- CipherTrace Scout App Takes Crypto Investigations Mobile: Federal agents want to move their tracing ever deeper. In a pre-solicitation document at the end of last year, the Department of Homeland Security mulled the feasibility of tracing privacy tokens, which confound easy research with complex security. Technologies such as CipherTrace and Chainalysis now pervade law enforcement agencies across the country. (Yahoo)
- Jevans in potdast "Discusses Latest Research Findings" (link). One goal is to prevent sanctioned countries from from avoiding sanctions by using crypto.
- US Regulator Zeroes in on Binance Chain as SEC Awards Monitoring Contract to Ciphertrace: SEC says it has chosen Ciphertrace because “its products are the only known blockchain forensics and risk intelligence tool that can support the Binance coin (BNB) and all tokens on the Binance network.” (News BTC)
- The Government Wants Your Crypto Data. And Lots of It. (Context of activities like those carried out by Cipher, named as one, and other companies doing the same) (Mines)
- While the tool can track stolen or illegal funds, CipherTrace plans to add more features, such as wallet identification and exchange attribution. But the private nature of Monero makes the tool unable to give a 100% guarantee on the data. When asked about whether the tool can trace the identity of the individuals, Jevans said they have not done that at CipherTrace. "We don’t identify individuals, he said. That task belonged to the law enforcement, Jevans added. (IBTimes)
- Regarding the regulation recently instated in EU privacy law (GDPR, implemented to protect the privacy of individuals) Mr Jevans said: “GDPR will negatively impact the overall security of the internet and will also inadvertently aid cybercriminals. (Express Co UK)

Unfortunately, anonymity isn’t something that you think about as being valuable. But as Edward Snowden points out in one of his interviews, “Arguing that you don’t care about the right to privacy because you have nothing to hide is no different than saying you don’t care about free speech because you have nothing to say.”
https://preview.redd.it/a2t5wii1wnj41.png?width=1024&format=png&auto=webp&s=df6889e510a2a0b231614636d0b6c1ac7be7e2c4
Many people are going up against online anonymity, mainly because it has the potential to enable and encourage undesirable behavior or illegal activity. State institutions and corporations are trying to limit the ability to use networks without authorization, allegedly in an attempt to increase security.
Meanwhile, there is no doubt that private information that falls into the wrong hands can be used for mean purposes in many ways. Dozens of examples truly highlight the need for online anonymity today. Without it, people’s lives can easily be ruined forever.
Financial and personal freedom are the main reasons why people started using cryptocurrencies. But using Bitcoin itself can not guaranty anonymity. They are not linked to a person or identity, so the name, e-mail or physical address can’t be found in the transaction. But public addresses we use publically recorded on the blockchain, so a person can be tracked down using this information and ID.
Here are some methods to keep your identity safe.
Use logless VPN
Virtual Private Network encrypts all of your Internet traffic and routes it through multiple servers at different locations before arriving at the final location. Using a VPN is one of the simplest ways to cover your digital tracks. Logless VPN services don’t store the history of your activities, some of them provide one IP address for several users, making it difficult to isolate one person among them.
It is highly recommended to avoid US/UK-based VPN services due to strict surveillance regimes in these countries.
Also, you should keep in mind that some exchangers’ security systems treating logging into an account with numerous different country IPs as suspicious which can lead to blocking your account.
Register a separate email
Never use personal or working email for the needs of the crypto. If hackers gain access to it that can ruin your life in many aspects at once.
A significant advantage will be the use of burner emails such as Guerrilla Mail and Temp Mail, or highly protected services like ProtonMail or Tutanota.
Don’t forget about common security rules such as using a strong password that contains different case letters, numbers and symbols. Keeping passwords and keys on your devices is definitely not safe, better write it down in an old-fashioned pen-paper way.
Create new blockchain address
Make new addresses for every single transaction you make. More than half of all transactions in the BTC network go through wallets that have been in use at least once. Over time this practice will build up a list of transactions associated with one wallet. Using some manipulations those transactions could be easily associated with a real-world identity as well as your wallet could be simply hacked and robbed.
Avoid KYC and AML using services
Know Your Client is a policy used by many companies in which each client is required to provide credentials such as ID documents to use a company’s service. Anti-Money Laundry consists of KYC procedures and ongoing risk assessment and monitoring of transactions. Such actions are implemented in the best interest of protecting users of cryptocurrency platforms but left no chance to stay anonymous.
Nowadays most of the crypto markets and exchanges require passing identity verification due to the growing control from the state institutions. However, there are some that allow you to remain anonymous unless you are withdrawing a large amount (Binance, Bitfinex, KuCoin, etc.). In such circumstances, decentralized exchanges seem like a good option.
Use Anonymity-Centric Cryptocurrencies
As mentioned earlier, blockchain analysis based on knowledge of the amount and time of the sent transaction allows hackers to attack user’s wallets and gain access to their data. As a reaction to this was developing coins with anonymity as the main priority.
At the moment, Monero is the most popular of the anonymity-centric cryptocurrencies. It has a complex of cryptographical tools for obfuscating traces of the original transaction. Its RingCT Protocol hides the sender, recipient and transfers amounts. After the transaction is completed, it is signed and receives a time-stamp using a ring signature, where collected group’s public keys, but the private key of the specific sender is not displayed.
Another private currency’s Dash work is based on the CoinJoin technology. The idea of the process is very simple: several transactions are mixed into one, so it is impossible to determine what amounts were transferred and by whom.
Zcash currency uses the Zero-Knowledge Proof commitment scheme to validate transactions without revealing information about them. Protocol, called Zk-SNARKs, comprises three algorithms that generate proof and verification keys, calculate the proof and verify the authenticity of the secret information. The obvious drawback of this mechanism is extremely massive complex calculations that require enormous capacity.
Even if complete anonymity seems not possible, following the above rules will help you avoid a lot of trouble.
You should be extra meticulous in the process of choosing currency and an exchanger, keeping in mind where and what personal information you provide.
If you need to exchange your coins private and without registration – StealthEX is here for you. Just go to http://stealthex.io and choose the pair and the amount for your exchange. Then follow these easy steps:
✔ Choose the pair and the amount for your exchange. For example ETH to BTC.
✔ Press the “Start exchange” button.
✔ Provide the recipient address to which the coins will be transferred.
✔ Move your cryptocurrency for the exchange.
✔ Receive your coins.
Follow us on Medium, Twitter, Facebook, and Reddit to get StealthEX.io updates and the latest news about the crypto world. For all requests message us via [[email protected]](mailto:[email protected])

This is mostly a duplicate of my summarised responses to that exchange's original announcement threads here and in /nanotrade**.**
The owners of that new exchange are welcome to downvote this new posting of mine, but everyone else can make their own decision about whether to upvote this for posterity's benefit, so that my post gets found in months to come (given that Reddit's search engine is really bad at searching comments.)
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Here's what's dodgy about this exchange, and why anyone who remembers BitGrail should be very afraid:
I emphasise that I'm not saying this is a scam. But I am saying it looks like what a scam website would look like and appears to be operating illegally under UK law:
​
* The domain NanoTrade.co.uk was registered only two days (one working day) before the site went live - meaning it only could have been tested very briefly, (Edit: and could not have been secured against accidentally being taken by another person, which implies incredible lack of planning)
* The domain was registered by NameCheap, with an obscured registrant
* The site was not pre-announced on /Nano Currency nor /NanoTrade
* The site was announced first on /nanotrade (6k subscribers), but only announced here on /nanocurrency (44k subscribers) three days later, demonstrating a lack of knowledge of Nano relative subscribers
* The announcer Paradise2GE claimed Google and Facebook Ads existed prelaunch - but no one of you here saw them because you would have excitedly told us if you had
* No such advertising for the site was noted by me, yet I would have been a key target for it
* Since the domain was not registered, such advertising could not have included, say, a [[email protected]](mailto:[email protected]) mail form, which is incompetent in itself
* Nano Associates Limited was registered with Companies House on 2018-02-28 (as company number 11229688) - to a London mail-forwarding company's central London address (a postcode with 11,000 companies registered at the same address)
* Its sole Director 'Orlando Carugo' has no Google history of being associated with Nano, Cryptocurrency, or finance at all
* Orlando Carugo's profession is listed as 'Sales Director'
* The Google and LinkedIn history of an UK-based 'Orlando Carugo' (a sales professional) can be found, with no reference to cryptocurrency but with references to being willing to work for stock options or commission
* The announcement on /NanoTrade was made by Paradise2GE - an account with a few questions on Bitcoin two years ago, a single comment one year ago, then absolutely nothing until this weekend.
* We know nothing of the overall reputation of the company owners
* The company uses a payment processor https://en.bitcoin.it/wiki/VirWoX which has a daily limit on PayPal withdrawals of 2500EUR. The NanoTrade website however states that up to 90,000 Nano can be sold per PayPal transaction. It seems impossible to reconcile this for me. If 90,000 Nano is sold to PayPal, when would the seller get their money?
* If the answer is that such payments cannot be made, when were the company planning to tell the sellers?
* On being asked on /Nanotrade, Paradise2GE has avoided answering this question in their dissembling answers
* The company is not registered by the FCA
* The company is not registered by HMRC as a money service
* It is a legal requirement for UK based companies to register as money services.
* It is not a get-out to just deal in USD and not GDP, yet Patadise2GE has attempted to use that get-out in their answers
* Paradise2GE has dissembled when answering questions as to why Nano Associates is not registered with FCA or HMRC
* Paradise2GE claimed 1000 trades on their first day... for an unannounced site...purely from a posting that had around 40 up votes at the time. It's a lie. Not even Nanex gets that many trades on a good day.
* Given a supposed 1000 trades in a day, 1440 minutes in a day, and 25% of Nano staked on Binance, we should expect to see >5Nano transactions coming out of the Binance hot wallet at least every 10 minutes or so. I don't see those
* The site works poorly on Android, showing a lack of technical skill in its developers
* The announcement of the exchange on /nanocurrency was by SMcArthurs - a one year old account, with very few postings, and no history in the /nanocurrency or /nanotrade subs
* Someone downvoted my reasonable questions on /nanotrade. I can think of only one person who would want to do that, if malicious
* Someone downvoted someone thanking me for my questions on /nanotrade. I can think of only one person who would want to do that, if malicious
* User astricali has posted at 2018-12-03 05:00GMT that they made a successful sale of 999.99 Nano. I performed a text extraction of the posted image address, which they were apparently instructed to send to, but I notice that although that address indeed Received a 999.99 amount from the Binance Representative at 2018-12-04 02:17:01 (Timezone unknown), the address has never actually Pocketed 999.99 Nano - the payment is still Pending.This is odd, since once might expect an efficient provider to pocket the Nano they receive asap, to sell it on the markets
* The address has however received a range of 8 payments ranging from 1.99 Nano to 1,847.99 Nano. That surprises me, because I would expect a payment provider to use a unique address for each received payment.
* The address has only ever sent a payment once, to KuCoin, on an unknown date before 2018-07-25
* Paradise2GE and SMcArthurs have been extremely quiet in response to these complaints levelled against their site
* Edit: Why would they be selling Nano at 1.00 USD at the moment when Nano is on Binance at 0.94?
* Edit: Seeing 403 Forbidden error 2018-12-05 23:38GMT
* Edit: Don't even get me started on the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations Regulations 2017
* Edit: It's 12 days later - 18-Dec-2018. The 999 Nano still hasn't been pocketed at address. In 12 days neither promoter has denied that's it's their account. They are therefore probably incompetent even if non-malicious.
* Also noticed something I should have picked up before: That address is Represented by Nanowallet.io - which means it's probably an account created on Nanowallet.io. Any 'real' exchange would need, at the very minimum, to run it's own node so that it can be online 24/7 - and if so would most likely Represent itself. Specifically choosing Nanowallet.io as their Representative after installing a full node would be an odd decision, given that they could help decentralize.
'm at way over 22 red flags here. I hope I save someone.

Last Friday FATF regulation is about source of fund for crypto https://www.coindesk.com/fatf-crypto-travel-rule
If you live in Asian countries and you migrate to USA or UK ......, to buy a home you have to verify your source of fund.
​
If you have invested or traded on stock, commodity, forex exchanges. When you make a deposit or withdrawal, these exchanges always verify your source of fund

• If you deposit 10K for example, the fund of this this deposit should be valid with your name for example: a bank account with your name as account holder, a PayPal account with your name as account holder.
• If you make a withdrawal, the destination account should be your: a bank or PayPal account

​
Imagine you have bought 50K of Segwit BTC + LN, BCH in 2017-2018. In 2021, this 50K of segwit BTC + LN, and BCH become 200K. However, you will not be able to use this 200K because you cannot prove that you are the owner of it.
Case 1: If someone in USA bought this 50K fron Binance in 2017-2018 , and made a withdrawal but Binance sent BTC to this guy's wallet using a criminal BTC. In 2021, this guy use this 200K to buy a house and a bank asks him to verify this source of fund and it is from illegal source, this guy will lose his 200K
Case 2: If someone in Singapore bought this 50K a valid exchange in 2019 after Lightnight Network launch and then made an withdrawal. In 2021, this guy use this 200K to buy a house and a bank asks him to verify this source of fund and he will not able to verify it because Segwit LN will send through many middle nodes before reaching this guy's wallet, this guy will lose his 200K too
​
After the last Friday FATF regulations, https://www.coindesk.com/fatf-crypto-travel-rule
BSV is beging fixed by BSV Dev team, Nchain, and Dr. Craig to return to its 2008-2009 Bitcoin design to meet this source of fund . This will make BSV is the only Bitcoin which you buy in 2018-2019 and your fund will be valid in 2021 and later. Please check this video https://www.youtube.com/watch?v=QTK5UuKCc6o to know that the Bitcoin 2008-2009 design meeting US, UK, EU, Sharia Laws and BSV is the Only real Bitcoin
​
Many scamming crytpo web sites never write about this, I share it here so that BSV supporters and new crypto users can avoid buying into BTC, BCH which are built to hide source of fund
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I expect many big players will convert from BTC and BCH to BSV in the next couple weeks or months.
Segwit BTC and BCH are killing them self for modifying the original Bitcoin design to hide source of fund

Developments in Financial Services

• A cryptocurrency exchange-traded product (ETP) that trades on Switzerland’s Six Exchange saw record trading volumes on Thursday and Friday last week, suggesting that institutional investors may be buying the dip in cryptocurrencies. Four major cryptocurrencies underlie the HODL ETP, including Bitcoin (BTC), Ripple (XRP), Ethereum (ETH), Litecoin (LTC), and Bitcoin Cash (BCH). While HODL ETP’s one-month average daily trading is 20,000 shares, on Thursday, December 6th, and Friday, December 7th, 53,233 shares and 62.986 shares were traded, respectively.
• A report published last week by global anti-money laundering policymaker, the Financial Action Task Force (FATF), indicates that cryptocurrency exchanges in the United Kingdom pose a, “low risk,” for money laundering and terrorist financing activities. The report, however, does highlight that such activities on UK cryptocurrency exchanges are an, “emerging risk,” although there is not yet enough evidence to suggest that these activities are occurring through cryptocurrency exchanges. In its report, the FATF urged UK regulators to, “Continue to develop an understanding of emerging risks (such as virtual currencies) and intelligence gaps, and take appropriate action.”
• Andreas Utermann, CEO and CIO of Allianz Global Investors, called on global financial regulators to ban cryptocurrencies while speaking at a panel discussion in London. According to a report by Reuters, Utermann said, “You should outlaw it,” while participating in a panel alongside Andrew Bailey, the head of Britain’s Financial Conduct Authority. Bailey responded by saying that Utermann’s comments were, “quite strong,” before adding that cryptocurrencies have, “no intrinsic value.”
• Basis, a major US-based stablecoin project, is shutting down its operations and returning most of its funds to investors, according to a report by crypto news outlet The Block. The report by The Block cited, “multiple people with direct knowledge of the situation,” in claiming that the algorithmic stablecoin project, which generated UDS$133mm of funding through private investments in April, will return funds to investors. According to the Co-Founder and CEO of competing stablecoin project Nevin Freeman, Basis’ shutdown is due to regulatory concerns around one of its token types. Freeman explained, highlighting that algorithmic stablecoins implement a “secondary token”, known as a “bond token”, to help maintain the primary token’s peg. In many cases, regulators like the US Securities and Exchange Commission (SEC) consider these secondary tokens to be securities.
• Binance, the world’s largest cryptocurrency exchange by daily trading volume, announced that it has added Circle’s US dollar-pegged stablecoin, USD Coin (USDC), to its combined Stablecoin Market. Circle, a company backed by Goldman Sachs, first released its stablecoin in September of this year. Binance’s combined Stablecoin Market features other notable stablecoins, like Tether (USDT), that trade against cryptocurrencies as interchangeable base pairs.
• Coinone, a South Korea-based cryptocurrency exchange, has officially launched Cross, a cross-border payments application that leverages Ripple’s xCurrent product to increase efficiencies. The application, released by Coinone’s payments subsidiary, Coinone Transfer, targets unbanked or underbanked South Koreans by enabling the transfer of funds to Thailand or the Philippines at a low cost.
• Gemini, a cryptocurrency exchange heralded by the Winklevoss twins, released an official company blog post this weekend announcing that the firm will support Bitcoin Cash (BCH) custody and trading. The exchange will support only the Bitcoin Cash ABC network at this time, adding that they, “are continuing to evaluate Bitcoin SV over the coming weeks or months, and we may or may not choose to support withdrawals and/or trading of Bitcoin SV in the future.” Additionally, the company detailed that its listing of BCH is pending regulatory approval by the New York State Department of Financial Services.
• Gemini, the cryptocurrency trading platform founded by the Winklevoss twins, announced the launch of a mobile crypto trading application in an official blog post today. Accompanying the launch of the crypto trading app is a new investment vehicle, dubbed, “The Cryptoverse,” that is comprised of a basket of cryptocurrencies weighted by market capitalization. While speaking to Bloomberg today, Cameron Winklevoss said that, “A lot of our decisions have perhaps given off a perception that we’re more institutional-based. The reality of the situation is that we have a diverse customer base. And the retail story is just beginning.” The Winklevoss twins went on to detail of a goal to expand reach to Asian markets by 2019’s end.
• Good Money, a US neo-banking platform, has closed its Series A investment round that generated USD$30mm led by cryptocurrency-focused merchant bank Galaxy Digital and the founder of EOS (EOS) Block.one. Good Money aims to provide a variety of banking service and certain financial instruments to US account holders while exploring innovative changes to traditional banking practices. “Modern banking is a primary driver of so many issues we as a society face – from economic inequality, institutional racism, environmental destruction to political corruption,” said Good Money founder Gunnar Lovelace. Specifically, Good Money eliminates ATM fees while offering each bank user equity in the company.
• Kraken, a notable cryptocurrency exchange, is seeking to raise funding with a USD$4bn valuation for the company and a USD$100,000 investment minimum, according to CoinDesk. In an email to investors, Kraken CEO Jesse Powell wrote, “There is presently a limited time opportunity available to a very small select number of clients to purchase shares.” The email goes on to detail that the exchange will close its offer on December 16th.
• OKEx, the second-largest cryptocurrency exchange by daily trading volume, will begin listing Bitcoin Cash ABC under the original Bitcoin Cash ticker (BCH), as per an official announcement Tuesday. Additionally, OKEx will change the Bitcoin Cash SV ticker from BCHSV to BSV. The announcement by OKEx comes after other notable cryptocurrency exchanges have made the same switch, including Coinbase and Gemini.
• PayPal, an online payments portal, has launched its own internal private blockchain platform that will allow staff to trade and exchange tokens while generating ideas and participating in programs to foster innovation, as per a report by news outlet Cheddar. The private blockchain network, which was built by 25 PayPal employees in just 6 months, will allow employees to earn more for enrolling in learning and development programs. The PayPal tokens are not tradeable, or worth anything for that matter, outside PayPal’s blockchain.
• PricewaterhouseCoopers (PwC), a big four consulting firm, is partnering with Bitfury Group, a large blockchain software and mining firm, to develop a blockchain accelerator specific to Russian businesses. As per an official press release by PwC, the partnership will leverage Exonum, Bitfury’s open source framework to build blockchain applications, for educational courses and seminars. The partnership aims to meet the, “current needs,” of PwC’s enterprise clients in Russia.
• Revolut, a digital banking alternative with an in-application cryptocurrency exchange, announced that it has been awarded a European banking license. Seeking to become the, “Amazon of banking,” the license will allow Revolut to offer traditional banking services alongside its current cryptocurrency offerings to European customers. Nikolay Storonsky, Founder and CEO of Revolut, said in regards to the newly acquired license that, “With the banking license now secured, commission-free stock trading progressing well, and five new international markets at final stages of launch, we are living up to our reputation as the ‘Amazon of Banking’. Our vision is simple: one ap with tens of millions of users, where you can manage every aspect of your financial life with the best value and technology.”
• Shinhan Bank, the second-largest commercial bank in South Korea, is launching a new project to implement blockchain technology in its internal processes with a goal of eliminating human error. According to a report by news outlet The Korea Times, Shinhan also recently completed a training program for its staff to increase their knowledge of blockchain technology across various applications. After Shinhan implemented blockchain technology for interest rate swap transactions on November 30th, South Korea’s second-largest bank is now aiming to apply the technology in its record-keeping process to enhance overall efficiencies.
• SolarisBank, Germany’s second-largest and Europe’s ninth-largest stock exchange, is partnering with Stuttgart Exchange Group, a German fintech company, to jointly develop a cryptocurrency exchange. As per a report by Cointelegraph Germany, the joint cryptocurrency exchange venture, “is scheduled to launch in the first half of 2019.” This news comes after SolarisBank announced plans to launch a zero-fee cryptocurrency trading application this past May.
• The Canadian city of Calgary is becoming the first city in Canada to launch a digital version of its local currency, according to a report by the Global News. Dubbed as the Calgary Digital Dollar, the digital currency will be exclusive to Calgary and operate alongside the country’s Canadian Dollar. Calgary-based businesses will now be required by law to accept at least 10% of a payment in digital currency, although they are allowed to accept up to 100%.
• The Society for Worldwide Interbank Financial Telecommunication (SWIFT) is launching a pilot of its Global Payment Initiative (GPI) to combat growing blockchain and fintech solutions, according to an official announcement last week. Currently, the SWIFT Network is used by global financial institutions to conduct global financial payments and cross-border transfers of fiat currency. Although the project is still in its early stages, the GPI pilot hopes to, “build the foundation of a new integrated and interactive service that will significantly improve efficiencies in the payments process and which will ultimately be made available to all 10,000 banks across the SWIFT network.”
• The United Arab Emirates’(UAE) central bank is partnering with the Saudi Arabian Monetary Authority (SAMA) to develop a cryptocurrency to facilitate cross border transactions between the two countries, according to a report by news outlet GulfNews. In a meeting pertaining to global banking standards and regulation in the Arab region, Mubarak Rashed Al Mansouri, the governor of the UAE’s central bank, said, “This is probably the first time ever that witnesses the cooperation of monetary authorities from different countries on this topic and we hope that this achievement will foster similar collaboration in our region.” The prospective digital currency will be used by both central banks and financial institutions in the countries.
• TokenSoft, a security token offering (STO) startup, has acquired a 20% stake in regulated broker-dealer Marpine Securities LLC in order to launch its own regulated broker-dealer. After acquiring the 20% stake, TokenSoft will launch its new regulated broker-dealer entity, called TokenSoft Global Markets, that will be registered through the Financial Industry Regulatory Authority (FINRA). The new regulated broker-dealer entity will allow TokenSoft to advise token issuers through every step of the Initial Coin Offering (ICO) process. Additionally, TokenSoft will now be able to legally operate in services related to insurance and management.
• Tom Lee, co-founder of Fundstrat Global Advisors and a notable cryptocurrency pundit, believes that the current fair value of Bitcoin (BTC) is between USD$13,800 and USD$14,800, according to a note published on Thursday. Lee arrived at this valuation by taking into account the number of active wallet addresses, usage per account, and other supply and demand metrics. Additionally, Lee forecasted that the fair value of BTC will reach USD$150,000/coin once BTC wallets account for 7% of Visa’s 4.5bn account holders.
• UAE Exchange, an exchange based in the United Arab Emirates (UAE), is partnering with Ripple to launch a blockchain-based cross-border remittances platform by 1Q2019, as per a Reuters report on Thursday. The report details further that Finablr, a payments and foreign exchange company that owns UAE Exchange, observes a high level of remittance inflows from expatriate workers in the Middle East region. “We expect to go live with Rippel by Q1, 2019 with two other Asian banks,” said Finablr CEO Promoth Manghat, adding, “This is for remittances to start with, from across the globe into Asia.”

Regulatory Environment

• De Nederlandsche Bank, the Netherlands’ central bank, will soon require domestic cryptocurrency providers to obtain a license from the regulator to operate, as per a report by Dutch news outlet DeTelegraaf. The Netherlands' central bank is taking these measures in the hope that it will, “prevent such cryptocurrencies from being used to launder money obtained through crime or to fund terrorism.” In order to receive a license, cryptocurrency firms must maintain Know-Your-Customer procedures and report any suspicious activity to the Dutch central bank.
• Eddie Hughes, a conservative member of the United Kingdom’s Parliament, suggested that Bitcoin (BTC) should be accepted as legal tender for tax and utility payments, according to news outlet Express.co.uk. The article discusses that Hughes, who is a self-described, “crypto enthusiast with amateur knowledge,” recently met with the Royal National Lifeboat Institution, which accepts cryptocurrency donations. This news comes after the US state of Ohio announced that it would begin accepting BTC as legal tender for tax payments.
• Following a case in Canadian courts that resulted in a ruling ordering mistakenly sent crypto funds to be returned to their owner, a blog post from the University of Oxford Faculty of Law is noting that there could be repercussions with the case potentially setting a precedent for lost or stolen cryptocurrency claims. The Canadian court case’s ruling will require defendant Brian Wall to return USD$370,482 worth of Ethereum (ETH) tokens to the plaintiff, Copytrack. The blog post from the University of Oxford Faculty of Law reads, ‘This precedent may have major repercussions for the enforcement of claims regarding lost or stolen cryptocurrencies,” adding that the ruling allows the plaintiff to recover tokens, “in whatsoever hands those Ether Tokens may currently be held.”
• Japan’s government is considering plans to ease cryptocurrency taxes in an effort to revitalize the domestic cryptocurrency and blockchain industry. This week, Japanese Congressman Takeshi Fujimaki proposed four significant changes to taxation requirements pertaining to digital assets, which include: a reduction on the cryptocurrency gains tax from 55% to 20%; elimination of taxes on crypto-to-crypto payments; elimination of taxes on miniscule cryptocurrency payments; and an adjustment that would allow cryptocurrency investors to carry forward losses across quarters and years, effectively until cryptocurrencies are ‘cashed’ out.
• Jay Clayton, Chairman for the United States Securities and Exchange Commission (US SEC), said during a speech that Initial Coin Offerings (ICOs), “can be effective,” for fundraising, but that, “securities laws must be followed.” Clayton went on in his speech to comment on the US SEC’s work regarding distributed ledger technology (DLT), digital assets, and ICOs, saying that it is an, “area where the Commission and staff have spent a significant amount of time,” and, “that this trend will continue in 2019.”
• Jay Clayton, the Chairman of the US Securities and Exchange Commission (SEC), expressed his optimism for distributed ledger technology’s potential impact on traditional financial markets in a testimony before the US Senate Committee on Banking, Housing, and Urban Affairs yesterday. According to a transcript published on the SEC’s website, Clayton said, “I am optimistic that developments in distributed ledger technology can help facilitate capital formation, providing promising investment opportunities for both institutional and Main Street Investors.” Additionally, Clayton highlighted that the SEC is, “Focusing a significant amount of attention and resources on digital assets and initial coin offerings (ICOs).”
• Maxim Akimov, the Deputy Prime Minister of Russia, announced that no significant changes will be made to the draft of a bill concerning cryptocurrency regulation in the country, as per news outlet Finmarket. The bill was already approved by Russia’s parliament, the State Duma, in May 2018, although the bill has generated substantial discussion since. Since approval of the bill, all cryptocurrency and token-related terminology have been removed and replaced with the term “digital rights”. At the beginning of December, Pavel Krasheninnikov, Chairman of Russia’s State Duma, said that the bill needed to be, “significantly,” changed.
• Pan Gongsheng, a deputy governor of the People’s Bank of China, highlighted that Security Token Offerings (STOs) in China are illegal while speaking at a summit in Beijing. As per a report by news outlet the South China Morning Post, Gongsheng told the summit that, “illegal financing activities through STOs and ICOs were still rampant in the mainland despite a nationwide clean-up of the cryptocurrency market last year.” In citing reasoning for the continued ban on STOs, Gongsheng explained that, “Virtual money has become an accomplice to all kinds of illegal and criminal activities.”
• Pantera Capital, a blockchain and cryptocurrency-focused investment firm and hedge fund, is warning investors that as much as a quarter of their ICO project could potentially be violating US securities laws, according to a Bloomberg report. In a newsletter to clients, Pantera Capital warned, “While we believe the vast majority of the projects in our portfolio should not be affected, approximately 25% of our fund’s capital is invested in other projects with liquid tokens that sold to US investors without using Regulation D or Regulation S”
• Russia has no intention of implementing Venezuela’s state-backed digital currency, the Petro, into commercial operations, according to a report by news outlet RIA Novosti. While speaking to reporters this week, Russian Deputy Finance Minister Sergey Storchak said, “Representatives from our tax service and central bank... got acquainted with the cryptocurrency Venezuela is introducing,” adding, “But no more than that. As for payments, they’re not happening yet.”
• South Korea’s representative body, the National Assembly, held its first official meeting with seven of the country’s largest cryptocurrency exchanges on Monday. The purpose of the meeting was to debate cryptocurrency regulation between stakeholders of South Korea’s cryptocurrency industry. Cryptocurrency exchanges Bithumb, CobitCoin, Coinone, Upbit, Gopax, Coinplug, and Hanbitco were among the attendees of the debate, which reportedly focused on Anti-Money Laundering (AML) customer protections and Know Your Customer (KYC) procedures.
• The United Kingdom’s Financial Action Task Force (FATF), an intergovernmental financial security body, is calling on the country’s government to increase monitoring of cryptocurrency markets. According to an official report last week, the UK must overhaul its Anti-Money Laundering (AML) and combat terrorist financing (CFT) efforts in order to prevent illicit activities with cryptocurrencies. “Virtual currency exchange providers are not yet covered by AML/CFT requirements,” the report details, adding, “this is an emerging risk and there is not yet evidence to suggest that broad scale ML/TF is occurring in the UK through this relatively small sector.”
• The United States Commodity Futures Trading Commission (CFTC) is interested in learning more about the Ethereum (ETH) network, its technology, and the markets build around it. On Tuesday, the CFTC published a Request for Input (RFI) that requests the public’s feedback on different questions concerning Ethereum. The RFI explains that its goal is to inform the CFTC about Ethereum and similar emerging technology, saying, “The input from this request will advance the CFTC’s mission of ensuring the integrity of the derivatives market as well as monitoring and reducing the systematic risk by enhancing legal certainty in the markets. The RFI seeks to understand the similarities and distinctions between certain virtual currencies, including here ether and bitcoin, as well as ether-specific opportunities, challenges, and risks.”
• The United States Securities and Exchange Commission (US SEC) is ordering that cryptocurrency asset manager CoinAlpha Advisors LLC pay a USD$50,000 fine, alleging that the firm conducted an unregistered securities sale. After forming in October 2017, CoinAlpha raised more than USD$600,000 from investors to invest in digital assets. In an official release, the US SEC said that CoinAlpha did not file a Notice of Exempt Offering of Securities, meaning that the firm breached securities laws by soliciting securities investors. Additionally, the firm allegedly did not adhere to proper know-your-customer procedures to verify that investors were accredited.
• Venezuela is reportedly beginning to convert its citizens’ monthly pension payments into Petros, Venezuela’s controversial state and oil-backed cryptocurrency, according to a report by local economics blog the Caracas Chronicles. The conversion of Venezuelan pensioners’ payments into Petros came after the country already sent pensioners their monthly payment in the form of a check for Venezuelan Bolivars -- normally, upon receiving their check, pensioners would deposit their funds into a bank account where they could then withdraw fiat from local branches. The Venezuelan government, however, converted pensioners’ fiat payments into the Petro upon their deposit into a bank. In the first few weeks of the Petro’s existence, its value has risen from 9,000 to more than 15,000.
• Warren Davidson, an Ohio Congressman and notable advocate of blockchain and digital assets, is floating blockchain technology as a solution to fund US President Donald Trump’s prospective US-Mexico border wall. While interviewing with NPR, Congressman Davidson suggested, “the American people, or whomever should choose to donate,” could pay for the border wall, adding, “you could do it with sort of like a crowdfunding site or you could do a blockchain and you could have WallCoins.”

General News

• “The long-term value of Bitcoin (BTC) is more likely to be USD$100 than USD$100,000,” says Kenneth Rogoff, a former Chief Economist for the International Monetary Fund (IMF) and the current Harvard University Professor of Economics and Public Policy. While writing an article for major UK news outlet The Guardian, Rogoff highlighted that, because BTC’s use is limited to transactions, it makes the digital asset more vulnerable to a bubble-like collapse. Rogoff also cited that BTC’s energy-intensive verification processes is, “vastly less efficient,” than systems that leverage, “a trusted central authority like a central bank.”
• A new report by PeckShield, a blockchain security company that monitors various cryptocurrency ecosystems, details that decentralized applications (DApps) on the EOS (EOS) blockchain have lost as much as USD$1mm in hacks since July 2018. The report details further that DApps on the EOS network have sustained 27 breaches since July, which are responsible for the up to 400,000 EOS that have been compromised from hacks. Guo Yonggang, a blockchain security expert cited in a report on the matter by crypto media firm Blockchain Truth, believes that the hacks can be attributed to security problems with the DApps themselves, rather than with the EOS network.
• A new study published by the Cambridge Centre for Alternative Finance on Wednesday finds that the number of unique ID-verified cryptocurrency users nearly doubled in in the first 3 quarters of 2018. The study details that total ID-verified users increased to 35mm in the first three quarters of 2018 from 18mm at the end of 2017, representing an increase of 94%. As per an analysis of the study by Bloomberg, the growth of crypto’s userbase despite the market decline, “could signal that an eventual recovery could be coming.”
• Amid the continued cryptocurrency sell-off, only two cryptocurrency mining machines remain profitable, according to real-time data from ASICMinerValue.com. ASICMInerValue.com, which calculates the profitability of Application-Specific Integrated Circuit (ASIC) miners, indicates that only indicates that only the Ebank Ebit E11++ and ASICminer 8 Nano 44Th mining models are profitable for mining cryptocurrencies based on the SHA-256 hash function -- notable cryptocurrencies like Bitcoin (BTC) and Bitcoin Cash (BCH) use this has function.
• Bitmain, a large Chinese cryptocurrency mining firm, announced that it is closing its development center in Israel, citing current cryptocurrency market conditions. In closing Bitmaintech Israel, the crypto mining giant was forced to fire all 23 employees. Among the employees let go is Gadi Glikberg, head of Bitmain’s Israeli branch and Vice President of International Sales, who said on the recent market turmoil, “The crypto market has undergone a shake-up in the past few months, which has forced Bitmain to examine its various activities around the globe and to refocus its business in accordance with the current situation.”
• Busan, a major South Korean city, will be the beneficiary of the South Korean government’s plan to spend 4bn Korean won (USD$3.5mm) to establish a blockchain-enabled virtual power plant (VPP). As per a report by South Korean news outlet Yonhap News Agency, the project will be angled as a national competition in 2019, hosted by South Korea’s largest electric utility, Korea Electric Power Corporation (KEPCO). The VPP will integrate the idle capacities of multiple energy resources through a cloud-based distributed ledger in order to optimize power generation and decrease costs.
• Church’s Chicken, a large international fast food franchise, is partnering with Dash Venezuela to accept cryptocurrencies in its Venezuelan locations. According to an official press release, 13 Church’s Chicken establishments will begin accepting Dash (DASH) as payment following, “extensive and rigorous days of training,” staff to understand cryptocurrencies. With the addition of Church’s Chicken, more than 2,200 establishments in Venezuela accept DASH as payment.
• Crypto.com, a Hong Kong-based cryptocurrency payments platform, announced the appointment of former PayPal executive Tyson Hackwood to serve as the firm’s Vice President and Head of Global Merchant Acquisition in an official press release today. Crypto.com aims to increase cryptocurrency adoption by both merchants and consumers through their point-of-sale (PoS) transaction terminals. Crypto.com CEO Kris Marszalek believes that Hackwood will be integral in furthering this goal, saying, “As we develop the Crypto.com Chain to fulfill the current industry need to pay and be paid in crypto, Tyson will play an important role in expanding the number and quality of merchants that are part of our network.”
• Hyperledger, a notable blockchain consortium, is continuing its robust expansion after announcing the addition of 16 new members at the Hyperledger Global Forum in Basel, Switzerland. Among the notables to join the consortium are, Alibaba Cloud, Citigroup’s Citi Ventures arm, and Deutsche Telekom. The latest addition of 16 members brings the total membership of Hyperledger to more than 260 different companies. In a public statement, Hyperledger Executive Director Brian Behlendorf said that, “The growing Hyperledger community reflects the increasing importance of open source efforts to build enterprise blockchain technologies across industries and markets. The latest members showcase the widening interest in and impact of DLT and Hyperledger."
• Jeremy Henrickson, the former Chief Product Officer at Coinbase, has departed the US-based cryptocurrency exchange after serving since July 2016. “Jeremy’s contributions to Coinbase over the past two years were invaluable,” said a Coinbase spokesperson, adding that, “he helped to build our scrappy startup team into a high-functioning product and engineering organization -- overseeing a 5x+ growth of the team.” Henrickson’s departure comes after long-term Coinbase executives Adam White and Hunter Merghart left the US-based cryptocurrency exchange in recent months.
• LinkedIn’s, “2018 U.S. Emerging Jobs,” report released on Thursday ranks the role of blockchain developer as the fastest growing job in the United States. The report by LinkedIn indicates that blockchain developer jobs have increased 33-fold in the past 12 months alone. San Francisco, New York City, and Atlanta are among the cities with the highest demand for blockchain developer jobs.
• Orbs, a unique hybrid blockchain platform, raised more than USD$15mm in cryptocurrencies to fund its development of a public blockchain, according to a company blog post. South Korean application provider Kakao lead the fundraising efforts with a representative telling CoinDesk that the company, “always seeks to invest and support innovative startups, and Orbs is a good example.” In total, Orbs raised 139,000 Ether (ETH) and 892 Bitcoin (BTC), amounting to roughly USD$15.4mm. Orbs aims to build a public blockchain with this funding that is, “universal,” and, “scalable,” for decentralized applications (DApps) with the, “liquidity of a base layer.”
• Samsung has reportedly filed patent applications for three different blockchain-related trademark requests that all pertain directly to smartphones, according to news outlet Galaxy Club. Specifically, the patents named “Blockchain KeyStore”, “Blockchain Key Box”, and “Blockchain Core” all pertain to cryptocurrency custody capabilities on smartphones. This news comes amid the release of HTC’s Exodus 1 and Sirin Labs’ FINNEY, both of which are being marketed as blockchain smartphones with cryptocurrency custody capabilities.

​

Developments in Financial Services

• Global investment firm Vaultbank has announced that free stock trading will be added to its platform launch in October. The platform will now include the free stock trading, crypto trading, and even trading security tokens. Vaultbank’s platform is currently undergoing beta testing, but users can sign up for the platform’s waitlist on vaultbank.io.
• Popular cryptocurrency debit card provider, Wirex, has added a Ripple (XRP) wallet to its platform. 1.7 million clietns across 130 countries will now be able to use their Wirex Visa Cards to transact with XRP. XRP is currently the third-most popular cryptocurrency by market cap, and was specifically chosen by Wirex due to its unique utility for facilitating global payments.
• Decoin is disrupting the crypto credit card market with its DTEP Exchange & Trading Platform. The Decoin credit card will operate directly the company’s coin wallet and will permit users to spend their digital currencies wherever and whenever they choose. Users registered to this exchange will also supposedly have the ability to earn redistributed revenues, up to 20% of the exchange’s trading revenue.
• Fintech company Digital Asset announced a partnership with Google Cloud to aid in the construction of blockchain applications. Digital Asset and Google Cloud will provide support and software tools to blockchain application developers so that they don’t have to code the applications from scratch. The pair will also be working on Digital Asset’s developer program private beta, giving Google Cloud developers access to its Digital Asset Modeling Language (DAML) software development kit (SDK).

Regulatory

• The Securities and Exchange Commission (SEC) has come to the conclusion that they need more time for the consideration of five Bitcoin ETF proposals. Direxion Investments submitted the proposals back in January. The SEC stated that they will announce their decision to either approve or deny the proposal on September 21, 2018. CBOE Global Markets also sent the SEC an ETF proposal last month that is also expected to be postponed.
• The Chinese mountain region of Xinjiang Uyghur is known for its vast areas of land and abundant electricity: key elements for Bitcoin (BTC) mining. However, the local authorities of Xinjiang have announced their plan to shut down all illegal mining operations by August 30,2018. Illegal mining operations are those that fail to comply to registration, tax, social security, and other laws.
• Japan Virtual Currency Exchange Association is suggesting domestic trading platforms limit investors to 4x leverage on their deposits. According to the Financial Services Agency, there are 142,000 crypto traders focused on derivatives a/o CY2017 in Japan, still a small portion of the estimated 3mm crypto traders in Japan. Just as a point of reference, 80%of crypto trading volume in Japan for CY2017 came from derivatives trading, recording USD$543bn - - 90%+ of this amount was from margin traders.
• Iran is currently looking to develop a domestic cryptocurrency in order to bypass its economic sanctions. Alireza Daliri, Iran’s Science and Technology Department head in charge of investment affairs, reported that the project is being worked on with the Central Bank of Iran. The cryptocurrency would back Iran’s national currency, the rial, and would allow cross-border transactions ahead of the US sanctions going into effect next month.
• The SEC rejected application for a Bitcoin ETF by Winkelvoss twins again. In its rejection, the SEC cited as a major concern the fact that “a significant portion of Bitcoin trading occurs on unregulated exchanges outside of the United States."
• Hester Peirce, Commissioner of the SEC, has published a letter of dissent regarding the SEC’s recent decision upholding the agency’s past ruling to deny the Winklevoss twins’ Bitcoin (BTC) ETF. The SEC denied the Bats BZX Exchange’s proposed rule change hoping to allow trading of the Winklevoss’ Bitcoin Trust shares, leading Peirce to say “I believe that the proposed rule change satisfies the statutory standard and that we should permit BZX to list and trade this Bitcoin-based exchange-traded product,” and that the decision “sends a strong signal that innovation is unwelcome in our markets.”
• The Law Commission of India published a report regarding the legal status of sports betting and gambling in the country, referencing cryptocurrencies. The report recognizes cryptocurrencies as a method of payment for betting and wagering. The report also stated that “gambling transactions should be made cashless, making use of electronic means of payment such as credit cards, debit cards, net-banking, virtual currencies (VC – also known as cryptocurrency), etc.”
• US Commodity Futures Trading Commission (CTFC) Chairman Christopher Giancarlo says the CTFC is falling behind and needs to begin testing the blockchain technology during testimony to House Committee on Agriculture. Chairman Giancarlo suggests the CTFC is four years behind other global institutions like the Bank of England (BOE) as it relates to testing blockchain.

General News

• Lufthansa, one of the world’s largest airlines, has announced a partnership with software firm SAP to create a competition focused on increasing the airline industry’s adoption of blockchain technology. There are currently not a lot of efforts being made to incorporate blockchain in the airline industry, and initial submissions into the competition are due at the end of August. Lufthansa is looking for applications regarding data processing, flight booking, loyalty programs, and supply chain enhancements.
• Cryptocurrency trading millionaires, especially in China, are looking into investments in foreign real estate markets as a form of diversification. Through the use of real estate startup apps, Chinese investors can buy real estate in California using Bitcoin (BTC), for example, through Hong Kong brokers that don’t require the same taxes and documentation as other financial assets held abroad.
• Binance, the world’s most popular cryptocurrency exchange, will soon enter the South Korean market. During the Blockchain Partners Summit in Seoul, Binance CEO Chanpgeng Zhao held a speech noting that Binance will enrich South Korea’s community. While Binance has not made any official announcements regarding the expansion, South Korean media outlets reported it following the summit.
• A New Jersey-based cryptocurrency mining startup, called Honeyminer, has released its free beta platform in June, and has amassed 10,000 downloads around the world already. The platform allows users to mine cryptocurrencies on their Windows laptops by running the app while the processor isn’t in use. Users will be able to mine Ethereum (ETH), Ethereum Classic (ETC), Monero (XMR), and Zcash (ZEC), but all earnings are transferred into Bitcoin (BTC) and sent to the user’s wallet.
• Since cryptocurrencies became popular several years ago, not many cryptocurrency platforms (i.e. exchanges and wallets) have conducted third-party security audits. However, three-month-old XMR Wallet, a web wallet for Monero (XMR) has announced its conclusion of an audit by the firm New Alchemy. Additionally, XMR Wallet has published the results of its audit, and stated that all issues found have already been resolved.
• ConsenSys, a blockchain technology company, has signed a Memorandum of Understanding (MoU) with China’s Xiongan New Area government. ConsenSys focuses on the development of Ethereum (ETH), and will be advising the government on blockchain solutions to make Xiongan a smart city. China’s president Xi Jinping has designated Xiongan a special economic zone and believes that by creating a smart economy using Ethereum, it could bring in USD$348 billion within the next 10 years.
• Bitmart, a global cryptocurrency exchange, has announced that it will be listing its own utility token, called BMX, on its exchange. The BMX token is an ERC-20 protocol token, and there will be 1 billion issued. All transaction fees paid on the BMX market will be redistributed to those who backed the project, and using BMX on the exchange lets users pay a discounted fee.
• US-based Coinbase is launching a crypto-backed gift card in Europe. Users of WeGift will be able to convert digital assets held in their Coinbase wallet to gift cards. Gift cards from WeGift can be used at over 120 retailers across the UK, France, Spain, the Netherlands and Italy.
• The Bank of Canada (BoC) released its Staff Working Paper this week, where it said that the proof-of-work (PoW) consensus system, the same one used by Bitcoin (BTC), held the most promise out of alternative consensus systems like proof-of-stake (PoS). PoW includes a built-in security measure, people with malicious intentions would need to spend a large amount of resources in order to successfully cheat the system. The paper continued that PoS unfairly gives users with the most coins (stake) in the system a higher probability of validating blocks.
• BitGo, a popular cryptocurrency custodial service, has announced its recent support of Zcash (ZEC). BitGo is the largest processor of on-chain Bitcoin (BTC) transactions in the world, and processes $15 billion every month in all cryptocurrencies. The Zcash team said that it is very excited for the recent support of their coin, and that along with their upcoming Zcash Sapling upgrade, this should prove to be a great catalyst for adoption of Zcash’s privacy features.
• California-based Propy, a global real estate company known for its decentralized title registry, has announced that it has successfully executed a real estate deal on the blockchain. The transaction was tracked every step of the process on Ethereum smart contracts, making this deal the first blockchain-recorded property deal in California, and only the second to be done in the world. The transaction used Bitcoin (BTC) as payment, effectively cutting out the role of banks for this deal.
• Waves decentralized exchange (DEX) was hacked on Tuesday, the first day it exited its beta test. Hackers were able to break into the exchange’s website and the company’s main site to phish for information in the personal wallets of users.
• Ethereum Chrome browser extension MetaMask was pulled from the Chrome Web store yesterday. It was listed again, 5 hours later. MetaMask has said it is unsure why its extension was pulled from the Chrome Web store. MetaMask is one of the oldest and widely used decentralized apps (DApps) on the Ethereum network.
• Augur has launched a platform that permits users to bet when certain public figures will die. If a user believes the public figure will die, they buy shares with ETH. If a user believes the public figure won’t die, they can short the bet by selling shares. If a user’s prediction is correct, they profit from the outcome. Augur uses a network of “reporters” who make sure that the bet is settled properly.
• Decenturion, constituted this past January, claims to be the world’s first decentralized blockchain-based digital state. Decenturion has appointed blockchain expert and founder of ICOBox, Nick Evdokimov, as its Minister of Information. The blockchain-based state has no central person of power, but is rather governed by passport holders’ voting using smart contracts.
• Popular cryptocurrency exchange Poloniex announced plans to delist nine tokens from its trading platform. The nine coins in question are FlorinCoin (FLO), FoldingCoin (FLDC), Vcash (XVC), Bitcrystals (BCY), Nexium (NXC), Radium (RADS), Blackcoin (BLK), Pinkcoin (PINK), and Riecoin (RIC). These cryptocurrencies reportedly do not meet Poloniex’s new asset framework. Owners of these coins have until September 2nd to withdraw them from the exchange.

Developments in Financial Services

• Global investment firm Vaultbank has announced that free stock trading will be added to its platform launch in October. The platform will now include the free stock trading, crypto trading, and even trading security tokens. Vaultbank’s platform is currently undergoing beta testing, but users can sign up for the platform’s waitlist on vaultbank.io.
• Popular cryptocurrency debit card provider, Wirex, has added a Ripple (XRP) wallet to its platform. 1.7 million clietns across 130 countries will now be able to use their Wirex Visa Cards to transact with XRP. XRP is currently the third-most popular cryptocurrency by market cap, and was specifically chosen by Wirex due to its unique utility for facilitating global payments.
• Decoin is disrupting the crypto credit card market with its DTEP Exchange & Trading Platform. The Decoin credit card will operate directly the company’s coin wallet and will permit users to spend their digital currencies wherever and whenever they choose. Users registered to this exchange will also supposedly have the ability to earn redistributed revenues, up to 20% of the exchange’s trading revenue.
• Fintech company Digital Asset announced a partnership with Google Cloud to aid in the construction of blockchain applications. Digital Asset and Google Cloud will provide support and software tools to blockchain application developers so that they don’t have to code the applications from scratch. The pair will also be working on Digital Asset’s developer program private beta, giving Google Cloud developers access to its Digital Asset Modeling Language (DAML) software development kit (SDK).

Regulatory

• The Securities and Exchange Commission (SEC) has come to the conclusion that they need more time for the consideration of five Bitcoin ETF proposals. Direxion Investments submitted the proposals back in January. The SEC stated that they will announce their decision to either approve or deny the proposal on September 21, 2018. CBOE Global Markets also sent the SEC an ETF proposal last month that is also expected to be postponed.
• The Chinese mountain region of Xinjiang Uyghur is known for its vast areas of land and abundant electricity: key elements for Bitcoin (BTC) mining. However, the local authorities of Xinjiang have announced their plan to shut down all illegal mining operations by August 30,2018. Illegal mining operations are those that fail to comply to registration, tax, social security, and other laws.
• Japan Virtual Currency Exchange Association is suggesting domestic trading platforms limit investors to 4x leverage on their deposits. According to the Financial Services Agency, there are 142,000 crypto traders focused on derivatives a/o CY2017 in Japan, still a small portion of the estimated 3mm crypto traders in Japan. Just as a point of reference, 80%of crypto trading volume in Japan for CY2017 came from derivatives trading, recording USD$543bn - - 90%+ of this amount was from margin traders.
• Iran is currently looking to develop a domestic cryptocurrency in order to bypass its economic sanctions. Alireza Daliri, Iran’s Science and Technology Department head in charge of investment affairs, reported that the project is being worked on with the Central Bank of Iran. The cryptocurrency would back Iran’s national currency, the rial, and would allow cross-border transactions ahead of the US sanctions going into effect next month.
• The SEC rejected application for a Bitcoin ETF by Winkelvoss twins again. In its rejection, the SEC cited as a major concern the fact that “a significant portion of Bitcoin trading occurs on unregulated exchanges outside of the United States."
• Hester Peirce, Commissioner of the SEC, has published a letter of dissent regarding the SEC’s recent decision upholding the agency’s past ruling to deny the Winklevoss twins’ Bitcoin (BTC) ETF. The SEC denied the Bats BZX Exchange’s proposed rule change hoping to allow trading of the Winklevoss’ Bitcoin Trust shares, leading Peirce to say “I believe that the proposed rule change satisfies the statutory standard and that we should permit BZX to list and trade this Bitcoin-based exchange-traded product,” and that the decision “sends a strong signal that innovation is unwelcome in our markets.”
• The Law Commission of India published a report regarding the legal status of sports betting and gambling in the country, referencing cryptocurrencies. The report recognizes cryptocurrencies as a method of payment for betting and wagering. The report also stated that “gambling transactions should be made cashless, making use of electronic means of payment such as credit cards, debit cards, net-banking, virtual currencies (VC – also known as cryptocurrency), etc.”
• US Commodity Futures Trading Commission (CTFC) Chairman Christopher Giancarlo says the CTFC is falling behind and needs to begin testing the blockchain technology during testimony to House Committee on Agriculture. Chairman Giancarlo suggests the CTFC is four years behind other global institutions like the Bank of England (BOE) as it relates to testing blockchain.

General News

• Lufthansa, one of the world’s largest airlines, has announced a partnership with software firm SAP to create a competition focused on increasing the airline industry’s adoption of blockchain technology. There are currently not a lot of efforts being made to incorporate blockchain in the airline industry, and initial submissions into the competition are due at the end of August. Lufthansa is looking for applications regarding data processing, flight booking, loyalty programs, and supply chain enhancements.
• Cryptocurrency trading millionaires, especially in China, are looking into investments in foreign real estate markets as a form of diversification. Through the use of real estate startup apps, Chinese investors can buy real estate in California using Bitcoin (BTC), for example, through Hong Kong brokers that don’t require the same taxes and documentation as other financial assets held abroad.
• Binance, the world’s most popular cryptocurrency exchange, will soon enter the South Korean market. During the Blockchain Partners Summit in Seoul, Binance CEO Chanpgeng Zhao held a speech noting that Binance will enrich South Korea’s community. While Binance has not made any official announcements regarding the expansion, South Korean media outlets reported it following the summit.
• A New Jersey-based cryptocurrency mining startup, called Honeyminer, has released its free beta platform in June, and has amassed 10,000 downloads around the world already. The platform allows users to mine cryptocurrencies on their Windows laptops by running the app while the processor isn’t in use. Users will be able to mine Ethereum (ETH), Ethereum Classic (ETC), Monero (XMR), and Zcash (ZEC), but all earnings are transferred into Bitcoin (BTC) and sent to the user’s wallet.
• Since cryptocurrencies became popular several years ago, not many cryptocurrency platforms (i.e. exchanges and wallets) have conducted third-party security audits. However, three-month-old XMR Wallet, a web wallet for Monero (XMR) has announced its conclusion of an audit by the firm New Alchemy. Additionally, XMR Wallet has published the results of its audit, and stated that all issues found have already been resolved.
• ConsenSys, a blockchain technology company, has signed a Memorandum of Understanding (MoU) with China’s Xiongan New Area government. ConsenSys focuses on the development of Ethereum (ETH), and will be advising the government on blockchain solutions to make Xiongan a smart city. China’s president Xi Jinping has designated Xiongan a special economic zone and believes that by creating a smart economy using Ethereum, it could bring in USD$348 billion within the next 10 years.
• Bitmart, a global cryptocurrency exchange, has announced that it will be listing its own utility token, called BMX, on its exchange. The BMX token is an ERC-20 protocol token, and there will be 1 billion issued. All transaction fees paid on the BMX market will be redistributed to those who backed the project, and using BMX on the exchange lets users pay a discounted fee.
• US-based Coinbase is launching a crypto-backed gift card in Europe. Users of WeGift will be able to convert digital assets held in their Coinbase wallet to gift cards. Gift cards from WeGift can be used at over 120 retailers across the UK, France, Spain, the Netherlands and Italy.
• The Bank of Canada (BoC) released its Staff Working Paper this week, where it said that the proof-of-work (PoW) consensus system, the same one used by Bitcoin (BTC), held the most promise out of alternative consensus systems like proof-of-stake (PoS). PoW includes a built-in security measure, people with malicious intentions would need to spend a large amount of resources in order to successfully cheat the system. The paper continued that PoS unfairly gives users with the most coins (stake) in the system a higher probability of validating blocks.
• BitGo, a popular cryptocurrency custodial service, has announced its recent support of Zcash (ZEC). BitGo is the largest processor of on-chain Bitcoin (BTC) transactions in the world, and processes $15 billion every month in all cryptocurrencies. The Zcash team said that it is very excited for the recent support of their coin, and that along with their upcoming Zcash Sapling upgrade, this should prove to be a great catalyst for adoption of Zcash’s privacy features.
• California-based Propy, a global real estate company known for its decentralized title registry, has announced that it has successfully executed a real estate deal on the blockchain. The transaction was tracked every step of the process on Ethereum smart contracts, making this deal the first blockchain-recorded property deal in California, and only the second to be done in the world. The transaction used Bitcoin (BTC) as payment, effectively cutting out the role of banks for this deal.
• Waves decentralized exchange (DEX) was hacked on Tuesday, the first day it exited its beta test. Hackers were able to break into the exchange’s website and the company’s main site to phish for information in the personal wallets of users.
• Ethereum Chrome browser extension MetaMask was pulled from the Chrome Web store yesterday. It was listed again, 5 hours later. MetaMask has said it is unsure why its extension was pulled from the Chrome Web store. MetaMask is one of the oldest and widely used decentralized apps (DApps) on the Ethereum network.
• Augur has launched a platform that permits users to bet when certain public figures will die. If a user believes the public figure will die, they buy shares with ETH. If a user believes the public figure won’t die, they can short the bet by selling shares. If a user’s prediction is correct, they profit from the outcome. Augur uses a network of “reporters” who make sure that the bet is settled properly.
• Decenturion, constituted this past January, claims to be the world’s first decentralized blockchain-based digital state. Decenturion has appointed blockchain expert and founder of ICOBox, Nick Evdokimov, as its Minister of Information. The blockchain-based state has no central person of power, but is rather governed by passport holders’ voting using smart contracts.
• Popular cryptocurrency exchange Poloniex announced plans to delist nine tokens from its trading platform. The nine coins in question are FlorinCoin (FLO), FoldingCoin (FLDC), Vcash (XVC), Bitcrystals (BCY), Nexium (NXC), Radium (RADS), Blackcoin (BLK), Pinkcoin (PINK), and Riecoin (RIC). These cryptocurrencies reportedly do not meet Poloniex’s new asset framework. Owners of these coins have until September 2nd to withdraw them from the exchange.

Developments in Financial Services

• Binance is launching a JV with Liechtenstein Cryptoassets Exchange (LCX) to launch a fiat to cryptocurrency exchange, Binnace LCX. The exchange/platforming will be based in Liechtenstein and offer trading between Swiss Francs (CHF) and euros (EUR) against major digital currencies pairs with the potential for new trading pairs in the future.
• bloXroute Labs, along with a partnership with a team of student at Northwestern University, are experimenting with a trustless scheme to address the scalability limitations of Bitcoin’s P2P platform. At the moment, with the Lightning Network, Bitcoin transactions capacity is capped at 82 BTC. According to Sarit Markovich, professor of strategy at Kellogg School of Management at Northwestern University, the bloXroute solution is scaling at 100x better and are targeting 1,000x.
• BOLT, a privacy overlay for the lighting network that will be applied to zcash, was formally launched on Github today. BOLT will obscure transaction, balances and sendereceiver identities. The BOLT upgrade to the zcash protocol is considered a soft fork.
• Coinbase, according to CEO and co-Founder Brian Armstrong in an interview with Bloomberg, is adding 50k new users a day. Assuming this run-rate, it implies Coinbase will add 350k new users a year.
• DGE, a South Korean blockchain developer, who launched its native cryptocurrency TMTG a few weeks ago that is linked to value of gold is attempting to partner with global gold exchanges (after agreements with the Korea Gold Exchange and Vau Diamond Exchange) to create a stable ecosystem for TMTG. In the opinion of DGE, many cryptocurrency developers do not consider the stability of their coins and its impact to the ecosystem these cryptocurrencies support.
• Ethereum Classic is +18% this morning after crypto’s inclusion into the Coinbase index fund after being added to the Coinbase Pro trading platform. At the moment, Ethereum Classic has a 0.91% allocation in the fund.
• Huobi, the Singapore-based cryptocurrency exchange (and third largest cryptocurrency exchange in the world), has announced partnerships with Yatai International Holding Group, Vnesheconombank, Chi Fu Group, Asia International Finance Holdings, and Dbank Group to create cryptocurrency trading exchanges/platforms in the Philippines, Taiwan, Indonesia, and Canada. The five companies will use Huobi’s Cloud service which will provide the different platforms with the tools they need to open their exchanges on a proven framework.
• LINE, a Japanese social messaging app, announced that is forming a USD$10mm blockchain venture capital fund. The company believes the decision to create a blockchain venture fund will make LINE one of the first publicly traded companies to formalize token investments through a corporate fund structure.
• Pantera Capital announces it has raised USD$71mm for a third cryptocurrency fund. Calling it Venture Fund III, Pantera has already begun to make investments following an allocation to cryptocurrency trading platform Bakkt (that has a JV with ICE).
• Ripple Labs continues to focus on expansion plans, even in the face of recent lawsuits from the District Court of California. The lawsuits content that Ripple’s native cryptocurrency, XRP, should be considered a security which the company flatly rejects. In spite of these issues, Ripple Labs remains focused on its overseas expansions plans in Asia and the Middle East.
• Ripple Labs has endorsed three cryptocurrency exchanges, Bittrex, Bitso, and Coins.ph as its preferred partners for transactions with Ripple’s xRapid payments system. Management at Ripple Labs is encouraging users in the US, Mexico and the Philippines to use these exchanges while transacting with xRapid. XRapid is a solution for Ripple’s blockchain-based real-time gross settlement system and is meant to facilitate international fiat transfers between financial institutions.
• Square announces that customers will be able to buy/sell Bitcoin via its Cash App across all 50 states in the United States.
• The Tokyo Stock Exchange (TSE) is publicly expressing concerns about the acquisition of Beat Holdings, listed on the TSE, by Noah Ark Technologies, a Hong Kong-based cryptocurrency frim. The TSE concerns are related to management’s bias to stay away from the cryptocurrency sector.

Regulatory

• The Australian Securities Exchange (ASX) is exploring using a distributed ledger technology (DLT) in place of its current clearing house electronic sub-register system. According to Dominic Steves, Managing Director and CEO of the ASX, shifting to a DLT system would save the exchange as much as USD$23bn. A DLT would permit customers to use nodes instead of sending messages and connect to the whole database instead of having to communicate with several different databases and should help eliminate errors.
• Bitmain’s upcoming IPO is coming under scrutiny as investors continue to worry about its long-term viability. Specifically, there seem to be concerns about Bitmain’s reserve of Bitcoin Cash which is considered an illiquid position given the daily turnover in current Bitcoin Cash markets. Bitmain’s IPO is currently being valued at USD$18bn.
• Bloomberg is reporting that a Bitcoin-based ETN that is listed on Nasdaq Stockholm will begin targeting US investors. The ETN, Bitcoin Tracker One, is listed and traded in Sweden but is now being quoted in USD$. Traders will buy the ETN in a similar way that they buy ADRs where transactions are in USD$ but settlement, clearing and custody will be done in SEK.

General News

• Alexander Petersons, product director of cloud mining service Hashtoro.com and self-proclaimed crypto-enthusiast, believes the cryptocoin industry will begin shifting to cleaner and smart mining by taking advantage of local climates to help reduce electricity consumption. While cryptocurrency critics cite costs of crypto mining as an impediment that will limit widescale adoption of digital currencies, Petersons and the team at Hashtoro.com believe the use of clean energy will help address the challenges of scalability.
• Bitcoin.com CEO Roger Ver has hinted the online cryptocurrency news publisher may consider an ICO in the future. The topic was brought up during a conversation with one of Bitcoin.com’s lead developers about developing tokens on the Bitcoin Cash blockchain - - Bitcoin.com published a new tool helping aspiring developers to build tokens on the Bitcoin Cash protocol.
• A group of researchers/hackers have claimed to have hacked John Mcafee-backed hardware wallet Bitfi. According to its advertising, Bitfi claims to be unhackable. The researchers/hackers claim to have had complete access to a Bitfi wallet for the past two weeks, tracking data being sent out of the wallet while still being connected to the Bitfi servers.
• According to a research report by Citrix, 59% of UK companies have been affected by cryptojacking malware. Cryptojacking malware employs its victim’s computational resources without their permission in order to mine cryptocurrencies for the attacker and leads to a wasteful increase in electric power consumption and the slowing down of affected devices. According to Citrix’s research, 80% of the cryptojacking cases took place in the last six months.
• Deviant coin releases its whitepaper ahead of the launch of its hybrid decentralized exchange and its open-source hardware wallet. The novelty of Deviant is that it proposed to create rewards within its ecosystems without the typical centralized control of node operators. The Deviant network offers improved speed with stealth addresses for complete anonymity, encrypted messaging for secure communication, low transaction fees, lower confirmation time, and a limited total supply.
• The Ethereum community continues to struggle with DApps topping the number of downloads on the blockchain network that are promising investments with high returns that turn out to be fraudulent. As an example, Team JUST, the anonymous development team behind the gambling DApp FOMO 3D is warning that an indentical version of its game is eating up 1/3 of the Ethereum network’s total computational power and raising USD$7mm over the past week.
• Genesis Mining, an Iceland-basd hashpower hosting service, is forcing customers to upgrade their Bitcoin mining contracts following this year’s drop in cryptocurrency valuations. The company is discounting the upgrade price of its Radiant service per 1 TH/s to USD$180 from USD$285. In 60 days, Genesis announced it will terminate open-ended contracts that mine less than the daily maintenance fee.
• Hash House, a crypto-themed café and workshare space in the city of Xi’an, the capital of Shaanxi Province in China, has recently launched. Among its many features, Hash House will provide visitors with learnings materials on cryptocurrencies and will hose seminars and meetups on different crypto topics.
• China News reports that the Hong Kong University of Science and Technology (HKUST) Business School has received a USD$20mm research grant to investigate the security capabilities of electronic payment systems. Partnering with University of Hong Kong (HKU), the Chinese University of Hong Kong (CUHK), and the City University of Hong Kong (CityU), the HKUST-led research initiative will focus on artificial intelligence, network security and blockchain technologies.
• During an unofficial discussion with Quartz India, unnamed state official in the Indian government, which is examining the impact of the virtual currency ecosystem.
• IBM files updates to a pending patent for managing a databases management system (DBMS) using a blockchain database. The patent was initially filed in December 2017 and covers the idea of connecting a blockchain databases with a traditional central database.
• Joe Lubin, the co-founder of Ethereum and ConsenSys, does not see the recent sell-off in cryptocurrencies constraining growth of the crypto ecosystem. In an interview with Bloomberg, Lubin suggested the recent run-up in cryptocurrency valuations is similar the previous six bubbles with each bubble more pronounced than the previous.
• Joe Lubin, the co-founder of the Ethereum Foundation, during an interview with Bloomberg, claims Ripple is not a blockchain technology and is not a competitor for Ethereum. In Lubin’s mind, Ripple is a payment system, not a blockchain technology. In the case of EOS, Lubin cautions against its decision-making framework and doesn’t believe it is should be treated as layer-one technology yet.
• Users can now be paid to participate on the lightning network nodes. The average fee on the lightning network currently is about 1 satoshi. In comparison, the montly income of using the lightning network has been estimated to be closer to USD$2 for a prominent application developer.
• Microsoft recent patent applications suggests the company is looking to use trusted execution environments (TEEs) within its blockchain technology. TEEs are pre-determined types of blockchain or other security protocols in validation nodes. TEEs will help assist in the implementation of consortium blockchain networks and will also assist in verifying blockchain transactions on networks where multiple pre-authorized entities must interact.
• Saudi Arabia officials warn citizens in a formal joint statement from the Ministry of Trade & Investment, Ministry of Information and Saudi Arabian Monetary Agency that trading Bitcoin and other cryptocurrencies are illegal in The Kingdom. This press release is in contrast to The Kingdom’s positive disposition to blockchain technology.
• Taproot, a protocol overlay for Bitcoin pushed by one of Bitcoin’s most well-known developers Greg Maxwell, will offer a privacy layer which will address Bitcoin critics who believe the benchmark cryptocurrency’s privacy is awful. Taproot, supported by other popular Bitcoin developers, will require the Schnorr upgrade which is still not ready to be implemented. The power of Taproot will be the ability to make smart contract transactions look like any regular Bitcoin transaction, offering anonymity for senders and receivers.
• The national government of Vietnam has decided to ban imports of cryptocurrency mining equipment. According to the Ho Chi Minh City Customs Department, 3,664 ASIC devices were imported into the city in C1H2018. The ban of cryptocurrency mining equipment is related to a government investigation into a ICO-fraud that scammed USD$660mm from 32,000 domestic investors. At the moment, cryptocurrencies are outlawed as payments in Vietnam after the Vietnamese Central Bank refused to accept cryptocurrencies as a recognizable form of non-cash payments.
• During an interview with Crypto Congressman Jason Hsu, Vitalik Buterin, the co-Founder of the Ethereum Foundation, highlighted his worries about the lack of sustainable applications on the Ethereum blockchain. Buterin is working on a proof-of-stake and charting protocols to help address the current bottlenecks that are preventing widescale adoption of Ethereum. In his opion, privacy concerns remain the biggest hurdle for widespread adoption of Ethereum in the financial sector.

Sources:
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