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Blockchain Startup Tron Announces Partnership with Internet Giant Baidu

A blockchain startup aiming to decentralized the internet is shaking hands with the field’s most prominent player. But does it matter?

 

Tron Foundation revealed in its latest tweet that it would be working closely with Baidu, a China-based internet giant, to use their cloud solutions. Far from what seems like an official and detailed press release, today’s announcement nevertheless confirmed to Tron’s October 12 teaser in which it admitted partnering with a giant whose valuation was worth billions of dollars.

But to many who responded after Baidu’s name came to the limelight, the Tron partnership with the internet giant was no less an equivalent of, as a tweet quoted, “a sleeper’s partnership with his pillow.”

 

Anatomy of a Tweet

Tron has stylized its tweet to create a right balance of hype and information. Readers might get mistaken from the first look that Tron is working as an equal – a blockchain innovator – with Baidu, perhaps on a decentralized cloud computing solution the latter wants to develop and launch anytime soon.

 

But a more in-depth look into the jumble of a tweet could prove that Tron is easily a customer of a cloud computing service that Baidu offers – nothing more, nothing less for now. The blockchain startup aims to build its Wave Field Tron system on Baidu cloud – simple.

 

 

Moreover, the attached image showcases an uncopiable-to-Google-Translate Chinese text which could be easily misinterpreted by the international media thanks to the fancy, subtitles-like English text below. The words like “joining forces,” “work with […] to offer blockchain solutions,” and “mass adoption” end up looking like jargons in what clearly seems like a politically correct yet misleading announcement.

 

CCN reached out to one of its team members to help with the translation and received the following text in return:

“Baidu Cloud service is cooperating with Tron’s Wave Field technology in basic cloud business field. Therefore, the Wave Field Tron will be built on Baidu Cloud. Both the parties have not reached any partnership on a business level, but the current partnership will be only focusing on the sale and the purchase of basic cloud computing resources.”

 

The translation went on about how Baidu is developing a blockchain commercialization architecture with the commercial superpartners to carry out technology exploration, revenue sharing, and build a blockchain ecosystem of cooperation. Meanwhile, the dots between Tron’s blockchain and Baidu’s cloud computing project were challenging to connect.

 

Tron price went up over 2 percent against the dollar after the Tron’s CEO Justin Sun’s announcement went live on Twitter. It is now trendline sideways around the intraday high established near 0.0255-fiat.

 

Meanwhile,

https://www.ccn.com/blockchain-startup-tron-announces-partnership-with-internet-giant-baidu/

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Major [Shuttered] Indian Exchange Zebpay Moves to Malta after Central Bank Blockade

The harsh cryptocurrency regulatory climate in India has turned out to be a gift for the self-styled blockchain island of Malta as one of the cryptocurrency exchanges that recently shut down in the world’s second-most populous country has decided to move operations there.

First reported by Quartz, Zebpay, one of the biggest exchanges in India, has registered an office in Malta with a view of serving not just citizens and residents of the island nation but also other European countries. In the Terms of Use page on its website Zebpay lists 20 countries whose residents and citizens are eligible to access its cryptocurrency exchange services. Besides Malta others include major European countries such as France, Germany, Italy, the Netherlands, Ireland, Sweden and Denmark.

New Home

In Malta, Zebpay has been incorporated under the name Awlencan, according to its website:

“For all intents and purposes, Zebpay shall mean and include below – Awlencan Innovations Malta Limited [C-88318], a Maltese Registered Company with Office Address situated at: 48, Triq Stella Maris, Sliema, SLM 1765, Malta, which owns and operates the ‘Zebpay’ VFA Exchange Platform in Malta, hereinafter referred to as “Awlencan” or “Zebpay” or “company”…”

Zebpay’s decision to shut down its Indian operations was announced last month and this was blamed on a move by the Reserve Bank of India to ban the financial institutions that it regulates from offering banking services to crypto businesses.

“The curb on bank accounts has crippled our, and our customer’s, ability to transact business meaningfully,” Zebpay wrote in a statement at the time as CCN reported. “At this point, we are unable to find a reasonable way to conduct the cryptocurrency exchange business.”

At the time, Zebpay, which was only launched three years ago, had amassed approximately three million users with hundreds of thousands of new users joining each month prior to the banking freeze by India’s central bank.

 

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Police: Dispute over Bitcoin Account Led to Connecticut Home Invasion

Two women have been  arrested in connection with a March home invasion in Killingly, CT, where victims were not only robbed but also allegedly pistol-whipped and attacked with an electric cattle prod. The incident, police said, was the tragic culmination of a dispute involving a bitcoin account.

 

Incident Details

Apparently, the home invasion occurred because a female victim opened a bitcoin account for one of the alleged home invasion suspects, Monique Delannoy-Jodoin, 59, who police said is a resident of Manville, RI. Police also stated that Ms. Delannoy-Jodoin was already under investigation for narcotic sales and delivery through the postal system. The other suspect was Beatriz Viruet, 38, who is a resident of Providence, RI.

 

The female renter claimed to recognize two of the home invaders, who then pistol-whipped one occupant on the head, and utilized an electric cattle prod on another occupant. The female renter was able to escape to a neighbor’s house, but not one of the suspects was able to force entry into the bathroom, where the renter was hiding, using a hammer.

The suspects stole money, cell phones, and a television, according to local authorities. Allegedly, one of the suspects, told the other to “shoot the victims,” as well.

 

Crypto Crime

Many have criticized the fact that cryptocurrency can be used for money laundering, considering that it can often be harder to trace than fiat currency. The sector is often accused of fraud, and there are even international task forces organized to target ICOs worldwide.

 

This is a still-rare-but-increasingly-more-common instance where there is a violent crime associated with cryptocurrency. Indeed, it is not the only violent incident that has happened in relation to bitcoin. Earlier this year, there was a  shooting in downtown Miami in connection with a bitcoin deal gone awry.

According to police, Monique Delannoy-Jodoin wanted money and passwords related to her bitcoin account. She was ultimately charged with home invasion, risk of injury to a child, third-degree criminal mischief, second-degree assault with a weapon, second-degree breach of peace, criminal use of a weapon, and sixth-degree larceny, among other charges. Beatriz Viruet was charged with home invasion, first-degree robbery, and second-degree breach of peace.

 

Delannoy-Jodoin was held on a $250,000 bond, while Viruet was held on a $100,000 bond. The women are both are due to appear Monday in Danielson Superior Court.

https://www.ccn.com/police-dispute-over-bitcoin-account-led-to-connecticut-home-invasion/

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Debunked: How Nouriel Roubini Failed to Attack Crypto with Cherrypicked Data

Recognized economist Nouriel Roubini, a professor at Stern School and NYU, recently launched a series of attacks against the crypto sector.

 

All of the False Claims Roubini Made

He claimed Bitcoin is a Ponzi scheme, Ethereum co-creator Vitalik Buterin amassed a wealth of a billion dollars by creating a pre-mined blockchain network, and said public blockchain protocols are unusable due to $60 fees — all of which are completely false.

 

Buterin disclosed that he had never held more than 0.9 percent of Ethereum’s total supply and had nowhere close to a billion dollars. Bitcoin fee is estimated to be around $0.1 according to Blockchain, not $60.

 

First claim: Bitcoin transaction fee is $60

Absurdly, Roubini decided to utilize a narrative that Bitcoin’s transaction fee is $60 and to pay for products of less value such as a cup of coffee, it costs upwards of $63.

 

For instance, Roubini stated that to purchase a Starbucks latte, which costs $2.9, one would have to pay $63 to buy with BTC.

 

 

Source: Bitinfocharts

However, the transaction fee of BTC is publicly available and verifiable data, which can be easily refuted. Hence, as Blocktower co-founder Ari Paul said, it remains unclear why Roubini led his criticism against crypto with a piece of information that can be refuted by anyone with ease.

 

“BTC fees are less than $0.10, easily verifiable. If you value truth, you’d provide a public correction. If your goal is to mislead people with simply false statements, carry on. There’s nothing to research. Fees are publicly viewable from many sources (googling it works.) I find it better not to provide a specific source because then regardless of source, the source gets attacked,” Paul said.

 

More importantly, an investor of BTC recently moved 29,999 BTC worth $194 million on the Bitcoin blockchain with a fee of $0.1. With legacy systems, it costs over a hundred thousand dollars to move an amount that is larger than $10 million.

 

Second claim: Crypto is printed out of nowhere

Bitcoin, Ethereum, and many public blockchain protocols utilize a consensus algorithm called Proof of Work (PoW), which requires miners to verify transactions and generate cryptocurrencies with a large amount of energy and hardware costs.

 

Currently, at the price of $6,500, BTC mining is nearly at a breakeven level, which means miners are generating BTC without any profit by foreseeing an increase in the value of the BTC in the long-term.

 

Hence, the claim that crypto can be printed out of nowhere is false as miners need to cover significant expenses required to maintain a blockchain network.

 

Third claim: Buterin stole 75% of Ethereum’s supply

Earlier this month, Roubini claimed Joseph Lubin and Vitalik Buterin, the two co-creators of Ethereum, stole 75 percent of the supply of ETH, the native cryptocurrency of the Ethereum protocol.

 

“Vitalik Buterin was the ringleader – together with Joe Lubin – of the criminal pre-mining sale/scam that created Ether. They stole 75% of the Ether supply and became instant ‘millionaires’ of fake wealth.”

 

In response, Buterin reaffirmed that he had never held more than 0.9 percent of Ethereum’s supply, instantaneously refuting the claim of Roubini. The third claim was also easy to disprove because through blockchain explorers, anyone on the network can publicly and transparently verify wallets and transactions.

 

“I never personally held more than 0.9% of all ETH, and my net worth never came close to $1 billion. Also, I’m pretty sure there are no criminal laws against pre-mining,” said Buterin.

 

Why did Roubini do this?

It remains unclear why Roubini, who is respected in his field of economics and finance, decided to attack an industry with a series of arguments and claims that can be disproved with sufficient evidence and data that is available to the public.

https://www.ccn.com/debunked-how-nouriel-roubini-failed-to-attack-crypto-with-cherrypicked-data/

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Norwegian Man Brutally Murdered Following In-Person Bitcoin Trade

A Norwegian man was brutally stabbed to death shortly after completing an in-person cash-for-bitcoin exchange, and investigators believe that the two events may be linked.

 

According to Norwegian news organization TV 2, the stabbing occurred on Monday morning at the 24-year-old victim’s apartment in Majorstuen, an affluent neighborhood in Oslo, likely between 7:50 am and 12:10 pm — when one of his roommates discovered the crime scene.

Sources within the Oslo police department told TV 2 that the murder victim had completed a bitcoin trade shortly before the tragic incident and that others within his social circle were aware of his cryptocurrency dealings.

 

Grete LIen Metlid, the leader of the Oslo police department’s head of intelligence and investigations unit, told the publication that investigators were aware of a tip involving a possible bitcoin connection, but he declined to elaborate further.

 

“We are familiar with a tip about Bitcoin, but at this time we will not provide more information about the investigation,” said Metlid, according to a rough translation, adding that the department investigates “widely” and that “economic motives” are always a primary area of interest for investigators.

 

As of the time of writing, the police did not have any suspects, nor had they made any arrests. Per local reports, forensic analysts continued to investigate the scene on Wednesday night.

https://www.ccn.com/norwegian-man-brutally-murdered-following-in-person-bitcoin-trade/

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Blockchain Journalism Startup Civil Refunds Investors after Failed ICO

Initial coin offering (ICO) operator Civil will refund investors due to the blockchain startup’s failure to reach its minimum sale cap. Civil will conduct another token sale in further efforts to build their Journalism business.

 

Civil ICO

Civil’s first ICO began in September and wrapped up this week. Their mission, according to their website, “is to help power sustainable journalism throughout the world” by using blockchain and decentralization.

 

Despite high profile partnerships including with media heavyweight Forbes, the ICO nevertheless failed to hit the $8 million fundraising minimum. Roughly 3,000 people bought CVL tokens to help the project.

 

Dealing With The Situation

The Civil team will conduct a new token sale fundraiser in a simpler format, with details in the coming days. After their new token sale reboot, Civil aims to officially launch. “This is happening in weeks, not months, “said Civil founder Matthew Iles.

 

Aiming to act appropriately, Civil will refund all investor funds via three options, allowing them to choose whether “to opt into this new sale, request an immediate refund, or be automatically refunded by October 29.”

ICOs have seen an enormous amount of deception and fraud over the past two years, which may have contributed to a reduction in ICO fundraising, even among reputable projects. CCN research shows that almost $100 million has been stolen from investors due to ICO exit scams alone. Moreover, 81 percent of ICOs are reportedly scams, suggests another report recently profiled by CCN.

 

Moving Forward

 

 

Civil made it clear that they intend to persist in their goals. “The CVL token sale didn’t succeed. We’re disappointed, but we’re as committed as ever to seeing Civil out in the world,” explained Iles.

 

The Civil Foundation has received $3.5 million from notable project ConsenSys, to help with initial operations. These funds will go toward funding various needs, such as their initial 14 newsrooms. Newsrooms are already working and reporting, the firm said.

After completion and distribution of the newly reformatted token sale, Civil will launch. Their launch includes the release of a blockchain publishing plugin for WordPress, a community governance application, and a developer tool for building with Civil data without blockchain expertise.

 

A Bigger Picture

The Civil project aims to save the world of journalism, explaining that the internet has taken this world down an unsustainable path that does not serve the public well.

 

Investors of the recently failed ICO see significant value in Civil’s model. Iles said that supporters were “not buying CVL tokens because they want the latest, greatest cryptocurrency. They’re doing it because they believe it’s a new and worthwhile way to create, distribute and support journalism, at a time when alternatives are desperately needed.”

One Civil supporter said, “I was really looking forward to having a part in responsible journalism that the readership can help also hold accountable.”

https://www.ccn.com/blockchain-journalism-startup-civil-refunds-investors-after-failed-ico/

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Malaysia to Spain: Asian FinTech Completes Ripple Blockchain API Payment

A central-bank approved Malaysian Fintech startup that has specializes in international money transfers has completed its first cross-border transfer on RippleNet, Ripple’s enterprise blockchain platform using an API solution.

 

With a payment from Malaysia to Spain, Kuala Lumpur-based MoneyMatch has completed its first cross-border blockchain transaction, a local report from Focus Malaysia confirmed.

The transaction, which enabled a retail user to convert Malaysian ringgits (MYR) to Euros (EUR) at a ‘significantly lower cost’ compared to traditional transfer services was completed in a matter of hours, the remittance firm revealed. In comparison, the global payments rail operated by SWIFT routinely takes several days to process a transaction that is likely to incur more fees.

 

MoneyMatch chief executive Adrian Yap said on Monday:

 

“We’re really proud to make this announcement today as we show clear evidence that a FinTech startup made wholly in Malaysia by young Malaysians is capable of integrating into the Ripple blockchain and performing a live legitimate international money transfer from Malaysia to Europe bringing blockchain innovation to the traditional Malaysian financial services industry.”

 

After the money transfer to Spain, the Malaysian startup also triggered cross-border payments to Germany, Latvia and Ireland, the company added.

 

As reported previously in April, MoneyMatch was one of five payments firms adopting xVia, a standard API solution that allows firms to send payments over RippleNet without the need for any additional software (think xCurrent).

With over 100 financial institutions including banks, payment providers and even a central bank, RippleNet enables its members to send payments to each other on the blockchain.

 

MoneyMatch says it is now working with other regulated partners who are members on RippleNet in countries including Thailand, India and the United States, among others.

https://www.ccn.com/malaysia-to-spain-asian-fintech-completes-ripple-blockchain-api-payment/

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Indian Govt. Panel Could Propose Illegalizing Holding of Unregulated Crypto Assets: Report

It could soon be illegal in the world’s largest democracy to hold cryptocurrencies that lack the government’s seal of approval.

 

 According to Moneycontrol, a report which is being prepared by a committee headed by India’s Economic Affairs Secretary, Subhash Chandra Garg, may propose amendments to the existing laws with a view of making it illegal to hold crypto assets that are not approved by the government.

Per the reports from the Indian financial publication, the Subhash Garg-committee is in the final phase of deliberations. Besides merely proposing legislative amendments and recommending punishment for those holding unapproved crypto assets, the panel will also define the punitive measures that will be meted on those who flout the law.

 

It is understood that this move stems from the government’s view that crypto assets which are unregulated should be kept out of the Indian financial ecosystem to prevent them from being used to aid illegalities such as evading taxes as well as in Ponzi and multi-level marketing schemes.

 

No Surprises

The Subhash Garg-committee was set up last year and is expected to submit its report in December. Besides the Economic Affairs Secretary, the membership of the committee is drawn from India’s central bank and the country’s securities markets regulator.

 

If the Subhash Garg-panel report is adopted as reported it will not be a surprise given the anti-cryptocurrency stance the various government agencies in India have taken. Early in April, for instance, the Reserve Bank of India (RBI) prohibited financial institutions that the central bank of the world’s second-most populous country regulates from offering services to crypto businesses. Additionally, the RBI banned these financial institutions from allowing their clients to buy cryptocurrencies.

“…with immediate effect, entities regulated by RBI shall not deal with or provide services to any individual or business entities dealing with or settling VCs [Virtual Currencies],” read part of a statement issued by the RBI as reported by CCN. “Regulated entities which already provide such services shall exit the relationship within a specified time.”

 

Trail of Devastation

Months after the ban the devastating repercussions continue to be felt in India. In September one of the biggest cryptocurrency exchanges in the world’s sixth-largest economy by nominal GDP, Zebpay, announced that it was shutting down after it found itself unable to operate without access to banking services.

The negative consequences of the ban have not been limited to cryptocurrency exchanges, however, and have spread to the wider blockchain ecosystem. As CCN reported last month, this was leading to a ‘blockchain brain drain’ as well as ‘blockchain capital flight’ to jurisdictions with more conducive environments such as Malta, Estonia, Switzerland and Thailand.

https://www.ccn.com/indian-govt-panel-could-propose-illegalizing-holding-of-unregulated-crypto-assets-report/

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India’s Largest Internet & Mobile Body Forms a Blockchain Committee

In a marked move to advance the development of the domestic blockchain ecosystem in India, the country’s influential internet industry association has formed a committee dedicated to the decentralized technology.

 

With the new blockchain committee, the Internet and Mobile Association of India (IAMAI) is looking to engage with the government, the wider industry and startups in the burgeoning sector to develop the ecosystem, India’s most-read business daily  the Economic Times report.

 

A pointed focus is to use blockchain tech to facilitate job creation for the new digital economy in the country, the report added.

 

The new committee within the influential non-profit will be chaired by Tina Singh, digital chief at private lending giant Mahindra Finance.

 

She told the publication:

 

“Blockchain is undeniably the technology of the future, slated to bring decentralization and trust and accountability into multiple areas of business. However, in order to be more effective and enter the mainstream, blockchain technology needs the intervention of government bodies, regulatory authorities and corporates.”

 

The committee includes several prominent executives at major corporate giants spanning tech and financial sectors such as Microsoft, Mastercard, IBM and HDFC Bank, India’s biggest private bank.

 

Curiously, the committee also counts Sandeep Goenka, founder of major Indian bitcoin exchange Zebpay. The app-only exchange was among India’s earliest and largest exchanges until it shuttered trading services less than a month ago. While Zebpay continues to provide a wallet service to users, the exchange said it was “unable to find a reasonable way to conduct the cryptocurrency exchange business” following the central bank’s comprehensive ban that bars banks from providing services to exchanges and the wider crypto sector.

Despite the curbs on the cryptocurrency sector, which remains unregulated, the formation of the blockchain committee proves the concentrated effort to integrate the groundbreaking tech into wider society.

 

Singh added:

 

The IAMAI Blockchain Committee will focus on creating dialogue between all stakeholders; curate and create content to aid skill development and move towards creating a participative economy with the usage of blockchain.”

https://www.ccn.com/indias-largest-internet-mobile-body-forms-a-blockchain-committee/

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Tether Found a New Bank, and it Might be in the Bahamas: Report

Tether, the controversial issuer of the USDT cryptocurrency, may have found a new banking partner in the Bahamas.

Tether May Have a New Bank

As first reported by The Block’s Larry Cermak, Tether — whose USD-pegged cryptocurrency has a market cap in the billions of dollars — is said to be holding its fiat reserves at Deltec Bank, which is based out of Nassau.

Those reserves, according to the company, are quite large. As of Tuesday morning, there are more than 2.25 billion USDT tokens in circulation, representing $2.25 billion in physical assets. At one point, USDT was worth nearly $2.9 billion, though hundreds of millions of dollars worth of the cryptocurrency token has been yanked out of circulation in October.

tether market cap

Source: CoinMarketCap

Bitfinex Unveils ‘Distributed Banking Solution’

Tether reportedly shares a management team with cryptocurrency exchange giant Bitfinex, and, concurrent with Cermak’s report on the stablecoin issuer’s new banking partner, Bitfinex introduced a “new, improved and increasingly resilient fiat depositing system” that utilizes a “distributed banking solution.”

Previously, both Bitfinex and Tether were said to be holding assets at Noble Bank, a financial institution located in Puerto Rico. However, Noble Bank is now reportedly up for sale as the result of monetary struggles of its own.

Bitfinex did not reveal any details about its new banking partner(s). However, screenshots allegedly taken from within the new fiat deposit system suggest that the exchange does not want this information to become public.

“This banking information is being provided to you for purposes of contributing good faith funding to your account on Bitfinex,” reads the message in the screenshot posted by widely-followed cryptocurrency investor WhalePanda. “This banking information is commercially sensitive and confidential. You should be very careful with this information. You are asked to keep this information to yourself and to not share it except with your financial institution. Divulging this information could damage not just yourself and Bitfinex, but the entire digital token ecosystem. Accordingly, you are cautioned that there may be serious negative effects associated with this information becoming public.”

As CCN reported, the tether price has slipped below the $1.00 mark in recent days, perhaps in part due to lingering concerns over the long-term ability to redeem USDT for physical currency. After slipping as low as $0.92 on Monday, tether’s global average had recovered to about $0.98 by the time of writing.

A Tether representative did not immediately respond to CCN’s request for confirmation on its alleged banking relationship with Deltec.

https://www.ccn.com/tether-found-a-new-bank-and-it-might-be-in-the-bahamas-report/

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Tether Market Cap Sinks to $2.2 Billion as another 250 Million USDT Exits Circulation

The loss of its U.S. dollar peg isn’t the only thing driving down the market cap of tether (USDT), the cryptocurrency market’s largest “stablecoin.”

Tether Falls Below Dollar Parity

The USD-backed token, which as recently as late August had a circulating valuation of nearly $2.9 billion, is now worth just $2.2 billion, representing a two-month decline of nearly 25 percent.

A portion of that decline is a direct result of USDT’s price falling below the $1.00 in assets that are supposedly backing each token. As CCN reported, the USDT/USD peg slipped away heading into Monday morning, throwing uncertainty into a market that relies on billions of dollars worth of tether trading on a daily basis on exchanges that do not support physical USD.

According to CoinMarketCap, tether’s global average traded as low as $0.92 on Monday but has since climbed back to $0.98. On Kraken, which offers a thinly-traded USDT/USD market, the tether price dropped as low as $0.85 before recovering to a present value near $0.95.

tether price chart

USDT/USD | Kraken

$560 Million in USDT Yanked from Circulation

However, given the current USDT/USD discount, the loss of dollar parity only accounts for about $50 million in lost market cap. The remaining decline is the result of Tether pulling hundreds of millions of dollars out of circulation during the first half of October.

Early this morning, Tether yanked 250 million USDT out of circulation after Bitfinex sent payments of 50 million USDT and 200 million USDT to the token’s treasury address, and it wasn’t the first time this month that tethers had exited the market.

tether

Source: Omni Explorer

CCN reported yesterday that Tether had pulled $300 million in USDT out of the cryptocurrency market through two transactions executed on Oct. 9 and Oct. 14. Altogether, 560 million tether tokens have been yanked out of circulation in October, and none have been issued since Sept. 21.

As of Tuesday morning, the Tether treasury is holding more than 736 million USDT, funds that the company’s website state have been authorized but not issued.

tether

Source: tether.to

USDT Arbitrage or Waning Consumer Confidence?

Assuming Tether and Bitfinex are operating above-board in their handling of USDT, the massive withdrawals could be connected to stablecoin arbitrage.

For professional traders who are confident in their ability to redeem tethers for USD at a 1:1 ratio on Bitfinex or — for large-scale holders — directly at Tether, the USDT/USD spread should represent an opportunity to generate easy, low-risk profit. Simply acquire USDT, deposit it at Bitfinex — where it is treated as USD — and then withdraw the funds to an external bank account.

 

Traders can continue to engage in USDT arbitrage as long as the exchange continues to process withdrawals (and though fiat deposits were temporarily paused in recent days the company said that withdrawals continued to process normally). Barring any unforeseen disruptions, arbitrage should eventually restore the tether price to dollar parity.

On the other hand, the withdrawals could be the result of large USDT holder seeking to diversify into other stablecoins, including the highly-touted new offerings from Paxos, Gemini, and Circle. While still much smaller than tether in terms of market cap and liquidity, these tokens — particularly Paxos Standard (PAX) — have been making significant gains in the weeks following their launches.

Notably, Bitfinex announced a new “distributed banking solution” on Tuesday, enabling it to resume fiat deposits following nearly a week of fiat deposit downtime. At the same time, The Block published a report citing anonymous sources who say that Tether has opened an account with Nassau-based financial institution Deltec Bank.

It remains to be seen whether this news will be sufficient to thrust the tether price back to dollar parity.

https://www.ccn.com/tether-market-cap-sinks-to-2-2-billion-as-another-250-million-usdt-exits-circulation/

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Ethereum Creator, NYU Economist Go to War On Twitter, Mull Public Debate

Ever since Nouriel Roubini appeared before the United States Senate Committee On Banking, Housing, and Urban Affairs, to discuss cryptocurrencies – he has certainly been causing quite the commotion with regards to the cryptocurrency community.  

Roubini vs Buterin

This is not surprising, considering the famed economist shared several controversial statements about bitcoin and cryptocurrency in general, such as stating that “only criminals and terrorists use crypto”, and that “utility tokens take us back to the stone age”.  He has also taken specific aim at Vitalik Buterin on Twitter earlier this month, likening the Ethereum founder to a “dictator for life”.

Buterin responded sarcastically that he “officially predicts a financial crisis between now and 2021”.  This is clearly a reference to the fact that many credit Roubini with predicting the global financial crisis of 2008, for which he received the nickname “Dr. Doom”.  

A Possible Debate

Despite his apparent dislike for the cryptocurrency community, Roubini has indicated that he is open to a live debate with Vitalik Buterin, an idea initially set forth by Laura Shin, who invited both to debate on her podcast, Unchained, one of the most popular cryptocurrency-focused podcasts in the world.  Buterin has indicated that he is open to a debate, but Roubini dismissed Ms. Shin as a pseudo-journalist, suggesting that the moderator have less of a bias.

Buterin responded with the suggestion of Kevin Pham as a moderator.  One of the reasons Mr. Pham might be an obvious choice is that he clearly isn’t a fan of Buterin, and even suggested earlier this year that the Etherem co-founder is colluding with the Russian government.

Arthur Hayes, the co-founder of the cryptocurrency exchange Bitmex, offered to pay for all of the production costs involved with the debate, and offered New York or London as possible locations.  Roubini was less than ecstatic with the offer, calling Bitmex a “criminal scam”.

Roubini also eventually responded to the suggestion of Pham as a moderator, quoting a tweet of his and suggesting that he is “thuggish”.

Many are confused as to whether this debate happening is a serious possibility, but that hasn’t stopped Twitter users from suggesting possible moderators.  Some suggestions appear to be more serious than others, but some names that have been floated include John McAfee, Joe Rogan, and the Dalai Lama.

https://www.ccn.com/ethereum-creator-nyu-economist-go-to-war-on-twitter-mull-public-debate/

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Cryptocurrency Needs More Regulation than other Commodities: Fmr. CFTC Chair

Former Commodity Futures Commission Chairman Gary Gensler, who helmed the organization from mid-2009 to early 2014, recently shared his opinions on cryptocurrency regulation in a Bloomberg interview.

Need For Regulation

Gensler was asked about the validity of blockchain technology, and the regulator-turned-blockchain-lecturer stated outright that it “has a real chance to be a catalyst for change in the world of finance.” He pointed out the fact that the decentralized nature of blockchain is significant, and noted that when he teaches blockchain technology at MIT, that “the class is crowded.”

When asked about how it should be regulated, he continued to state that if cryptocurrency truly is to be a part of the future, it must “come inside of the public policy envelope.” He stated the importance of protecting investors and guarding against illegal activity. He pointed out the fact that the large cryptocurrency exchanges have to comply with either the SEC or the CFTC, the organization that he was “once honored to chair.” He even stated that “pure cash cryptocurrencies, like bitcoin, need more protection than frankly, even the oil markets, or corn and wheat.” He then declined to comment on which organization should be regulating the market in general, declaring himself “regulator-neutral.”

Interestingly, he emphasized the importance of remaining “technology neutral” to promote innovation, while still calling for regulation — meaning that blockchain technology as a whole should not be regulated, but that there should be as much effort as possible to reduce fraud and manipulation within DLT applications.

Additional Conclusions

cryptocurrency derivatives CFTC

Source: Shutterstock

When asked whether it was realistic for organizations to understand the true nature of whether fraud is prevalent, and whether the federal government even had the manpower to regulate the industry, given the new nature of the technology, Gensler dismissed the idea that it cannot be understood, stating that, “It’s always a challenge…that was true when the internet came along in the 1990s…but I don’t think that means we give up.” He then elaborated that more confidence in markets meant that more investors could participate.

He elaborated that the more that asset managers can invest, the more widespread adoption we will see. His statements come off the heels of Fidelity, a $7.2 trillion asset manager, and a major player in global finance, announcing the creation of a new company to help its customers invest in bitcoin.

He was also clear about his belief that blockchain technology is at present still more “hype than reality.” He stated that the technology is years away from “being scaled,” comparing the transactions per second between Visa and bitcoin, and pointing out the massive difference. He does believe that the scaling issues will eventually be addressed.

https://www.ccn.com/cryptocurrency-needs-more-regulation-than-other-commodities-fmr-cftc-chair/

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$194 Million was Moved Using Bitcoin With $0.1 Fee, True Potential of Crypto

On October 16, a Bitcoin user moved 29,999 BTC worth $194 million with a $0.1 fee, a transaction which with banks would cost tens of thousands of dollars.

An often pushed narrative against cryptocurrencies like Bitcoin and Ethereum is that it is expensive to clear transactions due to fees sent to miners. However, the $194 million payment on the Bitcoin blockchain demonstrates the potential of consensus currencies to optimize cross-border payments significantly.

$1 Million Through a Bank Costs $10,000+

Transferwise is a UK-based multi-billion dollar firm that eliminates hidden fees in bank transfers. On the platform, users can send small to large payments through bank accounts with substantially lower fees.

However, even on a platform like Transferwise, to send over $1 million, it costs over $7,500 in transaction fees. That means, through wire transfers and conventional banking methods, tens of thousands of dollars are required to clear a transaction that is larger than $1 million.

Percentage-wise, $7,500 is less than 1 percent of $1 million, and in that sense, a $7,500 fee is cheap. But, on the Bitcoin network, which is supposedly highly inefficient in processing payments, it costs less than $0.1 to clear a $194 million transaction.

bitcoin

On October 14, publicly acclaimed cryptocurrency critic Nouriel Roubini, an economist and professor at Stern School, claimed that it costs $60 to process a Bitcoin transaction and as such, it costs $63 to purchase a Starbucks latte that costs $3, using Bitcoin.

“So the cost per transaction of bitcoin is literally $60. So if I were to buy a $3 latte at Starbucks I would have to pay $63 to get it! So the myth of a ‘Brilliant new technology that reduces the vast fees of legacy financial systems!’ turns out to be a Big Fat Lie!” Nouriel claimed.

In response, respected cryptocurrency investor and Blocktower co-founder Ari Paul stated that the transaction fee of Bitcoin, which is less than $0.1, is publicly verifiable on the blockchain.

“BTC fees are less than $0.10, easily verifiable. If you value truth, you’d provide a public correction. If your goal is to mislead people with simply false statements, carry on. There’s nothing to research. Fees are publicly viewable from many sources (googling it works.) I find it better not to provide a specific source because then regardless of source, the source gets attacked,” Paul noted.

Crypto Could Crack Offshore Banking Market First

As scalability of public blockchain networks improves with the integration of both on-chain and second-layer scaling solutions, cryptocurrencies will be able to handle small payments with higher efficiency.

But, in the mid-term, given the ability of the blockchain to process large-scale payments at the same cost of a small transaction, it is highly likely that cryptocurrencies will gain wide acceptance by investors and firms in the offshore banking market, a $30 trillion industry that relies on financial institutions to clear large transactions.

Spending $0.1 to $1 for a $5 to $10 transaction could be inefficient and impractical. However, spending the same fee to process multi-million dollar transactions provide cryptocurrencies a clear edge over legacy systems.

https://www.ccn.com/194-million-was-moved-using-bitcoin-with-0-1-fee-true-potential-of-crypto/

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Apple Pioneer Steve Wozniak Has Co-Founded a Blockchain Investment Firm

Steve Wozniak, the tech entrepreneur best known as the co-founder of Apple, has joined EQUI Global, a venture capital fund built using blockchain technology, as a co-founder.

In a Medium post published by the company, Wozniak said that he will scout for technology companies to find the “tech stars” of the future. He also said that he receives innovative pitches regularly; however, this is the first time, after Apple, that he has agreed to join a company. Wozniak added that he believes technology has the power to modify and improve businesses. EQUI Global not only caught his attention but also convinced him that it would prove to be a “game changer.”

According to Wozniak, the team is observing 20 different companies ahead of its official launch. Once the companies are short-listed, they will be mentored by EQUI Global’s board of social entrepreneurs. “We are the teachers and I believe in that so strongly because Apple was strongly mentored. The enjoyment we had, the passion, starting the company, the excitement, it’s the most exciting thing,” said Wozniak.

Wozniak also praised EQUI Global’s co-founders, Baroness Michelle Mone and Douglas Barrowman, for their history in supporting blockchain technology. Last year, Mone and Barrowman announced the development of the $325 million Aston Plaza and Residences in Dubai under their private equity firm Aston Ventures. In February 2018, the couple sold 50 apartments to Bitcoin users successfully.

The couple then launched an ICO for EQUI Capital but managed to raise only $7 million as compared to the expected $80 million by the end of June 2018. The company then abandoned the ICO, changed the name to EQUI Global, and partnered with Apple’s co-founder.

Talking about the new addition to the team, Mone explained, “Woz [Wozniak] has always been my business icon and it’s a dream come true to be working with him at EQUI.”

The “open-ended” EQUI fund will focus on non-institutional investors and tech companies, with only 20% set aside for non-tech companies such as real estate and investment collectibles. Investors can buy EQUITokens in order to join the venture capital fund. They will have the freedom to sell these tokens on external cryptocurrency exchanges to liquidate their investments.

Wozniak said that he believes firms like EQUI will disrupt the VC industry and allow other companies to follow the new model based on blockchain technology.

https://www.ccn.com/apple-pioneer-steve-wozniak-has-co-founded-a-blockchain-investment-firm/

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Next Bitcoin Bull Run Will See Crypto Market Rise ‘10x’: Pantera CIO

The co-chief investment officer of one the cryptocurrency industry’s largest investment firms said that he expects the next bitcoin bull run to carry the cryptocurrency market cap 1,000 percent above its current valuation.

Pantera Capital’s Joey Krug made this prediction during an interview with Bloomberg, forecasting that the next upswing could propel the cryptocurrency market cap to more than $2 trillion.

“If you look at that next bull run, I think the crypto space overall could hit 10x from here.”

Noting that in previous market cycles the news that major financial industry players like Fidelity Investments and Intercontinental Exchange (ICE) were entering the cryptocurrency space would have sparked a surge in speculative investments, Krug said that he believes the market is currently waiting on concrete adoption to catalyze a bull run.

bitcoin price chart

BTC/USD | Coinbase

For this to happen, he continued, cryptocurrency networks will need to achieve increased scalability, as the current state of cryptocurrency blockchain development is akin to the internet before dial-up.

He commented:

“If you look at the internet, it’s easy to say, ‘Well, you just create an app, get some users, and then you solve the scalability problems.’ But these are all markets, and so if you don’t have scalability, you don’t have market makers, and so you don’t have liquidity.”

As CCN has reported, two of those innovations for Bitcoin, in particular, include the Lightning and Liquid networks. The Lightning Network (LN), which is currently in beta, is a second-layer protocol that operates on top of Bitcoin. Using the network’s built-in scripting language, users can move funds “off-chain” into LN payment channels, where transactions do not require miner validation and can consequently be processed instantly at virtually no cost.

The Liquid Network, on the other hand, is a federated Bitcoin sidechain developed by blockchain startup Blockstream and targeted at cryptocurrency exchanges, financial institutions, and other bitcoin power users who desire to move large amounts of bitcoin more quickly and privately than they can across the main blockchain.

These technologies — as well as ones on other blockchains — are not yet ready for primetime, but Krug said that he expects some cryptocurrency networks to achieve Visa/Mastercard scale within the next couple of years, though that does not necessarily mean the bear market will endure for that long.

In the meantime, he said that he believes the cryptocurrency market has hit a bottom and will remain range-bound until the next catalyst arrives.

https://www.ccn.com/next-bitcoin-bull-run-will-see-crypto-prices-rise-10x-pantera-cio/

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Huobi Lists Four ‘Regulated’ Stablecoins Vying for Tether’s Crown

Huobi Global is set to list four new stablecoins, namely Paxos Standard (PAX), Gemini Dollar (GUSD), TrueUSD (TUSD), and USDCoin (USDC) later this week. In an announcement on its website, the cryptocurrency exchange revealed that the four new assets will go live on Oct. 19.

Huobi’s New Listings

PAX, a newly launched digital asset is dollar-pegged, issued by Paxos Trust, and regulated by the New York State Department of Financial Services. Participants are able to trade with USD-endorsed and USD-denominated assets under the supervision of the NYSDFS.

GUSD, which claims to be the worlds’ first regulated stablecoin, was issued recently by the Cameron and Tyler Winklevoss-owned Gemini exchange, also under NYDFS supervision. As with most other major fiat stablecoins, each GUSD token is backed by $1.00 in hard currency.

TUSD is a collateralized, dollar-backed stablecoin trusted by multiple banking partners, while Circle’s  USDC token allows eligible financial institutions join through its open membership, and it offers financial solutions that seek to resolve current crypto market problems.

Tether Faces More Competition

Huobi, the fourth-largest cryptocurrency trading platform, also hosts Tether’s USDT token (aka tether), which is also a U.S. dollar-pegged stablecoin. Tether, the token’s developers have claimed, is fully-backed by currency reserves, though it was trading 3.5 percent lower than its supposed value at $0.965 as recently as yesterday. It fell to around 93 cents at one point during the day but is now trading near $0.98.  Tether Limited, the company behind it, has been in the spotlight concerning its claim of holding enough USD reserves to back the tether tokens in circulation.

CCN reported recently that tether lost its USD peg in a flurry of market activity, falling as low as $0.85 on one exchange amidst sustained negative market sentiment toward the stablecoin lodestar. Though it still dominates a reported 98 percent of daily stablecoin trading volume, a series of new entrants into the stablecoin arena over the past few week have put pressure on market sentiment toward it.

Earlier, OKEx, another top major crypto exchange, announced the listing of USDC, GUSD, TUSD, and PAX as the four stablecoin upstarts prepare to do battle with USDT.

https://www.ccn.com/huobi-lists-four-regulated-stablecoins-vying-for-tethers-crown/

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Maldives’ Central Bank Denies Issuing Permits for Crypto Transactions

The central bank of the Maldives has warned citizens to be wary of advertisements appearing on social media platforms relating to the trading of cryptocurrencies.

In a press release, the Maldives Monetary Authority (MMA) cautioned members of the public against transacting in cryptocurrencies pointing out that it was the only agency responsible for licensing money exchange business and international as well as domestic money-remittance firms.

According to the central bank of Asia’s smallest country by both area and population, no permit has been issued to any organization authorizing the use of cryptocurrencies in conducting financial transactions.

“…no party has been granted permission to conduct any financial transactions using cryptocurrencies or other virtual currencies in the Maldives. Furthermore, the issuance of any legal tender by any other party is against the law,” wrote the Maldives Monetary Authority in a statement.

A Growing List

With regards to central banks that have taken an anti-cryptocurrency stance in the recent past, the Maldives Monetary Authority has plenty of company. Just this week, Zambia’s central bank, the Bank of Zambia (BoZ), stated that cryptocurrencies were not legal tender in the Southern African country and warned that Zambians engaging in trading or transacting in digital assets were doing so at their own risk.

“Cryptocurrencies are not legal tender in the Republic of Zambia; Secondly, BoZ does not oversee, supervise nor regulate the cryptocurrency landscape,” read a statement from the BoZ as CCN recently reported. “Consequently, any and all activities related to the buying, trading or usage of cryptocurrencies are performed at owner’s risk.”

Last month, the central bank of the world’s second largest economy, the People’s Bank of China, put out a public notice urging investors to avoid speculating in cryptocurrencies and overseas-issued Initial Coin Offerings. Despite a ban on all ICOs, trading in cryptocurrencies in mainland China has persisted as domestic investors have flocked to offshore exchanges.

Same Script, Different Jurisdiction

Other reserve banks which have taken an anti-cryptocurrency stance include the Central Bank of Samoa and the Bank of Laos. In the island nation of Samoa, the country’s central bank has not only stated that cryptocurrencies do not possess a legal tender status but has gone ahead to require promoters of cryptocurrencies to acquire the same licenses as financial institutions. The Bank of Laos, on the other hand, has also equally cautioned against trading in digital assets.

 

Not all central banks have taken a harsh stance on cryptocurrencies though and some have initiated efforts that are supportive of the sector. For instance, the Monetary Authority of Singapore recently indicated that it would assist domestic cryptocurrency exchanges and other crypto startups access banking services as a way of fostering the country’s fintech sector.

https://www.ccn.com/maldives-central-bank-denies-issuing-permits-for-crypto-transactions/

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What Led the World’s Largest Brokerage to Fully Integrate Crypto After 1 Year of Testing?

In late 2017, Fidelity, one of the largest brokerages and asset managers with 7.2 trillion in assets under management as of October 2018, launched its first crypto initiative.

By partnering with Coinbase, the biggest crypto-to-fiat exchange in the global market, Fidelity enabled its clients to track investments in major cryptocurrencies like Bitcoin and Ethereum through the Fidelity Portfolio Summary View.

At the time, Fidelity did not directly integrate cryptocurrencies into its infrastructure and only allowed investors that are registered with Coinbase to invest in the emerging asset class, most likely to test the market and the demand from investors for crypto.

Within 1 year, Fidelity has gone from studying and evaluating the crypto market to fully integrating digital assets into its platform.

Why is Fidelity Committed?

Since last year, Fidelity has maintained an open-minded stance towards cryptocurrencies and blockchain technology.

Hadley Stern, senior vice president and managing director at Fidelity Labs, told The Street in August 2017 that the investment firm does not underestimate the disruptive nature of the blockchain, even though consensus currencies still require significant work in infrastructure development and adoption to grow.

“Bitcoin and other blockchain technologies are emerging from their infancy but mass adoption is still many years away. Additionally, don’t underestimate their disruptive nature. Just as many other technologies have done in the past, Bitcoin and blockchain will transform how we manage our finances,” said Stern.

Around the same time, CCN reported that Fidelity mined cryptocurrencies for a brief period of time, to better understand and analyze the structure of digital assets. Stern explained the initiative was driven by Fidelity Labs as an experiment to learn how consensus, difficulty levels, and the network of Bitcoin operate.

Axel Pierron, managing director of bank consultant Opimas, stated that the ambitious decision of Fidelity to mine digital currencies was a response to increasing inquiries from its clients. Pierron explained:

“They’re clearly receiving interest from their clients, both from retail investors and on the institutional side. It’s highly volatile, it’s highly illiquid when you need to trade large volumes, so they see the opportunity for a new asset class which would require the capability of a broker-dealer.”

Since its partnership with Coinbase and the implementation of crypto onto the Fidelity Portfolio Summary View, it is highly likely Fidelity observed a significant increase in interest and demand for cryptocurrencies from its clients.

Similar to Goldman Sachs, Citigroup, NYSE, Bakkt, and TD Ameritrade, Fidelity has disclosed its intent to commit to serving investors that are interested in investing in the cryptocurrency market through a strictly regulated and transparent channel.

Founding head of Fidelity Digital Assets Tom Jessop said in an interview:

“This is a recognition that there is institutional demand for these assets as a class. Family offices, hedge funds, other sophisticated investors are starting to think seriously about this space.”

Not Merely Retail Investors

The 2017 rally of Bitcoin which saw the dominant cryptocurrency achieve a price of $20,000, was purely driven by retail traders and individual investors.

As hedge funds and institutional investors begin to invest in the asset class through Fidelity and other brokerages that are faciliating crypto trades, an influx of capital into the crypto market can be expected in the months to come.

https://www.ccn.com/what-led-the-worlds-largest-brokerage-to-fully-integrate-crypto-after-1-year-of-testing/

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27,000 Txn/s: Digital Asset Blockchain Beats Wall Street Bookkeeper’s Minimum Scale

Global business technology provider GFT has announced results of an independent performance test on the Digital Asset (DA) platform showing that the platform can process trading volumes exceeding 27,000 trades per second over a sustained period of time. These results place the platform above peak US equity trading volumes according to the DTCC.

Founded in 2014, Digital Asset claims to be the only distributed ledger platform to have been developed according to the production requirements of the world’s largest financial institutions. GFT on its part provides business, IT and software services  to the international financial services industry.

The test results potentially provide further evidence that barriers to the adoption of DLT at enterprise level can be surmounted. Speaking about the results, Blythe Masters, CEO of Digital Asset said:

“GFT’s performance test demonstrates the throughput capacity of the DA Platform can meet the demands of major markets. We are delighted that GFT’s findings have validated that the highest standards of integrity and privacy do not sacrifice performance. We are very optimistic about what this outcome will mean for the industry at large.”

To ensure objectivity, DA provided GFT with access to the DA Platform’s code base and a production-like environment to simulate a typical trade day for a cash equities market and a real-time market simulation based on historical data. A series of test scripts were then run to verify the throughput was capable of supporting 27,000 trades per second, or about 81,000 DLT transaction updates per second.

Giving his thought about the exercise and his hopes for GFT in the near future, David Collins, head of GFT’s Atlantic region said:

“GFT’s goal is to continually drive innovation throughout the financial services sector and DLT is a key part of this strategy. We believe the rigor of the test scenario’s construction and in the level of performance achieved demonstrates the DA Platform can handle peak trade volumes seen in US equities markets and scale to satisfy the performance requirements of large-scale financial institutions.”

According to Collins, the results of the performance test will create new opportunities both for GFT and for DA, which now has evidence that its DLT-based platform is able to operate at the speed and consistency required on a large scale enterprise solution. This, he said, can potentially accelerate the adoption of what he described as “a completely transformative capability” for the business.

The GFT team will demonstrate its performance application and further elaborate on the test results at the annual Sibos conference in Sydney next week.

https://www.ccn.com/27000-txn-s-digital-asset-blockchain-beats-wall-street-bookkeepers-minimum-scale/

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