Top Crypto News – 13/02/2018

Better Late Than Never: Why It’s Time Regulators Put Crypto on Notice

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I’m late, I’m late!

For a very important date!

No time to say “Hello.”

Goodbye!

I’m late! I’m late! I’m late!

When the White Rabbit was late in “Alice in Wonderland,” he rapidly scampered off to meet his appointed duties. In the wild and rapidly-evolving Wonderland of cryptocurrency, government regulators are quickly ramping up their efforts in fulfillment of their appointed duties, though the current regulatory framework still limits them in that regard.

That’s the clear takeaway from last week’s Senate Banking Committee hearing on cryptocurrency, where the heads of the two main financial market regulators testified.

If they weren’t already, cryptocurrency exchanges and promoters of initial coin offerings (ICOs) are now on notice: people who invest with them are entitled to be treated like all other investors in the U.S.

Exchanges that want to proclaim they are legitimate and that they follow all U.S. laws need to act like it when something goes wrong. ICO promoters who want to sell a product and raise funds by crowdsourcing crypto need to disclose all information accurately, transparently, and deliver on the product they sold.

If they don’t, they need to face the consequences of their actions.

I agree wholeheartedly with Securities and Exchange Commission Chairman Jay Clayton’s public statements over the past few months criticizing ICOs and the people behind those fundraisers.

“I believe every ICO I’ve seen is a security,” he told the Senate committee. It is almost as if he read my CoinDesk 2017 Year In Review article “I Love Bitcoin. That’s Why I Sue Exchanges,” wherein I said there has yet to be an ICO that did not perform that was not a security.

Clayton went on to condemn the promoters, attorneys and other related professionals who flout federal securities laws by putting the form of their offerings over the substance of what they really are: investments, stating, “We should regulate [ICOs] like we regulate securities offerings. End of story.”

ICO companies and their legal counsel should be scrambling over their past tone-deaf responses to investors. These entities need to take responsibility and not blame the people who sent them money. Legal loopholes are not designed to punish innocent people who were deceived.

Listening to the hearing testimony, it is also clear that squarely within the regulators’ crosshairs – and an area in which enforcement actions are on the near horizon – are cryptocurrency exchanges.

“When you have an unregulated exchange, the ability to manipulate the prices goes up significantly,” Clayton told the lawmakers.

Those comments were echoed by his counterpart at the Commodity Futures Trading Commission Christopher Giancarlo, who told the committee:

“Any proposed federal regulation of virtual currency platforms should be carefully tailored to the risks posed by relevant trading activity and enhancing efforts to prosecute fraud and manipulation.”

Market manipulation

Because each exchange makes its own independent and unregulated market for the cryptocurrency traded on its platform, the threat of market manipulation constantly hovers over its activities. Account holders at the exchange have no protections against the exchange suddenly slashing a cryptocurrency’s value without notice.

Even today certain exchanges admit their systems don’t work, but claim that doesn’t matter. While lawyers for these exchanges claim it’s within the legal rights of these exchanges to do so, those lawyers should know that legally and ethically they’re wrong.

Just as certain law firms believed in 2015 and 2016 that there was such a thing as a pre-functional utility token, almost all lawyers and regulators believe that not to be true today. What’s changed? My firm and others started filing lawsuits.

Similarly, most crypto investors are familiar with “flash crashes” and oversized liquidations that have caused crypto values to plummet on individual exchanges while those same cryptocurrency values remained unaffected on other exchanges at the same time.

In instances such as those, exchanges have disavowed responsibility for any possible market manipulation and simply shrugged off the incidents as “part of the game” while account-holders suffered devastating losses with little to no recourse.

The exchanges would like that to be the end of the story. However, an exchange that permits trading – especially leveraged transactions – has real responsibilities to its account holders and should be held accountable when it allows or causes massive amounts of value disappear in an instant on the exchange while no such impact is felt elsewhere.

The SEC and CFTC are clearly moving in that direction, though it is entirely unclear when they might reach their destination.

The overseers are rapidly making their way to fulfill their appointed duties in the cryptocurrency Wonderland, even if – like the White Rabbit – they arrive a little bit late. Better late than never, I say.

Clocks via Shutterstock

 

KYC Requirements Are Making ICOs Riskier, Not Safer

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KYC Requirements Are an Accident Waiting to Happen

It’s Easier to Open a Bank Account Than It Is to Participate in an ICOLast year, the U.S. Securities and Exchange Commission went after a number of ICOs for failing to perform due diligence to ensure their investors didn’t hail from the U.S. Spurred partially by a desire to avoid censure or shutdown from the SEC, ICOs have taken things to the opposite extreme, using Know Your Customer procedures to weed out investors from the U.S., China, and a handful of other countries. To date, all of 2018’s major crowdsales have required some sort of KYC in order to gain admittance to their whitelist, with many outsourcing the task to third parties that specialize in such matters.

To merely be considered for a token sale, it is now commonplace for an individual to have to submit a passport scan, bank statement, and various other documents and to answer a string of questions about their background and the origin of their cryptocurrency. Legolas, for example, requested that investors “Provide as much detail as possible about the origin of the BTC”. Being whitelisted for a token sale is no guarantee of participation either. Oversubscribed ICOs such as Arcblock returned ether to hundreds of participants who had failed to contribute in time or who were deemed to have “cheated” by using over the prescribed gas limit. Twitter traders now encourage investors to submit KYC to as many promising ICOs as possible, just in case they later decide to participate.

A Data Leak In the Making

It’s Easier to Open a Bank Account Than It Is to Participate in an ICO
In Sentinel’s Telegram chat, investors were deeply critical.

With ICOs now holding the passports and other identification documents of thousands of crypto investors together with their emails and wallet addresses, hackers have an added incentive to target crowdsales. Even if they’re unsuccessful in altering the contribution address, the raw data of tens of thousands of crypto holders is a honeypot of significant value in its own right. Some of that honey was stolen from The Bee Token, whose email database was accessed and used to send out phishing emails which raised over $1 million.

This week, Sentinel ICO had an even bigger fail after the passport data of its users was leaked. In a Medium post, the startup confessed that a website vulnerability had allowed uploaded files to be accessed by another user. To compound the problem, the user who discovered the flaw then claimed to have been reported to the police by Sentinel for their actions, despite having done nothing wrong.

KYC: Good for ICOs, Bad for Investors

It is hard to put a figure on the success rate for ICO whitelist applicants, though it’s likely to stand at less than 50%. At least half of the time, in other words, participants are submitting personally identifiable documents in exchange for nothing, be it due to whitelist oversubscription or network congestion that prevents them from contributing ether in time. The likelihood of that data being leaked is low, but cumulatively, over the course of dozens of KYC applications, those odds start to mount up. It only takes one failure to expose an individual’s data once and for all time. Email and wallet addresses can be changed; passports and driving licenses are permanent.

Gaining approval to participate in pre and public sales is now viewed by many ardent ICO participants as a game. The price for admission is the time it takes to complete the KYC registration process and the chance that none of the countless ICOs they apply to will suffer a catastrophic data breach. As if investing in ICOS wasn’t risky enough, KYC requirements have ironically made crowdsales even more hazardous.

 

This 16-Year Old Crypto-App Developer Fights Back Against Reddit Hate

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This week news.Bitcoin.com spoke with, Harshita Arora, a 16-year old girl who developed the Crypto Price Tracker application for iPhones. Arora explains she lives in a small town just outside of New Delhi in India and she’s a big fan of technology. Arora has been studying computer science, and was accepted to the Massachusetts Institute of Technology (MIT) for a summer internship. Arora decided to make a cryptocurrency price tracking app for iOS and announced the launch of the project on January 28.

This 16-Year Old Crypto-App Developer Fights Back Against Reddit Hate

However, when she announced the app herself on the forum /r/bitcoin, she was greeted by a mob of people who didn’t believe she created the app. One critic wrote a blog post detailing that the app was plagiarized although the story was later revealed as false. Most of the criticism came from the fact Arora hired help to do some of the backend coding on the Crypto Price Tracker. But following the accusations /r/bitcoin patrons started harassing Arora for being young and a wrote hateful and sexist comments to her. News.Bitcoin.com chatted with Arora to hear how she got into coding and cryptocurrencies but more importantly how she dealt with the issues she faced launching the platform.

Harshita Apps: How This Young Woman Overcame False Accusations and Attacks from Redditors

News.Bitcoin.com (BC): Can you tell our readers how you got into coding applications?

This 16-Year Old Crypto-App Developer Fights Back Against Reddit Hate Harshita Arora (HA): I got into technology at first because of my CS teacher at school. He’d assign really interesting projects to play with design software, Google Scratch, and the MIT App Inventor so we could learn programming concepts and start building fun programs and software. He planted the seed that eventually made me more interested. I then invested my time in programming and building things. I learned iOS app development in Swift around 2017 after I came back from MIT summer program. After working on an iOS app, at the university with a team, and learning from my friends.

BC: What got you into bitcoin and cryptocurrencies?

HA: The first time I heard about cryptocurrencies was in 2016, in a tech magazine I used to read every month (Digit). I learned about Bitcoin mining and understood some basic underlying technology and cryptography.

And then in 2017, cryptos and bitcoin was all over my Facebook feed and Quora. So I started getting more curious and read up more online.

BC: What made you decide to develop the Crypto Price Tracker?

HA: I’ve written a bit here in this article. In short, it was because of frustration from using horribly-designed apps that made it extremely hard for me to keep up to date with prices. And being a designer and maker at heart, I couldn’t stop myself from designing a new app with a better UI and UX.

This 16-Year Old Crypto-App Developer Fights Back Against Reddit Hate

BC: When you introduced the application to the Reddit (bitcoin) community there were a lot of negative people saying mean things. Why do you think that happened?

HA: Well, when I first introduced the app on the launch day (28th Jan), it got a lot of positive reaction. This was the thread. I got a lot of positive feedback on the app and how I could improve it further. I saw a lot of my traffic (in iTunes Connect App Analytics) came from Reddit. And I read four 5 star reviews mentioning that they came from Reddit. One of them even said, “I came here from Reddit, and I was not disappointed.”

But a woman decrypted my app on a jailbroken iPhone and wrote an angry blog post accusing me of plagiarizing the app based on inconclusive evidence. She posted it on Reddit, and that’s where it went viral and invited a lot of abuse and hatred.

BC: Do you think your age had anything to do with the criticism?

HA: Likely, but I’m not sure. I’ve been thinking about it based on the patterns in the comments. There were quite a lot of sexist, racist, and ageist remarks by some abusers. Not sure if any of that was the sole reason people criticised me and my app. But it could be a strong reason because *some* people have a hard time believing that there are teen entrepreneurs and developers out there.

This 16-Year Old Crypto-App Developer Fights Back Against Reddit Hate

BC: Do you think this type of behavior may be only particular to the Reddit bitcoin crowd? — as in — Do you have confidence the bitcoin community overall is far friendlier?

HA: After the article on The Daily Beast was published, I got an overwhelming amount of positive emails and messages from supporters in the bitcoin and crypto community.

People emphasized to me and understood what I had to go through. It might be just r/bitcoin that was nasty to me – but again, I’m not too sure.

BC: Are you a bitcoin holder or own any other cryptocurrencies?

HA: No, I don’t invest in bitcoin or other cryptos. I’m much more interested in the technology more so than the economics. I think people have been treating cryptos wrongly as an asset to invest in and to make quick money with.

BC: Where you live do any of your peers or classmates know much about bitcoin and cryptocurrencies? Maybe classmates or friends?

HA: I live in a small town in North India. All of my friends use the Internet regularly. My closest friends know about bitcoin and are actually building applications for bitcoin and cryptos. I tend to spend most of my friend time with other nerds. As for classmates, I do not go to school. I left formal schooling in 2016.

Written by CoinDesk.com

 

Iceland Bitcoin Mining to Double Energy Consumption This Year

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Iceland Mining Expected to Double to 100 Megawatts

“Four months ago, I could not have predicted this trend,” Johann Snorri Sigurbergsson, Hitaveita Sudurnesja’s business development manager, announced incredulously, “but then bitcoin skyrocketed and we got a lot more emails. Just today, I came from a meeting with a mining company seeking to buy 18 megawatts.”

Powering southwestern Iceland, Hitaveita Sudurnesja is a Svartsengi-based geothermal energy plant (about four km north of Grindavík). The area is also home to cryptocurrency mining, which is increasing at a pace to use more wattage than its residents combined, effectively doubling “its energy consumption to around 100 megawatts this year,” according to reports. In fact the National Energy Authority puts its usage at more than 340,000 households on the island.

Arguably, mining is the heart of the entire bitcoin affair – and due to its concept of baked-in digital scarcity, the computational problems associated with mining blocks, confirming transactions, building what is referred to as the blockchain or distributed ledger, mining has become a lucrative business.

Iceland Bitcoin Mining to Double Energy Consumption this Year
Svartsengi

To do so effectively, cooler climes are necessary, as are abundant sources of energy. Iceland is a natural home for the burgeoning industry, but not everyone is pleased. “Under normal circumstances,” Pirate Party legislator Smari McCarthy explained, “companies that are creating value in Iceland pay a certain amount of tax to the government. These companies are not doing that and we might want to ask ourselves whether they should.” Tapping a typical trope, the lawmaker continued, “We are spending tens or maybe hundreds of megawatts on producing something that has no tangible existence and no real use for humans outside the realm of financial speculation. That can’t be good.” The Pirate Party was once known as very pro bitcoin.

Iceland’s more timid hands might be forgiven due to its somewhat recent experience with so-called “speculation.” The 2008 Great Recession impacted it harshly, spreading to its banking system. When all was said and done, the island nation and government debt ballooned. Three of its major banks defaulted, and by some estimates it was considered the worst economic crisis in economic history relative to its size.

And especially in recent months, many people have soured on the digital asset, noting its volatility and lack of good user experience when it comes to basic transactions (fees and processing time). However, though Iceland’s economy has bounced back, it might not be wise to turn away the future of money so quickly.

Written by Bitcoin.com

SVK CRYPTO PODCAST 079 – 12/02/2018 – Crypto regulation is inevitable according to IMF chief!?

https://www.podbean.com/media/share/pb-6q29f-88483a

Welcome to the SVK Crypto, 15 Minutes of Crypto Fame, brought to you by your host, Charles Storry. We provide daily cryptocurrency content and analysis on topics such as Bitcoin, Ethereum, Altcoins and ICO’s.

We not only produce our daily content we feature CEO’s of all exciting ICO’s! Stay tuned to find out more!

If you’d like to stay in touch or get more info from me, please SUBSCRIBE to the channel and spread the good word!

Follow us on Twitter: https://twitter.com/SVK_Crypto

Visit our website: www.svkcrypto.com

Email us: cstorry@svkcrypto.com

Telegram: @SVKCROWD

Top Crypto News – 12-02-2018

Senate Candidate Accepts Largest Contribution in BTC

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The Largest Cryptocurrency Campaign Donation

Republican Senate Austin Petersen Accepts the Largest Campaign Contribution Paid in BTC
Austin Petersen’s AR-15 raffle.

The Republican Austin Petersen is looking for a Senate seat in Missouri and is accepting bitcoin donations to get there. Petersen was the runner-up back in 2016 for the Libertarian Party’s nomination for President of the United States. The Missouri candidate is well known throughout the younger crowd of voters for loving bitcoin and giving away an AR-15 riflein a raffle. This past December, the 36-year old stated in an interview: “I am a big fan of the digital currency community because of what it represents, which is ultimately decentralization.”

This week the Federal Election Commission’s records reveal Petersen has received the largest digital currency donation in U.S. history — 0.284 BTC or $4,500 USD at the time of donation. Petersen has also garnered 24 total election contributions in BTC, and his campaign uses the Atlanta based processor Bitpay to facilitate donations.

When asked about the recent BTC donation, Jeff Carson, the campaign manager stated:

I think it goes without saying we’re going to see a lot more of this in terms of campaign contributions and campaign financing — Austin is personally a fan of competition in the marketplace, even when it comes to our currency — With the rise of cryptocurrencies like bitcoin, it was a no-brainer.

Austin Petersen Accepts the Largest Campaign Contribution Paid In BTC

Gold, Silver, Cryptocurrencies and Ending the Fed

Petersen detailed last September that he would like to see “deregulation on monetary policy.” Further, the candidate added he would like to see the abolition of the private banking system the U.S. Federal Reserve.

“But barring that, at a minimum, I would like to introduce legislation that would decentralize the monetary unit, the dollar, in such a way as to legalize competition: Gold, silver, and cryptocurrencies, so that they can compete — That would cause a spike in the prices,” Petersen explains.

The contender follows other U.S. bureaucrats who’ve accepted bitcoin donations in the past. Back in 2014, the Coloradan Democrat Jared Polis received BTC for his campaign. The libertarian-leaning Republican Senator from Kentucky, Rand Paul, accepted crypto for his presidential run in 2016.

Written by Bitcoin.com

 

Ripple inks deal with major Middle East currency giant

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foreign exchange giant owned by Travelex billionaire Bavaguthu Shetty has adopted cryptocurrency Ripple for its international payments, the latest major financial player to lend its backing to blockchain technology.

UAE Exchange, one of the largest in the Middle East, has signed up to the San Francisco Bitcoin rival’s RippleNet network for cross-border payments.

“Incorporating Ripple’s blockchain technology into our payments systems will bring customers an enhanced, new payments experience,” said Promoth Manghat, CEO of UAE Exchange Group.

“The early adoption of this game-changing technology allows us to offer a competitive service, as it will have an impact on the speed and cost of cross-border transactions. We are proud to deliver the future of payments with Ripple.”

UAE Exchange, whose billionaire owner bought Travelex in 2014, said it has a 6.75pc share of the $575 billion global remittance market, with ambitions to take on 10pc by 2020. It has 800 branches in more than 30 countries, making it the largest UAE-based exchange to incorporate blockchain into its daily operations.

Ripple, which has its own unit of payment called XRP, saw its popularity rise at the end of 2017 thanks to backing from 100 banks including Japanese and Korean credit card companies.

Ripple has increasingly been adopted by payment networks and banks, including UBS and Santander for its settlement technology.

When XRP hit an all-time high of $3.84 (£2.80), earlier this year, the net worth of founder Chris Larsen – understood to own 5.19 billion XRP and a 17pc stake in the company – jumped to $59.9bn, a fortune larger than Facebook founder Mark Zuckerberg’s. However a dip last week saw him slump back down the Forbes’ rich list.

The Ripple network, which launched in 2012, acts as a system for verifying and recording transactions of various assets including its own XRP. Rather than being used as a form of payment, Ripple’s aim is to sign up customers to use its system for verifying and recording transactions of all kinds of assets.

 

“We chose to focus on solving inefficiencies in key corridors where payment flows are significant and growing, “said Dilip Rao, Ripple’s global head of infrastructure.

“Adding a market leader like UAE Exchange to RippleNet will bring instant, certain, low-cost payments to the millions of retail customers in the UAE who send money abroad”.

Written by the Telegraph

 

New Jersey Sends Cease & Desist to Crypto-Investment Pool

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New Jersey Officials Stop a Cryptocurrency Investment Firm from Operating In the State

New Jersey Sends Cease & Desist to Crypto-Investment Pool New Jersey lawmakers have sent a cease and desist letter to a firm called Bitstrade which claims to be a registered U.S. financial startup and offers digital asset banking services. Officials from New Jersey say Bitstrade unlawfully provided investors unregistered securities in the form of a pool that claims to guarantee up to 10 percent returns which accrue daily. Authorities from the Bureau of Securities and Attorney General’s office have found that “Bitstrade provides no basis to guarantee investment profit,” and “Bitstrade is not registered to sell securities in New Jersey.”

“The Bureau’s action today reinforces our commitment to protecting investors as they navigate the uncharted and largely unregulated domain of cryptocurrency-related investments,” said New Jersey’s Attorney General Gurbir Grewal.

We want to make sure that investors tempted to cash in on the cryptocurrency rage aren’t being lured into sending funds to an anonymous internet entity without knowing where the funds are going or how they’ll be used.

New Jersey Sends Cease & Desist to Crypto-Investment Pool

Lawmakers Remind Retail Investors to be Extra Vigilant About Cryptocurrency Investments

New Jersey Sends Cease & Desist to Crypto-Investment Pool Sharon Joyce, Acting Director of the Division of Consumer Affairs (DCA) says Bitstrade’s fraudulent offer is more harmful because “cryptocurrency is virtually anonymous, so there is no recourse for investors to recoup their losses.” Joyce continues, “We’re reminding investors to be extra vigilant about fully vetting what is being sold before investing with cryptocurrency.”

The news also follows the recent cease and desist notice sent to a cryptocurrency startup in Texas last month. The Bitstrade investigation was handled by Deputy Bureau Chief Amy Kopleton and Investigator Raymond Marelick of the Bureau of Securities, within the DCA. New Jersey’s regulators believe there is a  “high risk of fraud” when it comes to cryptocurrencies, and they plan to regulate the digital asset industry more.

“Bitstrade is a prime example of a company seeking to capitalize on the cryptocurrency craze — Regulators, including the Bureau, are actively responding to fraudulent crypto-cloaked securities offerings.” Christopher W. Gerold, Chief of the Bureau of Securities concludes.

Written by Bitcoin.com

DJ Gareth Emery Wants to Be Crypto Rich (For a Cause)

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Strobes pulsed through fog as a tightly packed audience sought to get a shot of the DJ.

Revered for his contributions to electronic dance music, Gareth Emery was in the box at London’s Ministry of Sound last weekend, there to show off the synths that have helped him win the prestigious “A State Of Trance Tune Of The Year” award three times over.

Fans were quickly sent into delirium, almost as delirious as crypto enthusiasts can sometimes seem – an interesting link since Emery, with his new startup Choon, wants to replace the antiquated digital music industry with ethereum tech.

Like many gigs that Emery has played in the past months, the night is a sell out.

“I’m one of the lucky ones,” Emery told CoinDesk backstage. “I get paid really well because I have a lot of fans that will come and see me do gigs.”

However, many musicians are less privileged as their audiences have turned to recorded music, Emery said. In that market, musicians are paid ridiculously low royalties on notoriously unreliable payment rails with long wait times.

“It’s fucking horrendous,” Emery said. “Basically we have this system that was designed in the days of sheet music and jukeboxes 60 years ago and it’s never been changed.”

According to Emery, while the music industry is anything but short on cash, it has failed to adapt to technological advancements.

But Choon looks to fix that. A streaming service that “mines” via a smart contract, Choon gives 80 percent of profits directly to musicians – a step up from similar services like Spotify – which pay out disturbingly low fees (some musicians have estimated it’s as low as $0.004891 per stream).

Emery told CoinDesk:

“We took a different path and said, ‘If you were to design the music industry today, how would you do it?'”

Musician as miner

And according to Emery, using blockchain “for what it’s really good at – money and contracts” is exactly how to create a more equitable music industry.

He’s not alone there, the music industry has been one of blockchain entrepreneurs’ favorites to disrupt. For instance, Slovenia-based Viberate is trying to eliminate the fee-taking middleman in the music industry, and several high profile people in the music industry have begun their own blockchain projects in this area as well.

But for Choon, Emery is working alongside the developers of CryptoPunks, a digital collectable precursor to CryptoKitties, with the hope of launching in the next six months.

The technology is based on a customizable “Smart Record Contract” that stores copyright credentials on the ethereum blockchain, and splits the funds gained from the track fairly between the creator and producer, in the form of an ERC-20 token called NOTES.

These NOTES will be sold in an initial coin offering (ICO) in the coming months. According to Emery, more than 500 artists are already signed up to use the platform, including several big names in the music industry like Daruge, creator of the infamous trance track “Sandstorm,” and leading dubstep DJ Datsik.

The tokens are programmed to distribute according to how many times a track has been streamed, directly into an artist’s wallet. (A breakdown of the distribution can be witnessed live on Choon’s functioning testnet).

Artists can cash out NOTES on participating exchanges, but to keep the price of the token high, artists are urged to keep their money inside the Choon system, with Emery hoping the token becomes widely accepted throughout the music industry.

And it has a chance, since artists that use the platform keep full copyright ownership of their work – a change from labels that buy up full copyright as part of the deal.

In the wrong pockets

The global music industry tops something like $130 billion annually.

In spite of this, funds get lost in the machinery – taking elaborate, unnecessary detours to end up in pockets that aren’t the musicians.

“It’s just going to the wrong people – copyrighters, publishers, recording labels, streaming companies,” Emery said. “I don’t see for the most part that we have a need for record labels and publishers.”

Because of the availability and cheapness of production now, artists don’t need to be sponsored for studio rent, Emery explained, and social media allows artists to take control of their own marketing. Plus, the manufacturing and distribution of music has become easier for individuals to do themselves.

Yet, regardless, the monopolies still exist, and musicians are struggling to make ends meet.

And because it’s so difficult to make money off recorded music, more musicians are pushed into relying on live gigs.

“I make 99.5 percent of my income from touring and 0.5 percent max from streaming and recording music,” Emery said.

And that’s upsetting since some great musicians cannot or would prefer not to tour due to health conditions and family, he continued, adding that he wants to bring those people back into the lucrative music industry.

The solution, according to Emery, is to wipe out the third party and replace it with a system where artists and their audience are connected directly.

Emery told CoinDesk:

“We don’t really need them anymore, yet they have more power than they ever had before, and the only reason is they just have this iron grip on the flow of money, on the flow of payment.”

Gibraltar’s Government Is Moving to Regulate ICOs

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Officials in Gibraltar are reportedly weighing rules for initial coin offerings (ICOs), a move that follows a bid to develop a licensure framework for companies working with the tech.

The discussions will include input from members of the British overseas territory’s legislature as well as the Gibraltar Financial Services Commission (GFSC). Like many other countries entertaining ICO regulation, the government there has framed the move as one aimed at protecting investors and consumers.

“One of the key aspects of the token regulations is that we will be introducing the concept of regulating authorized sponsors who will be responsible for assuring compliance with disclosure and financial crime rules,” said Sian Jones, a senior advisor to the GFSC, according to Reuters.

The GFSC previously hinted that it would pursue regulations around ICOs when it published an advisory on the blockchain funding model. At the time, the regulator said that it was “considering a complementary regulatory framework covering the promotion and sale of tokens, aligned with the DLT framework.”

Late last year, the territory put in place a regulatory framework for blockchain businesses that shored up legal status of the technology as a means of transmitting payments. The proposal was first introduced in October, with passage by lawmakers in December.

Government officials said the move would facilitate an environment of certainty attractive to businesses. Gibraltar is also reportedly considering regulation relating to investment funds associated with cryptocurrencies and tokens.

Gibraltar image via Shutterstock 
Written by CoinDesk.com

 

 

SVK CRYPTO PODCAST 078 – Has Binance Been Hacked!?

https://www.podbean.com/media/share/pb-buc3p-87c40c

Welcome to the SVK Crypto, 15 Minutes of Crypto Fame, brought to you by your host, Charles Storry. We provide daily cryptocurrency content and analysis on topics such as Bitcoin, Ethereum, Altcoins and ICO’s.

We not only produce our daily content we feature CEO’s of all exciting ICO’s! Stay tuned to find out more!

If you’d like to stay in touch or get more info from me, please SUBSCRIBE to the channel and spread the good word!

Follow us on Twitter: https://twitter.com/SVK_Crypto

Visit our website: www.svkcrypto.com

Email us: cstorry@svkcrypto.com

Telegram: @SVKCROWD

Top Crypto News – 09/02/2018

Binance Denies Hack As Exchange Halts Trading

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Hong Kong-based cryptocurrency exchange Binance said it won’t resume trading or enable customer withdrawals until Friday amid a continued blackout blamed on a prolonged system upgrade.

The suspension has sparked fears that the exchange has been hacked, though Binance, responding to such comments on Twitter, has strongly pushed back against the claim.

According to the most recent statement from Binance, the exchange is expected to resume trading at 4 a.m. UTC on Friday.

“We will allow a 30-minute window where users can cancel open orders prior to trading being opened,” the exchange wrote. “We will continue to update every two hours until the upgrade is complete.”

The exchange first posted on Twitter about the trading outage on Wednesday, telling users that they may see some degraded performance for the duration.

However, two hours later chief executive Changpeng Zhao announced that a server issue caused data to fall out of sync, stating that the development team would have to re-sync from a master database. In subsequent tweets, Zhao said that the maintenance did not proceed as planned, prolonging the outage.

Binance first launched in the summer of 2017, and in recent months has become one of the largest venues for cryptocurrencies by trade volume. According to a December report from Tech In Asia, the exchange was seeing as much as $500 million in daily trading volumes at the time.

Turnstile image via Shutterstock
Written by Bitcoin.com

 

Bitcoin Couture Makes Its Debut at New York Fashion Week

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From the Blockchain to the Catwalk

Bitcoin Couture Makes Its Debut at New York Fashion WeekBitcoin has been popping up in the unlikeliest of places recently, from Kentucky Fried Chicken to the catwalk. In an era in which everything is placed on the blockchain and “blockchain” is being placed in front of everything, it was inevitable that the crypto craze would be picked up by fashionistas sooner or later. Bitcoin has long since made the mainstream, but this is believed to be the first time it’s made the catwalk.

Fashion designers are notorious for tapping into whatever trends are en vogue, often commandeering movements and themes with little sensitivity or understanding of the underlying issues. Not that it’s necessary to comprehend distributed ledger technology to slap a bitcoin logo on a silk shirt of course; all that’s required is for a certain motif to be hot, and right now bitcoin ticks all the right boxes.

Ariel and Shimon Ovadia’s coda to NYFW saw them draw their inspiration from punk, Silicon Valley, and crypto. A collection of 35 men’s pieces was showcased, with the highlight – for bitcoiners at least – being a natty green shirt paired with a faux sailor’s cap. “Bitcoin accepted – No cash” ran the slogan on the side of the shirt. Judging by the haunted look in the model’s eyes as he traipsed down the catwalk, he was holding some very heavy crypto bags.

Bitcoin Couture Makes Its Debut at New York Fashion Week

Many of the pieces exhibited at events such as New York Fashion Week are haute couture that’s destined never to make it to the high street. Thus, the prospects of snapping up Ovadia & Sons’ bitcoin shirt – and of being able to pay for it in bitcoin (no cash) – seem remote. Still, should any self-styled fashionistas fancy replicating the look, it’s nothing that couldn’t be whipped up in five minutes with the aid of a gaudy green shirt and an iron-on bitcoin logo.

Written by Bitcoin.com

 

NY Regulator Demands Vigilance Against Market Manipulation from Bitlicense Firms

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Vigilant Against Market Manipulation

NY Regulator Demands Vigilance Against Market Manipulation from Bitlicense FirmsThe New York State Department of Financial Services (DFS) has issued a guidance paper on Wednesday, reminding all cryptocurrency companies licensed by it that they are required to implement measures designed to effectively detect, prevent, and respond to fraud, attempted fraud, and similar wrongdoing. In addition, it reminded Bitlicense holders that they must be especially vigilant against efforts at market manipulation. The regulator has granted six Bitlicenses so far, including to Bitflyer USA, Coinbase Inc., XRP II and Circle Internet Financial, and charters to Gemini Trust Company and itBit Trust Company.

“DFS took the lead in 2015 in regulating the virtual currency market, and we continue to be vigilant concerning risks in these markets. Market manipulation presents serious risks, both to consumers and to the safety and soundness of financial services institutions,” said Superintendent Maria T. Vullo. “As the cryptocurrency markets continue to evolve, DFS is directing virtual currency companies to take the necessary steps to guard against fraud, and to be extra vigilant about manipulation. By these actions, the market can evolve with strong regulatory supervision.”

All Bitlicense Firms to Report Risks

NY Regulator Demands Vigilance Against Market Manipulation from Bitlicense FirmsIn its guidance paper, the DFS also directed cryptocurrency firms to adopt measures that include effective implementation of a written policy to identify and assess the full range of fraud-related risk areas, including market manipulation. The policy should provides procedures and controls to protect against identified risks, allocate responsibility for monitoring those, and provide for the investigation of fraud and other wrongdoing, whether suspected or actual.

Immediately upon discovering any wrongdoing, a licensed cryptocurrency firm must submit a report to DFS with all the details. They must also submit, as soon as practicable, further reports of any developments along with a statement of the actions taken, and a statement of changes put in place in order to avoid repetition of similar events.

Written by Bitcoin.com

 

Where’s Greg? Maxwell Eyes New Bitcoin Projects After Blockstream

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One of bitcoin’s most respected developers, Gregory Maxwell, is returning to his cypherpunk roots with a series of new projects.

After nearly four years as CTO of high-profile bitcoin technology startup Blockstream, he’s departed that position to focus exclusively on code. Mainly because, as Maxwell explained in his departure letter, he accomplished what he set out to do at the startup, addressing the “significant under-investment” in bitcoin’s technology at the time he joined.

But with a “much larger and more active” developer community around bitcoin today, Maxwell is going into 2018 an untethered man set on improving bitcoin smart contracts.

In this pursuit, Maxwell published a paper on something called “Taproot” in mid-January, an idea that improves upon the privacy of MAST, an idea, long in the making, that could beef up bitcoin’s smart contract abilities. Days later, Maxwell released another proposal called “Graftroot,” improving on MAST further.

So, why is this focus so attractive for Maxwell?

Maxwell told CoinDesk:

“I expect every transaction to eventually use these tools, at least in limited ways. They are an incremental improvement, making things that were already more or less possible more private and efficient. They replace or make much better things like MAST.”

And so far, many developers have praised Maxwell’s new work.

“Taproot is annoyingly clever,” Lightning Network creator Tadge Dryja quipped on Twitter, adding that while the idea sounds simple in hindsight, no one had thought about it before Maxwell.

Like a dandelion?

Maxwell’s interest seems to be aligning with greater attention to MAST now that SegWit (a code change MAST depends on) has been activated on bitcoin.

To understand MAST, it’s helpful to start by looking one of the common use cases of bitcoin today – M-and-N multi-signatures, which require that coins can only be spent if a certain number of users (such as two-of-two, three-of-five) approve the transaction. One problem that can arise in these types of transactions is that one party loses their private key to sign with or just decides altogether not to comply, and at that point the money is unspendable.

MAST allows users to add additional conditions for when a transaction can be spent in a more efficient way, helping to solve the above issue.

For example, a transaction can be set to lose the need for multiple signatures, if the multi-signature funds aren’t spent after, say, 10 years. The magic of MAST is that it can cram all of this logic into one transaction efficiently.

In short, with Taproot and Graftroot, Maxwell has found a way to further improve privacy for these advanced transactions.

In Maxwell’s eyes, the problem with MAST as it stands is that each MAST transaction looks different than a normal transaction, which can be harmful for privacy, since people viewing bitcoin’s public ledger could theoretically glean which transactions are using MAST and in turn, more about financial transactions they have no business knowing anything about.

Taproot improves privacy in MAST instances where multi-signatures is used, by making those transactions, once settled on the blockchain, look the same as other transactions.

While Maxwell admits the use case is narrow, he told CoinDesk:

“There has been a lot of hype about smart contracts, but real and meaningful useage of them hasn’t caught up with that hype yet.”

But taking baby steps backed by real uses cases could help expand bitcoin’s value proposition as programmable money.

Both proposals, according to Maxwell, make smart contracts “easier to implement, more fee efficient and more private,” he said. “Taproot and Graftroot improve the backend technology for these advanced applications and by doing so will contribute to making them more accessible to people.”

And this ability to accomplish complex transactions without exposing that complexity is where Taproot specifically got its name.

“Taproot is most efficient to use for smart contract usage that resembles the root system of plants like a dandelion – a thick central path and small alternatives,” Maxwell said.

Simple but useful

While Maxwell is sold on the ideas, Taproot has attracted minor debate.

One of Maxwell’s former co-workers at Blockstream, Mark Friendenbach, argued that Taprootshows that MAST, if implemented a certain way, could cause problems in the future. His contention isn’t that Taproot itself is a bad proposal (in fact he argues the exact opposite), but that many of the MAST implementations on the table today aren’t built with future iterations in mind.

While Chaincode developer Matt Corallo said Taproot’s additional privacy is “absolutely massive to the ecosystem” and “should not be handwaved away for vague possibly-advantages.”

As long as Taproot and Graftroot get approval from developers and the community, though, Maxwell said it is possible to roll out the technologies alongside “future signature system upgrades,” such as aggregate signatures, another project Maxwell has contributed to.

But there could be some barriers still. According to Maxwell, bitcoin smart contracts are still a long way off.

“For real smart contracts like these to gain wide use a lot of additional work is required especially in the area of providing good user interfaces to use them,” he said.

But still, if disagreements are overcome, implementing and rolling out MAST with Taproot and Graftroot will be relatively painless.

Maxwell concluded:

“Taproot is one of these ideas which are very simple to implement but very useful.”

Written by CoinDesk

 

SVK CRYPTO PODCAST 077 – Exclusive interview with the CEO of Golem!

https://www.podbean.com/media/share/pb-7bvb2-879d8e

Welcome to the SVK Crypto, 15 Minutes of Crypto Fame, brought to you by your host, Charles Storry. We provide daily cryptocurrency content and analysis on topics such as Bitcoin, Ethereum, Altcoins and ICO’s.

We not only produce our daily content we feature CEO’s of all exciting ICO’s! Stay tuned to find out more!

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Top Crypto News – 08-02-2018

Crypto’s Price Correction Isn’t Killing the Industry High

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“You should buy crypto in amounts you’re not worried about, and sell it whenever you start thinking about it.”

At least that’s Blockchain CEO Peter Smith’s stance on investing in cryptocurrency, a take issued during just one of a dozen or so panel discussions at Yahoo Finance’s All Markets Summit Tuesday. Focused solely on cryptocurrencies, the one-day event, curated in part by CoinDesk, paired Smith with Chain CEO Adam Ludwin, who agreed this wasn’t exactly a bad investing philosophy.

The comments, while perhaps amounting to ‘Investing 101’ advice, were notable for their contrast to the “just HODL” movement, an ethos propagated by early investors that has largely encouraged the holding of cryptocurrency – no matter the ups and downs.

But that’s not to say that the panel, as well as the day’s event, didn’t showcase just how captivated investors are with cryptocurrency these days.

Smith told attendees:

“There’s probably never been more hype about a technology or industry than ours.”

And numbers from a survey Yahoo undertook seem to bear that out.

According to Yahoo editor-in-chief Andy Serwer, 40 percent of respondents have bought cryptocurrencies over the past year. Yet, in the same survey, about half still believe they may be a fad or even a hoax.

Both the hype and this confusion has caught the attention of various regulators – two of which, the CFTC and the SEC, were called before a Senate hearing on cryptocurrency just a day before the event. As such, the hearing provided ample fodder for the speakers, many of whom saw the regulators’ remarks as a positive for the fast-growing industry.

Speakers touched on the plethora of new investment vehicles and tools, even as some spoke out about what they feel is the nascent state of the technology.

“Usually nascent technologies out of the lab don’t get this much attention because there’s no way to profit off them,” said Ludwin. “It’s good to never lose sight of that.”

He added:

“You have a capital markets phenomenon overlaid against a very early technology … so time will tell whether this intense capital markets thing around it stunts the growth or accelerates the growth or stunts and accelerates back and forth, which has sort of been the course so far.”

More sophisticated options

But caution aside, much of the focus was on products, including hedge funds, derivatives, futures and initial coin offerings (ICOs) – topics that were all widely discussed during the day’s event.

For example, Barry Silbert, head of crypto investment conglomerate Digital Currency Group (DCG), was there to tout a new fund announced Tuesday by Grayscale, a DCG subsidiary specializing in public markets vehicles offering cryptocurrency exposure.

The fourth Grayscale product, the Digital Large Cap Fund is designed to give investors exposure to the five largest cryptocurrencies based on market capitalization, and it joins the ranks of a whole slew of hedge funds that have launched over the past year to lure more institutional investors.

Not only that but derivatives, futures and ETFs were also mentioned several times.

Bitcoin futures may have made a debut of two large traditional exchanges, CME Group and Cboe, at the end of last year, but there’s talk that more could be on the way.

According to Karan Sood, the CEO of Cboe Vest, the investment management arm of Cboe, the launch of futures has parlayed into more interest from Cboe’s institutional clients.

Speaking to the combination of traditional tools and the crypto market, Sood said:

“To marry those two gets us all excited.”

Cboe also seems excited about the idea of bitcoin ETFs, filing with the SEC to list six in one week at the end of December. Yet, no ETF has been approved so far. And as the SEC has been reluctant to accept the crypto ETF notion in the past, several speakers voiced pessimism that the product would be seen soon.

“A more likely thing is the continuation of the derivative aspect, because at least you have oversight from the CFTC on derivatives, and that’s how you were able to get the first products out,” said Kathleen Moriarty, a partner at Chapman and Cutler LLP.

Yet, Sood said retail investors are still predominantly driving interest in these sophisticated products. And as such, regulators are doing their best to keep up.

Wait up, innovators

On hand representing this group was CFTC commissioner Brian Quintenz, who spoke about how regulators are still trying to get their bearings in the crypto space.

Over the past several months, the CFTC has made headlines on multiple occasions for the role it played in jumpstarting the bitcoin futures market by overseeing a number of regulated products, and Quintenz didn’t exactly temper the mood Tuesday.

“One of the other takeaways from yesterday,” said Quintenz, speaking to Monday’s Senate hearing, “was you didn’t hear either chairman say ‘No, absolutely not, this is not safe, we must stop this at all costs.’ No one said that.”

He continued:

“We don’t want to be saying no to innovators.”

Having said that, though, Quintenz did elaborate on where the CFTC and other regulators would be focusing some of their efforts.

According to him, regulators are looking at the difference between a futures contract and a sale. If the delivery of an asset happens within 28 days, he said, it’s a sale and not a future. As such, the CFTC is currently looking for input on how to protect investors from what he called “look-alike” futures contracts.

Yet, while many speakers tipped their hats to the regulators for their seemingly positive outlook, Perianne Boring, the president of Chamber of Digital Commerce, a Washington D.C.-based advocacy group for cryptocurrency, said the regulatory landscape remains a mess in her eyes.

The CFTC is regulating cryptocurrency as if it’s a commodity; the IRS calls cryptocurrency property for tax purposes; and the SEC sees some cryptocurrencies as securities.

Because of this, she believes cryptocurrency entrepreneurs might leave the U.S. for not only places with lower regulatory hurdles, but those with a more clear regulatory framework for the nascent industry.

“In three years, we’ve really turned this around, to the point where we have a Congressional blockchain caucus, a group of senators coming together to say we’re going to protect this industry,” Boring continued.

But she and many others are hoping the cryptocurrency industry can come together to find ways to self-regulate so that stricter regulatory action isn’t pursued.

“We need best practices so people can delineate good from the bad,” she remarked.

Proceed with caution

Yet, that’s a tricky thing to do, especially since even experts in the industry have trouble figuring out what end is up in the space.

Alex Sunnarborg, a founding partner at Tetras Capital, went through a list of the ever-expanding list of available cryptocurrencies during his fireside chat, highlighting the growing number of token products, which have primarily differentiated themselves in name only (SAFT, ICO, TGE, ICBM).

All these new names have made it challenging for investors to differentiate tokens in an effort to decide which ones to invest in. And not only that but vetting cryptocurrencies and crypto tokens requires some amount of technical proficiency in looking at the teams, the white papers and the economics of the system.

Brad Garlinghouse, CEO of Ripple, whose native cryptocurrency XRP has seen meteoric growth over the past couple months, also commented on the troubles of assessing the token industry. In particular, he said many of the tokens he sees don’t have much purpose, and that as the industry corrects from the hype, “there’s also going to be carnage along the way.”

With that, Boring reminded the audience they shouldn’t invest in things they don’t understand.

“For the retail investor who wants to get involved in the blockchain ecosystem, whether through an ICO or through other means, you really need to educate yourself,” she continued. “For the first time in possibly history, you can have control – but with that increased amount of control comes an increased amount of responsibility.”

Having said that, though, Boring is still a true-blue crypto believer, telling the audience:

“I have more money in cryptocurrencies than in any formal retirement fund.”

Written by CoinDesk.com

 

Grayscale Plans to Launch a Cryptocurrency ‘Large Cap Fund’

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Grayscale Launches a New Cryptocurrency Fund

Grayscale Plans to Launch a Cryptocurrency 'Large Cap Fund'The managers of the popular bitcoin investment fund GBTC and the ethereum trust, Grayscale, have decided to create a much larger investment product comprised of a basket of top-performing cryptocurrencies. According to Grayscale’s announcement, the basket will consist of litecoin (LTC) bitcoin cash (BCH) ripple (XRP) bitcoin core (BTC), and ethereum (ETH) for now.

“We’re excited to further expand the universe of Grayscale’s product offerings as interest in the digital currency asset class continues to grow,” said Barry Silbert, CEO, and founder of Grayscale Investments.

As a trusted and experienced manager, Grayscale is committed to creating investment structures that are familiar to qualified investors and provide secure access to this emerging asset class.

The Fund Targets 70% Coverage of the Digital Asset Market

Grayscale Plans to Launch a Cryptocurrency 'Large Cap Fund'
Grayscale’s Barry Silbert.

The sponsors first funds consisting of ETH and BTC have done phenomenally well following alongside the prices rises of spot markets. When Grayscale launched its first product back in 2013 at the time BTC was averaging $127 per coin and GBTC became one of the first mainstream investment vehicles tied to bitcoin reserves. In July of 2017, the firm initiated its ethereum trust which is framed in a similar fashion. For the new ‘Grayscale Digital Large Cap Fund’ the sponsor may also hold cash and assets that arise from forks and airdrops. Shares will reflect the platform Tradeblock’s Digital Asset Reference Rate at 4 pm EDT.

“Through a rules-based portfolio construction process, the Fund targets 70% coverage of the digital asset market — The Fund will be rebalanced on a quarterly basis to remove existing digital assets or include new digital assets in the Fund’s portfolio in accordance with certain criteria established by Grayscale,” explains the announcement.

One Year of Holding and Risk

According to Grayscale the Fund is a Cayman Islands limited liability company but based in the United States. The product is also not registered with the U.S. Securities and Exchange Commission (SEC), and is not subject to American based securities laws.

Moreover, Grayscale details that the investment product is “highly speculative in nature,” and the Fund is subject to a one-year holding period. This means investors have to “bear the risks” for an entire year, but after the holding period assets can be “resold without restriction,” Grayscale concludes.

Written  by Bitcoin.com

 

Dfinity raises $61 million for platform that rivals ethereum

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Dfinity, a new product that rivals ethereum, just raised $61 million by well-respected investors Andreesen Horowitz and Polychain Capital, which has investors ranging from Sequoia Capital to Union Square Ventures.

This is the first token Andreesen Horowitz has invested in. Chris Dixon, general partner at Andreesen, led his firm’s investment in Dfinity. Ryan Zurer, venture partner at Polychain Capital, led his fund’s investment, which is its largest to date.

The $61 million raised in this strategic round brings Dfinity’s total project funding to over $100 million.

Dfinity’s Chief Scientist Dominic Williams told CNBC that Difinity has the power to disrupt the world of technology, calling it the “internet computer that will become the cloud 3.0.”

But what sets Dfinity apart from the rest?

Williams says Dfinity runs extremely fast and doesn’t have the security risks that many cryptocurrencies have fallen victim too.

“Dfinity is ultimately a new technology protocol with no back doors where hackers can get in,” said Williams.

The security component is perhaps most compelling to investors given the number of hacks the cryptocurrency industry has seen in the last 12 months. The latest one in Japan involved over $500 million of tokens being stolen from consumers’ digital wallets.

Time is also Dfinity’s friend. Williams says he’s built a technology that offers 3-5 second transaction finality, which is about 150 times faster than ethereum and over 900 times faster than bitcoin.

If this holds, experts say Dfinity could upend the cryptocurrency market.

“This is extremely important for scalability and transaction throughput on the network and will be important for any use-case that requires high-frequency transactions such as IoT or enterprise solutions. This will be the beginning of an architecture that becomes the new internet,” said Zurer.

One of the challenges in transacting with bitcoin is the amount of time it can take. But software enhancements like the “lightning network” are said to dramatically increase the speed at which one can buy or sell bitcoin. Lightning Labs CEO Elizabeth Stark told CNBC that once the lightning network is rolled out, it could make bitcoin much easier to use and transact with. Bespoke Investment says its bullish forecast on bitcoin is contingent on the lightning network being enabled in the coming months.

Written by CNBC

 

Korean Supreme Court to Judge Whether Crypto Regulations Are Unconstitutional

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Case Referred to Supreme Court

Korean Supreme Court to Judge Whether Crypto Regulations Are Unconstitutional
South Korean constitutional court.

The constitutional appeal filed against the South Korean government over cryptocurrency regulations at the end of December has been referred to the country’s Supreme Court by the Constitutional Court.

Lawyer Jeong Hee-chan alleged that “regulating the trade through administrative guidance without any legal grounds is an infringement of property rights,” the Korea Times reported and quoted Jeong’s law office stating:

The government’s regulations are devaluing virtual currencies by making trading very difficult…Thus, this is an infringement on people’s property rights by the government’s unlawful measures.

Jeong clarified, “We agree that regulations are necessary,” adding “but regulations should come after related laws are implemented. The petition is also a request for the government to respect people’s property rights and introduce regulations after reaching a social consensus.”

Is the Real-Name System Unfair?

Korean Supreme Court to Judge Whether Crypto Regulations Are UnconstitutionalAs part of the regulations for cryptocurrencies, the government has implemented a mandatory real-name system for cryptocurrency exchange accounts. The system went into effect on January 30.

According to the regulators, all existing virtual accounts used by cryptocurrency traders must be converted into real-name ones in order to deposit money for trading. After one week, only 8.21% of all virtual accounts at the country’s top four exchanges have been converted into real-name ones, leaving 1.6 million accounts unconverted.

Furthermore, banks are only converting accounts for Upbit, Bithumb, Coinone, and Korbit, leaving smaller exchanges with no way to use the real-name system. The Economic Review elaborated:

The key issue is the unfairness of the virtual currency real name system…the government should clarify the grounds for enacting the virtual currency real name system in the main judgment. The basic rights of the people in the Constitution can be restricted only by laws set by the National Assembly.

“The government insisted it [the real-name system] is legitimate based on the Banking Law and the Financial Information Act,” Top Star News described, adding that:

If the court makes an unconstitutional judgment, all the existing [cryptocurrency] regulations of the government can be nullified.

According to the Economic Review, the matter “shall be concluded within 180 days” from the date of filing under the Constitutional Court Act which was on December 30. Therefore, the case is expected to conclude by the end of June.

Written by Bitcoin.com