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Arrested Romanian Bitcoin Exchange CEO Helped Launder Stolen Funds



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According to a Cluj, Romania-based newspaper, the case of bitcoin exchange executive Vlad Nistor is much deeper than the simple illegal operation of a cryptocurrency firm. Their most recent report on the case speaks to some much more serious allegations as to the behavior of Vlad Nistor.

More Details Emerge in Bitcoin Exchange CoinFlux CEO’s Arrest

The paper reports that Nistor was part of a group that executed phishing attacks on United States soil between 2014 and 2015 when CoinFlux was just getting started. A total of 14 Romanians have been indicted by federal authorities based out of Kentucky, Vlad Nistor just being one of the more notable due to his business ties and outward appearance as an upstanding citizen.

He is said to have advised some of the active cyber criminals via Telegram and helped them launder the proceeds of their illegal activity. They apparently executed a number of phishing attacks on US soil, some even traveling to the US to better succeed.

From the report (roughly translated):

“Two of these methods were run online via phishing or through various fictitious sale ads (via eBay or through online platforms ). For example, Romanians were sending e-mails using instant messaging programs or telephone numbers where the user is advised to give confidential data to win certain prizes or was informed that they are necessary due to technical errors that led to loss of original data. A web address containing a clone of the site of a financial or trading institution was indicated in the e-mail.”

After stealing funds from phishing victims, the criminals would use the newly created CoinFlux exchange to wash funds through various crypto methods. That alone would not normally be enough to indict an exchange operator, as most exchanges have some form of user agreement which bans illegal activity and absolves itself of wrongdoing on the part of its clients. Provided they following know-your-customer and anti-money-laundering regulations, they are usually free of responsibility.

However, in the case of Vlad Nistor, according to allegations, he actually advised the phishers on how to dispose of their proceeds using his crypto exchange.

Nistor Extradition Delayed, Others Involved in Progress

coinflux cluj, romania bitcoin vlad nistor
Vlad Nistor is CEO of CoinFlux, a Cluj-Napoca, Romania-based bitcoin and cryptocurrency exchange.

The most recent reporting from the Cluj newspaper indicates that the court has given Nistor and his lawyers until Dec. 20 to make arguments as to why he should not be extradited. He appears to be what we would call in the US “free on bond,” but he is currently banned from using bitcoin or any other sort of digital currencies for any reason and must report to the court if they request his presence at any time.

Three criminals in the conspiracy have had their extradition requests approved: Popescu Bogdan-Ştefan, Dobrică Alin-Ionut and Arvat Florin. In the view of the Cluj reporter, the only difference between their actions and Vlad Nistor’s is that they carried out their illegal activities directly on US soil. The work of Nistor’s attorneys and the government of Romania is to determine whether or not Nistor acted in sufficient violation of US laws to warrant an extradition.

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‘Wasteland’ Director’s New Blockchain Gaming Store Signs up 22 Publishers



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Co-founded by veteran game developer Brian Fargo, Robot Cache will purportedly be the first blockchain-based digital marketplace for video games.

Brian Fargo Launches Blockchain-Based Steam Competitor

The PC games platform is set to launch sometime in 2019 but has already signed up 22 publishers and 700 games for its blockchain-based competitor to Steam.

brian fargo blockchain
“Wasteland” director Brian Fargo | Source: Wikimedia Commons/Jean-Frédéric

Robot Cache has several unique features. It plans to offer the option for game users to re-sell their game purchases and mine a “virtual currency” called IRON when their machines aren’t in use.

Lee Jacobson, CEO of Robot Cache, told VentureBeat:

“Reselling games is huge, with the publishers getting a cut, and gamers being able to make money. Some users want to monetize their digital library. They can play a game for a few months and then sell it back. Then they can use it to buy more games.”

The new platform has also committed to giving game publishers and developers in the region of 95% of the value of new game sales. In comparison, Steam gives back 70%.  Selling used titles on Robot Cache will still reward the publisher with 70% of the revenue and give the gamer 25%.

Robot Cache is based in San Diego, California, and co-founder Brian Fargo has also created game developers Interplay Entertainment and InXile Entertainment. He has delivered titles for Activision and Apple and directed the wildly popular “Wasteland” RPG.

So far, the platform’s Partner Portal for game publishers to register is open, and it hopes to offer a combination of big and indie labels.

The latest publishers to join Robot Cache include 1C Publishing, Bigben Interactive, Ci Games, Dankie, Devolver Digital, Headup, Hyperkinetic Studios, Revival Productions, and Running with Scissors. They join 14 others. Jacobson says Robot Cache is talking to “everybody in the industry” and that the platform will “have the largest launch library in the history of video games.”

IRON Won’t be a Cryptocurrency

The company had planned to create an ERC20 token called IRON but has shelved those plans as the U.S. Securities and Exchange Commission (SEC) cracks down on utility tokens and initial coin offerings (ICOs). Jacobson explained to VentureBeat:

“We didn’t want to go down that road of upsetting governmental authorities.”

IRON will instead be a virtual token limited to the Robot Cache platform, any IRON users “mine” on the platform can be used to pay for game titles.

The SEC classes most ICO tokens as securities, despite the increase in the use of the term utility token. It has promised to look at each ICO on a case by case basis, deterring even credible ICOs from launching due to the complication of securities legislation. The latest statistics on ICOs may also indicate that the funding model is a dying trend.

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Facebook Discussed Launching Cryptocurrency: Report



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Facebook has embarked on an aggressive hiring spree to woo crypto experts to expand its blockchain group amid speculation that the social media monopoly is considering launching its own cryptocurrency.

Facebook formed its blockchain unit in April 2018 with David Marcus, the former president of PayPal and VP at Messenger. Marcus is a longtime cryptocurrency advocate and a former board member at Coinbase, the largest US-based cryptocurrency exchange.

FB’s blockchain group now has 40 employees — including a half-dozen ex-PayPal executives that Marcus poached from his former employer, Cheddar reported.

FB Eyes Blockchain-Based Payment Product

The secretive unit includes people who have worked on Google Pay and Samsung Pay, a mobile payment and digital wallet service from Samsung — the world’s largest manufacturer of semiconductors and smartphones.

“They’ve been very quiet about what they’ve been working on, very stealthy,” said Cheddar’s Alex Heath (video below). “But it’s definitely going to be some kind of blockchain-based cryptocurrency payments product.”

Facebook is also considering launching a cryptocurrency that would enable its 2 billion users around the world to make electronic payments without the need for a traditional bank.

“They’ve already got policy people in D.C. to ramp this up,” Heath said.

Accordingly, Facebook is trying to hire crypto-savvy engineers, product managers, academics, and legal experts to expand its blockchain group.

“They’re actively, actively recruiting,” said Cheddar’s Alex Heath. “They’re also trying to scoop up crypto start-ups that are at the white-paper level, which means they don’t really even have a product yet.”

Facebook Is ‘Going Really Hard’ After Recruits

Health said Facebook is in hot pursuit of gifted recruits because the talent pool is relatively shallow since the crypto ecosystem is still in its infancy.

“The talent in this industry is so finite, and there are so many big players wanting these talented cryptographers and academics,” Heath said. “So Facebook is going really hard at them. And they’re having difficulty.”

Facebook is having a lot of trouble with their recruiting efforts due to its numerous recent data-privacy scandals that have eroded the public’s trust in the corporate juggernaut.

‘A Lot of People Don’t Trust Facebook’

“A lot of people obviously don’t trust the Facebook brand right now, especially people in the crypto/blockchain world,” Heath said. “A lot of them got into this industry because of the centralization and the data misuse of companies like Facebook.”

Many users are furious after learning that Facebook has been selling their personal data — without their consent — to third parties for profit.

Facebook CEO Mark Zuckerberg has apologized for the debacle, but the damage to his credibility and to Facebook’s brand continues to reverberate.

“So the idea of Facebook creating a cryptocurrency and a digital economy within its ecosystem is either incredibly exciting — if you talk to some people — or one of the scariest things in the world, if you talk to others,” Heath said. “It’s very polarizing, but they are actively building this up. I think we can expect to see Facebook buy some companies up in the crypto space in the next year.”

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Blockchain is a ‘Systemic Risk’ for Financial Industry: DTCC Exec.



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The Depository Trust & Clearing Corporation or DTCC issues a report every year on the stability of the global financial system and has done so every year since 2013. It describes this report in these terms:

“[T]he DTCC Systemic Risk Barometer Survey serves as an annual pulse check to monitor existing and emerging risks that may impact the safety, resiliency and stability of the global financial system. It is designed to help identify trends and foster industry-wide dialogue on potential threats to financial stability.”

This year’s report might seem to fans of Bitcoin and the blockchain like it should have come out back in 2013, when Mt. Gox and associated events had shaken the very foundations of cryptocurrency as revelations surrounding its demise came to light and the price dropped from $1,000, gradually bottoming a couple of years later. For in this year’s report is a tidbit from Stephen Scharf, DTCC’s Chief Security Officer [emphasis added]:

“The increase in concern around fintech’s impact on systemic risk demonstrates a growing awareness of the potential risk and highlights the need to evaluate both risks and rewards associated with fintech initiatives. DTCC embraces the promise that fintech innovations hold to further mitigate risk and reduce post-trade costs. But as the industry continues to adopt fintech innovations, like blockchain, AI and cloud solutions, we must ensure that those innovations do not jeopardize the safety and security of the current global financial marketplace.”

The report doesn’t elaborate on how the blockchain will actually do the opposite of its intended purpose, which is to stabilize and modernize archaic and opaque systems which frequently fail to serve their purpose or worse, to work against their users. The quote is mild in terms of anti-blockchain sentiment, but it still speaks to the fundamental unwillingness of some parties in old world finance to simply adapt, modernize, and survive the changes that will be brought about regardless if they get on board or not.

The report has some other interesting metrics within it, as well. The number of people who view “interconnectedness” as a systemic risk to finance was down 8% since last year’s poll, while the percentage of people who view Brexit as potentially problematic increased by 11%. Excessive debt was for the first time included in the report, and 28% of respondents listed it among their top five concerns.

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What Crypto Winter? It’s Perfectly Sunny for Luno with 40 New Jobs Open



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Bitcoin tumbled to a 15-month low today. Ethereum has all-but petered out. Heavyweights like ConsenSys are laying off staff, and many ICO startups are running out of cash before launching their products. You have to admit, things don’t look particularly good from any angle.

But while crypto investors are getting used to bracing before they open their eyes in the morning, the team at Luno remains quietly confident. The company that claims to make buying crypto from your mobile easy will continue on its mission of “upgrading the world to a better financial system.” And they’re hiring 40 new employees at their offices around the globe to help them do it.

In an announcement on the company’s social media, they said:

“New year. New career. New you. We’re hiring in our offices all over the globe. Learn more about our different positions in Engineering, Customer Success, and Design.”

The news did not go unnoticed. Major crypto personality Barry Silbert from Digital Currency Group (one of Luno’s main investors) retweeted the post exclaiming:

“What crypto winter? Luno has over 40 jobs they’re looking to fill.”

I asked VP of Countries and Marketing at Luno, James Lanigan, what’s behind their decision to take on more employees at a time when crypto companies are cutting back. He said:

“We are looking to lead the evolution of financial systems worldwide, something that we do not expect to happen in a short-term period. Instead, we fully anticipate it to be a process which requires much longer-term thinking.”

He explained that to build a team with the necessary skills and ability takes a number of years–and that the company fully expects to grow at a faster rate in 2019, despite the bearish market.

“More and more people are beginning to understand and see the value in owning crypto, and we want to be at the forefront of that educational process.”

Want a new career in 2019? Why not launch into crypto? There may be not much hopium left in this space, but if you like a good dosage of volatile with your eggs in the morning this could be the place for you.

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Crypto VC Funding Deals are Falling Apart Due to Bear Market



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According to Barry Silbert, the founder and CEO of Digital Currency Group (DCG), many venture capital funding deals in the crypto sector have fallen apart in the past few months as a result of the 12-month bear market.

Silbert, who oversees the operations of one of the largest venture capital firms in crypto with investments in Coinbase, bitFlyer, Blockchain, Chainalysis, Coins, ErisX, Etherscan, Kraken, Ledger, Ripple, and many more large-scale companies in the cryptocurrency space, said:

“We’ve seen half a dozen fundraising deals fall apart over the past month after the lead pulled out. All is not well in crypto VC investor land Good time to remind founders that a signed term sheet does not equal cash in the bank.”

Difficult Period For Crypto Companies

The bear and bull market cycle works the same way for venture capital firms as retail or individual investors. As ShapeShift CEO Erik Voorhees explained, venture capital firms tend to move out of a market when it struggles and comes back when it’s flooding with investments, demand, media coverage, and user activity.

Some venture capital firms, like Andreessen Horowitz, have stayed true to their vision and continued to lead investments during a market downtrend. However, the majority of venture capital firms habitually headed to the exits once the industry started to dwindle.

barry silbert bitcoin price
DCG founder Barry Silbert said that he has seen multiple crypto funding deals fall apart against the backdrop of the bitcoin bear market. | Source: YouTube/DLD Conference

“The VCs disappear when markets are down, and flood back in when markets are up. Are they not supposed to be the smart money? Their investing instincts seem little better than the Coors drinkin’ taxi driver all excited about Tron three weeks before the bubble pops,” Voorhees said.

In the past two to three months, some firms have made several high profile multi-million dollar investments in crypto startups that are strengthening the infrastructure around Bitcoin.

Nasdaq and Fidelity, for instance, engaged in a $27.5 million funding round to finance ErisX, a cryptocurrency exchange and a strictly regulated futures market based in the U.S.

At the time, ErisX CEO Thomas Chippas said that the support from leading financial institutions is monumental for the long-term growth of the startup:

“With increasing financial support from leading edge firms, ErisX stands to provide the most robust, secure and regulated digital asset offering available to both institutional and individual participants. Closing this second round of funding enables us to continue building our modern platform and expand our team.”

Build it While its Down

In the upcoming months, the crypto sector could continue to see a handful of venture capital firms and financial institutions finance the strengthening of the infrastructure surrounding the asset class while the vast majority of venture capital firms hold out on any additional investment.

After all, cryptocurrencies represent a market that is smaller than the market cap of major banks like JPMorgan. But, especially for venture capital firms whose role is to initiate high-risk, high-return investments in emerging or developing markets, the time to invest is when the market is demonstrating signs of recovery after a large downtrend when the valuation of companies and projects massively drop.

However, while the cryptocurrency bear market has taken a toll on all participants in the sector, reports show that the investment of venture capital firms in early-stage companies has noticeably slowed down throughout the past year, which suggest that the drop in crypto investments may correlate with a change in the global venture capital trend.

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Tron DApp Usage Jumps 48% — More Than 1 Million Weekly Transactions



tron cryptocurrency dapp

The TRON Foundation launched its TRC20 exchange this week. It is a place for people to exchange tokens issued on the TRON platform. The TRC20 exchange is located at TRX.market. The TRC10 token exchange is still on Tronscan, the primary block explorer and information service for the Tron ecosystem.

TRC20 and TRC10 tokens can be understood as Tron-native analogues to ERC-20 tokens. The TRC10 token is a user-issued token that doesn’t require the writing of a smart contract. The TRC20 token provides all the functionality and power of a smart contract-based token system. TRC20 is very similar to ERC20. All that’s needed to issue a TRC10 token is 1024 TRX, which are the equivalent of Ether in the system. TRX were trading at $0.013 USD at time of writing.

Tron has a number of decentralized applications running on it at present time, and despite the overall market downturn, usage was up, according to the foundation’s own metrics, by 48% over the last week. Usage crossed the 1 million transaction threshold in a single 24-hour period. In their blog on the subject, Tron wrote:

“This week, the 24-hour transaction number for Dapps reached 1.04M, a 48% increase compared with last week; the 24-hour trading volume hit 640M TRX, an 151% increase compared with last week. We have seen significant increases in both indexes […]”

One of the more interesting projects built on Tron is SeedIt, a decentralized platform that lets users contribute funds to content creators they most appreciate. Also Project Atlas, which incentivizes people to seed content on the BitTorrent protocol, the flagship program for which Tron acquired back in July.

Ethereum DApps Not Seeing Much Usage

If we take a look at the rankings on dAppRadar and dAppTrack, we see that Ethereum dApps overall would be in a whole new league of usage if they saw anywhere near the transaction activity that Tron dApps do. There are factors that mitigate actual Ethereum dApp usage, and one is that several sub-platforms have been built and run on Ethereum which would not contribute to direct Ethereum dApp activity.

Source: dappradar.com

Also, not all token activity is decentralized application activity – for instance, the Basic Attention Token is not exactly a decentralized application. Yet, it sees several thousand tokens transmitted per hour. Same thing with  Binance Coin (BNB), which has a volume higher than many non-token altcoins. BNB had over $15 million in volume in the last 24 hours at time of writing. Since it’s not used as a decentralized application, it doesn’t count as dApp transaction activity despite seeing a high usage.

All of which is to say we’re not insinuating that the Ethereum blockchain is currently under-used. But the data tells us that the dream of Ethereum decentralized apps has yet to be realized in the form of a “killer dApp.”

The central focus of most Ethereum developers has been scaling solutions. Second-layer scaling has been a major avenue of investment in the Ethereum world. Projects like Raiden and 0x saw massive investments, and dApps which build on these sidechains would not necessarily contribute to Ethereum mainnet’s statistics, either.

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Billion-Dollar Crypto Fund Says 25% of ICOs in its Fund May be Securities



Dan Morehead bitcoin etf pantera capital cryptocurrency hedge fund crypto ico

In a newsletter to clients sent on Thursday, Pantera Capital CEO Dan Morehead revealed that one in four initial coin offering (ICO) projects the firm has invested in could be considered as securities under U.S. regulations.

Morehead wrote:

“While we believe the vast majority of the projects in our portfolio should not be affected, approximately 25 percent of our fund’s capital is invested in projects with liquid tokens that sold to U.S. investors without using regulation D or regulation S. If any of these projects are deemed to be securities, the SEC’s position could adversely affect them. Of these projects, about a third (approximately 10 percent of the portfolio) are live and functional and, while they could technically continue without further development, ending development would hinder their progress.”

Are Pantera’s Crypto Investments Affected?

In April, Bloomberg reported that Pantera Capital had over $1 billion in its fund as the first official billion-dollar hedge fund in the cryptocurrency market.

At the time, on Bloomberg Television Thursday, Morehead disclosed that the firm’s single largest investment was ICON, South Korea’s largest blockchain project, and that it has roughly 10 percent of its capital invested in Bitcoin (BTC).

Since January, however, the value of ICO projects and tokens has declined substantially. ICON, which has been working with the government of Seoul to utilize the blockchain in various government-supported systems, saw a drop from $4.4 billion at its peak to $89 million, by 98 percent.

The value of most ICO projects and blockchain networks has declined by the range of 95 to 99 percent against the U.S. dollar in the past 12 months, mostly due to increasing regulatory pressure from the U.S. Securities and Exchange Commission (SEC) and the struggle of decentralized applications (dApps) to drive mainstream adoption.

SEC crypto ico blockchain
Pantera Capital CEO Dan Morehead said that, under SEC regulations and guidance, as many as 25% of the firm’s ICO investments could be securities. | Source: Shutterstock

One of the ICO projects Pantera invested in, Paragon, already reached a settlement with the SEC on November 16, as the first case of SEC registration charge settlement in crypto. Paragon was requested to register its token as a security, pay penalties, and file periodic reports with the SEC.

At the time, Stephanie Avakian, the co-director of the SEC’s Enforcement Division, said:

“We have made it clear that companies that issue securities through ICOs are required to comply with existing statutes and rules governing the registration of securities. These cases tell those who are considering taking similar actions that we continue to be on the lookout for violations of the federal securities laws with respect to digital assets.”

As SEC co-director Avakian emphasized, ICOs are required to comply with existing regulations, and several ICOs have gone through the appropriate steps to ensure its compliance with U.S. regulations.

The ERC20 tokens listed by Coinbase are generally considered to be non-securities given the exchange’s statement published in May that explicitly described its intent to only list crypto assets that are compliant with existing regulations.

Pantera Capital’s analysis of its own investments also demonstrates the possibility of segregating security tokens to non-security tokens with the guideline the SEC has provided earlier this year.

Shifting Trend

The ICO market has experienced a steep decline in demand, interest, and volume, all the while international government agencies crack down on projects for raising money through token sales.

With Japan and South Korea’s plans to restrict ICOs to accredited and institutional investors, the next chapter of the ICO sector could be institutionalization, as projects shift away from targeting retail investors in the public market to avoid any conflict with the U.S. SEC.

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Insurance Needs More Regulation Than Crypto



Allianz blockchain

Following recent comments by Allianz CEO Andreas Utermann calling for cryptocurrency to be outlawed, VanEck Head of Digital Assets Gabor Gurbacs has stated that the insurance industry is in greater need or comprehensive regulation than cryptocurrency. In a now-deleted post on his Twitter account, Gurbacs made the point that the behaviour of insurance companies toward investors and customers makes it hypocritical for them to pass judgement on cryptocurrency market participants.

Using an insurance company’s treatment of his mother’s claim following a serious car accident as a case in point, he noted that Allianz and other insurance companies are hardly in any position to profess some kind of moral superiority over crypto investors and businesses on the subject of regulatory oversight.

The tweet read:

“My mother almost died in a car accident a few years ago. All injuries theoretically covered in Allianz insurance policies. They didn’t pay when we most needed coverage that was paid for. Allianz should shut the f*** up on anything #crypto or #insurance!”

Gurbacs Takes Insurance Industry to Task

Earlier this week, comments by Utermann at a panel discussion in London made headlines around the world when he stated that the regulatory approach to cryptocurrencies should be a Chinese-style outright ban, as against the variety of regulatory frameworks being considered or implemented by regulators in most major economies around the world.

In his view, cryptocurrencies offer absolutely no value worth regulating and are notorious for wiping out people’s savings. As such according to him, they should be treated the same way as Ponzi schemes or money laundering networks. Expectedly, this view has not gone down well in crypto circles, sparking a groundswell of anger against what many cryptocurrency holders and investors see as a message of aggression from an attack dog working for a discredited financial system.

Writing on his Twitter thread, Gurbacs stated that rather than crypto, it is in fact insurers that need to be regulated more closely, due to misleading claims made to investors and sale of ill-suited product to clients.

In his words:

“Insurance companies regularly mislead investors, their disclosure systems are questionable and leave clients behind when they most needed. Insurance companies need more regulation, not crypto…The state by state regulation of insurance companies, and inconsistencies across the board, make it practically impossibly for policy buyers to understand what they are buying. Buying insurance is like intending to buy bread but getting horse-sh*t instead.”

Gurbacs has been in the news for an altogether different reason recently, following his pronouncement that VanEck is “cautiously optimistic” of being successful in its application to the SEC for a bitcoin ETF, even as the SEC issued a third and final three-month extension to enable it to come to a decision.

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Binance Adds USDC Trading Pairs – Stellar and Ripple Represented



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Binance announced Friday that it would be adding a few new USD Coin pairs and moving its two existing USDC pairs into the combined stablecoin market called USDⓈ. Both ripple (XRP) and stellar (XLM) will have USD Coin pairs, in addition to their existing stablecoin pairs. The move involves the cancelling of any trades that exist in the current two USDC markets: BTC/USDC and USDC/BNB at the time of the move, essentially wiping the slate and creating fresh markets for the stablecoin.

The pairs being created with USDC are: BNB, BTC, ETH, XRP, EOS, XLM, and USDT. All of these will now be accessed through the USDⓈ asset market tab. They will no longer be in the regular coin exchange of Binance. It has BTC and ether as its primary base trading tokens.

Binance was clear on their warning about existing trades in tangential markets:

“Please note: The existing USDC/BNB and USDC/BTC trading pairs will be removed and delisted at 2018/12/16 03:00 AM (UTC). All existing orders in each order book will also be canceled at this time.”

The new markets were already showing in the advanced exchange as of Friday but were not operational.

Stellar (XLM) and Ripple (XRP) Both Get New Liquidity

stellar cryptocurrency crypto xlm
Stellar (XLM) should receive a liquidity bump from the introduction of USD Coin trading pairs on Binance.

XRP and XLM, ripple and stellar, the feuding cousins of the regulated international money movement game, were both already listed against PAX, USDT, and TrueUSD. Now they will have an additional fiat trading pair in USDC. That they are being treated equally is an interesting move on the part of Binance, whereas their overall market indicators are far from equal.

XRP was trading at 29 cents at the time of writing with a 24-hour volume of over $300 million. Stellar lumens were at around 10 cents. Their 24-hour volume was approximately one-fifth of ripple’s, at just over $67 million.

The long history between the two tokens makes for an interesting dive for anyone interested in cryptocurrency. They’ve been embroiled in lawsuits and the like, but their communities have a lot of crossover. They started with essentially the same technology, but the Stellar project philosophically prefers to see itself as a peer-to-peer payment protocol. Blockchain startup Ripple, with whom XRP is closely associated, prefers to focus on bank-to-bank and institutional money movements across borders, easing frictions created in the old world financial system. Such frictions were created using clearinghouses and intermediary banks. They go away when cryptocurrency and blockchains enter the picture.

Both are, of course, a long way from their all-time highs. However, their current prices are much more realistic than many altcoins in that they draw from multiple fiat markets, including the now four they will each have on Binance, the world’s most active exchange.

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XYO Network Partners With Esri For Blockchain Enabled Geographic Information System



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XYO Network, a blockchain-based geographic information system (GIS) with an Ethereum token and its own blockchain network, announced today a partnership with Esri, one of the world’s oldest and largest GIS systems and mapmakers, a company founded in 1969.

The partnership came about when XYO hired a former Esri employee and the partnership became an obvious move. Esri wants to be able to access the data that the XYO Network is creating for its clients, and XYO network wants to have access to those clients.

Esri owns ArcGIS, a premier enterprise-level map-providing product, and this is the product that will be utilizing the XYO Network. It currently services more than 350,000 organizations. From the press release on the subject:

The collaboration opens the possibility for ArcGIS users to enable increasingly important capabilities such as tracking cars in emerging “smart cities,” clarifying the often-dramatic geographic changes based on natural or man-made disasters, and many other location-based applications and scenarios.

The advent of GPS and location-based services has brought with it several inevitable realities along with potential improvements. One inevitability is people’s propensity for scamming.

During a conversation with Markus Levin, co-founder of XYO Networks, he mentioned how people have repeatedly been able to scam rare Pokemon in the Pokemon Go game, and how the technologies his firm are working on would make such activity impossible. The inevitability is that any time people are able to act dishonestly, they will. Blockchain knows this and provides a number of ways to disincentivize or disable dishonesty in certain types of transactions.

One potential improvement is the notion of people being able to prove what they say. Local businesses can be made or broken through the use of online review systems like Yelp!, and there’s virtually no way to be sure, with standard GPS technology, whether or not the reviewers actually ever visited the restaurant they’re lambasting. Competition can hire reviewers to lie, for instance, or they can be motivated by some other anti-social element. But with XYO’s technology, reviewers could be forced to legitimize their claims by proving they were at this or that location at a given time, and other proof can attribute to them having given a useful review. Levin says that as much as 60% of all online reviews today are useless.

These are just two situations where the XYO Network’s Geographic Information System technology can be used. Levin told us that they’ve really developed a platform and a network where many types of participants can be at play, and using the XYO token, services and businesses that need the data can access it. Additionally, XYO’s GIS data can be useful in areas where there is no GPS ability, like underground or population-dense locations, or locations that have a lot of buildings. “We create an audit trail of the data which we then can follow,” he says.

Verifiable location data is big business. As Levin pointed out, if you look back 10 or 15 years when GPS first started being used in phones, it was really only used for maps and navigation. “No one was thinking about things like Uber back then,” he said.

Now, most apps a user installs have some need for GPS location data, but the location can be easily spoofed and modified using consumer-grade applications, and this can be dangerous in applications like self-driving cars or even delivery services. Logistics firms and delivery companies can benefit, while companies which currently use GPS could use verified data to improve their services. Levin also mentioned that ecological groups can build environmental models based on such data.

The partnership with Esri is big because the firm remains one of the main places that any enterprise goes to when it has spacial analytics needs. Emerging Technology Practice Lead at Esri, Kevin Bolger, said in the press release:

In the mapping and spatial analytics space, determining relative location of objects, and particularly those in motion, is important, and we have the opportunity to pair that ability and blockchain technology as a significant next step for the industry as a whole.

The applications of the XYO platform are open-ended. The services provided by it are myriad, with a number of possibilities for start-ups to partake, including technical roles within the network such as verifying data and serving it. XYO tokens are required to use the platform, which is what creates demand for the token. At time of writing the token had a circulating supply of more than 5.5 billion, a per token price of around .003 USD, and a resulting total market capitalization of more than $20 million. The high supply and low value is somewhat intentional – the token will be used frequently in order to access data, and it cannot be competitive if the built-in costs are high because the price of the tokens is too high.

CCN has been informed that the partnership with Esri is just one of many in relation to XYO over the coming months and years, with more exciting partnerships and announcements on deck.

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Porsche Arranges $170m Loan Using BBVA’s Blockchain Platform



Prestige car-maker Porsche has arranged a loan to back its proposed strategic acquisitions using Spanish-bank BBVA’s ever-developing distributed ledger technology (DLT) platform.

The loan, valued at €150 million (the equivalent of nearly $170 million USD) is, says a press release from BBVA:

“The first acquisition term loan ever arranged through blockchain technology.”

Acquisition term loans are provided for a specific purpose and period. In this case, Porsche Holding Salzburg, a subsidiary of Volkswagen AG, is seeking to expand its retail distribution network in Europe and Asia.

The pilot also makes Porsche, still the largest automotive distributor in Europe, the first non-Spanish borrower to use BBVA DLT to negotiate and close a corporate loan.

Frank Hoefnagels, Head of Banco Bilbao Vizcaya Argentaria (BBVA) Corporate Investment Banking (CIB) in Germany, is “proud” to be on a common blockchain path with such a longstanding partner. He adds:

“This transaction is all about putting blockchain technology into meaningful practice in the interactions with our clients.”

Hoefnagels illustrates a key next step for blockchain technology, after numerous pilots in the sector, the expectation now is to see more real blockchain use cases and applications. For BBVA, which has been actively working on its technology for some time, this is obviously important.

Using Blockchain to Create a DIY Financing Model

BBVA hopes to use blockchain to automate negotiation processes and minimize operational risks as well as improving the client experience. The bank plans to progress towards a “Do It Yourself” (DIY) financing model for its business and corporate clients. The bank says:

“Blockchain technology also ensures traceability and immutability making the documentation process safer and more transparent.”

BBVA believes its latest blockchain transaction demonstrates how new technologies can “provide a leap in efficiency in financial markets,” something again that forms the basis of blockchain’s promise.

Dominik Paschinger, Branch Manager of Porsche Corporate Finance, Belgium, says “digitalization” is a key part of “Porsche Holding’s Strategy 2025” and that:

“The goal is to advance in all fields of activity. We think that blockchain technology has great potential.”

BBVA has also recently used its blockchain platform to finalize a syndicated loan for Red Eléctrica of the same value and extend a line of credit with Repsol worth €325 million, around $367 million USD. It has previously trialed distributed-ledger loan processes using both Ethereum and Ripple blockchains successfully, naming itself the first global bank to successfully complete blockchain-based corporate lending.

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SoftBank May Sell Nvidia Shares — But Not Because of Crypto Downturn



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Nvidia’s share price has fallen 48 percent since October. Now, rumors have surfaced that SoftBank plans to sell its 4.9 percent share in the leading graphics chip maker.

Bloomberg reporting has cited anonymous sources who allege that SoftBank, which through its Vision Fund acquired around $3 billion in Nvidia shares in 2017, could sell all or part of its stake early next year.

Japan’s SoftBank bought its stake in the American technology company in May 2017, and it later transferred the shares to its Vision Fund. The fund is an investment vehicle with an end goal of $100 billion in value. SoftBank became Nvidia’s fourth-largest shareholder.

Nvidia’s graphics chips, popular in gaming machines, found a new market in cryptocurrency mining as home-users sought to improve their machines and take on the new form of income generation.

Nvidia’s Share Price Decline not Due to Crypto Downturn

nvidia crypto
Nvidia shares have taken a hit in the latter half of 2018, much like the crypto market has throughout the year.

In August, Nvidia shelved its focus on the cryptocurrency market, blaming the downward trend of cryptocurrency prices. At the time CCN disputed this reasoning by comparing Bitmain’s profitability in an equivalent period to that cited by Nvidia before it exited the market.

It was not the demand for cryptocurrencies that was impacting Nvidia, but a decline in demand for graphics processor unit (GPU) mining chips. ASIC mining chips and machines were performing much better in the market due to their efficiency, drawn from being designed purposely for cryptocurrency mining.

At the time of Nvidia’s market exit, the demand for cryptocurrency mining equipment was high, and competitors like Bitmain, Canaan, and Samsung saw growth. The demand for these specialist machines was fueled by large-scale crypto-mining operations which benefit from economies of scale far over the efficiencies of home and small miners.

In August, Nvidia CFO Collette Kress said:

“Whereas we had previously anticipated cryptocurrency to be meaningful for the year, we are now projecting no contributions going forward.”

Last month, CNBC Mad Money’s Jim Cramer illustrated a more likely reason for Nvidia’s sudden woes:

“Nvidia still makes the best graphics chips, which have become more powerful than traditional microprocessors. It still has a lead over the competition in a lot of uses, although you could argue that AMD’s catching up to them in the data center while Intel rivals them in self-driving vehicles. I think Nvidia made an honest forecasting mistake.”

Though Nvidia’s share price has fallen, it is still the largest gaming graphics card maker. Some of the share price fall should be attributed to a correction in demand for gaming chips. During Q3 there was an oversupply of gaming chips to the market, the firm slowed its supply and adjusted fourth-quarter forecasting down. Analyst consensus is that after this adjustment works through, the company will continue to see earnings growth in the region of 15 percent each year for the next five.

If SoftBank sells its Nvidia share, it is still like to make $3 billion from the deal, as it constructed a “collar-trade” to protect against a share price decline. The company, incidentally, also recently denied reports that it had participated in Bitmain’s latest pre-IPO funding round.

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UCLA Launches First Accredited Blockchain Engineering Course



UCLA blockchain course crypto

Blockchain courses are being adopted by more institutions as a way of teaching and equipping the next generation of crypto engineers to meet the ever-increasing demand for the technology and its applications. Now, the University of California, Los Angeles (UCLA) is gearing up to offer its first blockchain engineering course, thanks to a sizable donation from MouseBelt Blockchain Accelerator. 

UCLA to Offer Accredited Blockchain Course

The university, which previously organized blockchain and cryptocurrency seminars through its Anderson School of Management, has now announced that it will be running a full technical blockchain programming course from January 2019.

The course will be offered as 4-credit special topics course, which would be an upper-division elective requirement that is open to both students of electrical and computer engineering and computer science. It will cover topics including an overview of blockchain-related concepts, Ethereum, decentralized apps (dApps), crypto tokens, smart contracts, hash functions, and more.

The class will be led by Professor John D. Villasenor, a professor of management, electrical, and electronics engineering, as well as public policy. He will be assisted by Jason Huan and Andrew Battat, both of whom have been running various workshops on blockchain through Blockchain at UCLA, a student organization. MouseBelt Blockchain Accelerator is known for making investments in blockchain-based projects and startups, providing them with access to crypto engineers and developers to work on their projects, as well as dedicated support staff, marketing officers, and business management personnel to help secure real-use cases.

The company has also stated that it is making plans to add more schools to the university program in 2019 and that moves towards international expansion are already in the works.  

Patrick McLain, Chief Operations Officer at MouseBelt, told CCN via email:

“While the market is scary right now, we believe the future is bright. No better way to invest in the future than investing in the youth. For us, this is only the beginning of building the bright future ahead through our University Program.”

Seats Quickly Filled up

The course is accredited through UCLA, and it does require some background in programming from some other basic-level classes. According to a MouseBelt representative who spoke with CCN, slots for the course have already been filled up, even though registration has only been open for a few days.

UCLA is joining a long list of universities to offer full-fledged blockchain-related courses. Earlier last month, the University of Tokyo also announced that it would be offering a DLT course at its graduate engineering department. The course, which has been dubbed the Blockchain Innovation Donation Course, was rolled out on Nov. 1, and the program is expected to run through October 2021. The course was made possible thanks to donations totaling about $800,000 from organizations such as the Ethereum Foundation and banking giant Sumimoto Mitsui.

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Pro-Crypto Trading App Robinhood Adds Checkings & Savings Accounts



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Menlo Park-based Robinhood has launched savings and checking accounts for its US customers, according to a company blog post. The new accounts would follow the similar trend that we have become accustomed to: “fee-free, commitment-free and surprise-free” were the words used lavishly on the company’s website. Robinhood, which operates a crypto trading platform in addition to its flagship stock trading service, is also disrupting what customers can expect to earn on their bank deposits. The startup promises to pay 3 percent interest for every deposit made in both checking and savings accounts.

“Currently, traditional checking and savings accounts cost more for people who make less, are riddled with unfair and hidden fees, and earn you minimal returns on your savings. We believe you should earn more on your money, and shouldn’t be charged fees to access it,” the company’s blog reads.

As far back as June, the crypto-friendly Robinhood was rumored to be making moves to offer banking services to its user base, which has swelled to more than 6 million accounts. Bloomberg had quoted anonymous sources who said the startup was in advanced discussions with the US Office of the Comptroller of the Currency (OCC) so it could become a banking service provider. While the firm has yet to receive permission to operate as a bank, it said that it had structured its checking and savings accounts such that they could be offered under its current licenses.

Robinhood checking savings crypto trading
Source: Robinhood

The account also comes with a personalized debit card, which Robinhood claims can be used in over 75,000 ATMs across the US for free cash withdrawals. For users who are unsure where the free ATMs are located, the Robinhood app would have a new feature that allows you to find the nearest ATM.

But while Robinhood does not have a bank charter yet, it does have a broker-dealer license and is a member of the Securities Investor Protection Corporation, allowing it to protect cash accounts up to $250,000. Not having the bank charter also limits the kind of investments it can buy up with the deposits. For now, the startup would be generating funds from investments in safe assets like US Treasury bonds and interchange fees from debit card transactions.

As Robinhood continues to disrupt the financial sector in the US, European digital banking alternative Revolut — which also offers crypto trading — has its sights firmly on conquering Europe. The London-based startup recently received the green light to offer European customers banking services. As reported by CCN, Nikolay Storonsky, founder and CEO of Revolut noted:

“Our vision is simple: one app with tens of millions of users, where you can manage every aspect of your financial life with the best value and technology.”

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UAE Firm Taps Ripple Blockchain RippleNet to Launch Cross-Border Payments



Ripple UAE

RippleNet, the blockchain-based global payment network of Ripple, is set to increase its footprint in the Middle East with a United Arab Emirates-based remittance firm set to unveil cross-border payments using the technology.

According to Reuters, remittance firm UAE Exchange will roll out RippleNet-powered cross-border remittance services to Asia in the first quarter of 2019 in partnership with other financial institutions operating in the region.

“We expect to go live with Ripple by Q1, 2019 with one or two Asian banks. This is for remittances to start with, from across the globe into Asia,” the CEO of UAE Exchange, Promoth Manghat, said.

Expat Community

Asia is a lucrative market with regards to remittances owing to its large population working abroad. The United Arab Emirates (UAE), on the other hand, is one of the countries that boasts one of the highest percentages of expatriates relative to the native population. A significant number of these expats hail from Asian countries.

When UAE Exchange joined RippleNet in February this year, the global head of Infrastructure innovation at Ripple, Dilip Rao, buttressed this point noting the ready market waiting to be tapped in the UAE:

“We chose to focus on solving inefficiencies in key corridors where payment flows are significant and growing. Adding a market leader like UAE Exchange to RippleNet will bring instant, certain, low-cost payments to the millions of retail customers in the UAE who send money abroad.”

Growing List of Members

Though Ripple and UAE Exchange did not name the partnering financial institutions, it could be any of the over 100 member banks and financial institutions that have joined RippleNet in the recent past. In Asia, among the most recent banks to join the enterprise blockchain network of Ripple is Malaysia’s Commerce International Merchant Bankers (CIMB) Group, the fifth biggest bank in Southeast Asia by assets.

Just like in the case of UAE Exchange, CIMB Group joined RippleNet to enhance cross-border payments. While CIMB Group already had an existing remittance service known as SpeedSend, incorporating Ripple’s technology is expected to extend the service to the rest of Southeast Asia.

“CIMB’s network already spans 15 countries, nearly 800 branches and offers SpeedSend–one of the best solutions in the ASEAN region. Now, by integrating Ripple’s blockchain technology, they will enable their customers to send vital funds to family, friends and loved ones more efficiently,” the CEO of Ripple, Brad Garlinghouse, said at the time as CCN reported.

Other Asian banks that joined RippleNet this year include India’s Kotak Mahindra Bank and Thailand’s Siam Commercial Bank.

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Bear Market Hinders Coincheck’s Stabilization Effort after $530 Million Theft



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The bear market that the crypto industry is facing has had a lot of adverse effects, with companies shutting down services and laying off staff members in their droves.

Japanese cryptocurrency exchange Coincheck seems to be the latest company to feel the brunt of the dire crypto market state, according to reports from Nikkei Asian Review.

A top executive of the firm was quoted by the outlet, saying that the company which has been trying to turn back its fortunes after suffering a major crypto heist in January – has not found it easy. Bitcoin, whose value as of this writing is $3,429, along with the rest of the market, is currently experiencing one of the worst downturns in their prices. The bearish run has also battered the market cap of most cryptocurrencies.

Per the reports, the slide in the value of Bitcoin has soured the efforts of Coincheck to recover its lost fortunes, after a hack led to the loss of 58 billion Yen ($511 million) in cryptocurrency back in January.

Toshihiko Katsuya, President of Coincheck, said on Wednesday:

“We hope to see trading volume rise as we run the exchange in a stable way, but the market is weak. Volatility is high, but transaction activity has not been revitalized.”

In what has been referred to as one of the biggest thefts in the history of cryptocurrency, Coincheck was forced to halt all operations after 523 million NEM coins- which, at the time, were worth approximately $530 million- were stolen on the 26th of January.

According to the company’s representatives, the coins were lifted through a series of unauthorized transactions from a hot wallet that the hackers got access to. The NEM funds were housed in the wallet, and the hackers were able to drain it. After the hack, Coincheck was forced to halt all withdrawals from the site shortly after the breach.

The exchange, however, resumed its services on November 26, 2018, including opening new accounts and trading tokens. Although the company is yet to obtain approval from the Financial Services Agency, Japan’s financial regulator, it operates nonetheless.

As part of the company’s moves to gain lost ground, online broker Monex Group, which purchased the exchange back in April, announced that it would be launching crypto trading in the United States from the first quarter of 2019.

Monex held a press conference in Tokyo, where John Bartleman- President of TradeStation, the U.S. subsidiary of Monex- announced that they are planning to expand their crypto trading offerings to U.S.based customers in Q1 2019.

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Why Samsung Plans to Integrate Crypto Cold Storage in its S10 Series



samsung galaxy s cryptocurrency crypto

According to SamMobile, the biggest online Samsung community, the electronics giant is planning to integrate a cold wallet system into its upcoming Galaxy 10.

Adnan Farooqui, the senior executive editor at SamMobile, wrote:

“After hearing about the trademarks for Samsung’s blockchain and cryptocurrency software, we decided to dig around a little deeper. We can confirm that the company is indeed developing one and that it may be launched with the Galaxy S10.”

Reasons Behind Crypto Wallet Integration

Since early 2018, Samsung, the largest conglomerate in South Korea that has dominance over many of the country’s major sectors including insurance, online payment, asset management, car manufacturing, electronics, and property development, has demonstrated its interest towards the cryptocurrency sector.

Dissimilar to other conglomerates in the local market, Samsung entered the cryptocurrency sector with a venture focused on Bitcoin mining, creating mining equipment from its foundry based in Suwon, South Korea to ship to international distributors.

Throughout the past several months, reports claimed that Samsung has been working with Halong Mining in China and Squire in Canada, but as of December, the partner distributors of Samsung’s ASIC mining chips remain unclear.

Samsung Blockchain crypto

For over eight months, the company has been gradually increasing its mining business, and the cryptocurrency wallet sector seems to be the company’s next target market.

Samsung prefers to utilize and leverage its existing resources to expand into new emerging markets rather than creating an entirely new infrastructure to support it. The company established a mining equipment manufacturing business as a means to maximize the potential of its large-scale foundry and the company’s cryptocurrency wallet that is currently in development to be built into its popular Galaxy mobile phone series.

If the company is to enter the cryptocurrency exchange market, which nearly every major company in the country including telecommunications, gaming, financial, and insurance companies are involved in, it will have to build a new infrastructure from the ground up, similar to what Shinhan Bank has done with Gopax.

Instead, the company decided to utilize its existing line of products to help strengthen the infrastructure surrounding cryptocurrencies as an asset class.

According to SamMobile, if the wallet gets integrated into the Samsung Galaxy S10, users will be able to import their data from wallets such as MetaMask and Trust Wallet to transact natively with the mobile phone.

The publication reported:

“Samsung’s cold wallet app will enable users to import their existing wallets from third-party services like Metamask or TrustWallet. They will also be able to create a new one in the app itself. The cryptocurrencies and tokens supported initially may include Bitcoin, Ethereum, Ethereum-derived token ERC20 and Bitcoin Cash.”

Difficult Times For Hardware-Focused Businesses

Companies that dominate the global mobile phone market including Samsung, Apple, HTC, Huawei, and Oppo can easily integrate cryptocurrencies and provide native support for the asset class.

In the bull market of 2017, many projects raised hundreds of millions of dollars, and one — Sirin Labs — claims to have raised nearly $158 million in an initial coin offering (ICO) to create mobile phones with native cryptocurrency support to compete against the behemoths of the mobile phone market.

As companies like Samsung integrate cryptocurrency support, projects that focus on creating hardware could become increasingly irrelevant.

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Bitcoin Exchange CoinFlux CEO Arrested for Money Laundering



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According to a local Romanian news outlet Ziar de Cluj and others, Vlad Nistor — the CEO of Romania-based Bitcoin exchange CoinFlux — has been detained on behalf of the US government and is awaiting extradition. He was arrested in the city of Cluj-Napoca on Tuesday, according to another outlet.

The crypto exchange has not disclosed the arrest on its blog or social media pages, and as recently as Dec. 3 the firm was advertising Nistor’s impending appearance on a local radio show.

According to one report, he will be extradited to the US today, having sat in Cluj and Bucharest since his arrest. Nistor will reportedly be charged with fraud, computer fraud, money laundering, and what amounts to racketeering. CCN has reached out to the US Justice Department for a statement on the extradition and the nature of the charges against Nistor.

The three-year-old CoinFlux is an exchange platform so small that it does not register on CoinMarketCap’s market lists. There are markets on that page with volumes as small as $10,000, although, admittedly, they are on crypto exchanges with much higher volumes.

An editorial in one local newspaper expresses an opinion against the extradition of Vlad Nistor, with a view to the sovereignty of Romania [roughly translated]:

“Either Romanian Vlad Nistor rushed USSS guest starters yesterday morning, packed him tonight, and today he wants to pack him in the United States. Nobody opposes extradition from the Romanian authorities, even though the Romanian citizen is only in a criminal investigation stage – no one knows why he is accused (yesterday even the defenders had no idea what to build their minimal defense). Well, how about human rights, the right to an equitable judge, the equality of arms, and so on?”

Nistor is also reportedly the son of one of the founders of Banca Transilvania, the second-largest financial institution in Romania.

CCN will post more details on this case as they become available. In the meantime, this author believes that it is not recommended to use the CoinFlux bitcoin exchange as the firm has yet to publicly disclose a serious matter like the arrest of their CEO and co-founder.

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‘What is Bitcoin’ Ranked Among Top Google Searches in 2018



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About a year ago, Google searches for “Bitcoin” surpassed searches relating to Donald Trump. Now that Google has published its 2018 year-in-review of search terms, “What is Bitcoin” is among the top questions that people are asking Google, at least in the US. Last year, the largest cryptocurrency ranked in two categories globally, both in general news searches and “how to buy Bitcoin.”

More people wanted to know what Bitcoin was than people wanted to know about DACA, the administrative policy of Barack Obama to give a form of amnesty to those who were brought to the United States illegally as children.

what is bitcoin google

People are still more interested in Bitcoin than they are the Russian collusion investigation which is ongoing and yet to be resolved, more than two years into the presidency of Donald Trump.

what is bitcoin google

The downturn in interest in crypto searches goes along with the declining fiat value of the market over the same period of time. Bitcoin was several times as valuable a year ago as it is today. Mass media reporting on the subject of cryptocurrency certainly contributed a great deal. Another factor to take into account is that as people learn about crypto, their likelihood to search about the flagship cryptocurrency again is lessened a great deal. It’s safe to say the market has added hundreds of thousands, if not millions, of participants.

For its part, Google has never yet played a significant role in Bitcoin or other cryptocurrencies. None of their payment apps accept cryptocurrency. One thing that can be said for it, however, is that its Play store is much more permissive as regards the submission and publication of Bitcoin-related apps and other contents, than the iTunes Store, which has repeatedly generated news about censorship of crypto-related topics.

Google Trends doesn’t provide the gross number of searches, but Google is the top search engine in the world, processing millions of searches per minute, and therefore if one of its top queries is “What is Bitcoin” over the course of 2018, it’s safe to say that crypto reached the mainstream, at least as a topic of interest.

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What is Holding Coinbase Back From Integrating Ripple Into its Exchange?



ripple

On December 7, Coinbase, a leading crypto-to-fiat exchange, announced it is exploring 31 crypto assets to integrate into its exchange.

One of the cryptocurrencies the exchange has been looking into is Ripple (XRP), the second most valuable asset in the cryptocurrency market with a market valuation of over $12 billion.

Although Coinbase expressed its intent to list XRP in the future, the majority of investors in the global Ripple community were not satisfied by it because of the firm’s listing of four digital assets including Decentraland (MANA) this month.

So what exactly is holding Coinbase back from listing Ripple while listing small market cap cryptocurrencies and ERC20 tokens?

Federal Court Case

Earlier this week, Dan Romero, the vice president and general manager at Coinbase, stated that the company wants to eventually list 90 percent of legally compliant assets as long as they are above a certain quality bar.

He emphasized that like a traditional stock market, the company wants to provide users with as many selections as possible to allow users to decide which cryptocurrencies to invest in.

Romero said:

“Our recent shift in strategy is really driven by customers. When we asked customers the number one thing they want, they told us it’s adding new cryptocurrencies to the platform. With a traditional stock exchange, they list everything above a certain quality bar. And ultimately investors and individuals make decisions on what to invest.”

With the newly established priority of Coinbase to add new assets, many Ripple investors questioned the inability of the exchange to add XRP, given that it is the second biggest cryptocurrency in the world ahead of Ethereum (ETH).

The cautious approach of Coinbase towards the integration of XRP could be influenced by the pending federal court case between Ripple Labs and a group of investors alleging the asset to be a security.

Recently, the class action lawsuit filed against Ripple Labs was brought before the federal court of the U.S., and the case will be monumental in establishing the regulatory nature of XRP once and for all.

If the U.S. Securities and Exchange Commission (SEC) deems XRP as a security and Ripple Labs challenges it, it also has to go through the federal court. Hence, even for the U.S. SEC, there currently exists no alternative but to await the results of the pending case.

According to Jake Chervinsky, a U.S.-based attorney, In a conference in New York, the U.S. SEC chairman Jay Clayton said that the commission would have to wait for a judge or a jury to decide whether XRP is a security or not.

“The question I get most frequently: ‘do you think XRP is a security?’ Unfortunately, I can’t answer without giving legal advice. Even if I could, I’d only be speculating about what a judge or jury may decide and what Ripple is willing to accept in a settlement. Just have to wait,” Clayton said.

Likely No Decision Until Court Case Ends

Until the federal court decides whether XRP is a security or not, major crypto exchanges will likely not take the risk of integrating XRP, even if the exchanges believe XRP is not a security.

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Cryptocurrency Should be ‘Outlawed’: Allianz CEO Andreas Utermann



andreas utermann allianz bitcoin cryptocurrency crypto

Despite this year’s prolonged cryptocurrency market decline, many mainstream financial institutions and wealth managers have continued to explore how to make this nascent asset class more accessible to their clients. Firms such as Goldman Sachs and Fidelity are building crypto custody products, while exchange giants Intercontinental Exchange (ICE) and Nasdaq are focusing on futures trading. Don’t expect Allianz Global Investors to add its name to the list anytime soon.

Allianz CEO Unloads on Crypto

Speaking on Tuesday at a panel discussion in London, Andreas Utermann, CEO of Allianz — one of Europe’s largest asset managers — called for markets watchdogs to pursue a scorched earth approach to cryptocurrency regulation, stating that an outright ban was preferable to the “light-touch” frameworks pursued in some corners of the world.

“You should outlaw it”, Utermann said, according to a Reuters report. “I am personally surprised that regulators haven’t stepped in harder.”

The “you” to whom Utermann was referring may have been Andrew Bailey, the head of Britain’s Financial Conduct Authority (FCA), who was sitting next to him on the stage. Per the report, Bailey responded that Utermann’s position was “quite strong actually!” and that he agreed that cryptocurrency had “no intrinsic value.”

“We are watching that very closely,” Bailey continued, stating that the FCA had the initial coin offering (ICO) sector under close surveillance.

El-Erian: Cryptocurrency Has a Role in Economy

Mohamed El-Erian Bitcoin cryptocurrency Allianz blockchain
Source: World Economic Forum/Flickr

While Andreas Utermann’s hard line on cryptocurrency regulation does not appear to leave any room for negotiation, one of his colleagues at Allianz is somewhat more optimistic about this application of blockchain technology.

Mohamed El-Erian, chief economist at Allianz, has said that he doesn’t believe cryptocurrency will ever replace fiat money but that it will survive the present bear market and become “more and more widespread.”

“Cryptocurrencies will exist. They will become more and more widespread, but they will be part of an ecosystem,” he said last month at a conference in New York. “They will not be dominant, as some of the early adopters believed them to be.”

El-Erian has long regarded $5,000 as his bitcoin price target, stating that last year’s speculative frenzy — which caused a run-up to nearly $20,000 — was unwarranted and that the flagship cryptocurrency was a “buy” below that mark.

“Crypto is not dead, and certainly the underlying technology is not dead,” he said in September. “We’re going to see more widespread adoption, by both the private and public sector, of the blockchain technology and related technologies.”

Andreas Utermann Image from Rika73/Wikimedia Commons

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Danish Tax Agency to Go After 2,700 Nationals for Hiding Bitcoin Trades



Skattestyrelsen (SKAT), the Danish tax agency, has accelerated crackdown against a large number of nationals who secretly traded bitcoin on a Finnish crypto exchange.

According to information shared by the Swedish Tax Agency, a total of 2,700 Danes purchased circa $5.80 million worth of bitcoins from the exchange but sold them back for $6.1 million in local currency. That marks approximately $12 million worth of bitcoin trading that went unreported between the financial years of 2015 and 2017.

Karin Bergen, the directorate at SKAT, confirmed that they are reviewing the figures as of now and will go after every individual that ignored to mention their offshore bitcoin trades.

“If you have traded with bitcoins on the specific Finnish bitcoin exchange and have not specified any winnings, then you can hear from us so we can get your taxes in place,” she warned.

Tip of the Iceberg

Local media reports indicate that Danish tax inspectors and IT specialists are carefully studying the gains and losses made by bitcoin traders. It finds that while some traders invested inadequately in the crypto space with amount lesser than 10,000 Kroner, a notable number among all also purchased and sold cryptocurrencies for amounts exceeding 1 million Kroner.

“There are two types of trades,” explained Ole B. Sørensen, chairman of the personal data department of SKAT. “One is what I want to call a curious trade, which is about a few thousand dollars. And then there are those who have been trading for some enormous amounts.”

Reports also indicate that SKAT has already contacted the big whales involved in institutional-level bitcoin trading activity. The tax agency also plans to go after more such individuals in the coming months.

“It’s probably just the tip of the iceberg,” said Bergen. “Although the Finnish company is a relatively small bitcoin exchange, the information they have revealed is a precious source, which clearly shows trends and patterns in the area.”

Bitcoin is like Paintings

Danish nationals who have traded bitcoin over the years are now caught in a legal gray zone which, in the utmost consequence, may inadvertently put them in line with the law.

Payam Samarghandi, a lawyer and bitcoin expert from Denmark, confirmed that bitcoin is a taxable asset in the country.  According to the 1903 Tax Act, the Danish tax agency imposes charges when a property is purchased and sold again for profits. An expensive painting or vase, for instance, resembles how bitcoin taxation functions under the jurisdiction of SKAT.

“It’s a little bit like Kählervasen, a vase whose value increased five years after the first purchase,” Samarghandi explained. “At the time of purchase, the owner didn’t need to pay any tax on it. But when he sold it for at a significantly increased rate, then the profits he made became taxable.”

But again, a painting or a vase cannot be transferred online as a payment. SKAT realizes that it would be a difficult task for them to categorize bitcoin holders into those who speculate on the digital currency and those who utilize it.

Louise Schack Elholm, who is also a member of the Tax Council, said that there might be instances where bitcoin and other virtual currencies get purchased for purposes other than speculation.

“But,” she added, “it will be in sporadic cases.”

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Does Bitcoin Price Risk Fall to $2,500?



bitcoin price

Throughout the past three days, the Bitcoin price has demonstrated wild volatility in the range between $3,200 to $3,600.

The dominant cryptocurrency has struggled to break out of the $3,700 resistance level which several technical analysts have consistently mentioned over the last two weeks.

On December 12, the price of Bitcoin (BTC) fell by around three percent from $3,427 to $3,325 with a relatively low daily trading volume at $4.7 billion. Earlier this month, the daily volume of BTC hovered at around $6 billion.

The continuous fall in the price of BTC without a spike in its volume shows that the asset is declining in value without significant sell-pressure.

Where is Bitcoin Heading

Josh Olszewicz, a cryptocurrency trader and technical analyst better known for his online alias “BrotoshiMoku”, said cautiously that Bitcoin is at a risk of dropping to $2,500 if it cannot sustain any momentum in the short-term.

But, there also exists a possibility of the asset potentially surpassing major resistance levels and entering the $4,000 region and the analyst said that the decline in sell volume of the currency could allow it to engage in a corrective rally in the upcoming weeks.

He wrote:

“This is many weeks away from completing and will likely be wrong. But, if the pattern completes, bull entry at $4,300 other option is bearish 3rd drive down to $2,500 and then retrace to $3,600.”

It is difficult to predict the short-term trend of an asset in a highly volatile period and during a bear market because a minor factor could easily sway the price trend of the asset.

Historically, Bitcoin has tended to experience a major drop in the range of 80 to 85 percent prior to engaging in a several-month-long consolidation period and if it can establish a proper bottom at $3,000, a support level it has held up relatively well since late last month, a gradual climb to $4,000 is possible.

Bitcoin is Not Going to Zero

Mike Novogratz, a billionaire investor and the founder of Galaxy Digital, said that Bitcoin is at a phase wherein pessimism and fear are dominating the market.

He said:

“That was a drug, and I don’t say that lightly. When you’re in the speculative mania, testosterone is boiling over and there’s a lot of greed. The audience is more sober now—the drug is gone. If anything we’re on the other side, at the stage where there’s the pessimism, and the fear, and the ‘Oh my God, it’s going to zero.’ But it’s not going to zero. We’re at the methadone clinic.”

In the short-term, because the demand from the public has declined and the speculation towards the asset has somewhat stabilized, Novogratz said that the market could remain quiet for several months.

However, he emphasized that his company and his team are ready to wait out until the next wave of investors, users, and companies arrive, which he sees as inevitable.

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Ethereum Futures Inbound? CFTC Asks for Public Comment on ETH Network



ethereum dex crypto exchange

The Commodity Futures Trading Commission (CFTC) has put out a Request for Information (RFI) asking for public comment and feedback to enable it better understand Ether and the Ethereum blockchain as it seeks to expand its cryptocurrency knowledge base beyond bitcoin.

In a press release dated December 11, the regulator stated that it is seeking the feedback to inform its grasp of the mechanics, technology and markets for cryptocurrencies outside of bitcoin which has historically dominated the conversation.

The RFI will accept responses for 60 days after being published in the Federal Register. Clarifying what the information request seeks to achieve, an excerpt from the announcement reads:

“In a Request for Information (RFI) that will be published in the Federal Register, the CFTC is asking for public feedback on a range of questions related to the underlying technology, opportunities, risks, mechanics, use cases, and markets, related to Ether and the Ethereum Network. […] The RFI also seeks to understand similarities and distinctions between Ether and Bitcoin, as well as Ether-specific opportunities, challenges, and risks.”

According to the statement, the information gathered in the course of the exercise will be used to improve the CFTC’s knowledge bank on the subject of cryptocurrencies, which will position it for effective regulation as the space continues to grow. The data and responses gathered will also be used to inform the activities LabCFTC, the body’s Fintech initiative that aims to bridge the gap between the regulator and financial innovators.

ETH Futures Speculation

The announcement could be a hint at the preliminary workings of an Ether futures trading framework. Up to this point, the only cryptocurrency with regulated futures trading is bitcoin – a state of affairs that has historically fueled its outsized crypto market dominance. In November, CCN reported that Nasdaq  is planning to introduce a dedicated bitcoin futures market before the end of Q1 2019 after working through an approval process with the CFTC.

If it does turn out that the CFTC is in the early stages of exploring approval for Ether futures, this could have a significant positive impact on Ethereum following its recent dethronement by XRP to become only the third most capitalised cryptocurrency.

In line with the CFTC’s pro-innovation stance, the RFI is one of a number of methods that it deploys to ensure that its regulatory system does not result in overreach which stifles innovation according to University of Arkansas law lecturer Carol Goforth. CFTC chairman J. Christopher Giancarlo is himself notably pro-crypto, declaring recently that crypto is “here to stay“, whether or not it upstages the US Dollar as the de-facto world reserve currency.

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Crypto Regulation is Necessary, But is Korea on Right Track?



upbit crypto exchange bitcoin

On December 10, Lee Seok-wu, the CEO of Dunamu, the parent company of South Korea’s largest crypto exchange Upbit, said that regulation is important to establish industry standards.

During a meeting with several members of the Congress and the Financial Services Commission (FSC) hosted by Upbit, Bithumb, Gopax, Korbit, and Coinone, five of the biggest digital asset trading platform operators in the local market, Lee said:

“The role cryptocurrency exchanges play in the cryptocurrency and blockchain ecosystem is crucial and the industry with the government have to establish regulatory guidelines to ensure that the local market is operated by exchanges that meet high standards.”

The Upbit CEO emphasized that the regulatory frameworks implemented by the government to govern exchanges, especially in the area of Know Your Customer (KYC) and Anti-Money Laundering (AML) can be improved.

What Needs to be Improved?

According to Lee, the following areas of the cryptocurrency market and policies surrounding it need to be addressed quickly, in the short-term:

  1. Low standards of security implemented by small exchanges leading to hacking attacks
  2. Poor KYC/AML policies disallow crypto exchanges from monitoring transactions
  3. Regulatory guidelines must be strengthened to ensure platforms are on the same page

Speaking to high profile government officials, lawmakers, and regulators, Lee explained that the cryptocurrency market is characterized as an insecure and risky market to invest in due to various hacking attacks and security breaches small crypto exchanges fall victim to on a regular basis.

Lee told government officials that unless industry standards are established, minor digital asset exchanges that are solely focused on maximizing profit will continue to emerge and damage the reputation of the entire local market by rendering the efforts of the good actors in the space like Upbit unnecessary.

south korea bitcoin cryptocurrency crypto
Source: Shutterstock

On November 27, Upbit became the first crypto exchange in South Korea to receive an approval from the Korea Internet and Security Agency (KISA) for having world-class security measures and protocols in place.

With the information security management system (ISMS) license the exchange obtained, under existing regulations, the company is recognized as a major information corporation that is approved by the government.

But, all of the efforts Upbit, Gopax, Korbit, and other major cryptocurrency exchanges have made in the past few months could demonstrate little progress in recovering the public’s trust towards the digital asset market if minor exchanges continue to suffer security breaches by losing the funds of investors.

“Due to the lack of regulatory guidelines on cryptocurrency exchange development, small businesses are aggressively launching exchanges that do not have adequate internal management systems and security protocols in place, negatively affecting the public image of the local cryptocurrency market.”

Lee heavily emphasized that if the government provides a simple regulatory framework that prevents small exchanges from opening without sufficient security measures in place, most of the hacking attacks can be avoided in the future.

Is South Korea on the Right Track?

South Korea remains as one of the few countries alongside Switzerland, Singapore, Japan, the U.K., and the U.S. that are actively implementing new policies to facilitate the growth of its local blockchain and cryptocurrency ecosystem.

If the government continues to communicate with both large and small companies in the industry in an attempt to better regulate the space, the country could compete against bigger markets and potentially allure talent, investors, and startups into the local sector.

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State Farm is Testing Blockchain to Expedite Auto Insurance Claims



state farm auto insurance blockchain

Insurance is one of the golden geese of the blockchain, an industry with so much paperwork, sensitive data, and manual processes that it almost seems obvious that it will eventually adopt blockchain technology to streamline its claims processes, data storage, and even — eventually — its payments. State Farm is among the first notable insurance carriers to announce that it is investigating such a move as regards the claims payment process.

In insurance, subrogation is when one insurance company settles a debt with another. According to a recent statement by State Farm, among their multiple blockchain initiatives is one that they believe has the potential to improve their subrogation process. They have a working solution that they are currently testing against existing processes, which they describe as inefficient, requiring more than a few man-hours, manual issuance of checks, and other 20th-century methodologies.

“State Farm is working on a blockchain solution that could speed up the subrogation process for auto claims. The company is testing the solution against existing subrogation processes to determine if it can be a viable product for insurance industry adoption and bring value to customers.”

blockchain auto insurance state farm

Even if an insurance company had precisely zero claims for a period of time, the cost of insurance would still be relatively high because of the number of employees who are required to work on a single case. You need an adjuster, an accountant, a customer support specialist, a salesman, and so on, and each can only deal with so many clients in a given timeframe. Actual use of insurance policies increases costs, but that’s not something that can ever actually be brought to zero or anywhere near it. However, the cost of processing claims and the speed at which they can be handled are things that technology, specifically blockchain technology, can greatly contribute to.

State Farm also expresses a willingness to be a leader in the space, writing:

“State Farm is working with another insurer to understand how an enterprise blockchain solution can be used to reduce the time needed to complete the subrogation process by securely and automatically compiling all subrogation payment amounts, netting the balance and facilitating a single payment on a regular basis between insurers.”

The part of the claims process affected is the last step. Prior to that, there are other opportunities for the blockchain, including secure tracking of client behavior, secure storage of records, and, at some point, payments systems and potentially even some form of good behavior credits. The whole insurance industry is ripe for blockchainization, as is much of the medical system it works intimately with.

“The blockchain solution we are working on […] helps us automate a manual process securely and creates a permanent transaction record of each payment which can easily be verified for accuracy,” concluded State Farm Innovation Executive Mike Fields. “It also has the potential to decrease the amount of time for consumers to receive their deductible reimbursement.”

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Crypto Project Ampleforth Launches ‘Elastic’ Stablecoin



usd cryptocurrency stablecoin ampleforth fragments

Fragments protocol, an effort at stabilizing the buying power of cryptocurrency, has rebranded itself to Ampleforth as of today, renaming the crypto project after the “1984” character whose job is to translate poetry into Newspeak.

Ampleforth aims to preserve the unit of account and money properties of its tokens. Instead of pegging to a fixed supply of fiat capital, Ampleforth’s Amples have an elastic supply based on demand.

The way it works is pretty simple: if you bought 1 Ample at $1, and the demand for the token pushed the price up 100%, you’d now have 2 Amples instead of one. If the price of an Ample went back down, you’d likewise lose your extra Amples. You still experience losses and gains, but you know that the one Ample you bought will buy you a dollar’s worth of goods no matter what happens in the future. The concept is called a “noncollateralized stablecoin,” and differs from other stablecoins in its approach.

Ampleforth has raised some cash to conduct this important experiment, around $4.75 million from various venture capital firms including Pantera Capital and Brian Armstrong.

Elastic Supply Rather Than Elastic Valuation

Gemini stablecoin cryptocurrency

Ampleforth CEO Evan Kuo believes that the market dynamics in crypto work against Bitcoin actually fulfilling its vision as a medium of exchange. One cannot from one day to the next know what your Bitcoin will buy.

He also believes that the vast majority of stablecoins are weakened by the fact that they are tied to inflationary currencies. These are the two fundamental problems Ampleforth aims to solve: making the crypto a medium of exchange by stabilizing their real-world value and thereby making them a reasonable medium of exchange.

If the price were to go down, under your original buy price, you simply have less Amples, but the same amount of value. You are rewarded with increased buying power if you buy low, but you will always have your investment. In a sense, it’s a totally experimental form of stablecoin that the market will certainly have to test. According to the crypto project’s whitepaper:

“When the price exchange rate between Amples and dollars is < 1, the protocol responds by deflating directly from coin holders, placing pressure on speculators to buy.”

The target, as with most stablecoins, is a dollar. Thus traders will have that in mind as they’re buying and selling them. It’s unclear how this will actually work on exchanges, who may not be interested in constantly updating balances. Kuo says:

“Rather than solving the Tether problem, Ampleforth is delivering on Bitcoin’s original promise. The Bitcoin protocol launched as a fair and independent alternative to fiat money. But, as we’ve seen, Bitcoin’s fixed supply and price volatility makes it virtually impossible to be used as a unit of account or medium for exchange.”

The “Stablecoin Wars” just got more interesting, that’s for sure. Ampleforth is one approach to the problem. Crypto token Dai also has more complex mechanics than simply pegging itself to a supply of fiat.

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ICO Death March? November Inflows Fall to $65M From 2018 High of $2.6 Billion



The latest statistics on initial coin offerings suggest that the best days of the fundraising mechanism may have long passed.

According to digital assets newsletter Diar, the month of November recorded the lowest inflows into initial coin offerings (ICOs) in 2018. With US$65 million raised last month, this was in sharp contrast to this year’s best-performing month, February, when US$2.6 billion was collected. It is also a tiny fraction compared to the US$12.2 billion that has been raised so far this year in ICO issuances.

Prior to November, the worst-performing month had been September when US$180 million was collected by issuers, almost three times the amount that went into ICOs last month.

Regulatory Crackdown

The declining fortunes of ICOs come at a time when there is a slowdown in the cryptocurrency markets. This has also coincided with increased regulatory scrutiny in certain jurisdictions such as the United States.

Mid this year, the chairman of the U.S. Securities and Exchange Commission, Jay Clayton, stated that ICOs are securities. Since then there have been a number of ICO issuers who have come under the ire of the SEC after being found to have been in violation of securities laws.

Last month two blockchain startups Airfox and Paragon each reached a settlement of US$250,000 with the U.S. Securities and Exchange Commission over failure to register their ICO tokens as securities. The settlement deal also gave the affected investors the greenlight to request a refund from the two ICO issuers, raising the prospects of bankruptcy for the two firms.

“The orders impose $250,000 penalties against each company and include undertakings to compensate harmed investors who purchased tokens in the illegal offerings,” said the SEC in a press release as CCN reported. “The companies [Airfox and Paragon] also will register their tokens as securities pursuant to the Securities Exchange Act of 1934 and file periodic reports with the Commission for at least one year.”

Federal Law Violation

Earlier this month, the SEC slapped a US$50,000 fine on CoinAlpha Advisors for distributing unregistered securities.

As CCN reported at the time, CoinAlpha Advisors violated federal laws by failing to register its business. Additionally, an application to be exempted from a distribution license had been made by the firm but the criteria for approval was not met.

Celebrity endorsers of ICOs have not been spared either by the SEC. Late last month, the U.S. markets regulator slapped music producer DJ Khaled and boxing champion Floyd Mayweather Jr with charges of illegally promoting ICOs. A settlement was eventually reached with the two stars paying a combined US$767,500 to the SEC and a commitment not to promote any securities for a couple of years.

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Bitcoin Mining Industry ‘Under Considerable Stress,’ 1.3m Rigs Turned Off



bitcoin mining

For much of the year, the bitcoin mining industry appeared to be impervious to the crypto market downturn, as the flagship cryptocurrency’s hash rate continued to climb even as the BTC price halved — and then halved again. In recent weeks, however, cracks have begun to form in this sector as well.

Bitcoin Hash Rate Drops as Miners Turn off Older Devices

Earlier this month, Bitcoin network difficulty, which adjusts dynamically every 2,016 blocks (a roughly two-week interval) in response to hash rate fluctuations, fell by 15.1 percent — its second-largest drop in history and the greatest since Oct. 2011. Just one period earlier, BTC difficulty declined by 7.4 percent, which was the most significant drop in nearly six years.

bitcoin price vs. bitcoin mining hash rate
Bitcoin Mining Daily Cumulative Work vs. BTC Price | Source: BitMEX Research

While this does not, as some bears have suggested, mean that bitcoin has begun a death march, it does demonstrate the extent to which the downturn has begun to put the squeeze on miners with higher costs and thinner profit margins, many of whom had anticipated a crypto market that would look very different heading into 2019.

According to BitMEX Research, the Bitcoin hash rate has declined by more than 31 percent since the beginning of November, which is the equivalent of 1.3 million Antminer S9 miners being switched off completely.

CCN previously reported that while miner overhead varies wildly based on the size of the operation, energy costs, and other factors, the market decline had hastened the obsolescence of older miner models such as the Antminer S7, which for most users are now little more than expensive paperweights.

Miner Revenue Falling Faster Than Bitcoin Price

Notably, the recent market sell-off has hurt miners even more than ordinary investors. BitMEX Research estimates that cumulative bitcoin mining revenue has declined to $6 million per day at the start of December from $13 million at the start of November, outpacing the bitcoin price’s already-steep decline.”

bitcoin mining revenue
Bitcoin Mining Cumulative Daily Revenue | Source: BitMEX Research

The reason for this is that because network difficulty adjusts at set intervals rather than in real time, a hash rate drop will reduce the number of found blocks until the beginning of the next difficulty adjustment.

As the report explained:

“In the six-day period ending 3rd December, 21.8% fewer blocks than the expected 144 per day were found, as miners left the network before the difficulty adjusted, and as a result, fewer blocks were found. Therefore in the short term, there was a 21.8% fall in mining incentives on top of the impact of the declining price.”

At this point, BitMEX Research estimates that almost all cryptocurrency miners — regardless of scale and overhead — are operating at a loss, though some may have hedged profits or at least trimmed losses by shorting the bitcoin price throughout the year.

Not a ‘Death Spiral’

According to some analysts, this likely means that Bitcoin has entered the outer ring of a “death spiral,” wherein it endures a vicious cycle of miners turning off their machines before the difficulty can adjust lower, preventing the network from processing blocks at regular, 10-minute intervals and further prolonging the interval between difficulty adjustments.

Thankfully, as Andreas Antonopoulos recently explained, these ominous predictions fail to account for the fact that most miners are heavily invested in the cryptocurrency industry and thus operate with a long-term perspective that recognizes they may have to temporarily mine at a loss in pursuit of greater profits in the future.

“Part of the reason that’s unlikely to happen is that miners have a much more long-term perspective, meaning that they have existing investments in equipment and they usually purchase electricity on long-term plans, they don’t pay it by the week,” he said. “And therefore, if they have to wait to become profitable another three months and they have the equipment in place, they’re not turning it off.”

Consequently, the mining industry’s current struggles shouldn’t have any long-term impact on Bitcoin itself, though that doesn’t make things any easier for the individual cryptocurrency mining firms that must navigate this increasingly rocky landscape.

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Bitcoin and Ethereum Drop 3%, is the Bottom Still Faraway?



cryptocurrency

Over the past 24 hours, the prices of both Bitcoin (BTC) and Ethereum (ETH) have fallen by more than three percent against the U.S. dollar.

The cryptocurrency market experienced an abrupt $4 billion drop in its valuation, by just about 3.5 percent. While major cryptocurrencies struggled to demonstrate signs of a potential corrective rally, small market cap digital assets and ERC20 tokens plunged by more than 10 percent on average.

Is the Bottom Far From Here?

On December 11, the Bitcoin price dropped from $3,587 at its peak to $3,370. From its daily peak, the dominant cryptocurrency is actually down six percent.

One troubling sign of the short-term price trend of BTC is its low daily volume. In a steep sell-off or a 5 to 10 percent dip in price, an asset tends to see an increase in daily volume as sell volume intensifies.

When the volume of the asset does not increase but still drops in value, it suggests that the asset is free-falling without high sell pressure and with relatively small sell orders from the bears in the market.

The Ethereum price has been experiencing a similar trend as Bitcoin as its price fell by about the same magnitude as BTC with a drop in daily volume. In the past week, the volume of ETH has dropped from $2 billion to $1.6 billion, by nearly 20 percent.

Several traders have called a bottom for Bitcoin this week, seeing the strong recovery of Bitcoin from the low $3,000 region with the $3,000 support level intact.

But, as CCN reported on December 10, if BTC fails to breakout of major resistance levels at $3,700 and $4,000, a proper bottom cannot be confirmed. As of Tuesday, BTC remains in a tight range between $3,000 to $3,500.

A cryptocurrency technical analyst with an online alias “Hsaka” said:

“Rejected by previous support. Seems to be forming a descending channel on the LTFs (aka a way to visualize a downtrend). I often use channels for confluence with horizontal levels (both the rejections from the black horizontals were also at the channel boundary).”

In regards to the short-term trend of ETH, Edward Morra, a recognized digital asset trader, raised the possibility of ETH dropping to $55 suffering a 35 percent dip.

He said:

“If ETH bulls lose this support and low set at $83, it is basically vacuum till next meaningful support around $55 – $45, another 35% downside from here.”

What Will Happen to Tokens if ETH Drops Another 35%?

Already, according to ATHCoinIndex, most tokens have already dropped by nearly 99 percent from their all-time highs and are still at risk of falling even further against the U.S. dollar.

With increasing regulatory pressure from the U.S. Securities and Exchange Commission (SEC) and the public’s decline in confidence towards the initial coin offering (ICO) market, tokens could continue to lose its value from its already low price range, which could lead some to lose all of their value in the short-term.

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3 of 4 Ethereum Tokens Outpace Bitcoin on Day of Coinbase Listing



ethereum crypto coinbase

Trading of Civic (CVC), district0x (DNT), Loom Network (LOOM), and Decentraland (MANA) — all ERC-20 tokens that run on the Ethereum network — today went live on Coinbase Pro, and most received a bump from their listing on the crypto exchange.

CVC, LOOM, MANA, and DNT Listed on Coinbase

In a post earlier today, Coinbase reached out to traders to announce that it had started accepting inbound transfers of the newly listed crypto assets. The San Francisco exchange established that once they acquire enough liquidity, they would begin the trading. Several hours before press time, Coinbase confirmed reaching the said threshold, which prompted them to start a part of their trading services.

“Trading on the CVC, DNT, LOOM, and MANA order books is about to begin,” the company announced later. “These order books will now enter post-only mode. Customers can post limit orders, but there will be no matches. Order books will be in a post-only mode for a minimum of 1 minute.”

It marks the second stage — dubbed as Post-Only — of the overall listing process, as defined by Coinbase at the time of the announcement. The next steps would see Coinbase beginning to match limit orders for CVC, DNT, LOOM, and MANA. And in the final stage, full trading services will be available for these Ethereum tokens, including limit, market, and stop orders.

Tokens Rally Against Bitcoin & Ethereum

On Friday, when Coinbase announced that it was going to add CVC, DNT, LOOM, and MANA to its trading platform, the market of each Ethereum-based token reacted positively, noting decent surges across other crypto exchanges. As of today, each and every coin as mentioned above is undergoing extreme corrections against the US Dollar. But, at the same time, a majority of them have surged against Bitcoin and Ethereum.

Let’s begin by looking at the DNT chart below.

DNT 7D CHART | SOURCE: COINMARKETCAP.COM

DNT at press time is undergoing bearish correction after testing an aggregated high at $0.016321. The coin is now trading at $0.015018, up 3.63% on a 24-hour adjusted chart. Meanwhile, it has surged 8.66% against Bitcoin, now trading at 432 satoshis.

MANA, at the same time, is the least impressive performer among the four crypto assets. Despite a knee-jerk reaction to the Coinbase announcement, the coin failed to sustain near the strong resistance levels. There were attempts from lower levels, but they looked choppy enough to be taken as serious uptrends. Have a look:

MANA 7D CHART | SOURCE: COINMARKETCAP.COM

MANA at the time of writing  is trading at $0.055860, more than 11% down on the 24-hour adjusted timeframe. Against Bitcoin, the coin has dropped 6.6% lower, now trading at 1609 satoshis.

CIVIC and LOOM are slightly better than MANA within the same timeframe. While CIVIC-to-USD rate now stands 4.62% down at 0.056405, its price against Bitcoin is 1624 satoshis, representing a slight increase. Similarly, the current LOOM/USD rate is 0.047803, close to 3.5% down, but it is 1.5% up against BTC, now trading at 1377 satoshis.

However, ripple (XRP), which has a long history of surging on mere rumors that it will be listed on Coinbase, has not seen a similar bounce now that the crypto exchange says it is “exploring” support for this cryptocurrency.

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Crypto Downturn Thrusts Tether into 5th on the Market Cap Charts



tether cryptocurrency elevator

Tether (USDT) has recently found itself among the top five cryptocurrency assets by market cap – despite its own declining capitalization – due in part to the dramatic demise of other top currencies such as Bitcoin Cash and EOS.

That’s particularly notable since Tether has shed around $700 million in assets since September – which in USDT means actual units of issuance, not just changing crypto tides. That much has actually exited in this span of time – at the time being $2.5 billion and today being around $1.8 billion. This is an incredible loss, and if Tether’s network were a company, investors would be running for the hills. But instead, it’s more like customers are heading for the hills.

tether cryptocurrency market cap crypto
Source: CoinMarketCap

One could speculate on why Tether is retaining so much, rather than why it’s lost so much. One possible contributing factor is the high cost of exiting Tether directly as opposed to other stablecoins. Paxos Standard, USD Coin, and Gemini Dollar all have much friendlier exit terms than Tether, which charges a minimum in the several thousands of dollars to convert back to US dollar.

This time 90 days ago, Litecoin had more than double its present market cap, which stood at more than $3.4 billion. Today it’s $400 million behind Tether. EOS was also around 200% of its present state, then being at over $4 billion, but today being just over $2 billion and downward pressure possibly pushing it further. Tokenized platforms rely on demand from their associated tokens, and EOS will have to see the launch of new projects or renewed interest in old ones to recover its past glory.

But there’s no sadder story in this range than Bitcoin Cash, which has lost roughly 75% of its former glory. 90 days ago it had a market capitalization of over $8 billion whereas today it’s actually behind Tether by more than $100 million. It wouldn’t be fair not to note here that it’s much easier for Bitcoin Cash to add capitalization than it would be for Tether. There’s fewer gates to pass through, so if either is to recover in a quick and dramatic fashion, BCH would probably go first.

But will Tether retain its hold on the stablecoin sphere? Paxos Standard and USDC are rapidly gaining over the past 30 days, PAX more so than USDC, although USDC retains a higher overall capitalization by about $22 million. Combined they have a market capitalization of around $372 million.

If you add in TrueUSD‘s $210 million and Gemini Dollar’s $90 million, you’re pushing toward $700 million between them. Then, if you add in Dai, you’re close to three-quarters of one billion dollars.

So all told, the competitor stablecoins have a ways to go. But if trends continue, with newer entrants gaining and Tether losing, the day may not be terribly far off when Tether is the outlier and one of the later pegged coins is king.

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Bitcoin Nothing More Than a ‘Lottery Ticket’: Harvard Economist



bitcoin lottery ticket gambling

Former IMF Chief Economist and current Harvard University Professor of Economics and Public Policy Kenneth Rogoff believes that bitcoin and other cryptocurrencies currently amount to little more than “lottery tickets” at this moment in time. Writing in the Guardian on Monday, Rogoff stated that while some believe that cryptocurrencies have had their day and are on an irreversible downward slide, it is actually difficult to say with certainty that their value will actually fall to zero.

In his view, several questions exist about the ability of large economies to successfully embrace cryptocurrency, which means that outside of joint regulatory action, national level adoption of cryptocurrencies will likely be pushed only by weak pariah states like Iran, Somalia, Venezuela, and North Korea. This he says, makes it difficult to predict the eventual fate of this asset class.

Rogoff Raises Questions about Bitcoinbitcoin price cryptocurrency crypto

In the article, Rogoff calls into question the very intrinsic value of bitcoin, stating that its generally held status as “digital gold” is unsustainable because unlike real gold, it has no application outside of a monetary setting, and the massive energy consumption required to keep it functioning is substantially less efficient than a central banking system.

According to him, large economies will not tolerate cryptocurrencies in their current state much longer because of their capacity to facilitate money laundering, and yet if their anonymity/pseudnymity is stripped away, they will lose their mass appeal, which effectively places bitcoin in a catch-22 position. As a result, Rogoff believes that the long-term use and adoption of cryptocurrency in its current form lies outside of large, regulated economies, which essentially will make it the preserve of a group of failed states like Venezuela, which has made several headlines with its plan to revitalise its devastated economy with the petro.

Raising further question about the future of bitcoin, Rogoff said: 

“Regulators are gradually waking up to the fact that they cannot countenance large expensive-to-trace transaction technologies that facilitate tax evasion and criminal activity. At the same time, central banks from Sweden to China are realising that they, too, can issue digital currencies…When it comes to new forms of money, the private sector may innovate, but in due time the government regulates and appropriates.”

In Rogoff’s opinion, what this will lead to is essentially a lottery scenario where bitcoin’s long-term value is likely to be closer to $100, but may possibly also be $100,000 for a plethora of reasons that are difficult to even visualise at the moment. Explaining why even a widespread public belief in bitcoin as a store of value is not enough to hold its value over time, he stated:

“Economists (including me) who have worked on this kind of problem for five decades have found that price bubbles surrounding intrinsically worthless assets must eventually burst. The prices of assets that do have real underlying value cannot deviate arbitrarily far from historical benchmarks. And government-issued money is hardly a pure social convention; governments pay employees and suppliers, and demand tax payments in fiat currency.”

Ultimately he said, it is government actions that will determine whether bitcoin and other cryptocurrency assets can achieve general trade and retail adoption or whether cryptois destined to become the dystopian currency for dark net websites selling illegal goods and services and failed states with collapsed economies.

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UNICEF Invests in 6 Blockchain Startups with Humanitarian Venture Fund



unicef blockchain

Months after publishing a “blockchain call” to startups that could benefit humanity, the United Nations International Children’s Emergency Fund (UNICEF) has invested in six blockchain startups.

In January 2018, UNICEF called for early-stage technology startups that were registered in one of UNICEF’s programme countries. It received over 100 applications from 50 different countries. The organization already has 20 other technology companies in its Innovation Fund, from “data science and machine learning, to virtual reality, to drones.”

The new investments, says the UNICEF release, form part of a wider blockchain strategy for the humanitarian agency.

“Using smart-contracts for organizational efficiencies, creating distributed decision-making processes, and working to build knowledge and understanding of distributed ledger technology both in the United Nations and in the countries where UNICEF works.”

Announced today, the UNICEF Innovation Fund will invest up to $100,000 USD in Atix Labs, Onesmart, Prescrypto, Statwig, Utopixar, and W3 Engineers.

Blockchain Solutions to be Delivered in 2019

mexico unicef blockchain
Two of the blockchain startups are headquartered in Mexico.

All the startups must now deliver the open-source prototypes of their blockchain applications within the next 12 months.

Atix Labs, based in Argentina, is building a platform for other small to medium-sized businesses to access funding in a way that offers traceability as to how the funds are used.

Two of the startups are based in Mexico. Onesmart is developing an application to ensure the delivery of state-provided social services, addressing the issue of the misuse of social funds in emerging markets. The second in Mexico, Prescrypto, will improve the availability of electronic prescriptions by building a platform for patient medical histories.

India-based Statwig is creating a blockchain solution for the supply-chain management of vaccines to improve the efficiency of vaccine delivery. In neighboring Bangladesh, W3 Engineers are hoping to connect migrant and refugee communities with an offline mobile networking platform that doesn’t need a sim card or stable internet connection.

Utopixar, based in Tunisia, will build a social tool for decision-making and the transfer of value which will be used by communities and other organisations.

Chris Fabian, Principal Adviser at UNICEF Innovation, said:

“Blockchain technology is still at an early stage — and there is a great deal of experimentation, failure, and learning ahead of us as we see how, and where, we can use this technology to create a better world.”

The Fund chooses to invest in companies when its financing and technical support in areas of “vulnerable” populations can help technology “grow and mature in the most fair and equitable way possible.”

UNICEF’s Innovation Fund will also provide product and growth assistance as well as access to its network of experts and partners. In addition to its own seed-stage investment, it will assist the startups with their second-round investment garnering. If the technologies developed are successful there is further opportunity to apply them in the 190 countries covered by UNICEF.

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Companies that Accept Bitcoin – List Updated for 2019



While many Bitcoiners prefer simply to hold their coin, plenty also love to spend it. Over its history, more and more companies have integrated support for Bitcoin. It’s not just for gambling anymore – you can purchase almost anything with it.

Here CCN provides a detailed list of companies which are currently accepting Bitcoin as of December 2018, as well as other methods of spending Bitcoin at locations which don’t accept it directly. We noticed a lack of such comprehensive lists out there, with many of the ones we came across being severely outdated and even referencing businesses that hadn’t accepted Bitcoin in more than 2 years or some that had been out of business altogether, like Grooveshark, for years.

You can book flights, buy web domains, pay for computer products, buy household goods, and so much more with Bitcoin, and places that use BitPay for crypto transaction processing generally all support Bitcoin Cash as well. We hope this guide makes it easier for you.

Online Companies Who Accept Bitcoin As Payment

General Merchandise

  • Overstock.com – No list is complete without Overstock, the company run by crypto-believer Patrick Byrne which owns a Medici Ventures, an important mover and shaker in the blockchain space.
  • Fancy.com – A feminine-focused site that sells household goods and fashionable merchandise. Everything from couches to high heels.

Computer related

  • Microsoft – While not an option at checkout time, those with a Microsoft account wanting to use Bitcoin can go to “Billing and Payment Options” in their account and click “Redeem Bitcoin.” At this point they will be given the opportunity to add up to $100 at a time using BitPay.
  • Newegg.com is one of the biggest computer parts stores online, and they sell virtually everything related to computers and electronics. If you want to buy a PlayStation 4, a new gaming computer, a good laptop, a sound system, a television, you name it, Newegg will let you do it at checkout – with good old Bitcoin or Bitcoin Cash.

Web Services

  • Namecheap.com – Full-service domain registrar with hosting options, all of which you can use Bitcoin to pay for. Similar to Microsoft, you must first “top-up” your account with an amount of Bitcoin of your choosing and then you are free to use your account balance to pay for services.
  • ExpressVPN – A reliable and reputable VPN service that accepts Bitcoin payments. The author uses this VPN service and can personally attest to its usability.
  • Both Tutanota and Protonmail privacy-focused e-mail service providers accept Bitcoin as payment for their premium tier products.
  • Shopify – While you cannot pay your professional fees to Shopify in Bitcoin, any store that uses Shopify can accept Bitcoin and other cryptocurrencies with relative ease through the platform, so it’s worthwhile to contact such businesses if you’d like them to let you pay with Bitcoin.
  • PureVPN – PureVPN is another well-established virtual private networking (VPN) service that currently accepts Bitcoin. They even offer a guide on how to acquire coins with which to pay, which is a sign they are fully on board.
  • Several other VPNs including Private Internet Access, NordVPN, SurfShark, CyberGhost, and HideMyAss, also accept Bitcoin.

Travel Services

  • CheapAir.com – One of the oldest companies on the web to accept Bitcoin, and a competitive travel-booking service to boot which allows you to book hotels, flights, and rental cars with Bitcoin. They like Bitcoin so much they never stop talking about it on their blog. Unlike other travel services such as Expedia which have integrated Bitcoin only to remove it months later, CheapAir.com has always accepted it and likely always will.
  • Bitcoin.Travel has been around quite awhile as well, and they primarily act as a gateway to travel sites that will allow you to check out with Bitcoin. Potentially the easiest way to book a flight with digital cash.

Food

  • PizzaForCoins.com allows you to order pizza pretty much anywhere, and you don’t have to strictly use Bitcoin. You can use their integrated ShapeShift conversion tool to use dozens of other options like Litecoin, Ethereum, or Monero.
  • British website ordertakeaways.co.uk allows you to order from dozens of takeout restaurants in the UK using Bitcoin.
  • Customers in many European countries can buy coffee from CryptoCoffee, a crypto-centric coffee distributor.
  • Crypto-native Pex Peppers sells hot sauces for various cryptocurrencies.
  • You can also buy wine from Misconduct Wine Company, though shipping restrictions may apply.

The situation at present is that food is mostly purchased by Bitcoin through gift cards pre-purchased online. While there are a limited number of restaurants in major metros around the world that accept and support Bitcoin, large outfits that exist around the world are a bit slower on the uptake, so we suggest using gift cards when wanting to spend coins on food.

Don’t See It Here?

Bitcoin is a global currency, and the landscape of merchant adoption is ever-changing. This being the case, running a website that directs people on where to spend their cryptocurrency is a sub-industry all its own. Perhaps the elder service in that space is called SpendABit. CCN once interviewed its founder, and the site was going strong at time of writing with over 3 million products listed and verified as being able to be purchased with Bitcoin.

A newer entrant into this space is called spendbitcoins.com, and they offer a similar service.

Other Ways to Spend Bitcoin

There are two indirect ways to spend Bitcoin. One is to get a Bitcoin-powered credit card from somewhere like Xapo, Bitpay, or Uquid. There are options coming and going from the market all the time in this department, though these three seem to be standing the test of time and regulation.

Doing the above, however, requires a good deal of commitment to the company offering the credit card, and often has regional and other restrictions resulting from the global lag in Bitcoin acceptance.

As a result, a few quality sites are devoted to selling gift cards for Bitcoin. While there are plenty of sites that do not accept Bitcoin directly, almost every site where people shop these days has some form of gift card program. Between eGifter, Gyft, GiftOff, and BitRefill, you can find most major retailers like Walmart and Target as well as many chain restaurants including Dominos, Burger King, and Legal Seafood.

BitRefill also offers bill payment services. Speaking of which, Australian users can use Bitcoin to pay bills using Living Room of Satoshi or PaidByCoins, while US persons can use CoinBills or BillPayforCoins. In the EU, there is BitBill.

Perhaps one of the most impressive ways to use Bitcoin online is to spend it at Amazon through Purse.io, for a healthy discount up to 33% off regular prices. The way it works is you find something you want on Amazon, put a link on Purse.io with the amount of discount you want, and then someone buys it for you and has it sent to your house in exchange for Bitcoin. Often the Bitcoin rates are much different on Purse.io than anywhere else, to the Bitcoiner’s advantage. Purse users take advantage of Prime shipping and other Amazon perks, and thus they have not yet expanded to any other retailers.

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Companies that Accepts Bitcoin – List Updated for 2019



While many Bitcoiners prefer simply to hold their coin, plenty also love to spend it. Over its history, more and more companies have integrated support for Bitcoin. It’s not just for gambling anymore – you can purchase almost anything with it.

Here CCN provides a detailed list of companies which are currently accepting Bitcoin as of December 2018, as well as other methods of spending Bitcoin at locations which don’t accept it directly. We noticed a lack of such comprehensive lists out there, with many of the ones we came across being severely outdated and even referencing businesses that hadn’t accepted Bitcoin in more than 2 years or some that had been out of business altogether, like Grooveshark, for years.

You can book flights, buy web domains, pay for computer products, buy household goods, and so much more with Bitcoin, and places that use BitPay for crypto transaction processing generally all support Bitcoin Cash as well. We hope this guide makes it easier for you.

Online Companies Who Accept Bitcoin As Payment

General Merchandise

  • Overstock.com – No list is complete without Overstock, the company run by crypto-believer Patrick Byrne which owns a Medici Ventures, an important mover and shaker in the blockchain space.
  • Fancy.com – A feminine-focused site that sells household goods and fashionable merchandise. Everything from couches to high heels.

Computer related

  • Microsoft – While not an option at checkout time, those with a Microsoft account wanting to use Bitcoin can go to “Billing and Payment Options” in their account and click “Redeem Bitcoin.” At this point they will be given the opportunity to add up to $100 at a time using BitPay.
  • Newegg.com is one of the biggest computer parts stores online, and they sell virtually everything related to computers and electronics. If you want to buy a PlayStation 4, a new gaming computer, a good laptop, a sound system, a television, you name it, Newegg will let you do it at checkout – with good old Bitcoin or Bitcoin Cash.

Web Services

  • Namecheap.com – Full-service domain registrar with hosting options, all of which you can use Bitcoin to pay for. Similar to Microsoft, you must first “top-up” your account with an amount of Bitcoin of your choosing and then you are free to use your account balance to pay for services.
  • ExpressVPN – A reliable and reputable VPN service that accepts Bitcoin payments. The author uses this VPN service and can personally attest to its usability.
  • Both Tutanota and Protonmail privacy-focused e-mail service providers accept Bitcoin as payment for their premium tier products.
  • Shopify – While you cannot pay your professional fees to Shopify in Bitcoin, any store that uses Shopify can accept Bitcoin and other cryptocurrencies with relative ease through the platform, so it’s worthwhile to contact such businesses if you’d like them to let you pay with Bitcoin.
  • PureVPN – PureVPN is another well-established virtual private networking (VPN) service that currently accepts Bitcoin. They even offer a guide on how to acquire coins with which to pay, which is a sign they are fully on board.
  • Several other VPNs including Private Internet Access, NordVPN, SurfShark, CyberGhost, and HideMyAss, also accept Bitcoin.

Travel Services

  • CheapAir.com – One of the oldest companies on the web to accept Bitcoin, and a competitive travel-booking service to boot which allows you to book hotels, flights, and rental cars with Bitcoin. They like Bitcoin so much they never stop talking about it on their blog. Unlike other travel services such as Expedia which have integrated Bitcoin only to remove it months later, CheapAir.com has always accepted it and likely always will.
  • Bitcoin.Travel has been around quite awhile as well, and they primarily act as a gateway to travel sites that will allow you to check out with Bitcoin. Potentially the easiest way to book a flight with digital cash.

Food

  • PizzaForCoins.com allows you to order pizza pretty much anywhere, and you don’t have to strictly use Bitcoin. You can use their integrated ShapeShift conversion tool to use dozens of other options like Litecoin, Ethereum, or Monero.
  • British website ordertakeaways.co.uk allows you to order from dozens of takeout restaurants in the UK using Bitcoin.
  • Customers in many European countries can buy coffee from CryptoCoffee, a crypto-centric coffee distributor.
  • Crypto-native Pex Peppers sells hot sauces for various cryptocurrencies.
  • You can also buy wine from Misconduct Wine Company, though shipping restrictions may apply.

The situation at present is that food is mostly purchased by Bitcoin through gift cards pre-purchased online. While there are a limited number of restaurants in major metros around the world that accept and support Bitcoin, large outfits that exist around the world are a bit slower on the uptake, so we suggest using gift cards when wanting to spend coins on food.

Don’t See It Here?

Bitcoin is a global currency, and the landscape of merchant adoption is ever-changing. This being the case, running a website that directs people on where to spend their cryptocurrency is a sub-industry all its own. Perhaps the elder service in that space is called SpendABit. CCN once interviewed its founder, and the site was going strong at time of writing with over 3 million products listed and verified as being able to be purchased with Bitcoin.

A newer entrant into this space is called spendbitcoins.com, and they offer a similar service.

Other Ways to Spend Bitcoin

There are two indirect ways to spend Bitcoin. One is to get a Bitcoin-powered credit card from somewhere like Xapo, Bitpay, or Uquid. There are options coming and going from the market all the time in this department, though these three seem to be standing the test of time and regulation.

Doing the above, however, requires a good deal of commitment to the company offering the credit card, and often has regional and other restrictions resulting from the global lag in Bitcoin acceptance.

As a result, a few quality sites are devoted to selling gift cards for Bitcoin. While there are plenty of sites that do not accept Bitcoin directly, almost every site where people shop these days has some form of gift card program. Between eGifter, Gyft, GiftOff, and BitRefill, you can find most major retailers like Walmart and Target as well as many chain restaurants including Dominos, Burger King, and Legal Seafood.

BitRefill also offers bill payment services. Speaking of which, Australian users can use Bitcoin to pay bills using Living Room of Satoshi or PaidByCoins, while US persons can use CoinBills or BillPayforCoins. In the EU, there is BitBill.

Perhaps one of the most impressive ways to use Bitcoin online is to spend it at Amazon through Purse.io, for a healthy discount up to 33% off regular prices. The way it works is you find something you want on Amazon, put a link on Purse.io with the amount of discount you want, and then someone buys it for you and has it sent to your house in exchange for Bitcoin. Often the Bitcoin rates are much different on Purse.io than anywhere else, to the Bitcoiner’s advantage. Purse users take advantage of Prime shipping and other Amazon perks, and thus they have not yet expanded to any other retailers.

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EOS Surges 16% Over the Weekend, Eyeing Extended Gains



Despite the criticism it is receiving for being a pseudo-decentralized blockchain project, EOS is performing exceptionally well on the trading front.

The EOS/USD rate during the weekend noted more than 16% surge. The upside action came in continuation of a strong bounce back from the 1.546-fiat level on Friday. The combination of Friday and weekend price actions marked a circa 40% rally for EOS, during which market cap added over $400 million in profits.

There are no substantial factors that claim a role behind the ongoing EOS rally. True, the coin has made into the Coinbase list of could-be-added crypto assets, but there are also 29 other coins that have made into the same list. But they have not displayed any aggressive upside actions like EOS. XRP, for instance, is mentioned in the Coinbase list but its 24-hour adjusted price performance, according to CoinMarketCap.com is +0.16% (at press time).

On Monday, the EOS/USD rate is hinting a correction action, however. The pair established a higher high during its uptrend towards 2.192-fiat, following which it underwent a sharp pullback. Nevertheless, the bearish jerk is well within the range the technicals are establishing for the pair. It could, therefore, go ahead for a reversal action, to continue its uptrend further. Let’s have a look at the chart below to understand it better.

EOS/USD 1H CHART | SOURCE: BINANCE, COINMARKETCAP.COM

The EOS/USD in trending inside a near-term ascending channel, forming higher highs and higher lows. The pair has just reversed from its upper trendline, derived after connecting the recent swing highs. It is now targetting the lower trendline to the downside for a potential pullback action. The sentiment is pretty bullish near-term and is also signaling profitable opportunities for day traders.

That said, traders can open a long position when EOS/USD reaches the lower trendline and exit the trade when the pair touches the upper trendline. Similarly, traders can also open a short when EOS/USD reaches the upper trendline and exit the trade when it the lower one comes into its range. A stop-loss order placed just below the opening position and against the direction of the price action should maintain the overall risk management of the trade.

Then, there is a breakdown/breakout scenario that should be considered. If EOS/USD breaks above the upper trendline while riding on a notably increase volume, then opening a long position towards, in our opinion, 2.5-fiat would make sense. Similarly, if the pair breaks below the lower trendline, then opening a short position towards the 50-period moving average on a 1H chart timeframe could prove profitable.

In the meantime, traders should watch out for $2-range for a potential reversal action as well. It’s only a psychological barrier.

Click here for a real-time EOS price chart.

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Bitcoin Price Recovers 12% in 72 Hours While Traders Remain Cautious in Short-Term



bitcoin price analysis

Since December 8, the Bitcoin price has increased from $3,210 to $3,588, by just about 12 percent against the U.S. dollar.

In the same time frame, the cryptocurrency market added $11 billion to its valuation, avoiding a further drop below the $100 billion mark, which could have been critical for the short-term trend of the market.

Most major cryptocurrencies including Ethereum (ETH) and Bitcoin Cash (BCH) have been able to rebound from low double digits, as technical indicators started to demonstrate extremely oversold conditions.

But, traders and technical analysts remain cautious towards the short-term price trend of cryptocurrencies until major resistance levels are broken.

$3,700 For Bitcoin

Since early December, the value of Bitcoin has continuously fallen from the mid-$4,000 region, struggling to maintain its momentum and show any sign of stability.

According to DonAlt, a prominent cryptocurrency technical analyst, until Bitcoin breaks out of the $3,700 resistance level, it will remain in a tight range between $3,300 to $3,600, unable to engage in a major price movement.

The analyst said:

“Another good day for BTC. That said it’s still nowhere close to turning bullish on the higher time frames. While the low timeframes look decent, BTC hasn’t even reclaimed the previous trading range. Until it does, no swing long trades.”

As Alex Krüger, an economist and a cryptocurrency trader, recently emphasized, BTC is in a significantly better position to enter an accumulation phase and a consolidation period because it has been able to minimize its loss during several steep market sell-offs.

When compared to both Ethereum and Bitcoin Cash, Bitcoin has kept its value fairly well given the intensity of the market crash throughout the past two months.

ETH and BCH have recorded 93 percent and 95 percent losses respectively against the U.S. dollar, and BTC would have to drop another 72 percent from the current price range to experience a similar drop as the two digital assets.

“Performance from all-time-highs to date, for the main cryptoassets: BTC -82%, XRP -86%, ETH -93%, BCH -95% (using Bitfinex’s data). These may all look equally bad. It is not so. The difference between -82% and -95% is a further 72% drop,” Krüger explained.

Market Still Nervous

Several analysts have reaffirmed that as long as the dominant cryptocurrency remains below $3,700 and struggles to demonstrate a major breakout, the market is at risk of dropping to a new yearly low.

Historically, the cryptocurrency market has taken around 67 weeks on average to recover from a large correction and achieve a new all-time high.

While positive developments like the Nasdaq, Bakkt, and NYSE futures markets are around the corner and are expected to launch in the first quarter of 2019, it could easily take until the second quarter of next year for the cryptocurrency market to begin its recovery.

A proper bottom has not been established by BTC and other major cryptocurrencies, as well as small market cap ERC20 tokens, have not shown any signs of a large corrective rally.

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Tron’s Justin Sun Wants to ‘Rescue’ DApp Devs. from Ethereum & EOS



tron crypto justin sun

Tron founder Justin Sun has thrown a jab at Ethereum and EOS, announcing on Twitter that the company wishes to create a fund to “rescue” dApp developers working on both platforms on the condition that they move their dApps to the Tron network.

Driven by Sun’s penchant for successful self-promotion as well as the company’s successful acquisition strategy which saw it complete the takeover of BitTorrent in July, Tron claims that it has made significant progress toward its goal of building out the infrastructure for a thoroughly decentralised internet.

However, Sun was involved in a recent spot of controversy over his aggressive self-promotion after he hinted at a partnership with Chinese internet giant Baidu, only for it to emerge shortly thereafter that it was nothing more than a cloud computing services agreement. He also recently announced NBA legend Kobe Bryant as a speaker at Tron’s upcoming 2019 crypto conference.

The market, by and large, has rewarded Sun’s operational strategy, leading to Tron’s relatively favorable performance in an asset category suffering something of a meltdown. Ethereum and EOS, by comparison, are suffering significant losses, with EOS, in particular, performing poorly because of investor concerns over the longevity of its blockchain network.

tron price ethereum price eos price

In November, CCN reported that a research report by blockchain research and testing company Whiteblock stated that EOS is not really a blockchain network, but is, in fact, a “distributed homogenous database” suffering from significant security failings and lower-than-advertised network performance.

Ethereum is also suffering from the effects of the prolonged bear market, with co-founder Joseph Lubin recently announcing that his Ethereum development startup ConsenSys is kicking off a period of restructuring to eliminate underperforming projects and focus on projects that can create tangible value.

While no staff layoffs have been announced as part of the belt-tightening measures, it was revealed that henceforth all ConsenSys-backed projects would be ranked based on three criteria which, in order of importance, are: revenue or return on investment, positive impact on the Ethereum ecosystem, and social good.

It will be recalled that prior to current market conditions, Tron and Ethereum had historically been at loggerheads, with Sun having engaged in a public Twitter spat with Ethereum co-founder Vitalik Buterin over allegations that Tron plagiarised parts of its whitepaper from previous whitepapers by IPFS and Filecoin.

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Regulatory Overreach is Crippling the U.S. Crypto Sector: Law Prof.



bitcoin price crypto

A law professor has reached an unflattering conclusion regarding the regulatory climate of the crypto space in the United States — it’s confusing!

According to Carol Goforth, who teaches at the University of Arkansas School of Law, “overlapping regulations produced by a multitude of distinct agencies with different missions and priorities” has resulted in a “confusing mix of classifications and requirements” for cryptoassets.

To illustrate her point, Goforth noted that there are four federal agencies in the United States which regulate cryptoassets to a certain degree and form: the Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC), the Financial Crimes Enforcement Network (FinCEN) and the Internal Revenue Service (IRS).

Lack of Harmony

Consequently, the various federal agencies have varying definitions of cryptoassets, and this sows complexity and confusion. In its regulatory role the SEC, for instance, treats the issuance of new digital assets as securities. The CFTC, on the other hand, views all cryptoassets as commodities while the IRS sees crypto as property. In contrast, FinCEN regulates cryptocurrency exchanges as “money” exchangers, effectively leading to the conclusion that the U.S. Department of the Treasury bureau views cryptoassets as currency.

Inevitably, the varying definitions by the different agencies results in overregulation since each entity has its own requirements which must be met. Trying to comply with the numerous regulatory obligations thus becomes expensive and time-consuming for the players in the sector.

The situation gets worse at the state level since every state in the union has its own set of securities laws and tax regimes. Currently, only a handful of states have determined that cryptoassets should be exempted from state securities laws.

Per Goforth, the way forward is to adopt a regulatory approach that is more nuanced in order to avoid overregulation.

Here’s the Proof…

Already, the existing regulatory regime in the world’s biggest economy seems has severely limited the number of coins that U.S.-based cryptocurrency exchanges such as Coinbase can offer their clients. In contrast, a cryptocurrency exchange such as Binance which is headquartered in a friendlier jurisdiction boasts of dozens and dozens of supported coins.

The U.S. regulatory regime has also had an impact on ICO issuance. As reported by CCN earlier this year, a significant number of projects have skipped the U.S. and instead chosen to issue their initial coin offerings in jurisdictions such as Singapore, the Virgin Islands, and the Cayman Islands.

This was according to a report prepared by Satis Group Crypto Research which noted that in 2017 the U.S. had cornered 32% of the global ICO fundraising market. As of the first half of this year, this market share had declined to 10%.

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Bitcoin Cash Drama & a[nother] Blockchain Phone



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The Bitcoin price grabbed the headlines this week, once again plunging to a new yearly low and placing the crypto market on the brink of sinking below the $100 billion level for the first time in 2018. However, there was much more than price action afoot, and, per the usual, much of it involved drama in the Bitcoin Cash camp.

Lawsuit Takes Aim at Bitcoin Cash Backers

Another week, another lawsuit.

This week saw the launch of a groundbreaking lawsuit against the proprietors of Bitmain and Bitcoin.com, Jihan Wu and Roger Ver, both in personal name and business name, as well as the Kraken exchange. A lesser-known blockchain company which entered the space about a year ago believes that Roger Ver and the others named in the suit actively worked to centralize the Bitcoin Cash network during the hard fork that happened at the end of last month, and as such are responsible for damages done to their business. The company, UnitedCorp, primarily services miners with efficiency equipment. A follow-up story from CCN’s P. H. Madore is expected.

Obviously, on the other side of the fork, sentiments have been less than enthusiastic:

Bitcoin SV Rising and Terabyting

Bitcoin SV briefly overtook Bitcoin Cash in terms of price and thus market capitalization during the week, though it quickly faltered as the market did several times overall. Such rubber band movement is often seen in markets when people are waiting to dump. Too much good can be followed by a truckload of bad, but the price of Bitcoin SV seems to have stabilized about $10 behind Bitcoin Cash ABC by the end of the workweek. Crypto trades 24/7, though, and at time of current writing Bitcoin SV was 60 cents ahead (again taking a marginal lead.)

bitcoin cash price

In other Bitcoin SV news, which if early indicators are any sign, there will be plenty of as we move forward, Craig Wright seems to firmly believe that blocks will regularly clock in at 1TB. He confirmed this belief with a mining profitability prediction much later in the week on Twitter.

All this while Bitcoin SV is one of the least profitable-to-mine of the Bitcoin forks.

Bitcoin Cash Developer Strikes to the Heart of Fork Debate

One of our more popular and not-to-miss articles of the past week was our coverage of Bitcoin Cash developer _unwriter’s proclamations as regards the health of the Bitcoin ABC community and ecosystem. This reporter wrote:

“The anonymous contributor comes across as sincere and dedicated to his single-minded cause. He begins the article by stating that he has never met any developers in person and thereby never been influenced by anyone. He simply wants to “build what Bitcoin needs” and be judged “on what he builds.”

_unwriter’s sentiments seem to have come presciently just before the Bitcoin SV price overtook that of Bitcoin ABC, and at least one major lawsuit was launched.

Beijing Says No to Security Tokens

Beijing authorities have roundly declared that security tokens and their offering in the capital city of the country with 1 billion plus people is not going to be tolerated. CCN’s Conor Maloney wrote:

“While Chinese authorities are retaining their hard stance on crypto-fundraising, other governments are more open to STO fundraising, leading to many blockchain forms to abandon the somewhat disgraced ICO method for its legally compliant relative. With major companies like Indiegogo hosting STOs, the method is perhaps destined for more longevity than the ICO approach, which was fraught with disaster through scams, failed projects, and bad press.”

Facebook Wants in on Blockchain

Speculation arose this week that Facebook is probably working on the future’s most used blockchain application. Frequent Bitcoin commentator and professional financial analyst Anthony Pompliano was quoted as saying, “I bet Facebook builds the most used product in crypto.”

CCN journalist David Hundeyin wrote:

“In the interim, Facebook has continued recruiting blockchain developers to join its growing blockchain team. Facebook blockchain division head David Marcus recently resigned from his position on the board of directors at Coinbase, citing a new conflict of interest, fueling speculation that the company is indeed planning to launch a cryptocurrency project, which would be unprecedented in terms of the potential scale offered by access to Facebook’s 2 billion+ users. Others, however, believe that Facebook is merely joining the Silicon Valley bandwagon and does not really have any kind of well defined or workable crypto implementation blueprint to build on.”

HTC Launches FINNEY Competitor

The era of blockchain mobile is upon us. Last week, CCN dispatched our assistant editor Josiah Wilmoth to Spain for the launch of the FINNEY phone, and this week HTC unveiled its competitor phone, the Exodus.

From our reporting:

“From a visual standpoint, the Exodus 1 is at first glance much sleeker than the FINNEY, though — unlike the Sirin Labs device — it does not appear to feature a true cold storage wallet. Instead, the Exodus 1 stores private keys in a secure enclave called Zion, which isolates them from the remainder of the operating system. While perhaps less secure than cold storage, it is a significant step up from the software wallets — whether custodial or non-custodial — where most mobile users currently store their cryptocurrency funds.”

Arise Bank CEO Arrested

CCN dug a bit more into the story of Jared Rice, the CEO of Arise Bank who was earlier this year charged with fraud for bilking investors in his Arise series of blockchain products and spending the money on his own lavish lifestyle and personal problems, and found that he had a history of fraud as well as domestic violence.

Bitcoin Trader Accosted in Gruesome Crime

A Bitcoin trader in South Africa found out the lengths that greed will drive people after he was drugged, kidnapped, and beaten severely. From CCN’s Jimmy Aki:

“He is reported to have gone into the undisclosed residence at about 1 pm to conduct the presentation to an audience of six individuals. According to him, one of these people snuck up on him from behind and stuffed a cloth in his face — presumed to be soaked with a sleeping drug that made him unconscious. Later, having recovered from the influence of the drug, he woke up in a completely different residence. Here, he was surrounded by five people — two women and three men.”

Negative Prices Breed Negativity

A few anti-Bitcoin voices emerged with some degree of clarity as the market continued to struggle over the course of the week. Ehud Barak, former Prime Minister of Israel, called it a Ponzi scheme. A former blockchain analyst has grown disillusioned with blockchain technology, while a finance professor said Bitcoin has entered a death spiral.

On the Ethereum front, billionaire investor Joseph Lubin said the price is not of great concern because adoption is growing.

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Crypto ICOs in Crisis, Running Out of Money With No Products



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In the bull market of 2018, initial coin offering (ICO) projects in the crypto market raised tens of millions of dollars on average from investors in the public market to create decentralized applications (dApps) and systems.

Fast forward 12 months, most of the ICO projects that currently exist in the sector have either have no working products to show or an insufficient number of users to justify their valuation.

According to Martha Bennett, a principal analyst at Forrester Research, ICOs have struggled to find viable products with business models that failed to account for the occurrence of a potential bear market that could force projects to face a funding crunch.

Crisis

ICOs have raised large sums of money in the past year with several ICOs raising up to $4 billion from the public market. Yet, based on the data provided by DappRadar, apart from IDEX and ForkDelta, none of the dApps in the market have more than 600 users.

Many of the top 100 cryptocurrency projects in the market, even those that have active developer communities and strong technologies like Augur, 0x, Decentraland, ICON, Wanchain, and Polymath, have found it to be difficult to secure an active user base and maintain a high level of user activity on decentralized systems.

The abovementioned projects have working products in place that are currently utilized by users in the Ethereum ecosystem for various use cases. For instance, Augur saw its daily volume spike up to nearly $3 million during the recent U.S. midterms.

bankrupt ico empty wallet

But, the majority of ERC20 tokens and ICOs in the top 100 cryptocurrency rankings do not even have a working product to show that is actively used by users on a regular basis.

Considering the underwhelming performance of most dApps and ICO projects in the space, Forrester Research analyst Martha Bennett said that this year’s bear market has been a wake-up call for investors that funded multi-million dollar projects without working products and in many cases, a clear long-term vision, strategy, and solid business model.

Bennett said:

“Sooner or later, this would have led to a contraction anyway. The crypto crash acted as both catalyst and wake-up call.”

Several large-scale companies like Coinbase and ConsenSys have also laid off a relatively small portion of their employees in the past two months,affected  by the bear market and dropping prices of digital assets.

In October, Coinbase, one of the largest fiat-to-crypto exchanges in the global market, laid off 15 members of staff. This month, ConsenSys is said to have terminated the contracts of 13 percent of its employees, which is estimated to be around 130 individuals.

How to Move Forward

Lex Sokolin, the global director of fintech strategy at Autonomous Research, said that the entrance of new investors and capital could end up counterbalancing the sector in the months to come, and for commercial companies with strong profit margins like exchanges, that certainly could be the case.

“I’d be comfortable saying that the pricing pressure on digital assets in 2018 is likely to lead to 25-50-percent shutdowns and layoffs for current projects based on historical comparisons. However, the pace of new entrants and capital could counterbalance this contraction and still grow the sector overall.”

However, for ICOs, unless projects begin to start developing products that can actually be utilized by both cryptocurrency and casual users, it will be challenging to recover from the current state of the market.

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$80 Million ICO TenX Founder Linked to Pyramid Scheme: Report



pyramid scheme tenx julian hosp ico

TenX president Julian Hosp has reportedly been implicated in connection with Lyoness, an Austrian discount shopping service that has been declared an illegal pyramid scheme in Norway, Austria, and Switzerland.

After a summer of Chinese whispers on the internet alleging that he was involved in Lyoness before becoming the face of TenX, a video has emerged that appears to show Hosp presenting an online tutoring session used to enable viewers to recruit new participants in the pyramid scheme. The news was first reported by Breaker.

The emergence of the video, if authentic, is particularly damaging not only because of the reputational harm that TenX stands to suffer, but also because the contents of the video point to a damning lack of integrity and a willingness to promote dishonest and underhanded tactics in pursuit of profit. Among the pointers mentioned by Hosp in the video are exhortations for users to exploit relationships with friends and family because they “cannot evade” them, and to hide the real reason for requesting meetings with them. The video also includes tips for evading “annoying questions” about how Lyoness works.

Reputational Damage to TenX

It will be recalled that TenX raised over $80 million in its ICO last year on promises to “make cryptocurrencies spendable anytime anywhere” by connecting bitcoin to the real world with a Visa debit card and banking license. According to the TenX whitepaper, its platform native PAY token would entitle holders to dividend payments generated from use of its cards – a promise which has since been jettisoned. Since 2017, the platform’s basic promise has not been delivered on, with users still waiting for the promises bitcoin-linked debit cards more than a year later.

Questions are increasingly being asked about the willingness or capacity of TenX to fulfill its substantial promise, with some concluding that the company is in fact yet another iteration of an ICO exit scam.

According to reports, Hosp had previously been successful in censoring such material linking him with Lyoness (known as “Cashback World” in the United States), particularly before the TenX ICO. Twitter accounts that shared material discussing his involvement in Lyoness were quickly suspended from the website, and even a message board created to catalogue complaints about Lyoness has been commandeered by the company, redirecting to its U.S. website instead.

Excerpts of Hosp’s tips from the video go as follows:

“Never forget, it is not about telling the exact 100% truth…if you follow this [method], you can earn incomes in an extent that it’s not imaginable to you at this moment…you will never run out of contacts if you follow some guidelines.”

Apart from reputational damage however, this is unlikely to bother Hosp too much because multi-level marketing schemes are not a regulatory priority in the U.S. What will bother him a whole lot more however is the SEC’s current affinity for prosecuting ICOs that sold unregistered securities during the height of the ICO boom last year, one of whom is TenX.

CCN has reached out to TenX for comment and will update this article upon receiving a reply.

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Crypto Custody Startup Raises $8 Million from ConsenSys & Two Sigma Ventures



Venture firm Two Sigma and Ethereum development studio ConSensys have invested $8 million into digital asset custody solution provider Trustology, Business Insider reports. Both investors would be joining Trustology’s board of directors.

London based Trustology, known for developing the TrustVault, a crypto management service that safeguards private keys by keeping them in “tamper proof, programmable hardware security modules hosted in secure data centers, with encrypted backups in the cloud.”

“Trustology’s unique blend of people, process, and key management technology offer industry defining digital asset security with speed of access and unrivaled ease of use. Trustology aspires to be the digital assets brand of the future,” Alex Batlin, Trustology’s Founder and CEO explained in the press release.

The funding from the investors is expected to be used to create new products, support more digital assets classes and attract international customers for its services.

Joe Lubin, Founder of ConsenSys, hailed Trustology, as he believes the startup is going in the right direction.

“By prioritizing security without the need to sacrifice accessibility, Trustology will serve current digital asset holders and attract new institutional and individual investors to the space.”

It’s estimated that investors lost over $1 billion worth of cryptocurrency between 2012 to the second quarter of 2018, according to research firm Autonomous NEXT. Custody has been one of the challenges these past few months for cryptocurrencies, and its also seen as one of the solutions that have been holding back institutional investors. While the solution has been in existence in Wall Street for decades, in cryptocurrencies, it’s an emerging trend. But one that is becoming the darling of investors.

Mike Novogratz’s Galaxy Digital Ventures and Goldman Sachs placed a $15 million bet in the crypto wallet and security company BitGo Holdings in October. Coinbase launched in July, before acquiring the requisite approval from the New York State regulators, to operate as a Qualified Custodian in the state. International asset manager Fidelity Investments also announced its rollout of crypto custodial services next year.

Tom Jessop, head of its digital assets arm, Fidelity Digital Assets, went as far as to suggest that the organization might change the structure of its custodian solution to support up to five cryptocurrencies, as they continue to evaluate the demand from investors.

“I think there is demand for the next four or five in the rank of market cap order. So we will be looking at that,” Jessop remarked.

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Chile Court Approves Banks Banning Crypto Exchanges, Can Market Survive?



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On December 6, the Third Chamber of the Chilean Supreme Court officially sided with the state-owned BancoEstado after it banned a local crypto exchange by shutting down its bank account.

Orionx, a digital asset trading platform based in Chile, filed an appeal with the supreme court following an abrupt termination of its account by BancoEstado. Ultimately, the court ruled the case in favor of the bank, reaffirming that the bank cannot obtain sufficient information to monitor transactions and determine the identities of the senders of crypto payments.

The court ruling read:

“These characteristics and elements determine, therefore, the current impossibility for the Bank to comply with the aforementioned obligations, since it prevents it from knowing in depth the financial activities related to cryptocurrencies developed by the appellant, the most relevant characteristics of its operations, the foundations on which these are supported and, finally, if their amounts are excessive or not.”

Downfall of the Chilean Crypto Market

chile bitcoin crypto

The global crypto exchange market has become highly competitive with key players like Japan, South Korea, and the U.S. dominating the vast majority of digital asset trading volume and activity.

One common element in the cryptocurrency-related policies implemented by the three countries is that banks are permitted and encouraged to provide stable banking services to cryptocurrency exchanges.

In South Korea, for instance, the Financial Services Commission (FSC) recently approved banks to work with cryptocurrency-related business, and the Seoul Central District Court ruled a high profile case between a major commercial bank and a small local cryptocurrency exchange in favor of the exchange, establishing a strong precedent across the industry.

Following the court ruling, attorney Kim Tae-rim, the representative of the exchange, said:

“Cryptocurrency exchanges, by default, have the right to freely deposit and withdraw funds to and from major banks in South Korea, and an abrupt termination of partnership and services by the bank [in this case Nonghyup] without sufficient evidence or reasoning falls under the breach of contract,” the attorney said.

With access to banking services and insurance, cryptocurrency exchanges in Japan, South Korea, and the U.S. have been able to primarily focus on growth and adoption, without being in conflict with regulations and commissions.

As more countries like Singapore, Malta, and the U.K. move towards the implementation of practical and efficient regulatory frameworks surrounding digital assets, regions that deny cryptocurrency businesses the simplest of requirements like a stable banking service could struggle in remaining relevant in the highly competitive global cryptocurrency market.

Throughout the past eleven months, at least three major Chilean banks including Itau Corpbanca, Bank of Nova Scotia, and BancoEstado unilaterally shut down the bank accounts of most of the country’s largest cryptocurrency exchanges.

Some banks like the state-owned BancoEstado even have a strict policy in place that prohibits the establishment of a relationship or a partnership of any sort with a cryptocurrency company.

Isolation

In a period in which the G20, a forum of government officials from 20 of the largest economies in the world, is moving towards regulating the global cryptocurrency market, the inability to read market trends and follow lead of consortia like the G20 could result in isolation that may create a challenging environment for Chile’s local cryptocurrency sector to grow in the long run.

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Corda Blockchain Platform Executes Successful Live Commercial Paper Transaction in Europe



EOS

Enterprise blockchain software provider R3 has issued a statement announcing that Corda, its blockchain platform has successfully completed a live commercial paper transaction.

In collaboration with Commerzbank, ING, Natixis and Rabobank, the transaction was carried out on the Euro Debt Solution application which was built on Corda. The transaction is a follow-up to a similar transaction simulated on an earlier version of the application in September 2017.

From launch in 2017, the stated aim of the Corda consortium has been to leverage blockchain technology to provide consequential benefits for issuers. According to the statement from R3, the intention is to achieve this by “offering a streamlined capability for accessing debt whilst bringing greater transparency to the marketplace.” The intention is that the participating institutions will enjoy reduced operational costs and risk as well as the ability to deliver intraday settlement finality for their clients.

Positive Reactions

The transaction involved the issuance of a €100,000 notional with a one-day maturity, with Commerzbank providing  the pilot framework, software, distributed ledger network and guidance on regulatory implications. Natixis acted as the issuer, Rabobank acted as the investor and ING served as both dealer and escrow agent.

Commenting on the success of the live transaction, R3 CEO David E. Rutter said:

“The issuance and settlement of securities is a complex process and current models are rife with inefficiency. Corda addresses these challenges by enabling parties to financial agreements to record them once and collaborate to maintain accurate, shared records of these agreements. The successful live trade on the Euro Debt Solution not only demonstrates that blockchain provides clear advantages over existing processes but marks the next step towards a production-ready solution on Corda.”

Other project partners also expressed satisfaction with the success of Corda including Marnix Bruning, Head of Money Market & Central Bank Sales at ING who stated that the company is eager to continue the collaboration into the next project phase. Head of Digital for Corporate & Investment Banking at Natixis, Frederic Dalibard expressed eagerness for a full commercial launch of the solution with the attendant positive implications for operational efficiency.

According to Youssef el Mir of Rabobank, Global Head of STIRT and Commercial Paper Trading, the pilot trade not only demonstrates the company’s determination to lead innovation-driven financial markets, but also taps the potential of blockchain technology to open new frontiers in settlement speed and clearing. This he said, will benefit customers by giving them a more efficient product experience, and will ultimately benefit the company.

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Power Ledger’s Blockchain Energy Service is Live in Fremantle



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Australia’s coastal city of Fremantle has kicked off a trial that will allow some residents to trade solar power on a blockchain-based platform provided by renewable energy-focused crypto startup Power Ledger.

According to the Minister for Finance, Energy and Aboriginal Affairs in the government of Western Australia, Ben Wyatt, around 40 households in Fremantle will participate in the trial that will end next year in June.

Efficient Balancing of Supply and Demand

During the trial, households will enjoy the flexibility of determining the price at which they are willing to purchase and sell solar power for and then conduct the transactions on a blockchain-enabled platform.

“The trial represents an innovative solution to virtual energy trading that may have implications for energy utilities working to balance energy supply and demand all over the world,” Wyatt said in a statement. “These households are believed to be the first in the world to be taking part in an active, billed, peer-to-peer trading trial that allows them to effectively buy and sell solar energy generated by their rooftop system across the grid.”

The trial is part of the RENeW Nexus Project that has brought together various entities including Power Ledger. The RENeW Nexus project was initiated with a view of exploring how future cities can use blockchain technology and big data to integrate distributed energy as well as water systems infrastructure.

Power Ledger in the United States

This comes less than a month since Power Ledger made a foray in the biggest wholesale electricity market in the United States by inking a deal with energy supplier American PowerNet. The deal allowed Power Ledger to deploy its blockchain-based peer-to-peer renewable energy trading platform at the electricity provider’s headquarters in the state of Pennsylvania.

As CCN reported at the time, the initiative enabled the solar power generated on the rooftops and carports at the headquarters of American PowerNet to be distributed to the surrounding businesses using Power Ledger’s xGrid platform.

“Rather than just dump our excess solar power on to the grid, we’re thrilled we can now provide clean, sustainable power to our neighbors,” CCN quoted American PowerNet’s president, Scott Helm, as having said.

A month prior, Power Ledger had won the 2018 edition of Extreme Tech Challenge (XTC), a competition organized by the billionaire founder of Virgin Group, Sir Richard Branson, to equip techpreneurs with the necessary tools required for their success. The startup, which raised approximately AUD$34 million in an initial coin offering last year in October, received financial endorsements totaling millions of dollars after winning the XTC 2018.

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Crypto Exchange Bithumb May Have Propped up Bitcoin Price: Analysts



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The bitcoin price touched a fresh yearly low this morning, leaving traders and investors scrambling for answers as the crypto market searches for a bottom. While there are numerous pressures that have weighed on bitcoin as it has taken step after step away from last year’s all-time high, research from CryptoCompare suggests that South Korean cryptocurrency exchange Bithumb may have contributed to the recent sell-off — at least indirectly.

According to the firm’s latest CCCACG (short for CryptoCompare’s Aggregate Pricing Index), Bithumb led all crypto exchanges in daily volume from October to November, averaging about $1.24 billion in daily turnover. That represented a parabolic month-over-month increase of 284 percent, even as global exchange heavyweight Binance endured a 34 percent decline in volume.

bitcoin price chart
BTC/USD | Coinbase | Source:  TradingView

Unsurprisingly, Bithumb’s volumes were not entirely organic, which is why CoinMarketCap and other data aggregators still list Binance as the world’s highest volume cryptocurrency exchange. Rather, Bithumb’s increased volumes correlated with several trading promotions, “Super Airdrop Festival” and “Special Gift.” These promotions appear to have enabled Bithumb to ramp up its daily volume — and the prominence of KRW trading in the spot crypto market — even as its number of active traders decreased significantly, according to web analytics.

From the report:

“Bithumb saw a 284% increase in volumes from the previous average of 323 million USD for the Sept/Oct period. This increase in volumes follows after Singapore-based BK Global Consortium bought a controlling share in the exchange in recent months, and later implemented a series of airdrop competitions, raffles, rebates, and other programs designed to incentivize non-Korean users to sign up to the exchange and trade in exchange for rewards. They have also implemented a potential form of trans-fee mining for certain users, where trading beyond a specific volume is rewarded in the form of “Bithumb Cash” at a later date.”

As CCN has noted in the past, higher trading volumes tend to correlate with a strong bitcoin price, while lower volumes tend to accompany gradual downward movements. Consequently, the fact that Bithumb, along with several other lesser-known exchanges, managed to increase daily turnover even as their active user bases shrunk might indicate that these trading promotions helped the bitcoin price remain stable above $6,000 for longer than fundamental and technical factors suggest that it should have.

To wit, bitcoin’s first break below $6,000 occurred shortly after one of Bithumb’s trading promotions ended, at which point the market embarked on a severe downward trajectory from which it has thus far been unable to recover.

crypto exchange bithumb bitcoin price
Source: CryptoCompare

Commenting on the report, Mati Greenspan, senior market analyst at eToro, said that while Bithumb should probably not be blamed for the recent bitcoin price collapse, the crypto exchange’s trading promotion may have helped the market remain stable for longer than it would have otherwise.

“If these findings are indeed accurate, I would say that blaming South Korea for the drop wouldn’t exactly be correct,” Greenspan wrote in daily market commentary shared with CCN. “More likely, it appears that the volume promotion by Bithumb caused several months of stabilization in prices, to begin with.”

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Cryptocurrency Exchange Coinbase Lists Four More Ethereum Tokens



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The most popular US cryptocurrency exchange is continuing its promise to support Ethereum-based ERC20 tokens, adding four more of the coins to the Coinbase Pro platform.

Starting today, December 7, Coinbase Pro users can transfer their balances of Civic (CVC), district0x (DNT), Loom Network (LOOM), and Decentraland (MANA) to the exchange, and full trading will commence around 48 hours from today. The Coinbase announcement confirms:

“Once sufficient liquidity is established, trading will begin on each respective USDC order book. Trading will initially be accessible for Coinbase Pro users in the US (excluding NY), UK, European Union, Canada, Singapore and Australia.”

There are four stages of launch for each token. Beginning with the acceptance of transfers into the platform, then “post-only” will allow the posting of limit orders for a short time, before limit orders will start matching. After this point, full trading will become available. The Coinbase Pro Twitter account will be updated at each stage.

The four coins will, for now, only be available on the Coinbase Pro platform for advanced trading and not the standard brokerage platform at Coinbase.com or within the firm’s mobile applications. Both services, Coinbase and Coinbase Pro, are free to register, but trading fees vary.  Availability of the new coins for more countries could also be added later.

Coinbase plans to list even more ERC20 tokens “over time” and reveals:

“We are exploring the addition of many new assets beyond ERC20 tokens on a jurisdiction-by-jurisdiction basis.”

ERC20 tokens, says Coinbase, integrate easily with its existing infrastructure “particularly from a security standpoint,” but the exchange acknowledges there are other popular coins it is yet to support.

ERC20 token 0x (ZRX) and the Coinbase stablecoin USDC (USD Coin) were added by the platform in October 2018, followed by Brave Browser’s Basic Attention Token (BAT) in early November. With the addition of four more coins now in December, Coinbase is delivering on its ERC20 support plans announced back in March 2018, and more additions look set to follow.

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