Tag: Cryptocurrency Regulation

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Crypto Critic Elizabeth Warren Running For President

One reality of the world is that not everyone will agree with your opinion. Over time, we have seen that entrepreneurs and politicians of all kinds have offered their perspective on cryptocurrencies, some of them more positive than others. In addition, there are other individuals that have slammed cryptocurrency publicly, even before understanding it.

One politician that has been particularly critical of cryptocurrency is Elizabeth Warren, a United States senator from Massachusetts. However, it is important to note that Warren has much more of a higher profile than many other politicians. She has now officially announced that she will be running for President of the United States in 2020.

About Warren

The fact that Elizabeth Warren has criticized cryptocurrency shouldn’t be too surprising, as she has been a critic of the financial sector in general. Specifically, she has gone out of her way to criticize big banks and unregulated capitalism, and it could be argued that the decentralized nature of cryptocurrency is one of the reasons that Warren isn’t interested in the space. She has described cryptocurrency as “easy to steal” earlier this year.

Warren is one of the most prominent Democrats in the country, so the announcement did not come as a complete surprise to those who follow politics. She has also been a vocal opponent of Trump, as well, previously calling him a “racist bully” and “wannabe tyrant”. Warren is also well-known for proposing the creation of the Consumer Financial Protection Bureau in 2007, one of her most famous achievements.

About The Announcement

 

Warren officially announced an exploratory committee for a 2020 presidential bid, and she has proclaimed that she will “return Washington back to the people”. A video explaining the announcement was e-mailed to her supporters, where she stated that the government “had become a tool for the wealthy and well-connected”.

She not only promoted economic fairness, but racial equality, which is a far cry from Donald Trump, who many believe has normalized white supremacists and caused more racial tension in the United States since assuming office. However, it should be noted that many believe that her chances to actually become president are slim, with some suggesting that it could be the “end of her”.

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Time Writer Thinks Bitcoin (BTC) Can Help Free Us All

If there is one thing that any cryptocurrency enthusiast should know by now, it’s that the issue of cryptocurrency is polarizing. There are those who swear up and down that Bitcoin is a scam simply meant to fool new investors, and that the entire ICO sector is a sham – while there are many others who believe that cryptocurrencies will fundamentally change the way that we live and interact with each other.

It appears that respected and well-known publication TIME has made their opinion known – well, at the very least, a TIME writer has, and, unlike many other mainstream news publications, is actually advocating for Bitcoin development. The TIME column has quickly gained traction within the cryptocurrency community.

About The Column

The author is one Alex Gladstein, the chief strategy officer at the Human Rights Foundation and the Oslo Freedom Forum (according to his Twitter bio). The column’s title is quite a bold one – “Why Bitcoin Matters For Freedom”, and Gladstein tweeted out a link to the column. The tweet has already garnered over 1,000 likes and 400 retweets:

https://twitter.com/gladstein/status/1078614849305890816

 

One example of how Bitcoin can change the world that is explored is an obvious one that cryptocurrency proponents are already aware about: Venezuela. Because of the economic crisis in Venezuela caused by hyperinflation; many have turned to Bitcoin as a means of avoiding the strict financial control associated with the country.

Measured Praise

It’s important to note that the column was not simply an advertisement for cryptocurrency markets, as Gladstein acknowledged specifically that “speculation, fraud and greed in the cryptocurrency and blockchain community have overshadowed the real, liberating potential of Satoshi Nakomoto’s invention.”

The column did not simply provide Venezuela as an example, but pointed to the fact that cryptocurrency can disrupt the remittance industry, a point that is brought up by many that believe in the potential of blockchain. Gladstein even stated that decentralized technology in general allows for users to avoid the traditional financial system and social networks that could ultimately be used against us.

The column ended by pointing out that Bitcoin can help many people who live under authoritarian rule, and can financially empower populations that normally might not have the opportunity . Gladstein stated: “If we invest the time and resources to develop user-friendly wallets, more exchanges, and better educational materials for Bitcoin, it has the potential to make a real difference for the 4 billion people who can’t trust their rulers or who can’t access the banking system. For them, Bitcoin can be a way out.”

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WSJ Finds Around 15% Of ICO Projects Examined “Questionable”

One of the main criticisms about the cryptocurrency markets is the fact that the initial coin offering (ICO) market has been wrought with issues. Of course, the fact that 2018 has been bearish plays a large role in the ICO markets, but on top of that, there has been rampant fraud in the sector, which many believe has prevented overall institutional money flow into the cryptocurrency sector.

There have been various studies, with different results, regarding ICOs and the amount of fraud/exit scams/manipulation involved in the sector. A recent investigation by the Wall Street Journal delved into the ICO sector and studied which projects might be questionable.

About The Investigation

The Wall Street Journal (WSJ) chose to investigate projects that have been evaluated on three of the top ICO websites. These websites are ICOBench.com, TokenData.io, and ICOrating.com. The investigation involved studying the whitepapers of the projects to identify potential plagiarism issues, and examining details about the team members and project, as well.

The study found that a significant portion of the projects were deemed questionable. In fact, out of over 3,300 projects – over 500 were considered “questionable”. Over half of the “questionable” projects don’t even have websites, and many are not even able to be contacted. In fact, out of the 513 projects that were deemed questionable by reporters, almost all of them offered no response.

Going Forward

Of course, countries all around the world have been trying to figure out how to regulate the cryptocurrency market so that it is not restricting innovation while simultaneously protecting the consumer. In both the United States and the UK, lawmakers have been fighting for more regulation, rather than more crackdowns.

Lawmakers in the UK called the entire sector a “Wild West”, suggesting that the sector was wildly unregulated. There are many lawmakers in the UK who want this to end immediately, in part because London could potentially become an innovative hub for blockchains startups, given the fact that it is already a global financial center.

There have been small steps forward in the United States. Most notably, two United States representatives introduced a bill that categorized cryptocurrencies as separate from “securities”. In addition, Ohio also recently announced that they were accepting tax payments in cryptocurrency, as well.

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Changpeng Zhao Writes Letter About Binance’s 2018

There’s no doubt that the end of the year offers time for individuals of all kinds to reflect on the past 365 days. Thanksgiving urges us all to be grateful, and the holiday season also allows us to spend time with our family, friends, and loved ones. Similarly, it appears as though Binance founder and CEO Changpeng Zhao has taken the time to write a reflective letter regarding the past year.

Zhao recognized that it was a hard year for many, given the fact that cryptocurrency markets lost hundreds of billions of dollars in market capitalization. However, he struck an optimistic tone, as he noted that overall, the cryptocurrency market looks good entering into 2019.

List Of Thoughts

Zhao titled the letter the “2018 Binance Year End Review”, and the official Binance account tweeted a link to the letter:

The Binance CEO summarized some disappointments of 2018. First and foremost, he acknowledged that the cryptocurrency bull market of late 2017 caused some unrealistic expectations. In addition, he added that the ICO market in 2018 “didn’t deliver.”

Specifically, he stated, in a “short list off the top of my head”:

“– Price overswung on the up side in 2017.

– Many ICO projects from 2017 were expected to deliver in 2018, but didn’t.

– There were a number of security incidents at various exchanges.

– Regulatory uncertainty in many locations around the world stalled industry advancement.

– We, as a young industry, were not very united. There were fights between projects, between people, and stupid forks that triggered further drops in price.”

He ended this portion of the letter by stating “I guess with freedom comes a bit of chaos.”

Progress In Other Areas

However, it has been an incredible year for Binance, the world’s largest cryptocurrency exchange by daily volume. Even if the cryptocurrency markets were disappointing, Binance certainly has made its presence more known in more parts of the world than ever, in addition to making progress in other areas.

Some of the achievements that Zhao listed were the fact that Binance had made progress with its philanthropic arm, Binance Charity Foundation, and also with its Binance Labs, which aims to be an incubator for blockchain startups, as well. The company also launched the Binance Academy, which is an education portal to help the general public learn more about cryptocurrency.

The letter makes clear clear that Zhao is looking forward to more developments in 2019 regarding cryptocurrency and Binance.

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South Korean Court Acquits Bithumb

One of the issues with an emerging technology that has the potential to be disruptive is the fact that often times, the world doesn’t know exactly how to respond. By now, it is clear that blockchain technology and cryptocurrency can be applied to many sectors – but governments and courts are unclear on the exact laws and regulations that should apply.

In a new development, a South Korean court has acquitted the cryptocurrency exchange Bithumb with respect to a court case. The issue revolves around the fact that a client claims that hackers were “allowed” to steal cash and crypto assets from the exchange, and the amount in question is substantial. Specifically, the amount is over $300,000 (the exact amount is 400 million Korean won, which pans out to about $355,000 USD).

About The Case

The user’s name is Anh Park, and the incident occurred over a year ago, when Bitcoin was in the midst of a massive bull run, and many were much more optimistic about the cryptocurrency markets. The exact day of the incident was November 30, 2017.

Park alleges that Bithumb’s security is to blame. Hackers were able to enter Park’s account, and empty it of almost all of the money (save a few cents). It should be noted that one of the main points of the case is the fact that Bithumb’s security was compromised before, because information about over 30,000 users were compromised thanks to hackers gaining access to a Bithumb employee’s records. Since the exchange’s security was already compromised – the argument is that the exchange is at fault. The company has claimed that it has compensated all involved.

Precedents and Obligations

Bithumb’s argument was that it isn’t responsible for compensation, since it technically isn’t a financial firm of any kind. The lawsuit gained attention because many users worldwide want to know whether exchanges are technically obligated to compensate for users during security breaches like this.

It’s clear that the court sided with Bithumb, which sets a dangerous precedent. This might trouble investors and traders who are concerned about their funds getting hacked and having no legal recourse. Of course, time will tell whether this case is influential on a global level with regards to exchanges and financial obligations.

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Coinbase Moves Billions In Crypto

If you are a cryptocurrency enthusiast, or trade/invest in cryptocurrency; there is little doubt that you are aware of Coinbase. The San Francisco-based cryptocurrency exchange is widely considered one of the most important companies in the sector, and has been valued in the billions, despite the fact that it has been a tough year for cryptocurrency markets in general.

For example, while other cryptocurrency exchanges were struggling, Coinbase was featured in the opening credits for the hit HBO TV show Silicon Valley, which many in the cryptocurrency community took as a sign that more people are aware of the cryptocurrency markets and their potential.

Moving Billions

The exchange’s importance was shown again in a tweet, where the company confirmed the fact that it moved billions in cryptocurrency funds into cold storage. The announcement was made in a tweet. Specifically, Coinbase announced that it had moved “5% of all BTC, 8% of all ETH, and 25% of all LTC in circulation to our next-gen secure cold storage.”

https://twitter.com/coinbase/status/1075465004629995521

In the associated Medium post, Coinbase boasted that it could be the “largest crypto migration on record”. The post elaborated that this was not a sudden move, but Coinbase had been preparing for the migration for some time now. Specifically, the post stated that the company “conducted risk assessments, honed monitoring plans and conducted test migrations until we were positive that the live migration would go off without a hitch.”

Cold Storage

Coinbase also seemed to take a bit of a nostalgic look back at memory lane to remember how much its grown, and how much its definition of cold storage had changed. In 2012, Coinbase simply placed keys in a safe deposit box. Obviously, the company has grown immensely since then, and its definition of “cold storage” is radically different.

The company elaborated that these days, the company utilizes Coinbase Custody, a secure foundation with a highly controlled and audited key generation process and continue with a globally distributed key storage and transaction approval system.

It seems like Coinbase went out of its way to explain that moving this amount of cryptocurrency was not something that they took lightly, and even ended the blog post to point out that they were hiring anyone who might be interested in helping keep the exchange as secure as possible.

 

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Binance Labs Launching Blockchain Startups

There is no denying the fact that Binance is one of the most important companies in the cryptocurrency sector. This shouldn’t come as much of a surprise, considering it is the world’s largest cryptocurrency exchange by daily volume, and is steadily expanding worldwide, in countries all around the world.

Binance Labs has also apparently been focusing on incubation, as it has officially announced the launch of eight projects that the company has been incubating for months. Specifically, the company has not only provided mentorship for these projects, but resources, as well.

Expansion Plans

Several months ago, Binance announced a joint partnership with the Lichtenstein Cryptoassets Exchange (LXC) in order to launch a fiat-to-crypto exchange. The Prime Minister of Lichtenstein even commented on the venture, stating: “We are confident that Liechtenstein’s existing and future legal framework and practice provide a robust foundation for the Binance LXC and other blockchain companies to provide exceptional services here in Liechtenstein.

That isn’t the only place that Binance is expanding, however. The company recently made headway in Uganda, signing up 40,000 users in its first week, which seemed to confirm the idea that Africa’s demand for cryptocurrency is legitimate. This is significant, considering that many consider Africa’s unbanked population to be a massive opportunity for the fintech sector.

Project Launches

Ella Zhang, the head of Binance Labs, elaborated that Binance was dedicated to building a blockchain ecosystem worldwide. She stated: In the long run, we aim to build up a strong blockchain ecosystem and network of BUIDLers around the world. Our first incubation program in San Francisco was an amazing experience and we are grateful to the mentors, advisers and friends who helped our BUIDLers during the 10 weeks. We are very excited to expand our program next season and meet with blockchain projects across five different continents — scaling quickly, that is Binance speed.

 

The program was selective, with over 500 projects applying. However, only eight startups will launch. They include projects such as SafePal, which markets itself as the “best hardware wallet ever”, and Torus, which aims to help ease the process of logging into decentralized apps.

 

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Blythe Masters Steps Down As CEO Of Digital Asset

In 2014, Bythe Masters made headlines when she stepped down from a comfy position as a J.P. Morgan Chase executive and decided to lead the blockchain startup Digital Asset. It appears as though her journey at the startup has come to an abrupt end, however, as she announced that she was stepping down after over three years in the CEO role at Digital Asset, and apparently doing so for personal reasons.

About The Announcement

Many people believed that Digital Asset would help institutional money flow into the markets. First and foremost, the startup is backed by some of the world’s largest banks, and one of the main goals of the startup was, and is, to allow for more confidential trades. The company describes itself as a “leading provider of digital ledger technology.”

In a press release, the company announced that Masters would step down and that AG Gandaghar would move into the CEO role. Gandaghar joined the company’s Board of Directors earlier this year, in April. It should also be noted that Masters will still remain a shareholder, board member, and strategic advisor.

Moving Forward

In a statement, Masters said: “Digital Asset has evolved from an ambitious idea to a truly global software engineering firm. We are fortunate to have a deep bench of accomplished executives on the management team and Board, including AG, who have the requisite experience to take the company to the next level. Having come to know and trust AG as an an advisor and Board member, I am convinced that he brings what’s needed to guide the company through its next phase.”

Gandaghar has worked at a variety of reputable technology companies, including Google, Microsoft, Amazon, and Uber. Michael Bodson, another member of the Digital Asset board, stated: “We are excited to have a world-renowned technologist like [Gangadhar] to help take the company forward.”

 

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Italy’s CONSOB Suspends Two ICOs

All around the world, countries are trying to come up with a regulatory framework that makes sense for cryptocurrency. This involves laying the groundwork for innovation while still being able to protect traders from fraudulent initial coin offerings (ICOs), which is a widespread issue that many believes is preventing the cryptocurrency markets from expanding.

Italy has recently cracked down on two ICOs that an Italian securities regulator is claiming are fraudulent. However, the ICOs were not completely shut down – but instead were suspended for 90 days, as of press time.

BitSurge

The first ICO was a project called “Bitsurge Token”. The token promised monthly returns of 6 to 13%, and was accepting capital from $1000 to $25000. There is very little information about the project, and a Youtube trailer related to the project offers very little actual insight into the project, despite the fact that it utilizes special effects and appears to sound/look a bit like a movie trailer. You can find the trailer here:

 

In advertising for the project, the text in the quick 35-second ad simply says: “Learn how the surge grows, bit by bit. Be prepared for the absolutely amazing benefit. Join the mission”, before displaying a “Bitsurge” logo and text. The comments are disabled on the video, as well.

Crypto Green Earth

The second project is Project Crypto Green Earth. In a press release, the project claimed that it was attempting a blockchain-based mapping project of Costa Rica. It stated that it would utilize drone technology to map the “8.1 million square meters of observation data inside Costa Rica”. Users would then purchase “green certificates” to designate which portions of the map that they would like to preserve.

The Italian Companies and Exchange Commission — or Commissione Nazionale per le Società e la Borsa (CONSOB), is essentially the Italian version of the American Securities and Exchange Commission, and is responsible for the suspension. Both scams originate from a company called Avalon Life, based outside of the European Union, that claims it “empowers people” and “supports the planet” on its website.

 

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Iran Turning To Blockchain?

While there are many individuals in the traditional finance world that still attempt to downplay the cryptocurrency markets, more politicians and businessman are praising the fact that blockchain technology can improve our world in ways that we simply cannot imagine. Interestingly enough, an official from Iran has recently pointed out that cryptocurrencies and blockchain could actually revitalize Iran’s economy.

Iran Official Interested

His name is Alireza Daliri, and he is a Deputy for Management Development and Resources at the Vice Presidency for Science and Technology. He was quick to point out that other countries were already benefiting from blockchain, stating: “Over 140 countries are now benefiting from blockchain technology around the world.”

While he acknowledged that there was risk involved, he declared that while some governments are concerned about blockchain technology, “its benefits are more than its damages”, while also pointing out that blockchain could “decrease bureaucratic procedures”, as well.

Iran and Crypto

Iran seems to view cryptocurrency as a positive way to spur innovation. Daliri was supposedly behind the scenes with regards to laying groundwork for possibly creating a new national cryptocurrency in order to circumvent U.S. sanctions. The national cryptocurrency would be backed by the official currency of Iran, the rial.

Iranian President Hassan Rouhani

The plans were supposedly even approved by Hassan Rouhani, the current president of Iran. An individual by the name of Saeed Mahdiyoun, the deputy director of the Supreme Cyberspace Council, confirmed these plans months ago, but did not elaborate.

While Iran might utilize blockchain technology in various ways – the investor/trader climate in Iran is not looking so great in Iran since Binance, the world’s largest cryptocurrency exchange by daily volume, recently warned its users to withdraw their capital.

This is a result of U.S. sanctions, which activated on November 5. Iranian Binance users received an email, stating: “If you have an account with Binance and fall into that [sanctions] category, please withdraw your assets from Binance as soon as possible,” reads an email received in recent days by Iranian users, according to several local sources.