Community

Australian Home Affairs Minister Says Terrorists Use Crypto to Obfuscate Crimes

The Australian Minister of Home Affairs Peter Dutton warned that terrorists are exploiting cryptocurrencies to “fund their deadly missions.”

During a counter-terror conference in Melbourne on Nov. 7, Dutton said that the anonymity of cryptocurrencies allow extremists to avoid scrutiny. He stated that the increased use of digital currencies, stored-value cards, online payment systems and crowd-funding platforms may provide new channels through which terrorism can be financed, adding:

“The anonymity afforded by such technologies enables terrorist financiers to obfuscate their activities.”

Dutton, who leads the Department of Home Affairs, which is responsible for immigration, border control, domestic security and law enforcement, further said that nations across the globe need to stay ahead of modern financing measures and embrace expertise from outside governments.

The Minister also turned his scrutiny toward charities and not-for-profits, claiming they had become popular terror financing conduits and that often these organizations are not even aware that they are being manipulated for such use.

Dutton has recently been the target of criticism in his home country, after claiming that climate activists should pay for the cost of police response to protests, and opposing a bill that would streamline medevac laws. 

Crypto the next frontier in war on terrorism

In September, during the 19th Annual International Conference on Counter-Terrorism, United States Treasury Undersecretary Sigal Mandelker stated that cryptocurrencies could become “the next frontier” in the war on terrorism. She said:

“Terrorist organizations and their supporters and sympathizers are constantly looking for new ways to raise and transfer funds without detection or tracking by law enforcement.  While most terrorist groups still primarily rely on the traditional financial system and cash to transfer funds, without the appropriate strong safeguards cryptocurrencies could become the next frontier.”

Earlier in June, the governor of the Philippines’ central bank, Benjamin Diokno, made similar warnings 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. 

Since the beginning of 2017, BSP has required domestic crypto exchanges to register as remittance and transfer companies and implement specific safeguards — covering anti-money laundering, risk management and consumer protection.

China Signs Agreement With Hong Kong Central Bank for Blockchain Push

Blockchain has received fresh endorsement from China in the form of a development pact with the de facto central bank of Hong Kong

In a news post on Nov. 6, the Hong Kong Monetary Authority (HKMA) confirmed it had signed a Memorandum of Understanding (MoU) with a subsidiary of the People’s Bank of China (PBoC).

Central banks want “more convenient trade finance”

The deal aims to create a Proof-of-Concept for a trade finance platform from Q1 2020, linking two existing projects: the HKMA’s eTradeConnect and the PBoC’s Trade Finance Platform. 

The two central banks will be represented by subsidiaries of Hong Kong Interbank Clearing Limited and the Institute of Digital Currency of the PBoC.

“Once the connection has successfully been established, it will provide firms in both places with more convenient trade finance services and enable banks in Hong Kong to expedite the expansion of their trade finance business,” the post adds.

China blockchain funds approach $6 billion

The news follows sudden endorsement of blockchain technology from Beijing, with president Xi Jinping personally appealing for its use to expand across the domestic economy. 

As a direct response to the events, Chinese regional governments and other entities have pledged blockchain funds worth $5.7 billion to further support, local financial media outlet China Money Network reported on Wednesday. 

Among them is a 100 million yuan ($14.3 million) fund from 1911 Group, the publication wrote citing another outlet, PE Daily. 

“To lift Hong Kong’s fintech development to a new height, we must take a holistic ‘HK Inc.’ approach,” HKMA chief executive Eddie Yue commented as part of the MoU signing.

European Union Drafts Law Suggesting Consideration of Eurocoin

A draft document issued by the European Union suggests that the union should consider issuing its own digital currency.

Will the EU wage war on crypto?

Reuters reported on Nov. 5 that the draft in question — which is still subject to amendments — urges member states to develop a common approach to cryptocurrencies, possibly banning high-risk projects.

If the draft in its current form is approved, which could happen as early as next month, it could have far-reaching consequences. More precisely, Reuters suggests that such a law could escalate into an EU regulatory campaign against cryptocurrencies.

European Central Bank to consider Eurocoin

The draft prepared by the Finnish EU presidency also suggests that the European Central Bank should consider issuing its own digital currency:

“The ECB and other EU central banks could usefully explore the opportunities as well as challenges of issuing central bank digital currencies including by considering concrete steps to this effect.”

The draft will be discussed this Friday, and perspective on its adoption will be presented on Dec. 5.

As Cointelegraph reported in a dedicated analysis in late September, Europe’s digital currency is being increasingly seen as an answer to Facebook’s Libra stablecoin.

Manipulation? CME Bitcoin Futures Flash Crash to Fill $8.5K ‘Gap’

Bitcoin (BTC) trading is coming under the spotlight this week after another flash crash sparked concerns that traders are manipulating markets.

As various social media users noted, including statistician Willy Woo on Nov. 5, unusual occurrences on exchanges give reason to be critical of Bitcoin price movements. 

Woo: I’m “highly suspicious” of BTC/USD

As Cointelegraph reported, last week saw sudden erratic behavior at two exchanges — Deribit and Coinbase Pro — which appeared to influence BTC/USD.

On Tuesday, it was CME Group’s Bitcoin futures which continued the trend. In early trading, BTC/USD futures suddenly tanked to below $8,500 before rebounding to $9,300.

CME Bitcoin futures daily chart

CME Bitcoin futures daily chart. Source: TradingView

That lower level previously formed a gap in futures trading — when one session begins higher than where the last ended. Analysts note that Bitcoin often seeks to “fill” those gaps, but in this case, it did so with minimal resources.

“I cannot believe how crazy trading BTCUSD on the short term is right now. The gap on the CME has filled already. It’s thinly traded yes. But man, I’m highly suspicious of the price action across all the exchanges of late, more so than usual,” Woo summarized.

Cointelegraph contributor filbfilb reacted similarly, noting the unusual nature of the price filling at CME.

“Don’t know what happened there!” he told subscribers of his dedicated Telegram trading channel on Tuesday.

For Twitter analyst lowstrife meanwhile, the behavior was a “good example” of market manipulation.

“If you look at my original tweet, all the volume printed before the actual dump. But on the 1 minute chart it looks like it was part of the entire move. This is called painting the tape,” the account wrote.

BTC price red herring?

Bitcoin has seen two major run-ups in recent weeks, defying the previous sentiment that markets would remain lower in the months before the May 2020 block reward halving event. 

The moves seemed to take analysts by surprise, with BTC/USD recording its second-largest daily gains in history late last month. 

Longer-term, 2019 has been characterized by periods of price stability punctuated by sudden upward and downward movements occurring in a matter of minutes or hours.

Stellar Burns Over 55 Billion Tokens Worth $4.7 Billion USD

The Stellar Development Foundation (SDF) announced a new mandate today for its network’s development, stating that it has burned over 55 billion Stellar Lumens (XLM) tokens. 

According to a Medium post on Nov. 4, the development foundation drastically reduced the number of tokens in existence as part of an effort to become more efficient as it moves forward. 

Of the over 85 billion tokens that were earmarked for SDF operations, giveaway programs and partnership programs, the SDF burned over 55 billion. 

At a current price of $0.085 per token, the value of the burned tokens is nearly $4.7 billion. The coin has reacted positively to the news, seeing a price increase of nearly 25% on the day at press time.   

Adding the surviving tokens in the aforementioned programs to the XLM that are already out in the world, there are exactly 50 billion XLM in existence, according to the blog post. 

Breakdown of XLM burn and remaining token disbursement. Source: Stellar Development Foundation

SDF focuses on development in the ecosystem 

The SDF states that the burn was geared to making the system more efficient as it moves forward. It wrote:

“SDF can be leaner and do the work it was created to do using fewer lumens. Over the years we’ve also seen that giveaways and airdrops have diminishing effects, especially in the outsized amounts our original plan was designed to support. So a smaller public-facing program would have just as much impact.”

The development organization said that it will pour 12 billion of the remaining tokens ($1.02 billion) into “an aggressive program of direct development and advocacy for Stellar.” SDF said that it expects to double its current staff of nearly 60 by the end of the year. 

Two billion XLM ($170 million) will go into ecosystem support, while 1 billion XLM ($85 million) will go into Stellar’s infrastructure grant program. 

Additional sums of tokens will be distributed to use-case investment, currency support, new products, the Stellar Enterprise Fund and other applications. 

Stellar removes inflation feature

In September, Stellar announced that it intended to remove its inflation feature in an upcoming upgrade. The Stellar Development Foundation said that developers wanted to get rid of the tool, which they said is no longer useful for network participants.

BitMEX on User Info Leak: No Data Was Disclosed Beyond Emails

BitMEX, the biggest crypto exchange by trade volume to date, says that no other data except email addresses has been disclosed in a recent email leak.

“At no point were any of our core systems at risk”

After the first reports on the accident on Nov. 1, BitMEX released an official statement on the issue Nov. 4, emphasizing that no personal or account information has been disclosed beyond email addresses.

Apologizing for the concern caused by the leak, the exchange added that none of BitMEX’s core systems were at risk at any point.

BitMEX has not sent mass emails since 2017

In the post, written by the firm’s deputy COO Vivien Khoo, BitMEX confirmed that the recent email leak took place on Nov. 1 and was a result of a failure in the company’s internal bulk email service. 

BitMEX stressed that they only send mass emails to all users on a rare occasion and only when absolutely necessary, claiming that the exchange has not sent any bulk emails since 2017.

As such, BitMEX elaborated that the BitMEX Indices Update was important enough to be included in a mass email to customers. “It will impact pricing of all of our products — that we felt it necessary to inform all our users about it,” BitMEX explained.

The exchange further admitted that there was a desire to speed up the delivery of emails as BitMEX found out that the initial send request would have taken up to 10 hours to complete. Instead, the exchange preferred to ensure that customers received the same information “on a more reasonable timescale.”

After the exchange discovered the leak, BitMEX immediately stopped further emails from being sent and initiated a number of measures to mitigate the damage such as forced password resets for all users with balances and without two-factor authentication.

Twitter hack was unrelated, BitMEX says

In the post, BitMEX also mentioned hackers taking over the company’s Twitter right after the email leak issue on Nov. 1. The exchange said that the Twitter accident was unrelated to this action, stating that the account was back under BitMEX control within 6 minutes.

Following the news, lawyer and general counsel at decentralized finance startup Compound Finance Jake Chervinsky outlined that Know Your Client regulatory compliance often exposes the public to hacking, phishing and identity theft risks.

Bitcoin Price Will See $16,000 ‘Soon-Ish,’ Predicts Binance CEO CZ

Changpeng Zhao, the CEO of major cryptocurrency exchange Binance, says a price of $16,000 per Bitcoin will happen “soon-ish,” in a tweet sent on Nov. 1. Zhao explains that price predictions are easy, but getting the timing right is hard. 

He said:

“Lol, price predictions are easy. It’s just hard to be right about the timing. We will see $16k soon-ish. 1.4 billion people working on it as we speak.”

The message was an answer to the tweet of another user who pointed out that the prediction of an anonymous 4chan user predicting Bitcoin’s price would hit $16,000 by the end of October turned out to be wrong. The given prediction also stated that BTC will hit $29,000 in the first quarter of next year, $56,000 in Q3 2020 and $87,000 in Q4 2020.

At the same time, other predictions are actually less modest. John McAfee, for example, doubled down recently on his $1M Bitcoin by 2020 prediction, arguing that Bitcoin’s next price surge will be triggered by its scarcity. 

As Cointelegraph reported, the Bitcoin network mined its 18 millionth BTC last month, which means there are only 3 million BTC not yet in circulation.

Binance DEX is the DEX with the most volume

Meanwhile, yesterday Zhao claimed that the Binance’s blockchain decentralized exchange (DEX) Binance Chain has the most volume among DEX platforms. He said:

“Already the largest DEX in the world by volume.  Will take some time for adoption.”

The latest data released by Binance a few weeks ago reveals that Binance Chain, the blockchain powering the DEX platform in question, at the time reached more than 26 million transactions submitted by about 290 thousand addresses.

As Cointelegraph reported yesterday, competing non-custodial DEX Dolomite announced that on Nov. 8 it will add a margin trading with stop-loss orders.

Craig Wright Says He Has No Funds for Settlement in Kleiman Case

The latest court documents in the David Kleinman versus Craig Wright case filed on Nov. 1 reveal that Wright — the self-proclaimed Bitcoin (BTC) creator Satoshi Nakamoto — informed the plaintiff that he could not finance a 500,000 BTC ($4.5 billion) settlement.

Given that the case was apparently reaching a resolution with the agreement, the plaintiff stopped active litigation and focused on settlement, joining Wright’s requests to extend the deadline into late October. Then Wright allegedly broke the settlement agreement:

“On October 30, without any advance notice, Plaintiffs were informed Craig could no longer finance the settlement and was ‘breaking’ the non-binding settlement agreement.”

The given document is the plaintiff’s expedited motion to depose out of state witness. The deposition explains that in September the plaintiffs discussed a settlement with Wright, noting that his claims implied he had the means to cover the costs.

A crucial deposition

Therefore, because Wright broke the settlement agreement, the plaintiffs resumed preparing for a trial. 

As part of the process, they contacted the chief financial officer of Wright’s companies in 2013 and 2012, James Wilson, “during which Dave was alive and Craig alleges he sold Dave interest in his companies in exchange for a fortune of Bitcoin.”

On Oct. 31, Wilson told the council that he will be in the United States, in Washington D.C., and available for testimony on Nov. 8. The defense counsel, on the other hand, informed that they were not intentioned to consent to the deposition at the aforementioned date. The plaintiff of the document explains:

“Under the Local Rules of this District, parties must have 7-days notice for a deposition in Florida, but 14-days notice for an out of state deposition.”

For this reason, the plaintiff requested that the defendant and Wilson are given permission to attend the meeting via video conference and that the deposition is completed in under 14 days — earlier than required by local rules depending on court approval.

Therefore, the Plaintiffs “respectfully request that the Court allow them to depose Mr. Wilson on November 8, 2019 in Washington D.C. on condition they provide Defense counsel with the ability to attend the deposition via video link,” the document reads. 

As Cointelegraph reported in mid-October, Wright has asserted that Satoshi Nakamoto, the author of the Bitcoin white paper, plagiarized him.

Former US Congressman Ron Paul Receives His First Bitcoin

Former Texas Republican congressman and presidential candidate Ron Paul received his reportedly first Bitcoin (BTC) from Bitcoin Foundation board member and Bitcoin wallet startup Ballet Crypto founder, Bobby Lee, on Oct. 28.

Ron Paul now owns a gold plated Bitcoin wallet

Lee publicly announced the gift he had given to Paul on Nov. 2, noting that the coin has been loaded into a gold-plated Bitcoin wallet produced by his company Ballet Crypto. He added that extra care has been given to customizing the wallet to better suit the former congressman:

“It was a special serial number AA000820 to match his birthday! And he loves the #Gold color.”

The wallets produced by Lee’s company are non-electronic physical wallets meant for cold storage of cryptocurrency. Their format is similar to that of a credit card, and they feature the passphrase of the wallet under a scratchable layer.

Freedom of money

Paul received the gift at a lunch that took place at the Litecoin (LTC) summit 2019, also in the presence of Litecoin founder Charlie Lee, who said that all three of them share some ideals:

“We are all #libertarian — personal liberty and #freedomofmoney.”

Paul — an outspoken critic of the Federal Reserve — is known for his advocacy of gold. With regards to Bitcoin, Paul noted in July that he’s in favor of cryptocurrencies and blockchain technology because he supports competing currencies.

Paul’s stance is also in stark contrast with the ideas of U.S. congressman Brad Sherman, who believes that cryptocurrencies — potentially competing with the national currency, i.e. the dollar — should be banned. In late October, he said:

“Cryptocurrency either doesn’t work, in which case investors lose a lot of money, or it does achieve its objectives perhaps and displaces the U.S. dollar or interferes with the U.S. dollar being virtually the sole reserve currency in the world.”

On the other hand, not all U.S. representatives share Sherman’s dollar maximalist view. As Cointelegraph reported this week, two congressmen showed support on Bitcoin’s 11th birthday, noting that the technology has created “infinite possibilities for technological innovation and privacy protections.”

United States National Debt Hits 23 Trillion — Over $1M Per Bitcoin

The United States national debt is now over $23 trillion, according to website U.S Debt Clock.

It is also worth noting that the debt per United States citizen is $69,724 and that the debt to gross domestic product ratio is 106.65%.

The milestone has been pointed out on Nov. 1 by Bitcoin advocate Twitter personality Rhythm, who also said that every dollar of U.S. national debt is, in fact, a reason to buy Bitcoin (BTC). Another user presented another interesting take adding:

“That’s more than $1,000,000 debt per 1 Bitcoin.”

“All fiat money will die”

Host of the Keiser Report and cryptocurrency entrepreneur, Max Keiser, also says that central banks are contributing to Bitcoin’s success in a recent interview with tech news outlet Hackernoon published on Nov. 1. 

For instance, the impact of the U.S. Federal Reserve’s quantitative easing monetary policy on the price of Bitcoin:

“It bottomed when the Fed signaled ‘Infinite QE’ recently at around $3,300 BTC. Global Central Banking is about to go bust. […] All fiat money will die.”

As Cointelegraph recently reported, Bitcoin proponents rang the alarm bells, pointing out that since mid-September, the U.S. Fed has effectively created hundreds of billions in new money — more than Bitcoin’s entire market cap of $165B — in a just a matter of days.

Belgian Regulator Blacklists Another 9 Crypto Websites Suspected of Fraud

Belgium’s Financial Services and Markets Authority (FSMA) has made an additional update to its blacklist of cryptocurrency-related websites associated with fraud.

On Oct. 29, Belgium’s financial watchdog updated its list of cryptocurrency trading platforms for which it has detected indications of fraud, by adding nine new suspect sites, bringing the total of suspected crypto scams to 131.

The financial authority said that it continued to receive new complaints from consumers who made crypto investments on those trading platforms, adding that cryptocurrency fraud continues to find new victims in Belgium, despite prior warnings.

The FSMA has issued previous warnings to Belgian crypto investors to be wary of companies that claim to hold authorizations from supervisory authorities, adding:

“This is a very frequently used technique. However, these are often cases of identity theft. Feel free to ask the FSMA to confirm the information you have received.”

Many of the blacklisted crypto firms purportedly offer financial services without complying with Belgian financial legislation. However, most of these crypto firms mentioned in the list operate outside the jurisdiction of the FSMA, which makes it near impossible for the agency to legally charge them. 

Although the FSMA cannot charge the suspected websites of fraud, an alert could still minimize the risks for potential cryptocurrency investors.

The FSMA added that the blacklist is based solely on the findings of the authority and warns that it does not include all of the crypto companies that might be operating illegally in Belgium.

Raising awareness of risks associated with crypto investment

In June 2018, the Belgian financial authority FPS Economy (FPS) launched a website to raise awareness of the risks associated with cryptocurrency investments. Belgian investors reportedly lost about $2.5 million in crypto scams in 2017, which accounts for only 4% of overall crypto fraud cases, with the total losses estimated at $152 million.

Argentina’s Central Bank Bans Bitcoin Purchases With Credit Cards

After recently imposing limits on U.S. dollar purchases, the Central Bank of Argentina (BCA) announced Oct. 31, that citizens are prohibited from using credit cards to buy Bitcoin (BTC) or other cryptocurrencies. The news was initially reported by Cointelegraph Brazil on Nov. 1. 

All in the name of preserving forex reserves

The measures were published in a communication covering several industries in which credit card use was limited or prohibited. The section referring to cryptocurrency reads:

“Acquisition of Bitcoin and cryptocurrencies: It is prohibited to purchase BTC with this payment method. The only remaining alternative for this investment is to do so with funds transferred from a bank account.”

It is unclear whether the rules apply only to credit cards or if this includes debit and prepaid cards.

The BCA says that these measures are critical to preserving the country’s foreign exchange reserves.

Bitcoin just part of a wide-ranging crackdown

According to experts, the central bank intends to block the entry of dollars into the country, seeking to have stronger exchange control. 

This follows a move by the BCA earlier this week, which limited the amount of U.S. Dollars Argentinian citizens could buy each month. The maximum amount was reduced from $10,000 to just $200.

At the time this caused a spike in Bitcoin trading, which these latest measures would seem to partially address.