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US Lawmakers to Visit Switzerland to Discuss Crypto, Facebook’s Libra

A delegation of the United States House of Representatives will visit Switzerland on cryptocurrency concerns, with Facebook’s not-yet-released stablecoin Libra being in the focus.

As local weekly news outlet NZZ am Sonntag reported on Aug. 17, a six-member delegation from the House Financial Services Committee is going to meet with Swiss Federal Data Protection and Information Commissioner (FDPIC) Adrian Lobsiger to exchange views about digital currencies.

A spokesperson told NZZ am Sonntag that Libra will be the focal point of the dialogue between the regulator and U.S. lawmakers. The delegation is led by the chairwoman of the House Financial Services Committee, Maxine Waters, who previously requested that Facebook halt Libra’s development until the purported risks it poses could be properly understood.

Swiss regulation

The visit from U.S. legislators aims to clarify regulatory issues surrounding Libra. In hearings before the House Financial Services Committee in July, some representatives expressed their discomfort with the coin being regulated from Switzerland. 

In the hearings, Facebook’s David Marcus assured Representative Bill Huizenga that Facebook had been in touch with the Swiss Financial Market Supervisory Authority.

The head of communications at the FDPIC, Hugo Wyler, subsequently said that Facebook had not contacted the regulator regarding the registration of its cryptocurrency project. The FDPIC then sent a letter to the Libra Association — the stablecoin’s proposed governing body — asking for details about Libra:

“The FDPIC stated in his letter that as he had not received any indication on what personal data may be processed, the Libra Association should inform him of the current status of the project so that he could assess the extent to which his advisory competences and supervisory powers would apply.”

During a hearing before U.S. House of Representatives in mid-July, Marcus fielded questions as to why the company had chosen to register its Libra Association in Switzerland rather than the U.S. “The choice of Switzerland,” Marcus claimed, had “nothing to do with evading regulations or oversight.” Marcus argued that the jurisdiction is an international place conducive to doing business.

Chainzilla and Pundi X to Enable Retail Bitcoin Payments in Panama

Cryptocurrency startup Pundi X announced that its point-of-sale payment gateway (XPOS) will soon be launched in Panama and its surrounding regions. Blockchain development company Chainzilla joined the initiative as a local distributor.

Combining cryptocurrency and traditional payments in one terminal

On Aug. 14, Cointelegraph in Spanish spoke with Chainzilla CEO, Charles Gonzales, to find out more details. According to Gonzales: 

“Recently, Pundi X integrated its module into the Verifone X990. This is an important development because this payment processor is compatible with both cryptocurrency and traditional payments. […] That means that a seller can process crypto payments alongside other Visa and Mastercard payments, it’s all in one device.”

As well as acting as the distributor of the XPOS terminals in Panama, Chainzilla will launch tools for merchants to immediately convert their Bitcoin (BTC) and other cryptocurrency payments into the local currency or stablecoins.

Opportunities through education

The first of the new payment processors will arrive in Panama in two weeks and will be demonstrated by Chainzilla at Revolve Summit for entrepreneurs. Chainzilla will also offer the first blockchain course in the country with the help of Panama’s Chamber of Digital Commerce and Blockchain, along with education startup The Blockchain Space, in October 2019.

When asked about the fintech scene in Panama, Gonzales replied: 

“The fintech sector is fragmented in Latin America. Each country acts as an island that has its own regulations, which are often different from those of its neighboring countries. This creates difficulties in developing international services. These challenges are difficult and they will take time to resolve but it all starts with education. That’s why we’re focusing on educating the people, companies, and government entities we interact with.”

As Cointelegraph reported, it was only last month that Pundi X integrated its crypto payment module into the Verifone device.

QuadrigaCX Users Request Details on How EY Lost 103 Bitcoins

Users of now-defunct Canadian cryptocurrency exchange QuadrigaCX are requesting further information concerning the recent loss of 103 Bitcoins (BTC) during the funds’ recovery.

An unfortunate loss

As Cointelegraph reported in February, one of the Big Four accounting firms — EY (formerly branded as Ernst & Young) — was appointed by QuadrigaCX as an independent third party to monitor the proceedings in a creditor protection case.

Ey announced at the time that “Quadriga inadvertently transferred 103 Bitcoins valued at approximately $468,675 to Quadriga cold wallets, which the Company is currently unable to access.” Currently, the coins would be worth $1 million.

Industry news outlet Coindesk reported on Aug. 16 that — six months after the accident — the auditor has not yet given any insightful information concerning how the loss occurred. 

According to the article, all the information disclosed came from the report released by EY in February, in which the company declares that the loss was caused by a platform setting error. QuadrigaCX creditor Ali Mousavi told the outlet:

“This sounds like gross negligence to us and many of us want to hold EY accountable for what happened. […] Instead of giving us the details, they [struck] a deal with [law firm Miller Thomson] to keep the details confidential and [are] making it harder for us to hold EY accountable.”

Creditors want a different legal firm

Creditor Xitong Zou also said that “EY does not seem like they want to explain what happened when that’s the very least they could do” since “it was our money, after all.” He also claims:

“A lot of people want [Miller Thomson] replaced. […] Although I don’t think that’s going to happen.”

EY has reportedly recovered about $25 million, with a judge awarding $1.6 million in fees and costs to all the firms involved in the case. The auditor also aims to raise another $9 million by selling assets of the exchange’s CEO.

As Cointelegraph reported in a dedicated follow-up piece, the crypto community has recently been actively discussing the fate of QuadrigaCX’s 30-year-old founder, Gerald Cotten, who reportedly died in India from a fatal disease in December 2018.

Recently, Cointelegraph also recounted the biggest alleged crypto heists.

Mike Tyson: ‘I Am Not Involved With Fight to Fame or Their Countdown Website’

Disclaimer: This story is a follow-up to a piece published by Cointelegraph Aug. 13, which appears to be based on flawed sources and which should consequently be considered incorrect.

American legendary professional boxer Mike Tyson has denied news putting forward his support for a blockchain-based platform for fighters dubbed Fight to Fame, which is allegedly a fraudulent scheme.

In a tweet published on Aug. 14, Tyson said:

“I am not involved with Fight to Fame or their countdown website, nor will I be involved with anything related to Fight to Fame now or in the future. Any media reporting my current involvement isn’t accurate.”

Earlier in August, Cointelegraph and VentureBeat reported that Tyson will serve as the founder and chairman of the sports and competition committee for allegedly blockchain-based sports project Fight to Fame. The project also allegedly considered issuing a so-called Tyson Token and a token sale in early June.

This spring, crypto research and analysis firm Cointelligence released the results of its research into the project and its founder and CEO Shi Jianxiang, calling Fight to Fame “a total fraud.” 

Cointelligence revealed that Shi is wanted by Interpol and the Chinese regulatory authorities “on charges of fraud and illegal fundraising that caused losses to investors of more than 10 billion yuan [about $1.5 billion]”

On Aug. 16 Tyson’s wife and manager Lakiha Tyson told technology-focused media outlet Modern Consensus that Tyson and her had negotiated working with the project several years ago, however later they made “very clear [they] … are not involved with Fight to Fame.”

This is where it all starts

Lakiha Tyson also revealed that the current mishap is due to an “incautiously signed but very preliminary agreement” with Fight to Fame’s founder Shi Jianxiang, who initially offered Mike Tyson casting in a Hong Kong martial arts film. 

In 2018, Shi provided the Tysons with a term sheet briefly outlining a deal between Tyson and the U.S.-China Motion Picture Association (UCMPA) and its strategic partner, MG Pictures, the companies under Shi’s management. The term sheet specified that Tyson would serve as the chair of Fight to Fame and receive a share in the project.

Lakiha Tyson approved the agreement, having amended the clause specifying that as a “partner and co-founder Tyson will cooperate fully with UCMPA,” and hand-wrote “as per agreed in writing at a later date.” She said:

“We had no idea that this was a way to launch this Tyson Token. We didn’t agree to this. I was fuming at this point.”

Bakkt Announces Sept. 23 Launch of Futures and Custody Platform in US

Bakkt has announced the coming launch of its much-anticipated platform for daily and monthly futures in the United States in a blog post on Aug. 16. Having received approval from the necessary regulators, the launch is scheduled for Sept. 23.  

Bakkt’s physically delivered futures have been the subject of a great deal of anticipation, with the company initially announcing its launch August 2018 before being subject to repeated delays over compliance issues. Satisfying the Commodity Futures Trading Commission (CFTC) has proven particularly challenging. The company began testing in earnest on July 22, as Cointelegraph reported at the time. 

Per the announcement, Bakkt has hosted numerous events in New York and Chicago — cities critical to the U.S. futures market. They have also sat down with regulators from the CFTC as well as the Securities and Exchange Commission (SEC). 

Bakkt will be partnering with Intercontinental Exchange Futures U.S. and Intercontinental Exchange Clear U.S. to provide its futures contracts.

Institutional services and custody have been a growing market in crypto, with major U.S. exchange Coinbase announcing the addition of Xapo’s Institutions into its custodial operation last night. After the announcement, Coinbase CEO Brian Armstrong commented on the major rise in institutional clients for crypto services, saying: 

“Whether institutions were going to adopt crypto or not was an open question about 12 months ago. I think it’s safe to say we now know the answer. We’re seeing $200-400M a week in new crypto deposits come in from institutional customers.”

Researchers: Bitcoin Price Drop Not Caused by $3B Ponzi BTC Dump

Bitcoin’s (BTC) recent price drop has not been caused by Bitcoin sell-offs from a $3 billion Chinese Ponzi scheme PlusToken, according to researchers at crypto analytics firm TokenAnalyst. 

Crypto analytics firm: PlusToken cannot be the cause 

As Bloomberg reports on Aug. 15, co-founder of London-based cryptocurrency analytics firm TokenAnalyst, Sid Shekhar, said that a Bitcoin dump by the PlusToken operators cannot be the cause of the recent price drop. 

Notably, the firm did not find any evidence that PlusToken moved any significant amounts of Bitcoin to any known exchange addresses. Shekhar said:

“It doesn’t look like any of these addresses are exchange owned. […] So that was enlightening. We’ll keep an eye on this to see if they do move the 100s of millions into exchanges at some point.”

Disputed claims

The findings dispute recent claims by founding partner of blockchain-based investment company Primitive Ventures, Dovey Wan, who suspects PlusToken has been selling great quantities of Bitcoin. 

However, TokenAnalyst analyzed PlusToken’s transactions on the Bitcoin blockchain and found that thousands of Bitcoins were sent to online mixing services to obfuscate the origins of the coins.

Much of the scammers’ money filtered into mixing-type services about a month ago, Shekhar added.

As Cointelegraph reported in July, Vanuatu, a Pacific Island country, has extradited six Chinese citizens arrested in the course of an ongoing investigation of the PlusToken to the mainland.

Coinbase Custody Buys Xapo Institutions, Continuing Rapid Expansion

Coinbase Custody has reportedly acquired Xapo’s institutional business to become the world’s largest crypto custodian by assets under custody.

Major crypto exchange Coinbase announced the news in a post on the company’s blog Aug. 15. The news follows rapid growth on the part of Coinbase’s year-old custodial wing, which only two months ago reported assets under custody (AUC) valued at $1.3 billion. 

According to the announcement, the new acquisition puts Coinbase Custody’s AUC at $7 billion.

Xapo is itself a major crypto wallet provider who has apparently been in negotiations with Coinbase Custody over the sale of its institutions business since the middle of May this year.

The announcement claims that Coinbase Custody now stores on behalf of more than 120 clients in 14 different countries. In affirming the company’s commitment to its institutional services, Coinbase wrote: “Our institutional range of products provides a seamless, powerful and compliant ecosystem for our clients to trade, store and interact with their crypto.” 

Earlier this month, Cointelegraph reported that Coinbase Custody had added experts in New York banking regulation to its Board of Directors, suggesting plans to expand in the notoriously tough regulatory environment of New York State.

In July, Coinbase CEO Brian Armstrong said in an AMA session that he hoped to see Coinbase shift its focus from trading to broader adoption within the economy in the next five years.

As of press time, Coinbase had not responded to Cointelegraph’s request for comment.

$3B Ponzi Scheme Is Now Allegedly Dumping Bitcoin by the Hundreds

Amid a downturn in the cryptocurrency markets, the apparent swathe of Bitcoin sell-offs from a $3 billion Chinese Ponzi scheme could be to blame.

On Aug. 14, Dovey Wan — founding partner of blockchain-based investment company Primitive Ventures — called attention to the ongoing mass sell-offs from the fraudulent Chinese investment scheme, dubbed PlusToken.

10 million investors scammed of $3 billion 

As Wan outlines, PlusToken was created in mid-2018 and promised high yield investment returns at different rebate percentages to its four tiers of member — a classic Ponzi scheme structure. By early 2019, the project claimed to have over 10 million members. 

Wan has attached data on all the wallet addresses — including Bitcoin (BTC), Ether (ETH) and EOS — known to be associated with PlusToken and urgently called on exchanges and over-the-counter platforms to blacklist them.  

She notes that Chinese police hunted down a core team member of the scheme two months ago and have revealed that investors were scammed of a whopping $3 billion.

Alongside the addresses, Wan has attached investigative data from security audit firm Peckshield that reveals the money flow from PlusToken’s wallet as of early July, the date the sell-offs are thought to have begun:

Graph showing PlusToken’s money flow in early July

Graph showing PlusToken’s money flow in early July. Source: Peckshield via @DoveyWan

Incessant sell-offs

Despite the arrest, the cryptocurrency cannot reportedly be rolled back, as Wan explains:

“Many of their BTC addresses are started with P2SH which commonly used for mutil-sig, most likely some ppl who hold the keys are not being caught hence police can’t unlock the wallet. For EOS/ETH wallet can be diff case but so far police was not able to touch any of those.”

In an attempt to curb the impact of the sell-offs, she has recommended that Peckshield and blockchain analytics firm Chainalysis analyze the flows more closely, noting that PlusToken appears to be moving their funds in small batches of 50-100 BTC into exchanges. 

Chinese traders have reportedly claimed that an unknown address has in recent days been dumping 100 BTC incessantly on crypto exchange Binance, which Wan suspects to be connected to the scheme. 

As just reported, the PlusToken scheme was identified as being the largest single incident of loss in a recent summary of 2019 crypto-related theft from blockchain security firm CipherTrace, having purportedly defrauded investors of $2.9 billion.

Bitcoin Drops to $10,000 in Recent Downtrend

Despite exceeding $12,000 several times this month, Bitcoin (BTC) has slumped back to $10,000 in a recent downtrend. The number one cryptocurrency last traded below $10,000 on July 31.

A little earlier this month, experts were optimistic about Bitcoin continuing its rally, citing geopolitical tensions — particularly the ongoing United States-China trade war — as a reason for its possibly continuing success. Galaxy Digital CEO Mike Novogratz commented on Aug. 5 about this possibility, saying:

“With the yuan over 7.0, an FX war, instability in HKG and the beginnings of capital flight, $Btc rally could have real legs.”

Co-founder of market research firm DataTrek Research Nicholas Colas recently said that investors in Hong Kong and Argentina have used the original crypto as a safe haven asset. Forbes contributor and former executive director at Deutsche Bank Peter Tchir recently wrote in an article that Bitcoin is a leading indicator of hidden geopolitical tensions.

Crypto investors are reportedly now divided into three main camps regarding Bitcoin price predictions. The most bearish of the three say that Bitcoin is set to pull back to $8,500–$7,500 while the moderates say it will consolidate between $9,000 and $12,000 prior to its rewards halving in 2020.

The bulls remain unphased by recent price trends and remain confident that Bitcoin will retake its yearly high and continue upwards. Correlatory data with Tether (USDT) suggests that it will reach $20,000 in about a month.

At press time, Bitcoin is trading at $10,048, down 5.81% on the day and almost 16% on the week according to data from Coin360.

ING Poll: Austrians Are Most Skeptical of Bitcoin and Cryptocurrency

An online survey by banking giant ING finds that Austrians are the most skeptical of Bitcoin (BTC) and cryptocurrencies in general. The poll, including respondents from 15 countries, shows that Bitcoin-positivity is also weakening in other countries, according to Der Standard, Aug. 14.

The worst and getting worse

Austrians are generally conservative on investments, but on cryptocurrency they are very skeptical, with only 13% seeing digital currencies in a positive light.

Attitudes towards cryptocurrency worsened since last year’s survey. This year 17% of Austrians think that cryptocurrency is the future of digital payments, compared to 20% last year. And now only 14% believe it is a significant form of investment in contrast to 17% last year.

Just 5% of Austrians would consider having their salaries paid in Bitcoin.

According to the survey, Austrians know more than most nations about cryptocurrencies, but prefer to avoid risk and volatility as much as possible.

Bucking the trend

Of the 13 European nations (plus Australia and the United States) who were questioned, the majority saw a downturn in crypto-positivity compared to last year. The exceptions were Turkey, Poland and Romania.

Poland and Romania saw 43% and 44% of respondents with a positive opinion of cryptocurrencies. While in Turkey, 62% were crypto positive and 36% would be happy to be paid in Bitcoin.

Austrians do however see the value in blockchain as a technology. Energy trading firm, Graz, is planning to use a DLT-based platform in the move towards zero-carbon energy distribution.

Barclays May Be Ending Work With Coinbase, Transactions in GBP to Slow

British banking giant Barclays has reportedly cut ties with United States crypto exchange Coinbase.

As Coindesk reported on August 13, unnamed industry sources have said that Barclays will no longer be banking for Coinbase, severing a relationship that began when Coinbase opened a Barclays account in March 2018.

The news is expected to hit the crypto community hard, as, in addition to linking a major crypto exchange with a heavy hitter among the traditional banking establishment, the break may end Coindesk users’ access to the United Kingdom’s Faster Payments Scheme (FPS) and slow the exchange of cryptocurrencies for British pounds sterling dramatically.

The precise reason for the split is unknown, but one anonymous source speculated to Coindesk that: 

“It is my understanding that Barclays’ risk appetite has contracted a little — I’m not sure exactly why or what’s been driving that, maybe there has been some activity they are not happy with. But it’s about Barclays’ comfort level with crypto as a whole.”

Reportedly, Coinbase will continue its access to UK banking through Clearbank, a younger and less established operation.

This is not the first time that Barclays has taken a step back from increasing involvement in the crypto sphere. In August of 2018, the bank began official denials that it was opening a crypto trading desk in light of two employees removing information about work on digital assets from their respective LinkedIn profiles. 

Coinbase, for its part, does not seem to have suffered greatly in recent months. This July, it came out that the exchange had registered eight million new users in the preceding year.

Also in July, Cointelegraph reported that Coinbase’s CEO Brian Armstrong was looking to take the exchange beyond trading, expressing plans to expand Coinbase into wider promotion of crypto adoption.

Bitcoin Going to $100K After ‘Steady Accumulation,’ Says Crypto Trader

Former Goldman Sachs analyst turned Bitcoin (BTC)  maximalist Murad Mahmudov believes the top cryptocurrency will hit $100,000.

“Zoom out & think big”

In a tweet posted on Aug. 13, Mahmudov — who serves as chief information officer (CIO) at cryptocurrency hedge fund Adaptive Capital — wrote:

“At first glance this looks like a weak chop for the next week or so, but my intuition tells me there is steady accumulation happening at these levels. Don’t try to outsmart yourself on short timeframes, zoom out & think big. In my view, BTC is going to $100K per orangecoin.”

BTC-USD technical analysis

BTC-USD technical analysis. Source: @MustStopMurad

Mahmudov analyzed the coin’s key support levels, observing that “200MA [moving-average] /EMA [exponential moving average]/RSIbands [relative strength indicator]+Weekly support all point to 10.8 [$ thousands) but you may get a wick at most given the orderbook support across exchanges.”

Isolating $10,800 as an emergent key support level on the BTC/USD daily chart as well, he said that — with the caveat that he is not purporting to give financial advice — “If I were a betting man, I would be patiently and slowly adding at every key support.” 

To the sky

Mahmudov’s eye-popping $100,000 forecast has been recently echoed by Morgan Creek Digital Assets founder Anthony Pompliano, who considers that the recent dovish turn by central banks will be rocket fuel for Bitcoin’s price and help drive it to $100,000 by the end of 2021. 

Pompliano also cited bitcoin’s halving — the reduction of mining rewards in half in May 2020 — as a major factor likely to propel the coin’s valuation upwards.

This July, Cointelegraph reported that United States-based regulated crypto derivatives and clearing platform LedgerX was giving retail investors the chance to bet on Bitcoin hitting $100,000 by 2020.

At press time, Bitcoin is trading in the $11,200-300 range, fractionally down on the day, according to Cointelegraph’s Bitcoin Price Index.