks. Since then central banks have been paying closer attention to cryptocurrency, especially in recent months as Facebook threatens to usurp their dominance.

The benefits of a digital currency are clear, faster and more efficient payments are good news for all. Banks already make huge profits moving peoples money around for them and digital cash will aid them even further.

Facebook has rattled the regulatory cages of the world and given bankers a wake-up call. If they cannot improve their archaic and costly transfer mechanisms, which are mostly based on SWIFT, better alternatives will emerge.

There is a definite demand for a Libra like cryptocurrency but Facebook is clearly not suitable to be in charge of it. Bitcoin does exactly what is required but is price volatility is still preventing everyday use and is off-putting for most.

Central banks in China, Sweden, the Bahamas and Thailand are experimenting with their own cryptocurrencies and many will be launching soon. The FED is still waiting on the sidelines according to Bloomberg and is likely to be left behind by rafts of innovation hampering regulations.

The threat to national sovereignty by the social media giant was large enough to bring down an avalanche of criticism for its Libra project. There was also the threat that central banks would not be able to effectively manage monetary policy (print more money) if an alternative global currency existed.

Central banks are looking into wholesale solutions which would limit access to any stablecoin to the banks and financial institutions. They would be used internally to make payment flows within the existing financial system faster and cheaper.

A retail solution would be to allow account holders to use the digital currency under tight control. The central bank would manage the ledger and have full control over the supply and flow of any stablecoin it develops.

China is likely to be the first major nation to roll out its own central banks cryptocurrency as Asia forges ahead with innovative research and development. However there has been no time frame for launch as yet. A recruitment notice by the PBoC, shows that it wants to hire six more tech experts with expertise in cryptography, econometrics, and micro-electronics to join the development for the banks new cryptocurrency.

Chinas stance on decentralized crypto assets such as Bitcoin and Ethereum has not changed. It still will not allow people to buy crypto with fiat. Central banks are unlikely to ever see public cryptocurrencies in a good light simply because they are beyond state control and have no such transaction limits.

Whether Libra goes ahead or not is now looking dubious but Facebook has accelerated the research process for the banks of the world and a slew of new centralized stablecoins are likely to be launched in the coming years.

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Why Cryptocurrency is in The Spotlight For More Central Banks - newsBTC

Bank of Canada Warms To National Cryptocurrency, Will it Compete Against Bitcoin? – newsBTC

Leaks within the Bank of Canada show officials are considering the development of a national cryptocurrency. As such, with interest in central bank digital currencies (CBDCs) on the rise, could it threaten bitcoin?

Mike Eppel, Senior Business Editor at 680 News, has revealed that Canadas central bank is considering the development of a national cryptocurrency.

During his interview, Eppel drew attention to concerns surrounding cryptocurrencies, such as inadequate regulatory frameworks, as well as volatility. But all the same, he posed the question, is this the next phase in how we transact?

And that question is something Bank of Canada officials are in the process of considering. He said:

The Bank of Canada wants to get ahead of the curve. They have this internal memo saying, yeah, eventually, theyre likely going to launch some sort of crypto.

Having said that, as the conversation continued, it became apparent that the underlying reasons for this come down to centralization. Eppel continued:

Because its about regulation. All these new cryptocurrencies are not overseen by any type of government regulator and they would like to have a little bit more saythe flip side of course is, they can use this to track our spending.

Nonetheless, motivations aside, its apparent that central banks around the world are making moves in this space. While individual countries, on the whole, have kept tight-lipped, those in the know believe CBDCs are just a matter of time. For example, Philadelphia Federal Reserve bank president Patrick Harker claims that a US CBDC is inevitable.

If so, could a coordinated rise in CBDCs spell the end for private cryptocurrencies?

According to Economist, Nouriel Roubini, who once called Bitcoin the mother of all scams, the answer is a resounding yes.

In an article released late last year, Roubini proposes that central banks worldwide should issue their own digital currencies in order to shut cryptocurrencies out. He said:

If a CBDC were to be issued, it would immediately displace cryptocurrencies, which are not scalable, cheap, secure, or actually decentralised.

Moreover, in such a scenario, he rubbished the idea of a niche market, through privacy, by saying:

Cryptocurrencies such as bitcoin are not actually anonymous, given that individuals and organisations using crypto-wallets still leave a digital footprint. And authorities that legitimately want to track criminals and terrorists will soon crack down on attempts to create cryptocurrencies with complete privacy.

And almost a year on, Roubinis predictions have come to pass with unnerving accuracy, as evidenced by the recent crackdown on illegal porn, as well as the delisting of privacy coins.

Moreover, theres no denying that Bitcoin is the underdog here. And central banks will not give up their monopoly control easily, or without a fight.

Yes, Bitcoin and other cryptocurrencies have made a significant splash during their short time. But the reality is adoption rates are tiny, and the market cap is minuscule when compared to legacy markets.

That being so, arguments on Bitcoin being decentralized and borderless wont stick. Not unless the bankers want it to stick. And that is what were up against.

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Bank of Canada Warms To National Cryptocurrency, Will it Compete Against Bitcoin? - newsBTC

Cryptocurrency Mining Hardware Market 2019-2023 | Evolving Opportunities with Advanced Micro Devices, Inc and Baikal Miner | Technavio – Business Wire

LONDON--(BUSINESS WIRE)--The global cryptocurrency mining hardware market is poised to grow by USD 2.7 billion during 2019-2023, progressing at a CAGR of over 10% during the forecast period.

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The market is driven by the rising popularity of mining pools. In addition, the use of smartphones and applications to mine cryptocurrency is anticipated to further boost the growth of the cryptocurrency mining hardware market.

The rising popularity of mining pools will be one of the major drivers in the global cryptocurrency mining hardware market. Mining pools are groups of miners who work together by combining their computational resources and sharing hashing power to reduce the effects of volatility and obtain better outputs. The chances of achieving success decrease when miner prefer their own cryptocurrency mining hardware. This increases the popularity of mining pools as miners can combine their cryptocurrency mining hardware to enhance the success rate. Moreover, in mining pools, miners cannot steal the rewards of other miners. As the rising demand of mining pools will encourage new miners to join, the use of cryptocurrency mining hardware will increase which will boost the market growth

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Major Five Cryptocurrency Mining Hardware Market Companies:

Advanced Micro Devices, Inc

Advanced Micro Devices, Inc owns and operates businesses under various segments such as computing and graphics and enterprise, embedded, and semi-custom. The company offers a wide range of cryptocurrency mining hardware. Some of the products offered by the company are Radeon RX Vega Series, Radeon RX 500 Series, and Radeon RX 400 Series.

Baikal Miner

Baikal Miners key cryptocurrency mining hardware products include BK-G28, BK-N70, BK-B, BK-D, and BK-X.

Bitfury Group Limited

Bitfury Group Limited has business operations under various segments, namely software and hardware. The product offered by the company is Bitfury Tardis.

BitMain Technologies Holding Company

BitMain Technologies Holding Company operates business under four segments, which include antminer, antpool, BTC.com, and artificial intelligence. The companys key offerings include Antminer S17, Antminer S11, Antminer T15, Antminer DR5, and Antminer Z11.

Canaan Creative CO., LTD

Canaan Creative CO., LTDs key product offerings in the cryptocurrency mining hardware include AvalonMiner 10, AvalonMiner 851, and AvalonMiner 911.

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Cryptocurrency Mining Hardware Product Outlook (Revenue, USD Million, 2019 - 2023)

Cryptocurrency Mining Hardware Regional Outlook (Revenue, USD Million, 2019 - 2023)

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With over 500 specialized analysts, Technavios report library consists of more than 10,000 reports and counting, covering 800 technologies, spanning across 50 countries. Their client base consists of enterprises of all sizes, including more than 100 Fortune 500 companies. This growing client base relies on Technavios comprehensive coverage, extensive research, and actionable market insights to identify opportunities in existing and potential markets and assess their competitive positions within changing market scenarios.

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Cryptocurrency Mining Hardware Market 2019-2023 | Evolving Opportunities with Advanced Micro Devices, Inc and Baikal Miner | Technavio - Business Wire

Sitharaman Says Other Nations Agree With Indias Stance On Cryptocurrency – Inc42 Media

The FM said lawmakers from other nations at the IMF meeting also recommended extreme caution

Facebooks Libra was one of the hot topics at the annual IMF meeting, Sitharaman claimed

Terror funding and money laundering are the two major concerns around cryptocurrency for the IMF

Even as India is looking to create a concrete policy on cryptocurrency amid the current ban on trading and possession, finance minister Nirmala Sitharaman said the Indian government has already received several red flags from other nations, which vindicate its stance on virtual currencies.

Sitharaman, who is currently at the 40th meeting of the International Monetary and Financial Committee (IMFC) in the US, said that many global leaders and policy makers agreed with Indias contention that even though using cryptocurrencies might have their benefits, but there needs to be extreme caution before doing something to legalise the same.

According to a PTI report, Reserve Bank of India (RBI) governor Shantikanta Das spoke about Indias concerns regarding cryptocurrencies at one of the interventions at the meet.

The finance minister also added that Facebooks controversial cryptocurrency project Libra was one of the hot topics at the annual meeting.

Kristalina Georgieva, managing director of the IMF, said the organisation is taking a balanced approach in this matter as ease of use, cost savings, and most importantly, financial inclusion are some of the very important perks of cryptocurrencies. However, she is also aware about the risk virtual currencies can bring in terms of privacy.

We are not specifically focusing on Libra. We are looking into, one, the inevitability of expanding digital money on the wave of the digital revolution, but then the necessity to do so, mindful of monetary stability, Georgieva said.

Moreover, she added that cryptocurrencies come with the scope of terror funding and other illegal activities. She assured that the IMF is engaging with other organisations like the Financial Stability Board, the European Central Bank to explore more benefits and risks involved in the use of cryptocurrencies.

India is planning a ban on cryptocurrency and other crypto assets in the draft bill, and is currently looking to pass Banning of Cryptocurrency and Regulations of Official Digital Currency Bill, 2019. The bill recommends a jail terms and steep penalties for those who mine, hold, transact or deal with cryptocurrencies in any form, whether directly or indirectly through an exchange or trading.

The bill also proposed that cryptocurrencies holders will be mandated to declare and dispose of it within 90 days from the date of commencement of the act.

Update: October 21, 2019 | 3:18 PM

An earlier version of the story had inaccurately stated that India had banned cryptocurrency, whereas that is an oversimplification of the official government policy, which is yet to be finalised. We have changed the article accordingly.

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Sitharaman Says Other Nations Agree With Indias Stance On Cryptocurrency - Inc42 Media

As Facebook’s libra faces headwinds, China is racing to launch its own global cryptocurrency – CNBC

A visual representation of a cryptocurrency coin on display in front of the logos for Facebook and Libra.

Chesnot | Getty Images

Facebook's cryptocurrency plans looked shaky this week after a handful of high-profile members bowed out of the project. But while libra slowly gets off the ground, China is looking to launch an alternative.

The People's Bank of China announced earlier this year that it was working on a digital currency backed by the yuan, reportedly inspired by Facebook's announcement. Analysts and crypto industry leaders are highlighting geopolitical implications of China launching a digital currency first especially if libra hits a brick wall with U.S. regulators.

"China has been incredibly strategic about how they think about cryptocurrency," Brad Garlinghouse, CEO of Ripple, told CNBC in a phone interview. "They have been dependent on the U.S. dollar as the global reserve currency to the extent that other currencies emerge, and they can help propagate those, they're intrigued by that."

China's proposed digital currency would bear some similarities to Facebook's libra, a senior central bank officer said this summer, according to a transcript of a speech that was published online. He also said the digital coin could be used across major payment platforms, including China's ubiquitous WeChat and Alipay.

RBC Capital Markets analysts told clients this week that based on recent conversations and meetings in Beijing, China's plans are moving quickly. The People's Bank of China "has expedited its development of a Central Bank Digital Currency" after Libra's announcement in June, the analysts said.

"If U.S. regulators ultimately dismiss Libra and decide not to draft regulation to encourage Crypto innovation in the U.S., China's [Central Bank Digital Currency] may be strategically positioned to become the de facto global digital currency in emerging economies, largely through Alipay, WeChat, UnionPay and other messaging & payment apps," RBC analysts Mark Mahaney and Zachary Schwartzman said in a research note Tuesday.

Cryptocurrency would add to a long list of existing tensions between the global superpowers. The U.S. and China are locked in a stalemate on trade, and a battle for dominance in 5G, the mobile network promising faster data speeds. The U.S. Treasury Department has also labeled China as a currency manipulator a complaint that could be exacerbated if a yuan-backed cryptocurrency takes off.

Fed chairman Jerome Powell said earlier this year that the U.S. is keeping an eye on sovereign-issued digital currencies but that it wasn't something he was "actively considering." In the meantime, other digital currencies could "dampen the domineering influence of the U.S. dollar on global trade," Bank of England governor Mark Carneysaid during a speech in Jackson Hole, Wyoming, earlier this year.

In June, Facebook announced that it would spearhead the launch of a cryptocurrency run by the nonprofit Switzerland-based Libra Association in 2020. Libra is a so-called "stable coin," meaning its value is tied to that of an underlying fiat currency such as the dollar. For now, the Libra Association has said its cryptocurrency would be pegged to the yen, U.S. dollar and euro. It has not said whether the yuan would be included.

It started with roughly two dozen members. But last week Visa, PayPal, MasterCard and Stripe all dropped out, fueling concerns that the project may never see the light of day. The association met this week in Geneva, Switzerland, and the remaining group signed the association's charter on Monday.

Katie Haun, general partner at Andreessen Horowitz and co-head of its $350 million cryptocurrency fund, was elected to the board of directors for the project. Despite the exodus of high-profile names this week, Haun said she and the firm "remain committed to Libra's mission."

The project received pushback this summer from senior congressional finance committee members, global regulators, former lawmakers and industry insiders who flagged risks and questioned Facebook's ambitions.

Lisa Ellis, senior equity analyst at MoffettNathanson, said regulators may be sidetracked by Facebook's involvement in libra and need to "keep their eye on the fact that we do need to innovate to create digital forms of currency."

"If governments and regulators are concerned about their control over monetary systems and money flows, the best defense would be a good offense," Ellis said. "It would behoove regulators in the U.S. and Europe over the long term to maintain their leadership given that the dollar, the euro and the yen are used as proxies for global reserve currencies."

Ripple's Garlinghouse, who has been critical of libra, pointed to U.S. dominance in the rise of the internet, too. That was in part because of a "constructive regulatory policy." If cryptocurrency projects aren't grown in the U.S., he said, there are potential "geopolitical implications."

Garlinghouse is hardly alone in calls for clearer regulation. In a roundtable hosted on Capitol Hill last year, more than 50 cryptocurrency industry participants from Fidelity, Nasdaq, State Street and Andreessen Horowitz voiced concerns about lack of clear laws and potential for innovation to flee overseas as a result.

"While bashing Facebook is good politics, neglecting the traditional role of the United States in welcoming the growth of innovative technology is not," the Blockchain Association, a Washington, D.C., lobbying group for cryptocurrency and blockchain, said in a blog post last month. "Congress should focus on nurturing open blockchain networks before the United States loses out in this global technology race."

Andreessen's Haun told CNBC recently that it would be a "dangerous thing, and frankly a dangerous precedent to start shutting down technology before it's built." Haun also said there are "national security implications" if the United States falls behind in this area, and pointed to China's cryptocurrency as an example.

Others are more worried about the national security implications if libra does get off the ground. Treasury Secretary Steven Mnuchin said in July that Facebook's planned digital currency "could be misused by money launderers and terrorist financiers" and that it was a "national security issue."

He told CNBC's "Squawk Box" in an interview Monday that he met with libra representatives on multiple occasions and has been "very clear" that if they don't meet anti-money-laundering standards "that we would take enforcement actions against them."

"I think they realized that they're not ready, they're not up to par," Mnuchin said. "I assume some of the partners got concerned and dropped out until they meet those standards."

For Facebook, moving meaningfully into payments would likely be done through WhatsApp. The mobile chat app, bought by Facebook for $19 billion in 2014, doesn't have fully built-in payment functions yet. WhatsApp has, however, done a pilot program with payments in India.

RBC's Mahaney and Schwartzman said that messaging apps "represent the greatest opportunity to onboard consumers to digital wallets which could lead to a greater consumer adoption of digital currencies." This has already played out in China, where, according to RBC, WeChat has more than 1.1 billion monthly active users and Alipay counts 1.2 billion global annual active users.

Brian Kelly, CEO of BKCM, also said the reason Facebook is launching libra in the first place is to compete with those "super apps" in Asia. WeChat and Alipay's built-in payments capability could be a leg up in emerging markets.

Offering a payments capability is especially important in places such as sub-Saharan Africa, where mobile money is on the rise. According to the World Bank, the share of people with traditional financial accounts remained flat through 2018. But the percentage of those with mobile-only money accounts nearly doubled year over year to 21%.

The Libra Association is moving ahead this week despite the loss of key members. Facebook CEO Mark Zuckerberg is heading to Capitol Hill next week to answer for the project in front of the House of Representatives. Kelly said if regulatory pushback persists, he "wouldn't be surprised if libra launches in another country."

Even in the face of regulatory scrutiny, RBC analysts are predicting "Facebook will continue to pursue digital wallet initiatives."

"We believe a host of other companies remain very interested in joining the association," Mahaney and Schwartzman said. "If a clear regulatory roadmap is developed and Libra launches successfully, we would not be surprised to see these firms reapply to the association."

CNBC's Michael Bloom contributed to this report.

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As Facebook's libra faces headwinds, China is racing to launch its own global cryptocurrency - CNBC

Telegram might be forced to put its global cryptocurrency plans on ice – MIT Technology Review

The US Securities and Exchange Commission (SEC) has just halted Telegram's massiveand massively hyped$2 billion digital tokensale.

Those halcyon days: In early 2018, exuberant investors poured billions of dollars into Telegrams ambitious plan to launch a global cryptocurrency network. In return, they got rights to digital tokens that Telegram, a messaging app with 300 million monthly users, promised would be useful on its future network. That was slated to launch by October 31 of this year.

The news: That initial exuberance has turned to uncertainty. According to the SEC, Telegram Group and a subsidiary company called TON Issuer Inc. conducted an illegal sale of unregistered securities in the US. The defendants sold 2.9 billion digital tokens, called Grams, to 171 investors around the world, raising $1.7 billion. Since $425 million worth was sold in the US, the SEC, which is supposed to look out for US investors, was paying attention.

Since the planned network hasnt yet launched, and the tokens cant be used for anything yet, they are subject to the same kinds of strict regulations that govern stocks and bonds, says the SEC. That means they should have been registered with the agency, and Telegram should have provided investors with information about its business operations, financial condition, management, and risk factors. We have repeatedly stated that issuers cannot avoid the federal securities laws just by labeling their product a cryptocurrency or a digital token, Steven Peikin, co-director of the SECs division of enforcement, said in a statement.

What now? According to Bloomberg, the company is evaluating ways to resolve the agencys concerns, and in fact been in talks with the SEC for 18 months. The company said it was surprised and disappointed by the lawsuit, and now it may delay the launch of its network.

The takeaway: The SEC is not done cleaning up the mess created by the initial coin offering boom of 2017 and early 2018. Its lawsuit against Telegram comes just two weeks after it settled with Block.One, which had raised $4 billion via its own token sale before launching the EOS blockchain network in 2018.

Its not clear why Block.One, which had to pay a $24 million penalty, didnt get as harsh a penalty as Telegram (though it could be that Block.One was more cooperative with the SEC). But the bottom line is what Peikin said: calling something a cryptocurrency doesnt exempt it from existing laws.

Keep up with the fast-moving and sometimes baffling world of cryptocurrencies and blockchains with our weekly newsletter Chain Letter.Subscribe here. Its free!

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Telegram might be forced to put its global cryptocurrency plans on ice - MIT Technology Review

Mastering Emotions and Managing Risk in Cryptocurrency Trading – Coindesk

When it comes to trading, there are several steps you can take in order to reduce your exposure to the market extremes of price volatility.

A combination of both technical and fundamental analysis can be used to determine thetrue worth of a company or asset, securing a greater chance of success with a particular investment while reducing your risk along the way.

But for that, you need a plan.

Developing a successful risk management plan is paramount in minimizing unexpected outcomes, translating into an overall reduction in your losses.

A successful risk management plan should also run parallel to your crypto trading journal records, working in conjunction to curb poor trading behavior while simultaneously justifying your fundamental expectations.

Sometimes temptation leads to poor choices and it is no more on display than a market driven by fear and greed.

By reducing harmful or negative trading habits, one can hope to increase profit without putting too much on the table.

A key component of a successful risk management plan is determining what kind of trader you are and where your skills currently lie:

From these personas you can draw a rough idea on where you currently sit in terms of your trading mentality. The idea is to identify what habits are forcing you to lose out and which habits are guiding you to profit.

Try to remain stoic and reasoned, removing emotion from the psychological aspect of trading while relying solely on the information in front of you such as the price, volume, news and trend.

No matter how tempting or promising a particular trade opportunity may appear it is never a good idea to place all of your worth on the line.

Generally, a spread of one particular type of asset class (as well as a generous mix of different asset classes within your portfolio) is an ample measure in reducing your exposure to larger price moves within a particular industry/market.

The volatility of the cryptocurrency market means that any trade, even a seemingly perfect trade, can collapse and result in a significant loss. Therefore, it is recommended that you start investing in 5 or more different coins.

Also remember to take advantage of an exchanges stop-loss feature and use it to your benefit when you are away from trading manually such as times of rest or at work.

Time and again new traders fail to incorporate an adequate exit strategy, often arriving back at their computer to find their beloved basket of crypto have dropped 20 percent and a new trend has developed to the downside. This act not only reduces your risk but allows for greater control over your losses.

Finally, it can be tempting to use a buy and hold strategy where you invest in a coin and refuse to sell for an extended period of time. This passive approach is often tempting to new traders due to its simplicity and is often falsely associated with reducing ones risk.

However, youll unlikely amount to any significant wins by playing it too safe, so dive in, take on the adequate risk and ensure you have a plan mapped out because trading crypto can be a fun and profitable endeavour when executed correctly.

Disclosure: The author holds no cryptocurrency assets at the time of writing.

See-saw image via Shutterstock

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Mastering Emotions and Managing Risk in Cryptocurrency Trading - Coindesk

Europol: Bitcoin is the still the dark webs favorite cryptocurrency – The Next Web

Bitcoin BTC is still very much the dark webs favorite cryptocurrency, but those looking to cover their tracks are slowly learning to useprivacy-focused alternatives.

While we have previously reported a small shift towards more privacy-focused cryptocurrencies such as Monero, Bitcoin still remains the currency of choice for both legitimate and criminal use, reports Europol with its latest assessment of internet-based organised crime.

Europol notes that Bitcoins prevalence in the underground economy is a consequence of its familiarity within the customer base, particularly in dark web markets.

In particular, ransomware campaigns have continued to feature Bitcoin almost exclusively. Europol highlighted these attacks as the most prominent cybercrime it tackles.

Hard Fork has previously reported on numerous ransomware attacks thatve demanded Bitcoin to restore encrypted files.

Still, authorities say there has been a more pronounced shift towards more privacy-orientated cryptocurrencies, and expects this trend to continue as criminals become more security aware.

The main developments regarding this trend are on the Darknet [sic] markets, several of which also accept Monero, or in some cases exclusively trade in it, Europol added.

Join us inAmsterdamon October 15-17 to discuss blockchainandcryptocurrencywith leading experts.

Published October 14, 2019 12:45 UTC

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Europol: Bitcoin is the still the dark webs favorite cryptocurrency - The Next Web

Theres A New Question On Your 1040 As IRS Gets Serious About Cryptocurrency – Forbes

internet banking network and cryptocurrency concept. Man hand using credit card for trade cryptocurrency.

Days after the Internal Revenue Service (IRS) released two new pieces of guidance for taxpayers who engage in transactions involving virtual currency, the IRS announced another compliance measure: a checkbox on form 1040. The checkbox, which appears on the early release draft of the form 1040, asks taxpayers about financial interests in virtual currency.

The checkbox appears on the second early release draft of the 2019 Form 1040, Schedule 1, Additional Income and Adjustments to Income (downloads as a PDF). The checkbox is at the top of Schedule 1, which is used for reporting income or adjustments to income that cant be entered directly on the front page of form 1040:

KPE

The question is:

At any time during 2019, did you receive, sell, send, exchange or otherwise acquire any financial interest in any virtual currency?

If youre wondering why that sounds familiar, the wording closely parallels the verbiage on Schedule B, Part III, concerning offshore accounts.

KPE

That question appears at the bottom of the Schedule. It asks:

At any time during 2018, did you have a financial interest in or signature authority over a financial account (such as a bank account, securities account, or brokerage account) located in a foreign country?

The similarities arent surprising. You may recall that Ive suggested (here and here) that the strategy the IRS is using to pursue cryptocurrency is reminiscent of how the agency chased down offshore accounts.

However, Im not overly keen on the location of the cryptocurrency question. As noted, taxpayers who file Schedule 1 to report income or adjustments to income that cant be entered directly on Form 1040 should check the appropriate box to answer the virtual currency question. But taxpayers who dont have to file Schedule 1 for any other purpose may not be aware that they need to file Schedule 1 to answer to this question if it applies to them. Yes, tax software interviews will likely catch it - but what if they dont? Or what if taxpayers are completing the form by hand? Or if tax preparers dont think to ask?

I think its something that IRS will need to address. The IRS will accept Schedule 1 comments via email at WI.1040.Comments@IRS.gov for a 30-day comment period beginning October 11, 2019. The IRS cannot respond individually to each comment received, but all feedback will be considered.

Why does the location of the checkbox matter? Compliance. The checkbox is ostensibly on the form to remind taxpayers to report their cryptocurrency transactions. But those tax professionals like me who have seen the response to the checkbox on Schedule B know that this is also an easy way to hold those who dont check the box - even by accident - accountable. The IRS can and has taken the position that willfully failing to check the box related to offshores interests can form the basis for criminal prosecution. Failing to check the box by accident can still result in headaches and penalties. I fully expect a similar result on the cryptocurrency side.

If youre looking for more information on cryptocurrency, you can read more about the recent guidance here. You can find out more about the taxation of cryptocurrencies like Bitcoinhere. And you can get up to date about how the IRS is targeting non-compliance through a variety of efforts, ranging from taxpayer education to audits to criminal investigations here.

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Theres A New Question On Your 1040 As IRS Gets Serious About Cryptocurrency - Forbes