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Visa Launches Global Cross-Border Network Based on Certain Aspects of Blockchain

United States’ payment giant Visa has launched a cross-border payment network derived from some aspects of blockchain technology, Reuters reports June 11.

The network, called “Visa B2B Connect,” is designed to facilitate international payments made by global financial institutions by enabling direct interbanking transactions between businesses and beneficiaries.

According to the report, the network already covers 30 trade channels worldwide to enable faster and cheaper cross-border payments, and is expected to expand to 90 markets by the end of 2019.

Visa B2B Connect is partially based on blockchain technology, containing elements of Hyperledger, the open source distributed ledger technology (DLT) developed by a group led by the Linux Foundation, the report notes.

Specifically, certain aspects of blockchain tech were reportedly used due to its capability to transfer more data on a payment than any existing payment system, global head of Visa Business Solutions Kevin Phalen said in the report.

The new network is a result of collaboration with tech global giant IBM, as well as e-payment operator Bottomline Technologies and fintech firm FIS. In order to develop the product, Visa was reportedly initially working with cryptographic ledger systems builder Chain.

Recently, Visa also partnered with the fintech operator of Japanese messaging app LINE — LINE Pay Corporation — in order to develop new blockchain and digital payments solutions.

Earlier this year, software startup DataLight released a report claiming that bitcoin (BTC) has a potential to replace global payment systems such as Visa and MasterCard within ten years.

Nasdaq and CryptoCompare Partner on Institution-Oriented Crypto Pricing Product

The world’s second-largest stock exchange, Nasdaq, and crypto data provider CryptoCompare have partnered to release a cryptocurrency pricing product targeted at institutional investors. The news was revealed in a press release shared with Cointelegraph on June 11.

The new product, dubbed the “Nasdaq/CryptoCompare Aggregate Crypto Reference Prices,” will be made available on the Nasdaq-owned platform Quandl — which reportedly provides financial and economic alternative datasets for over 400,000 financial professionals globally.

The new Nasdaq-CryptoCompare pricing product will be based on CryptoCompare’s aggregate index datasets, which provide ostensibly minute-by-minute pricing data from those cryptocurrency markets that have the highest liquidity.

The product aims to enhance institutional investors’ capabilities in the crypto markets, across “trading strategy, quantitative research, risk modelling, NAV calculations and back-testing,” the press release notes.

In an official statement, CryptoCompare CEO and co-founder Charles Hayter has argued that “reliable data is the bedrock of transparent, liquid markets,” and can offer global, institutional investors and traders a competitive edge in the crypto sector.

In late 2018, Nasdaq had ostensibly confirmed its plans to launch bitcoin futures in the first half of 2019, having deferred an earlier planned rollout.

In February 2019, Nasdaq started listing two cryptocurrency price indices from United States blockchain and crypto market data firm Brave New Coin (BNC), including BNC’s Bitcoin Liquid Index (BLX) and Ethereum Liquid Index (ELX).

Cryptocompare has meanwhile just this week partnered with major crypto derivatives platform BitMEX to jointly construct a real-time crypto futures dataset, which will be delivered to financial markets data provider Refinitiv.

Major Korean Bank Signs MoU With Atomrigs Lab to Explore Crypto Asset Management

This article has been updated to correct the name of Atomrigs Lab.

Major South Korean commercial lender KB Kookmin Bank has signed a Memorandum of Understanding with blockchain technology firm Atomrigs Lab to jointly explore digital asset management and protection solutions. The news was released at a press conference at the bank’s office in Seoul on June 11.

The MoU — signed yesterday, June 10, in Seoul — establishes that the two partners will focus on digital asset market growth and new crypto-related businesses, according to Korean news outlet Yonhap News.

Atomrigs Lab is a firm specializing in blockchain development for the financial sector, and has been developing blockchain-based digital asset protection technologies using next-generation cryptography.

The two firms will further cooperate on developing digital asset management services that harness both Atomrigs Lab’s technology and KB Kookmin Bank’s internal control infrastructure and data protection technologies, the report notes.

Another key area of cooperation will ostensibly be the creation of an ecosystem that would bridge the blockchain and financial sectors.

As Yonhap writes, KB Kookmin has determined its core technological focus using the acronym “ABCDE” — standing for artificial intelligence, blockchain, cloud, data and ecosystem. The bank has reportedly made the promotion of digital transformation a priority as of last year.

As Cointelegraph has previously reported, KB Kookmin Bank came under regulatory scrutiny last year from Korea’s Financial Supervisory Service (FSS). In its joint review of the bank and its fellow domestic institution Nonghyup Bank, the FSS criticized both banks’ management of cryptocurrency transactions in regard to anti-money laundering regulations.

Notably, the FSS’ subsequent order for improvement applied only to accounts that had been contracted with a real-name verification service, not crypto counterparty (exchange) accounts.

The bank had previously faced inspections from Korea’s Financial Services Commission as part of a series of strict compliance checks on domestic banks servicing crypto exchanges.

Digital Asset Security Startup Fireblocks Leaves Stealth Mode With $16 Million in Funding

Digital asset cybersecurity startup Fireblocks announced its launch out of stealth mode with $16 million in funding, according to a press release shared with Cointelegraph on June 11.

Per the release, Fireblocks obtained the capital during its Series A funding round from Cyberstarts, Tenaya Capital, EightRoads (Fidelity INTL), Swisscom Ventures and MState. The startup reportedly counts crypto merchant bank Galaxy Digital, over-the-counter digital trading platform Genesis Global Trading and others among its customers, with the company declaring:

“Currently, Fireblocks is integrated with 15 digital asset exchanges and offers support for over 180 cryptocurrencies, tokens, and stablecoins.”

The author of the release claims that over $3 billion in digital assets have been stolen by hackers in the past 18 months and cites the 7,000 bitcoins (BTC) stolen from major crypto exchange Binance (worth $40,705,000 at the time). Michael Shaulov, CEO and co-founder of Fireblocks, is quoted in the announcement as saying:

“While Blockchain based assets by themselves are cryptographically secure, moving digital assets is a nightmare. After interviewing over 100 institutional customers, including hedge funds, broker-dealers, exchanges, and banks, we concluded that the current process is slow and highly susceptible to cyber attacks and human errors.”

Lastly, Shaulov claims that his startup created a platform which “secures the process and simplifies the movement of funds into one or two steps.”

As Cointelegraph reported yesterday, cryptocurrency wallet provider Komodo effectively hacked itself to prevent fraudsters from accessing its users’ funds.

In May, Sean Coonce, engineering manager at cryptocurrency custodian BitGo, announced that he had fallen victim to a SIM swapping hack.

Philippines’ Central Bank Will Continue to Closely Monitor Crypto, Citing Terror Financing

The governor of the Philippines’ central bank, Benjamin Diokno, has warned against the potential use of cryptocurrencies for terrorism financing and underscored that the Bangko Sentral ng Pilipinas (BSP) will continue to closely monitor their use in the country. The news was reported by local English language newspaper The Philippine Star on June 10.

In addition to Diokno’s remarks, BSP Deputy Governor Diwa Guinigundo reportedly provided further insights into the institution’s stance toward cryptocurrencies during the launch of an unnamed book about bitcoin (BTC).

Diokno ostensibly criticized bitcoin’s potential to function as a unit of account, medium of exchange and store of value, claiming that the top cryptocurrency’s volatility inhibits its usefulness on all three points.

The governor reportedly recognized that blockchain and certain implementations of distributed ledger technologies can be useful for payments and settlements for peer-to-peer transactions, presenting this as a potential risk to the traditional banking sector:

“Game theory dictates possible dysfunction when there is market breakdown, when everyone may distrust one another. There cannot be a total disregard for a central bank or a third party that provides lender of last resort facility.”

Guinigundo said the central bank would approach fintech development using regulatory sandboxes in order to balance the prospective benefits of innovative financial technologies with robust consumer and investor protection.

The Philippine Star cites fresh data from BSP’s Technology Risk and Innovation Supervision Department, which has reportedly revealed that the value of cryptocurrency transactions almost doubled in 2018 — hitting $390.37 million as compared with $189.18 million in 2017.

The data breakdown indicated that conversion from fiat currencies into cryptocurrencies accounted for $208.27 million, crypto-fiat conversion for  $173.33 million, and crypto-enabled international incoming remittances for $8.77 million.

In February of this year, the Philippines introduced a new set of rules governing the issuance and acquisition of utility and security tokens.

BSP has required domestic crypto exchanges to register as remittance and transfer companies and implement specific safeguards — covering AML, CFT, risk management and consumer protection — since February 2017.

Earlier this month, BitMEX Ventures invested in a crypto exchange officially licensed by BSP, and in April, payment services firm Bitspark revealed plans to release a cryptocurrency pegged to the Philippines’ national fiat currency, the peso.

Liquid Cryptocurrency Exchange to Host Public Phase of Telegram ICO

Cryptocurrency exchange Liquid will be the first to host encrypted messaging app Telegram’s Gram tokens when they go on public sale, a press release confirmed on June 11.

Telegram, which has not provided an official statement on the move, became the focus of international attention last year when it held a private initial coin offering (ICO) for Gram, which raised $1.7 billion for its Telegram Open Network (TON) project.

At the time, it was thought no public phase would follow, but the largest Gram holder organization, Gram Asia, will now offer an undisclosed number before a full sale in October.

“We share the vision for a more secure and open value transfer system in order to enable the mainstream adoption of cryptocurrencies,” Liquid CEO, Mike Kayamori, commented in the press release. He added:

“The TON Blockchain infrastructure can help enhance Telegram’s current capabilities as a peer to peer network of value, with the launch of their cryptocurrency light wallets for Telegram’s highly engaged user base.”

The requirements for participation in the initial public sale are stringent. A raft of countries’ citizens are excluded for regulatory reasons, while grams will not in fact be tradeable, instead held in stablecoin USDC until October.

The move comes roughly two weeks after Telegram released a testnet version of the TON client, which itself follows an extensive development process and the Q3 launch date.

Report: Liquid Cryptocurrency Exchange to Host Public Phase of Telegram ICO

This article has been updated to include that Cointelegraph has reached out to Telegram for comment.

Cryptocurrency exchange Liquid will reportedly be the first to host encrypted messaging app Telegram’s Gram tokens when they go on public sale, a press release confirmed on June 11.

Telegram, which has not provided an official statement on the move, became the focus of international attention last year when it held a private initial coin offering (ICO) for Gram, which raised $1.7 billion for its Telegram Open Network (TON) project.

A message from an unofficial TON channel on Telegram wrote that Liquid could be attempting to catch on to the hype surrounding the as-of-yet unreleased token, and that investors should wait for official information from Telegram.

After Telegram’s ICO, it was thought no public phase would follow, but the largest Gram holder organization, Gram Asia, will now reportedly offer an undisclosed number before a full sale in October, according to the release.

“We share the vision for a more secure and open value transfer system in order to enable the mainstream adoption of cryptocurrencies,” Liquid CEO, Mike Kayamori, commented in the press release. He added:

“The TON Blockchain infrastructure can help enhance Telegram’s current capabilities as a peer to peer network of value, with the launch of their cryptocurrency light wallets for Telegram’s highly engaged user base.”

The requirements for participation in the initial public sale are stringent. A raft of countries’ citizens are excluded for regulatory reasons, while grams will not in fact be tradeable, instead held in stablecoin USDC until October.

The move comes roughly two weeks after Telegram released a testnet version of the TON client, which itself follows an extensive development process and the Q3 launch date.

Telegram has not responded to a request for comment by press time.

New Report Reviews Blockchain Applications by US Federal Government

The research organization Data Foundation and IT firm Booz Allen Hamilton have published a report with five proposed questions to guide the United States federal government on where and how to implement blockchain initiatives.

Their research was published in the report “Bringing Blockchain Into Government: A Path Forward for Creating Effective Federal Blockchain Initiatives” on June 10.

According to the report, blockchain solutions make the most sense when applied to some sort of procedure with a predetermined level of consistency and a low level of agility, assuming that the immutable ledger provided by blockchain is valuable for the task in the first place.

The report lists five questions they came up with for how a federal organization can decide whether a blockchain solution makes sense:

“1. Does the blockchain offer a real benefit for information security, trust, or transparency? … 2. Can blockchain be practically and efficiently applied? … 3. What blockchain design is most appropriate? … 4. Is the cost of applying blockchain merited relative to information gains? … 5. Does the application satisfy applicable data sharing and confidentiality laws?”

In coming up with these criteria, the organizations looked at seven instances of blockchain initiatives at the federal level that they deemed successful.

The report noted several blockchain-based initiatives across various agencies such as the Food and Drug Administration (FDA), the Department of Health and Human Services, the Department of Treasury and the Department of Defense, among others.

The report notes that the programs are in varying stages of success and development. The researchers conclude that, “Whether blockchain will ultimately prove a success in government is yet to be seen. But for now, applying blockchain for government programs and operations should be a welcome development when possible.”

As previously reported by Cointelegraph, the FDA launched a pilot program using blockchain tech as a supply chain tracker for pharmaceuticals in February. The Pilot Project Program Under the Drug Supply Chain Security Act is specifically focused on tracking drugs and preventing pharma counterfeiting.

Trend Micro: Cybercriminals Use Obfuscation Trick to Install Crypto Mining Malware

Cybersecurity firm Trend Micro has confirmed that attackers have been exploiting a vulnerability in the Oracle WebLogic server to install monero (XMR) mining malware, while using certificate files as an obfuscation trick. The news was revealed in a Trend Micro blog post published on June 10.

As previously reported, forms of stealth crypto mining are also referred to with the industry term cryptojacking — the practice of installing malware that uses a computer’s processing power to mine for cryptocurrencies without the owner’s consent or knowledge.

According to Trend Micro’s post, a security patch for theOracle WebLogic vulnerability (“CVE-2019-2725”) — reportedly caused by a deserialization error — was released in the national vulnerability database earlier this spring.

However, Trend Micro cites reports that emerged on the SANS ISC InfoSec forum alleging that the vulnerability has already been exploited for cryptojacking purposes, and confirms that it has verified and analyzed the allegations.

The firm notes that the identified attacks deployed what it describes as “an interesting twist” — namely that “the malware hides its malicious codes in certificate files as an obfuscation tactic”:

“The idea of using certificate files to hide malware is not a new one […] By using certificate files for obfuscation purposes, a piece of malware can possibly evade detection since the downloaded file is in a certificate file format which is seen as normal -— especially when establishing HTTPS connections.”

Trend Micro’s analysis begins by noting that the malware exploits CVE-2019-2725 to execute a PowerShell command, prompting the download of a certificate file from the command-and-control server.

After continuing to trace its steps and characteristics — including the installation of the XMR miner payload — Micro Trend notes an apparent anomaly in its current deployment:

“[O]ddly enough, upon execution of the PS command from the decoded certificate file, other malicious files are downloaded without being hidden via the certificate file format mentioned earlier. This might indicate that the obfuscation method is currently being tested for its effectiveness, with its expansion to other malware variants pegged at a later date.”

The post concludes with a recommendation to firms using WebLogic Server to update their software to the latest version with the security patch in order to mitigate the risk of cryptojacking.

As recently reported, Trend Micro detected a major uptick in XMR cryptojacking targeting China-based systems this spring, in a campaign mimicking earlier activities that had used an obfuscated PowerShell script to deliver XMR-mining malware.

US Retailer Target Unveils Open Source Blockchain for Supply Chain Tracking

United States-based retail giant Target is creating an open source blockchain project for supply chain tracking, according to an official blog post from the company’s VP of architecture on April 22.

According to the post, Target ran a pilot test using blockchain technology to certify its paper products along the supply chain in 2018. The blockchain used in the test period was reportedly made open source on GitHub recently as “ConsenSource” — at least as far back as two months ago, judging by the repository’s update history.

According to the GitHub documentation, ConsenSource is built on blockchain platform Hyperledger Sawtooth, one of the Hyperledger projects hosted by the Linux Foundation.

The post also mentions that Target will support the Hyperledger Grid, a project initiated in large part by Cargill, one of the company’s main food suppliers. Before bringing the project to the Linux foundation with Intel, Cargill reportedly took the initiative in making a “supply chain middleware” to record transactions and other data.

The post’s author Joel Crabb comments on the company’s enthusiasm for keeping blockchain projects for supply chains open source, saying:

“… the largest obstacle to implementing a distributed ledger is getting multiple companies to agree on which data are stored in the blockchain and how the system will be operated and governed. To achieve this close interaction among corporate entities, many companies — including Target — see the most potential for enterprise blockchain initiatives as open source.”

As previously reported by Cointelegraph, Cargill announced its investment in Hyperledger Grid on January 25. The goal of Hyperledger Grid is reportedly to streamline supply chain infrastructure with blockchain technology, addressing a number of issues for food retail such as traceability, food safety and trade settlement.

Crypto Advocacy Center Says Proposed UK AML Regulations Violate Privacy Rights

Coin Center — a nonprofit research and advocacy center focused on crypto-related public policy issues — has urged Her Majesty’s Treasury not to over-broaden the scope of the United Kingdom’s anti-money laundering/counter terrorism financing (AML/CFT) regulations.

The development was revealed in an official Coin Center news release published on June 10.

Coin Center’s central concern regards HM Treasury’s plans to ostensibly “impose data collection and reporting requirements on not only cryptocurrency developers, but all open-source software developers and others who facilitate the peer-to-peer exchange of cryptoassets,” as the news release states.

The advocacy center outlined its position in detail in a comment letter, submitted to HM Treasury on June 7, which addresses the government’s planned transposition of the European Union (EU)’s Fifth AML Directive (AMLD5) into national law.

In its comment letter, Coin Center argues that HM Treasury is expanding the basic framework of AMLD5 with its own additional provisions that go beyond the minimum that would be required to harmonize the U.K’s financial surveillance policy with the EU’s directive.

The center strongly urges that the U.K. instead seek parity with the approach of the United States. Coin Center cited the recent interpretive guidance released by the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) in regard to the Bank Secrecy Act (BSA) and crypto assets as a benchmark for HM Treasury.

FinCEN’s interpretation, as Coin Center notes, only brings persons who have “independent control” over another person’s crypto assets under the purview of the BSA, excluding those that merely enable exchange or transmission — for example, open source software developers, multiple-signature service providers, and decentralized exchange facilitators.

Those that develop such crypto-related network technologies do so from a political conviction in the increasing importance of privacy protection, Coin Center argues, suggesting that they:

“…believe that such tools are necessary to protect human dignity and autonomy, and argue that they are of profound political and societal importance in a world where transactions are increasingly surveilled and controlled by a handful of private financial intermediaries and powerful governments.”

Expanding AML surveillance obligations to crypto or decentralized exchange software developers or users would, Coin Center goes on to claim, “violate U.K. citizens’ free speech and privacy rights, as codified in the International Covenant on Civil and Political Rights and in the European Convention on Human Rights.”

As previously reported, the Cyprus Securities and Exchange Commission has similarly proposed bringing several additional areas of crypto-related activity under AML/CFT obligations, which are notably not included in the provisions of AMLD5.

Coinbase Earn Now Supports Ethereum-Based Dai Stablecoin

Major crypto platform Coinbase has added a course on MakerDao’s stablecoin dai in its educational portal Coinbase Earn, according to an official blog post by Coinbase on June 10.

According to the post, dai is the first stablecoin covered by Coinbase Earn, which will offer videos and quizzes to help users learn about the token, and receive some Dai for their efforts.

As summarized in the announcement, the Ethereum-based stablecoin Dai is backed by its sister token maker (MKR) and is balanced around retaining a stable value of $1 over time.

Coinbase first announced that they were adding dai to their exchange on May 23. At the time, Coinbase commented that it would be available in most jurisdictions with the exception of New York.

As previously reported by Cointelegraph, dai has been worth less than a dollar — lower than its stated goal — for much of 2019, which has sparked at least five voting sessions centered on rebalancing the coin’s value via increasing its stability fee.

Coinbase also comments that it anticipates earning in general to grow into a relevant crypto-based activity, ranking alongside the known areas of buying, staking, voting, and mining.

Coinbase Earn launched on May 18, following its announcement near the end of 2018. It purports to be a solution for potential investors who are interested in crypto, particularly ones less prominent than bitcoin (BTC), but are reluctant to invest without more information:

“…one of the biggest barriers preventing people from exploring a new digital asset was a lack of knowledge about that asset. Many of the people we surveyed expressed a strong desire to begin learning about new and different crypto assets beyond Bitcoin, but didn’t know where to begin.”