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Former Locke Lord LLP partner allegedly received $50 million to launder $400 million for OneCoin co-founder and current fugitive Ruja Ignatova.
United States prosecutors told a Manhattan jury that lawyer Mark S. Scott was paid $50 million to help OneCoin co-founder and current fugitive Ruja Ignatova launder $400 million.
On Nov. 20, Law360 reported that the Manhattan U.S. attorney's office and the New York County district attorney's office are in the last phase of prosecuting Scott, a former partner at law firm Locke Lord, who allegedly received $50 million to launder a whopping $400 million for Ignatova, also known as the “cryptoqueen.”
Crypto scam raised $4.4 billion
OneCoin is among the crypto industry’s most infamous exit scams. However, the Bulgaria-based firm remains operational to date despite investigators’ allegations that it raised $4.4 billion in a Ponzi scheme.
The U.S. prosecutors accuse Scott of employing a wide network of fake companies, offshore bank accounts and fraudulent investment schemes to launder more than $400 million in ill-gotten funds.
Prosecutor Julieta Lozano had previously said that as compensation for his criminal activities, Scott was paid in the form of a 57-foot yacht, three multimillion-dollar homes in Cape Cod, Massachusetts and luxury cars, including three Porsches and a Ferrari.
Although Scott maintains that he had no knowledge that OneCoin was a scam, prosecutor Nicholas Folly said that the evidence against Scott was “overwhelming” and “obvious.”
Scott's defense lawyer, on the other hand, told the jury that there is plenty of doubt, making the case that there is no evidence that Mark Scott ever believed OneCoin was a scam.
A spokeswoman for Locke Lord said in a statement that the firm was unaware of Scott's alleged criminal activities, which occurred after he left, saying:
"Scott, who was with our firm for a little over a year, was charged by the federal government with money laundering almost two years after his departure. We were not aware of his individual activities outside of the firm, and we have been fully cooperating and working with government authorities.”
George Bush’s brother met with OneCoin’s ‘cryptoqueen’
In November, Cointelegraph reported that Neil Bush, brother of former President George W. Bush and son of the late President George H.W. Bush was alleged to have received $300,000 to attend a meeting involving Ruja Ignatova. Scott’s counsel David Garvin said:
“Bush recalled that the head of Hoifu Energy, Dr. Hui Chi Ming, received a bunch of cryptocurrency for an oil deal in Madagascar. Bush had a residual interest in the cryptocurrency from the oil deal. Bush met the woman from the cryptocurrency company, Ruja Ignatova, in Hong Kong with Dr. Hui."
Think tank The Rand Corporation has released a report on investigating illicit transactions on the dark web, including the use of cryptocurrencies.
United States think tank The Rand Corporation has taken a closer look at the dark web, where criminal activities are difficult to discover, monitor, and investigate for law enforcement.
On Nov. 20, The Rand Corporation, the Police Executive Research Forum, and the University of Denver on behalf of the National Institute of Justice released a report that dives into a variety of criminal aspects of the so-called dark web.
Dark web provides level of anonymity by using crypto
The report was compiled during a workshop where law enforcement practitioners and researchers identified 46 potential solutions that include the improvement of training for law enforcement, sharing information across jurisdictions, and investigating the gaps and shortcomings in current laws.
In regards to cryptocurrencies, the think tank found that the anonymity of the dark web is presenting law enforcement with significant challenges, as users with malintent are able to achieve a high level of anonymity by using cryptocurrencies, with the report singling out Bitcoin (BTC), Litecoin (LTC), or Monero (XMR).
The report further points out that due to the large number of legitimate cryptocurrency users, especially for BTC, the difficulty increases for law enforcement agencies to properly identify and police the trading of illicit goods and services.
During the workshop, participants recognized that current methods used to identify suspects on the dark web largely rely on traditional techniques to which most officers already are accustomed.
According to the report, the two main findings were that increased investment is needed in training and in the efforts which are aimed at improving information sharing across agencies, both within the U.S. and across international borders.
Dark web drug dealer ordered to forfeit $150,000 in Bitcoin
At the end of October, a U.S. court ordered Christopher Bania, who pleaded guilty to drug distribution, to give up almost 17 Bitcoin — worth roughly $150,000 at the time. Bania’s plea was to the single charge of possession of controlled substances with intent to distribute on the dark web, which carries a maximum sentence of 20 years in jail.
CEO of payment processor PayPal Dan Schulman revealed during an interview on PayPal’s departure from Libra that the only cryptocurrency he owns is Bitcoin.
Dan Schulman, CEO of payment processor PayPal, revealed during an interview that he does indeed own Bitcoin (BTC).
On Nov. 20, Fortune reported that PayPal CEO Dan Schulman stopped by its offices where he discussed a variety of topics, including the reason for PayPal’s withdrawal from the Libra Association and whether he is the proud owner of any cryptocurrencies.
PayPal was the first to leave Libra
Schulman explained that PayPal withdrew from Libra because the company decided to put its attention elsewhere. According to the CEO it was a question of “where do we want to put our attention, and what do we want to do today to advance our mission?” He added:
“You know, we think if we focus on our own roadmap, we’d be able to advance financial inclusion faster than if we put all these resources against Libra.”
Schulman added that Libra will start going down a road that his company remains “very interested in looking at,” and once Libra starts to figure things out, “we’ll take another look at where they are.”
At the beginning of October, a PayPal spokesperson told Cointelegraph that the company had officially left the association, adding that they remain supportive of Libra’s aspirations and continue to look forward to dialogue on ways to work together in the future.
A lot of promise to blockchain technology
PayPal’s CFO John Rainey said in May that the firm has teams that are working on blockchain and cryptocurrency, and that they wish to participate in that technology in whatever form it takes in the future.
In the Fortune interview, Schulman was reluctant to share any significant details as to what exactly PayPal is working on in the sphere, although he was quick to point out that it is not “necessarily competitive with Libra,” adding:
“We think there’s a lot of promise to blockchain technology. It’s intriguing to us, but it really needs to do something that the traditional rails can’t do. Most people think that blockchain is about efficiency, but the system today is pretty efficient.”
Regarding cryptocurrencies, the CEO said that it is still very volatile, and that they do not have much demand for it by merchants because merchants operate on very small margins. He said:
“Until it becomes less volatile, it won’t be a currency that is widely accepted by merchants on the web — not the dark web, but the web.”
As to whether he owns any cryptocurrencies himself, Schulman’s answer was short and straightforward:
“Yes, Bitcoin. [...] Only.”
Guests on a Bloomberg panel agreed that Bitcoin becomes more attractive during times of irresponsible monetary policies from central banks and governments globally.
John Pfeffer, founder of Pfeffer Capital, together with Travis Kling, founder and CIO of Ikigai Asset Management and Charles McGarraugh, head of markets for Blockchain, discussed Bitcoin (BTC) in the context of Brexit, trade wars and geopolitical uncertainty.
On Nov. 20, the panel of three sat down for an interview with Bloomberg’s Alastair Marsh at the Future of Digital Assets briefing in London, where they took a closer look at the idea that Bitcoin becomes more attractive as an investment during times of global uncertainty.
Bitcoin the ultimate store of value?
(1:20) Charles McGarraugh started off the conversation by agreeing to the idea that BTC does indeed become more appealing during threats of recessions and general global times of uncertainty. “I totally buy into that idea,” he said.
(3:12) John Pfeffer continued by saying that BTC is poised to become digital gold. “Sooner or later that is going to happen,” Pfeffer said, pointing out that if BTC were already considered today’s digital gold, the upside of BTC would not be the same, as it would be worth at least one or two orders of magnitudes more. He added:
“We think of [BTC] in our portfolio as it goes into our venture portfolio. [...] It is a venture that aspires to become digital gold, and is showing great promise of doing that. Because it hasn’t done that yet [...] there is a lot of upside, but also downside.”
(5:35) Travis Kling gives perhaps the most direct answer when he says that Bitcoin is a risk asset, one with specific investment characteristics “that become increasingly more attractive the more irresponsible monetary and fiscal policy is from central banks and governments globally,” adding:
“Investors in BTC today aren’t investing in Bitcoin as a store of value today, we’re speculating that it may become a store of value because it has the characteristics to be a good store of value.”
(11:00) Kling further points out that if the United States was still on the gold standard, and was balancing its budget every year instead of spending a trillion dollars more than they collect, “we might not need Bitcoin so much.” However, as Kling puts it, “that ain’t the world we’re living in.”
US national debt growth is not sustainable
In November, the head of the United States Federal Reserve Jerome Powell noted that currently, U.S. national debt is growing faster than nominal GDP. He admitted that the current economic policy is not sustainable, but that it is not its job to fix it. “Ultimately in the long run that’s not a sustainable place to be,” he said.
U.S. debt has now topped $23 trillion, which adds up to $70,000 per head of the population, or more than $1 million for every Bitcoin that will ever exist.
Chinese companies submitted around 7,600 blockchain patent applications between 2009 and 2018, about three times as many as U.S.-based companies.
Measured by patent applications in the sector, China is handily outpacing other countries including the United States in blockchain technology.
On Nov. 20, Japan-based financial newspaper Nikkei reported that Chinese companies submitted around 7,600 applications between 2009 and 2018 — about three times as many as U.S.-based companies.
A total of 12,000 blockchain applications
According to Tokyo-based research firm Astamuse, the U.S., China, Japan, South Korea and Germany together submitted around 12,000 blockchain-related patent applications through 2018, with China accounting for over 60% of the five-country total.
South Korea submitted close to 1,150 applications within the same time frame, while Japan submitted fewer than 380 applications.
With 512 applications, Chinese retail giant Alibaba Group Holding took the lead amongst the ranking of corporate applicants compiled by Japan's NGB based on data from Innography. United Kingdom-based nChain followed Alibaba closely, with 468, while technology giant IBM filed 248 applications.
In November, the Chinese news program Focus Report pointed out that although there are around 32,000 companies in China that claim to use blockchain technology, reportedly the real number is not even 10% of that. According to the episode, China's blockchain industry is at the forefront of the world, with the total number of blockchain enterprises second only to the United States.
China and blockchain adoption
In October, China’s President Xi Jinping called for the country to accelerate its adoption of blockchain technologies as central to innovation. Xi stressed that the implementation of integrated blockchain technologies is key in promoting technological innovation and transforming industries.
Edith Cheung, partner at blockchain-focused venture capital fund Proof of Capital, said that she believes that China will “definitely” deploy its new digital currency within the next six months to a year. Cheung looked to foreign powers, who she believes should already be prepared to respond, as China hopes to become the first country worldwide to issue a digital incarnation of its national currency. She added:
“I really think the United States needs to hurry up; to have a strong thinking and policy, at least a direction for virtual USD.”
Bitcoin’s drop below $8k increases the change of a visit to the 61.8% Fibonacci retracement level at $7,845. Is a bounce incoming?
Bitcoin’s (BTC) price action continues to be less than impressive unless one is a bear capitalizing on the current shorting opportunities.
Bulls pinned their hopes on BTC price breaking out of the falling wedge in a strong upside move since the consensus was that this particular pattern tends to produce bullish outcomes more often than not. This was not the case and Bitcoin price toppled below the descending trendline to $7,981.
Since reaching a dominance rate of 69.35% on Oct. 27, Bitcoin’s dominance rate has dropped to 65.9% and a growing number of traders appear to be shifting their attention to altcoins as many are pressing against their long-term descending trendlines and 200-day moving averages.
Crypto market data monthly view. Source: Coin360
Ultimately, the issue here seems to be a lack of interest manifesting in low trading volume.
Some crypto-Twitter analysts are now calling for Bitcoin price to drop to $6,000 and the most bearish among them have called for a revisit to the $3,000 range. Bitcoin’s current price action does not suggest a drop below $6,000 as a realistic short-term price estimate. But let’s have a look at the charts to see what clues they could provide.
BTC USD daily chart. Source: TradingView
Bitcoin’s nearest support below $8,000 is at $7,866, roughly $20 away from a golden pocket bounce off the 61.8% Fibonacci retracement level at $7,845. Currently, the $8,300 support has flipped to resistance, a point which also aligns with the Bollinger Band indicator moving average (yellow line) on the 6-hour chart.
BTC USD 6-hour chart. Source: TradingView
At the time of writing, buyers have pushed Bitcoin price to $8,232 on a low volume move and the MACD line of the moving average convergence divergence has curled up toward the signal line. Bulls may attempt to push the price higher but the current volume and relative strength index (RSI) reading below 30 dampen enthusiasm.
In the event that buyers continue to press the price higher, a move through $8,300 is required; and above this point, Bitcoin price is capped by the falling wedge descending trendline and the 50-day moving average (black line), which has weighed on the price since Nov. 11.
BTC USD daily MACD, RSI, and Stoch chart. Source: TradingView
The Stoch and RSI on the daily chart suggest Bitcoin could be due for an oversold bounce and traders will notice what could become (depending on the daily close) a double bottom at $8,020.
BTC USD daily chart. Source: TradingView
A bird’s eye view of Bitcoin’s price action on the daily chart shows that double bottoms have been a frequent occurrence often followed by price reversals.
In a newsletter published earlier in the week, crypto analyst Philip Swift suggested that Bitcoin remains in the early phase of a bull market and according to Swift, it is unlikely that the price will drop below $6,000.
As shown by Swift’s Bitcoin 2-Year Multiplier, Bitcoin bounced off after dropping slightly below the 2-year moving average to $7,450. If the price fails to bounce off the 61.8% Fibonacci retracement level, perhaps it will form a double bottom and reverse in this region again.
Bitcoin 2-Year MA Multiplier. Source: Philip Swift
Bears foresee buyers failing to purchase a drop to the 61.8% Fibonacci retracement level at $7,845, after which Bitcoin price drops to the $7,500 support. If this fails to hold, Bitcoin could complete a full retrace of the Oct. 25 42% rally to $7,400 which would form a double bottom where price could bounce.
BTC USD weekly chart. Source: TradingView
Looking at the long-term descending channel, BTC could drop to $6,850 where the lower channel arm is. However, this outcome seems unlikely, as the weekly chart volume profile visible (VPVR) range shows Bitcoin price supported from $8,250 to $7,900.
Furthermore, the weekly chart shows the lower band of the Bollinger Band indicator is situated $7,430, quite near the previous bottom on Oct. 23.
Over the short-term bulls need to flip the s/r level at $8,300 then move to take out the 50-MA at $8,500. The next step would be to overcome the s/r level at $8,600 which places the price at the overhead trendline of the long term descending channel.
As mentioned earlier, Bitcoin trading volume needs to improve or bears are likely to continue pressing the price lower. In the meantime, traders are encouraged to at least keep an eye on altcoins as some enticing price action has been taking place with many tokens over the last 3 weeks.
The views and opinions expressed here are solely those of the author (@HorusHughes) and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
The new $200 million Bitcoin Cash Ecosystem Fund will focus on payment solutions and non-custodial financial services for Bitcoin Cash.
Ver has announced the news speaking at a Bitcoin Cash meetup in London on Nov. 19, as he tweeted on Nov. 20. The event was hosted by major global crypto wallet Blockchain.com. The new Bitcoin Cash Ecosystem Fund will focus on payment solutions and non-custodial financial services for Bitcoin Cash, a cryptocurrency that emerged from a hard fork of Bitcoin in August 2017.
The new fund will be investing in payment gateways and wallet acquirers
According to an official announcement, details of the BCH Ecosystem Investment Fund are not yet finalized but it will allow participation from institutional investors. The fund will be investing in payment gateways, processors remittances, wallet and merchant acquirers.
Bitcoin.com’s new CEO, Stefan Rust, has reportedly identified up to 20 potential institutional investors that share the company’s vision and are interested to invest alongside Bitcoin.com’s executive chairman Ver and the company itself.
Bitcoin.com recently launched its own crypto exchange
Formerly known as a website focused on covering BTC and BCH, Bitcoin.com now provides a number of Bitcoin and Bitcoin Cash services including crypto trading and storage. The firm behind the website has been gradually embracing more services since its domain name was acquired by Ver back in 2014.
Increasing emergence of new crypto funds
Meanwhile, the number of new crypto-related funds appears to be surging. Yesterday, Michael Novogratz’s crypto merchant bank Galaxy Digital announced the launch of two Bitcoin funds, targeting “the wealth of America,” or people between the ages of 50 and 80. Last week, ConsenSys’ CSO Sam Cassatt announced that his new blockchain-oriented investment firm Aligned Capital is planning to raise $50 million for its first fund.
Web 3.0 browsers are tapping into existing networks in emerging markets to foster crypto adoption.
In October, web browser developer Opera Software AS launched added support for in-browser transactions with Bitcoin (BTC) and Tron (TRX). This follows the company’s initial launch of an in-browser Ether (ETH) wallet in 2018. The latest announcement is part of the company’s grander plan to make the “Web 3.0” easier to access for the average consumer.
Opera, based in Norway, is the first major browser to develop and integrate a native crypto wallet, which also supports direct transactions. The company started testing the in-browser payment feature in July through a beta version of the Opera for Android browser.
Opera’s move fits into a larger narrative of companies integrating cryptocurrency into existing systems and networks that people already use. Brave Software Inc., another web browser developer, had first incorporated wallet technology into its browser to allow web users to earn cryptocurrency for performing or permitting certain actions that they already do with traditional browsers without earning anything. Other platforms looking to implement similar Web 3.0 features are also active.
A first step?
Cryptocurrencies are still more popular in the developed world than in developing markets, where most of the world’s financially excluded people live. Opera’s moves to enable Web 3.0 can potentially bring cryptocurrency to several financially excluded people.
That’s thanks to the browser’s popularity in the developing world, especially Africa. Opera browsers are popular for their data-saving features. The company claimed that data savings in its products helped users in Africa save nearly $100 million in 2018.
Therefore, making crypto wallets easily accessible to this group of consumers could be a big step toward using cryptocurrencies to offer financial services to the unbanked and underbanked. In addition to Bitcoin, Ether and Tron, the Opera crypto wallet also supports ERC-20 and TRC-10 tokens. Multiple decentralized financial, or DeFi, products are already being built using certain ERC tokens.
Opera’s push to expand access to Web 3.0 could also impact the burgeoning betting industry in Africa. The combined size of the gambling market in Kenya, Nigeria and South Africa was worth an estimated $37 billion in 2018.
When asked on how Opera’s latest developments could potentially help onboard new crypto users through gambling, Tron founder and CEO Justin Sun told Cointelegraph that Wink, a decentralized application built on the Tron blockchain is working now with seamless integration.
“Users can simply use the Opera browser to play Wink by logging onto Wink.org without using any 3rd party wallets. We expect to see more TRON DApps integrated within Opera in the future, in similar fashion.”
According to Opera, 350 million people use its browsers globally — nearly 120 million of those are in Africa. It’s worth noting, however, that Opera’s crypto wallet is only available on the “Opera browser with free VPN” application on Android and the “Opera Touch” browser on iOS.
There isn’t any data to tell what portion of the 350 million users use Opera Mini. Still, this means that the crypto wallet is available to fewer than 350 million users. If Opera Mini has the largest user base, then the number of people who can use the Opera crypto wallet could be significantly lower. Opera didn’t respond to a request for comment regarding this.
Incorporation into an existing network is becoming a trend
Opera isn’t the first company to have integrated functionalities for cryptocurrencies into an existing network to foster quicker adoption, as the Brave browser is another web-surfing tool spearheading the crypto charge.
Brave was the first to reimagine using browsers as a tool to foster crypto adoption through its privacy-focused Brave browser. The browser gives internet users power over their data by blocking tracking services and ads.
Instead, Brave allows users to earn native Basic Attention Token (BAT) when they view advertisements. Users can also use the BAT to reward platforms and content creators of their liking. The browser recently reached 9 million active monthly users.
As Opera appears to be targeting the user base that cares about cost-saving for crypto adoption, Brave’s target is the privacy-loving customers.
In August, Brave went beyond its native wallet that only supports its rewards programs to integrate an Ether wallet that supports ETH as well as most Ethereum tokens and collectibles. Unlike its Brave Rewards system, the Ether wallet doesn’t require users to take part in Know Your Customer procedure and can interact with DApps.
The browser also allows users to connect a hardware wallet in addition to other layers of protection, according to Brian Bondy, Brave’s chief technology officer and co-founder, who told Cointelegraph:
“Our Crypto Wallets feature can be used with hardware wallets (Ledger, Trezor) for users who would like the added security. Additionally, our Crypto Wallet is based on an extension and the background page for that extension has its own process and address space.”
Brave has made it clear, however, that its wallet is targeted at “people who already have a working understanding of cryptocurrency generally.” Still, Brave appears interested in using the existing browser network to further the adoption of blockchain and cryptocurrency.
“We’re excited to continue pushing the envelope when it comes to support for cryptocurrency and other blockchain applications on the web platform,” Brave said in its announcement of its crypto wallet.
IOV Labs, RSK and social media
Beyond browsers, different companies are tapping into existing networks and systems to promote the use of cryptocurrencies. In September, Argentina-based IOV Labs acquired Spanish-oriented social media platform Taringa, which has 30 million users.
IOV Labs, which powers the RSK Bitcoin smart contact platform, sees an opportunity in tapping into data from the social network to build, test and distribute decentralized products based on its smart contract platform and its native RIF token. In the end, it hopes to bring wider adoption to Bitcoin. IOV Labs CEO Diego Gutiérrez Zaldívar told Cointelegraph that:
“Latin America, a market already in need of financial services as half of the population is unbanked. The values inherent in the development of Bitcoin, blockchain and Taringa are one and the same, empowering individuals by giving them a voice and the economic tools they need to thrive.”
IOV Labs plans to incentivize Taringa users to participate meaningfully in the communities hosted on the social network by rewarding them with RIF tokens. Zaldívar added that:
“We know blockchain technology can meet the existing needs of these users far more effectively than existing systems, by protecting user privacy, and sharing the economic value and reputation users create with their interactions.”
Alternative app store Aptoide
In 2017, Aptoide started developing AppCoins, an open-source and distributed protocol for app stores based on the Ethereum blockchain. It raised over $16.8 million in an initial coin offering for AppCoins’ development. For Aptoide, which claimed to have more than 200 million users, integrating a blockchain-based system was a natural step, owing to its community-oriented approach to app distribution.
Aptoide’s chief operating officer and creator, Álvaro Pinto, told Cointelegraph that Aptoide has been a community-driven app store since inception. With Aptoide, users can create their own list of apps, which can be shared with family, friends and colleagues to foster deeper app engagement.
Part of Aptoide’s aim is to make in-app payment simpler in emerging markets, where it has the majority of its users. In these countries, it can be difficult for users to make in-app purchases because one can only buy them using a credit card, PayPal and gift cards as Pinto explained:
“We have this huge amount of people using smartphones, but if you look into the number, the number of users doing in-app purchases and buying digital goods in the app stores is very limited.”
However, Pinto is adamant that the problem isn’t affordability. He believes that many people can afford to make 50-cent purchases, but the process for making such purchases is difficult. Pinto added:
“We’re starting to see the common user having their first experience with blockchain, and that was part of the idea — to take blockchain to the average user and to all this gigantic user base of Android.”
Salmon farming company Cermaq and smoked salmon producer Labeyrie began using IBM’s cloud blockchain technology to trace their products’ supply chains.
Cermaq announced the development in a Nov. 20 press release, revealing that it cooperated with Labeyrie and IBM’s blockchain platform IBM Food Trust to enable customers to get information about the salmon value chain. All Cermaq salmon products now come with a CV and QR-code, so consumers can check details such as:
“... [fish] origin, when it was hatched, which fresh water facility it came from, how big it was when it was transferred to seawater, at which sea water facility it has been farmed, as well as health and welfare information such as which vaccinations it has received, what it has been fed, and when it was harvested.”
Labeyrie rolled out a traceability system for two of its Norwegian smoked salmon products, thus allowing consumers to see information about the whole production chain of the fish — from egg to store. Commenting on the development, Brede Løfsgaard, sales director in Cermaq Norway, said that the project was partly driven by customer demand for more transparency.
Putting food on the blockchain
Food manufacturers around the world have been actively integrating blockchain technology into their supply chains. Earlier in November, retail giants Carrefour and Nestlé began deploying IBM’s Food Trust blockchain platform to track the supply chain of milk-based formula for infants. The firms aim to advance consumer confidence in the products’ quality by ensuring more transparency of the supply chain of formulas produced by Laboratoires Guigoz.
American logistics giant UPS successfully delivered a blockchain-verified beef shipment from the United States to Japan. The company had partnered with agritech firm HerdX to incorporate its packaging technology into a blockchain network to trace the journey of beef from Kansas to Japan.
ShapeShift cryptocurrency exchange has launched new tokens that enable holders to trade on the exchange with no fees.
Switzerland-based crypto exchange ShapeShift has launched zero-fee trading and its loyalty token FOX. ShapeShift founder and CEO Erik Voorhees announced the news on Twitter Nov. 20, noting that zero-commission trading on the platform is enabled by the newly released FOX token.
According to the executive, zero-fee trading solves two major problems of non-custodial exchanges — illiquidity and high price of services.
“The model is simple: hold FOX & you trade at a 0% commission rate. If not, you trade at our retail rate. You don’t spend or lose the FOX tokens to get the benefit. Just hodl.”
In a Medium post, Voorhees elaborated that the platform gives customers 100 FOX tokens on verified signup. Each FOX token grants $10 of free trading volume every 30 days.
Voorhees expects 30% surge in trading accounts in a month
Voorhees also stated that the new feature is not a temporary offer, emphasizing that zero-commission crypto trading will now be granted perpetually on ShapeShift.
In an interview with industry publication The Block, Voorhees said that he does not think that zero-commission trading will negatively affect ShapeShift’s revenues. Instead, ShapeShift plans to sell its FOX tokens to new clients in exchange for perpetual free trading services if the model eventually succeeds. Moreover, users who do not hold FOX tokens will still pay their fees.
As a result of the zero-fee trading launch, Voorhees expects a 30% surge in the number of ShapeShift trading accounts.
Zero-fee cryptocurrency trading is not a new concept. American stock brokerage Robinhood Crypto is a major provider of zero-fee crypto trading, allowing users to trade seven major cryptocurrencies with no commission fee. In late September 2019, California-based financial firm SoFi launched zero-fee crypto trading on its platform SoFi Invest.
Bitcoin price is close to critical support levels, but we anticipate a bounce off the support levels as we take a look at the charts.
The Federal Reserve Board Chairman Jerome Powell has said that the Fed is not developing a central bank digital currency (CBDC), but it is conducting its own research to evaluate the benefits and limitations of such an initiative.
On the other hand, Edith Cheung, partner at blockchain-focused venture capital fund Proof of Capital, believes that China will launch its digital currency within the next six to twelve months. A CBDC by a large economy will be an interesting development.
Daily cryptocurrency market performance. Source: Coin360
The crypto markets have been losing ground in the past few weeks due to the lack of a positive catalyst. The United States Securities and Exchange Commission announced that it will review its previous decision to reject the exchange-traded fund (ETF) filing from Bitwise Asset Management and NYSE Arca. Though this review does not guarantee approval, it is certainly a step in the right direction.
The majority of crypto investors are in the age group of 18 to 34. Lack of understanding of the technology has kept the people above the age of 50 away from crypto investing. Michael Novogratz’s crypto merchant bank Galaxy Digital plans to tap into this wealth among older investors by offering two Bitcoin (BTC) funds — Galaxy Bitcoin Fund and Galaxy Institutional Bitcoin Fund. These funds could bring a lot of fresh money into the crypto markets.
As the fundamentals continue to improve, we believe that dips should be viewed as a buying opportunity. However, it is best to wait for the price to stop falling and signal a turn around before entering long positions. Do the charts of the major cryptocurrencies signal a bottom or could the prices fall further? Let’s analyze the charts.
After holding close to $8,467.54 for three days, Bitcoin plummeted on Nov. 18. The fall has dragged the price to $8,000, which is psychological support. Just below this, at $7,952.84 is the 78.6% Fibonacci retracement level of the most recent rally. We anticipate a strong defense of this support by the bulls.
BTC USD daily chart. Source: Tradingview
Though the price has not breached the $8,000 mark, the bulls have failed to achieve a strong rebound. This shows that the bulls are cautious at these levels. If the price fails to scale above the moving averages within the next few days, we anticipate the bears to make another attempt to sink the price below the $7,702.87 to $7,337.78 support zone. If this zone gives way, the BTC/USD pair might nosedive to $5,500. Such a move will be a huge negative but we give it a low probability of occurring.
We will wait for the price to climb above the $8,777.89 to $9,080 overhead resistance before turning positive.
Ether (ETH) has gradually dipped to the first support at $173.841. If this support fails to hold, the correction can deepen to $161.056 and below it to $151.829. A breakdown of $151.829 will resume the downtrend.
ETH USD daily chart. Source: Tradingview
Conversely, if the price rebounds off $173.841, a few days of range-bound action between $173.841 and $197.75 is likely.
While most other cryptocurrencies are struggling to hold their support levels, the ETH/USD pair has not given up much ground. Hence, during the next up move, the pair is likely to be at the front of the rally. Therefore, we are not recommending traders to close their long positions yet. They can protect their positions with stops at $150.
XRP dipped below $0.24 on Nov. 18, which triggered our suggested stop loss on the long positions. The bulls are currently attempting to defend the support at $0.24508. However, the downsloping 20-day EMA and the RSI close to the oversold territory indicates that bears have the upper hand.
XRP USD daily chart. Source: Tradingview
If the bears sink the price below $0.024508, a retest of the yearly low at $0.22 will be on the cards. A break below this level will be a huge negative as it will resume the downtrend.
Contrary to our assumption, if the XRP/USD pair rebounds off the current levels, the bulls will try to keep it range-bound between $0.24508 and $0.31491 for the next few days. We will wait for a new buy setup to form before turning positive.
Bitcoin Cash (BCH) plunged below the 50-day SMA on Nov. 18 and is currently threatening to break below the critical support at $241.85. If this support breaks down, a retest of $203.36 is possible. The 20-day EMA has started to turn down and the RSI has dipped into the negative zone, which shows that bears are in command.
BTC USD daily chart. Source: Tradingview
Contrary to our assumption, if the price turns around from the current levels, the bulls will attempt to push it above the 20-day EMA. If successful, a move to $306.78 is likely. We will wait for the decline to end and the price to form a reliable buy pattern before recommending taking a long position.
The tight consolidation in Litecoin (LTC) resolved to the downside on Nov. 18, with a break below the 50-day SMA. The next support on the downside is $50 and below it $47.1851. If this support zone cracks, the downtrend will resume. Therefore, traders can protect their long positions with stops at $47.
LTC USD daily chart. Source: Tradingview
If the bulls defend the support at $50, the LTC/USD pair will extend its stay inside the $50 to $62.0764 range for a few more days. The pair will pick up momentum on a breakout of $66.1486.
The bulls have held the support at $2.9980 for the past two days but have failed to achieve a strong bounce off it. This shows a lack of aggressive buying at the support level. Unless the price quickly rebounds off the current levels, EOS could slip below the support at $2.9980. Below this support, a retest of $2.4001 is possible.
EOS USD daily chart. Source: Tradingview
Conversely, if the EOS/USD pair rebounds off $2.9980, it might remain range-bound between $2.9980 and $3.69 for a few days. The pair will pick up momentum on a break above $3.69.
The bears have made a strong comeback in Binance Coin (BNB). The price has plunged below both the moving averages and is currently challenging the support at $18.30. This is an important level to watch out for because the uptrend line is also located close by. A break below this level can sink the price to $16.50.
The 20-day EMA has started to slope down and the RSI has dropped into the negative territory, which shows that bears have the edge.
BNB USD daily chart. Source: Tradingview
However, if the bulls defend the support at $18.30, the BNB/USD pair might consolidate between $18.30 and $21.2378 for a few more days. The pair will pick up momentum above $21.80. Traders can retain the stop loss on the long positions at $16.
Bitcoin SV (BSV) broke below the descending channel on Nov. 19 and is currently threatening to break below the critical support at $107. If this level cracks, the next support is at $92.693.
BSV USD daily chart. Source: Tradingview
The 20-day EMA has turned down and the RSI has dipped close to the oversold zone, which shows that bears are in the driver’s seat.
Our negative view will be invalidated if the bulls defend the support at $107. This will be a positive sign as it will indicate demand at lower levels. A bounce off $107 can carry the price to $155.380. We will wait for a new buy setup to form before turning positive.
Stellar (XLM) is looking weak as the bulls have failed to defend the 50-day SMA. There is minor support at $0.062122 below which a drop to $0.0560 is possible. The 20-day EMA has started to slope down and the RSI has dipped into the negative territory, which shows that bears have the upper hand.
XLM USD daily chart. Source: Tradingview
Contrary to our assumption, if the XLM/USD pair bounces off $0.062122, it will indicate that bulls are using the dips to accumulate. The recovery attempt will face resistance at the moving averages, above which a move to $0.088708 is possible. We do not find a reliable buy setup at the current levels, hence, we are not suggesting taking a position at this time.
Tron (TRX) has broken below the 50-day SMA. It is currently falling inside a descending channel. The 20-day EMA has started to turn down and the RSI has dipped back into the negative zone, which suggests that bears are in command.
TRX USD daily chart. Source: Tradingview
The TRX/USD pair can now dip to the support line of the descending channel, which is close to the horizontal support at $0.0157773. If this support holds, the pair will extend its stay inside the channel.
However, if the bears sink the price below the channel, the down move will pick up momentum. The next support on the downside is $0.0136655 and below it is $0.0116262. We will wait for the price to break out and sustain above the channel before turning positive.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
Market data is provided by HitBTC exchange.
French law enforcement’s cybercrime unit has validated judicial expenses incurred during investigations on the Tezos blockchain.
The French Armies and Gendarmerie’s Information and Public Relations Center has validated judicial expenses incurred during investigations on the Tezos (XTZ) blockchain.
A press release published on Nov. 20 notes that the Gendarmerie’s cybercrime division (C3N) used the system to buy cryptocurrency from Europol-allocated funds and cover its operational costs with those assets.
Blockchain ensures the ability to audit
Tezos’ main development and research center, Nomadic Labs, claims that the system employs “the first smart contract ever developed by a public authority.” The program enables C3N to buy cryptocurrency from Europol-allocated funds and cover its operational costs with those assets.
Using a blockchain-based system reportedly simplifies administration and procedures, and ensures the ability to audit and traceability of funds. The smart contract that regulates the functioning of the system only interacts with authorized individuals and enables C3N to justify expenses without disclosing operational activities.
Governments are showing an increasing interest in blockchain technology. Recently, during BlockShow Asia 2019, experts stated that blockchain technology enables ecosystem connectivity by sharing information in a trustless, decentralized fashion, which in turn could enable a new form of governance.
In a recent instance of blockchain being used in a government administration, China’s Zhejiang province has already processed nearly $6 billion via a blockchain medical billing platform using Ant Financial’s blockchain technology.
U.S.-based Trade Station — a subsidiary of Coincheck owner Monex Group — is launching a crypto brokerage platform via a newly-launched offshoot, Trade Station Crypto.
As Cointelegraph Japan reported on Nov. 20, the platform will establish an online brokerage model in line with similar platforms that exist for traditional assets in equities, options, futures and forex markets.
Initial support for five major cryptos
As distinct from an exchange, which functions as a self-contained market and can, therefore, lack deep liquidity, Trade Station claims that its crypto brokerage services will provide crypto traders with access to aggregated, multiple liquidity pools, thereby improving price execution.
Via the new platform and services, traders in approved countries and U.S. states will be able to trade Bitcoin (BTC), Bitcoin Cash (BCH), Ether (ETH), Litecoin (LTC) and Ripple (XRP), with more cryptos to be supported in the future.
Services will include a smart order-routing system to optimize visibility and trade execution. In a statement, James Putra — TradeStation Crypto’s director of product strategy — noted:
“When we began to explore the crypto space, we saw a fragmented market that lacked efficient means of price discovery and order execution.”
He added that the venture gives priority to maximizing liquidity, market access and fairer pricing. The company’s institutional investor team will be catering to institutional clients by offering them tailored support for their crypto trading.
Monex’s Coincheck acquisition
Trade Station was listed on Nasdaq until its acquisition by Tokyo Stock Exchange-listed Monex Group Inc. in 2011. The latter is well-known in the cryptocurrency sector for its acquisition of the Japanese crypto exchange Coincheck in April 2018, which had suffered an industry record-breaking $534 million hack earlier that year.
Earlier this fall, Monex Group revealed it would be paying out dividends denominated in Bitcoin (BTC) as a mid-term shareholder benefit. In July, the firm revealed its intentions to join Facebook’s cryptocurrency project Libra.
The United States Federal Reserve System is exploring the development of a digital currency and what issues and risks it could potentially pose.
Federal Reserve Board Chairman Jerome Powell provided a response to U.S. Representatives French Hill and Bill Fosters’ request on whether the Federal Reserve plans to launch a national digital currency, financial services reporter Zachary Warmbrodt tweeted on Nov. 20.
In the letter, Powell set forth the Federal Reserve’s views on the creation of a CBDC, emphasizing that, although the agency is not currently developing a CBDC, it has assessed and continues to evaluate the costs and benefits of such an initiative.
Powell revealed that the agency is conducting its own small-scale, research-focused experiments to gain hands-on experience and better understand the opportunities and limitations of CBDCs.
CBDCs raise a range of legal concerns
Powell said that prior to issuing a CBDC, the Federal Reserve has to address a number of legal questions, including monetary and payments policies, financial stability, supervision and operational issues, and their vulnerability to cyber-attacks. Powell continued saying:
“If it is designed to be financially transparent and provide safeguards against illicit activity, a general purpose CBDC could conceivably require the Federal Reserve to keep running record of all payments data using the digital currency [...] and sometimes that raises issues related to data privacy and information security.”
Lastly, Powell noted that a number of design features should be considered for the development of a CBDC, including the governance of the outstanding stock of such a currency, the necessity of a Federal Reserve payment system to conduct transactions and the issue of anonymity in regard to owning and transacting a CBDC.
Representatives’ response to the letter
In response to Powell’s letter, Rep. Hill expressed enthusiasm that the Federal Reserve is exploring whether there is a point to issuing a CBDC, and said:
“This decision would have far-reaching implications on every aspect of America’s monetary policy and requires a deep level of analysis to ensure proper implementation.”
Rep. Foster said: “My main concern is that we are not caught flat-footed by fast moving developments in other countries that may put our economy at a competitive disadvantage and threaten the primacy of the U.S. dollar.”
Despite crypto markets reclaiming the capitalization boasted in Nov. 2017 and record volumes, altcoins have seen a declining market share.
At present, the combined capitalization of the 2,022 crypto assets with a known market cap was roughly $222 billion.
On Nov. 19, 2017, just weeks before the current all-time highs would be set for the price and capitalization of Bitcoin and the crypto market overall, the 985 tokens with a known market cap represented a capitalization of around $244 billion — a similar zone to where the market is at currently.
However, with the capitalization of Bitcoin (BTC) having grown 15% from $134.1 billion to $154.6 billion during the 24 months following November 2017, more than twice as many altcoins are competing for an increasingly shrinking share of the combined crypto market cap when compared to the altcoin bubble of 2017.
Altcoins compete for diminishing market share
While 2019 has seen BTC produce an impressive recovery, the majority of altcoins have lost a significant market share when compared to 2017.
As of Nov. 17, 2018, the combined crypto capitalization was approximately $186 billion after having shrunk by 21.7% over 12 months. Since November 2017, the dominance of BTC had fallen from 56.5% to 52.6%, with altcoins gaining an overall 47.4% market share of crypto capitalization.
However, the number of tokens with a known capitalization had risen 75.8% to 1,732, increasing competition among altcoins for a shrinking pool of liquidity — with the combined capitalization of altcoins having dropped from $107.2 billion to $86.8 billion just 12 months later.
Despite the number of crypto assets having increased by a further 16.7% since November 2018, the combined altcoin capitalization reduced by roughly 8% to $80 billion during the past year. As such, altcoins have seen increased proliferation in the face of a declining pool of liquidity for two consecutive years.
Altcoin capitalization centralizes among top markets during 2019
Between November 2017 and November 2018, the relative market share of alternative cryptocurrencies became more pluralized, with the share of capitalization represented by altcoins sitting outside of the top 10 by market cap, increasing from 23.3% to 28.4% despite the dramatic rise in the number of markets.
The greater pluralism in the distribution of altcoin capitalization in 2018 can be largely attributed to a decline in the relative market share of Ether (ETH) and Bitcoin Cash (BCH) throughout the 12 months prior. Together, ETH and BCH had shed 23% of altcoins’ relative market share in one year.
Of the 10 largest altcoins by market cap on Nov. 18, 2017, only XRP’s market share increased throughout the next year, becoming the largest altcoin by capitalization and representing 22.8% of the combined altcoin market cap on Nov. 17, 2018.
LTC fell by one rank, from fifth to fourth, shedding nearly a third of its relative market share in the process — from 3.7% during November 2017 to 2.8% one year later. XMR also fell one rank, from eighth to ninth, with its market share dropping from 1.9% to 1.7%.
Dash, NEO, Iota, Nem (XEM) and Ethereum Classic (ETC) all fell from the top 10 altcoins by capitalization as their relative market share declined in 2018. They did, however, retain their rank among the top 20.
Dash fell from fifth, with an altcoin market share of 3.3%, to rank 12th with 1.3%; NEO fell from sixth with 2.5% to 15th with 0.9%; Iota fell from seventh with 2.3% to 11th with 1.3%; NEM moved from ninth with 1.8% to 14th with 0.9%; and ETC fell from 10th with 1.7% all the way to 16th place with 0.9%.
As of Nov. 17, 2018, the relative market share represented by the alternative cryptocurrencies ranked third to 10th by capitalization had increased from 17.2% to 19.9%, with XLM, EOS, Tether (USDT), Cardano (ADA) and Tron (TRX) having emerged among the top 10 altcoins by market cap.
In just 12 months, XLM rose from the 20th-ranked altcoin, representing a relative market share of 0.6%, to the fourth-largest alternative cryptocurrency, with 5.5% of total altcoin capitalization.
EOS also climbed, from 14th with 0.88% in 2017 to rank fifth with 4.7% in 2018, while Tether grew from 19th with 0.7% to place sixth with 2%, and ADA grew from 18th with 0.7% to seventh with 1.8%, while TRX produced the most dramatic growth, climbing from the position of 53rd-largest altcoin with a relative market share of 0.1% to rank tenth with 1.4%.
Altcoin capital centralizes during 2019
During 2019, altcoin capitalization has significantly centralized among the top alternative currencies by market cap. Currently, the 2,011 alternative cryptocurrencies that do not rank among the top 10 by market cap are competing for just 20.61% of the total combined capitalization.
In 12 months, ETH has restored its ranking as the largest altcoin by market cap and increased its market share by a quarter, currently representing 25.1% of the total altcoin market capitalization.
XRP now ranks as the second-largest alternative cryptocurrency by market cap following a 39% drop in relative market share, which currently sits at 14.2%. Despite BCH seeing another 12-month decline in altcoin market share, the token retained its distinctive position as the third-largest alternative cryptocurrency by market cap, with BCH now representing 6% of altcoin capitalization.
As such, the relative dominance of the three largest altcoins has increased 7% year-on-year from 51.7% to 55.4%.
Top 10 altcoins gain market share
The market share of altcoins represented by the tokens ranking from third to 10th by capitalization also increased for the second consecutive year, currently representing 24% of the combined altcoin market cap.
The relative market share of Tether increased by 160% between November 2018 and November 2019, with USDT ranking as the fourth-largest alternative cryptocurrency and comprising 5.2% of all altcoin value.
LTC also saw a significant gain in market share, with LTC currently ranking as the fifth-largest alternative cryptocurrency by market cap after its relative market share increased by 66% to 4.7%.
The sixth-largest altcoin by capitalization, Binance Coin (BNB), has risen from the 13th-ranked altcoin due to a 230% gain in market share and currently represents 3.9% of altcoin value. The seventh-ranked altcoin, Bitcoin SV (BSV), also constitutes a new entrant among the top 10 altcoins, representing 2.79%.
TRX saw an 11.4% gain in relative altcoin dominance, currently ranking as the 10th-largest alternative crypto asset, with a market share of 1.6%.
Altcoin trade volume grows steadily
Despite the increasing centralization of altcoin capitalization among the top markets over recent years, many alternative cryptocurrencies have seen a significant increase in trade activity.
On Nov. 18, 2017, the 10 most-traded cryptocurrencies reportedly generated $7.1 billion worth of trade during 24 hours. BTC, BCH and ETH amassed a combined 24-hour volume exceeding $1 billion, while eight tokens including USDT, NEO, LTC, XRP and ETC also produced a daily volume greater than $100 million. Overall, 23 crypto assets posted eight-figure volumes or higher.
Despite the brutal bear trend of 2018, the combined daily volume reported by the 10-most traded tokens had increased 66.8% by Nov. 17, 2018. Only three of 2017’s 10-most traded tokens saw a decline in volume, with BCH, Dash and Iota seeing a dip in trade activity. During the period, 14 cryptocurrencies each garnered a 24-hour trade volume exceeding $100 million, and 36 other assets boasted a volume of more than $10 million.
This time around, the 10-most traded cryptocurrencies produce $56.8 billion in daily volume — an increase totaling 381% year-on-year and 700% over the last 24 months.
None of 2018’s most popular tokens have posted a reduction in trade volume, despite BSV and TRX replacing ZEC and NEO among the top ten. USDT, BTC, ETH, LTC, BCH, EOS and XRP posted 24-hour volumes exceeding $1 billion, while 33 other tokens reported more than $100 million in daily trade and nearly 150 tokens continuously producing more than $10 billion worth of trades.
Crypto mining operations of mining firm Bitfarms are still expanding despite complaints about the noise moved by residents of the city.
The cryptocurrency mining operations of mining firm Bitfarms are still expanding despite complaints of the residents of the city of Sherbrooke, Quebec.
Local news outlet CityNews reported on Nov. 20 that residents living near the site of the firm’s mining operations are complaining about the allegedly intolerable sound and vibrations originating from the facility.
The complaints of the population
The firm’s executives claim that the noise problems will be solved by a 23-meter wall around its mining farm, but residents are not convinced. Marcel Cyr, a resident living across the river from the facility notes that — while residents are complaining — the company has so far only expanded its operations. He told the outlet that residents want the business to cease operations until the noise issues are solved:
“They say they are acting in good faith. [...] And in the beginning we believed them. But we no longer believe them. How can we? [...] The noise destroys the environment, destroys people’s health because of the stress. [...] We had peace and quiet, and we want peace and quiet to return.”
Bitfarms reportedly manages five mining operations spread across the province to take advantage of cheap local hydropower. The firm struck a deal with Sherbrooke to pay the city about 3 million Canadian dollars (about $2.25 million) per year for its electricity use.
City councilor Marc Denault admitted that, if the city had known about the noise generated by the facility’s cooling fans, it would not have allowed it to use the location. The councilor also said he believes that if the company foresaw such issues, it would not have chosen its present location.
Denault also said that the company intended to address the noise issue and will renovate the building and build a wall outside it to muffle the sound. He claimed that an increase in the capacity of the farm will not increase the noise, stating:
“We expect significant improvement versus what the residents are allegedly complaining about today.”
Not the first such instance, but the company improved conditions
Denault’s claims that the company is cooperative in solving noise problems are backed up by Patrick Melchior, mayor of Farnham, another place where Bitfarm operates. He said that residents had similar complaints in 2017, but the company has since improved the situation:
“They were very cooperative. Their goal was really not to be a bad corporate citizen. [...] They reduced the noise considerably .. and the citizens were very satisfied. The case is closed.”
Cointelegraph reached out to councilmembers from the aforementioned cities but has not received any responses as of press time.
According to Google Finance, BitFarms’ stocks are trading at 0.53 Canadian dollars ($0.40). This means that the shares are down over 75% from when they were listed in July.
Despite uncertain market conditions, cryptocurrency mining firms are seemingly optimistic when it comes to the future of their industry. As Cointelegraph reported yesterday, German Bitcoin (BTC) mining firm Northern Bitcoin has entered a merger agreement with United States-based competitor Whinstone to jointly build what will supposedly be the world’s largest mining farm.
Russia’s largest bank, the state-owned Sberbank, has pioneered a blockchain solution for repurchase agreements — also known as repo.
According to a Sberbank announcement on Nov. 19, the bank has been awarded a patent for the solution, which uses smart contract technology to automate repo transactions between parties.
Repurchase agreements are widely used in wholesale funding markets and serve as a vehicle for banks and non-banks to access liquidity via short-term funding agreements that are collateralized by underlying securities.
In a repo transaction, a bank (or other entity) buys a security and pays for the purchase by immediately reselling it for a period — from just one night to as long as three months — with a commitment to repurchase it at an agreed price.
Repos are thus highly elastic instruments to meet the funding and liquidity needs of different financial institutions and play a central role in the global banking system.
Reducing counterparty risk
According to Sberbank’s announcement, the bank is ostensibly the first in Russia to have patented a repo deals solution with a blockchain-based execution system.
Using the solution, the counterparties in a repo deal sign a smart contract using e-signatures via a distributed ledger; the contract is initially used to automate the transfer of funds and securities between parties.
Sberbank’s solution includes a mechanism to monitor the market price of the collateralized security in question throughout the course of the repo’s term (or maturity). Based on this data, the contract then makes mutual payments to the parties to settle the deal automatically.
Sberbank notes that its solution covers the repo lifecycle end-to-end, which it claims eliminates counterparty risk and, in doing so, could translate into more affordable financing.
A blockchain-not-Bitcoin institution
Sberbank has actively pursued blockchain development in various aspects of its business but has stopped short of offering cryptocurrency-related services.
In May 2019, Cointelegraph reported that the bank had halted its potential cryptocurrency trading plans because the Central Bank of Russia is still largely opposed to the adoption of the crypto space. At the time, Sberbank vice president Andrey Shemetov said that the bank is waiting for decisive cryptocurrency legislation to be adopted before moving ahead with more serious plans.
In June, Sberbank CEO Herman Gref confirmed the bank’s choice not to develop cryptocurrency-related offerings, noting the institution was focused on developing blockchain solutions for financial services.
A New York district court has ruled in favor of the U.S. government to intervene in a civil case against Jon Barry Thompson who is alleged of $7 million in Bitcoin-related fraud.
The New York Southern District Court has ruled in favor of the United States government to intervene in a civil case against Jon Barry Thompson, who is alleged of a $7 million Bitcoin (BTC)-related fraud.
With Judge Loretta A. Preska’s ruling on Nov. 19, the U.S. government — in this case, represented by the Commodity Futures Trading Commission (CFTC) — now has the right to intervene in civil proceedings that are running parallel to a criminal multimillion Bitcoin scam case.
Thompson, a resident of Easton, Pennsylvania, is charged with “knowingly or recklessly making false representations to customers in connection with the purported purchase of Bitcoins worth over $7 million.” Preska stated:
“Upon the consent of all relevant parties, the Government’s application to intervene in the above entitled matter and to stay the matter in its entirety until the conclusion of the parallel criminal case, United States v. Jon Barry Thompson [...] is granted.”
Initiation of the case by the CFTC
The case was initiated by the CFTC in late September, which claimed that after receiving clients’ funds, Thompson, the head of a Bitcoin escrow service, sent virtually all of the money to third parties. The purported Bitcoin was not delivered to clients while their funds were not safeguarded as promised.
The CFTC thus seeks restitution, disgorgement, civil monetary penalties, permanent trading and registration bans, and a permanent injunction against all further violations of the Commodity Exchange Act and the CFTC’s regulations.
Other recent injunctions in the crypto world
As reported on Nov. 6, the Office of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations and prosecutors for the Southern District of New York indicted Asa Saint Clair for allegedly participating in a cryptocurrency scheme dubbed Igobit. Saint Clair was charged with one count of wire fraud, which carries a maximum sentence of 20 years in prison if convicted.
Last month, the CEO of Delaware-registered blockchain firm Veritaseum LLC and New York-registered Veritaseum Inc., Reggie Middleton, was ordered to pay $8.4 million in disgorgement in a securities fraud case.
London-based cryptocurrency forensics firm Elliptic claims that $400 million worth of XRP tokens is tied to illicit activities.
Cryptocurrency forensics and analysis firm Elliptic has tied about $400 million worth XRP tokens to illegal transactions.
In a press release published on Nov. 20, the firm indicated that “the $400m of illicit activity identified by Elliptic represents less than 0.2% of total XRP transactions, demonstrating that the vast majority of activity is legitimate.”
Tracing XRP’s relation to illicit activities
Elliptic began analyzing XRP over a year ago and has identified that several hundred XRP accounts are related to illegal activity — from thefts to the sale of stolen credit cards, the release further reads. Commenting on the findings, Tom Robinson, chief scientist and co-founder of Elliptic, said:
"As criminal use of crypto-assets such as XRP evolves, we are committed to shining a light on this illicit activity, giving financial institutions the confidence they need to engage with the crypto ecosystem. XRP is gaining increasing traction in the APAC region among financial institutions and banks."
The firm revealed its findings as part of the introduction of the beta version of transaction monitoring support for XRP that enables clients to check if a transaction is linked to criminal activities or sanctioned entities. In its analysis, Elliptic conducts ongoing dark web research, identification of money laundering patterns, and collects data that links XRP accounts to known entities.
Fighting illicit use of cryptocurrencies
Recently, blockchain analytics firm Chainalysis launched alerts for suspicious transactions across 15 major cryptocurrencies. The tool is meant to help cryptocurrency exchanges and other financial institutions mitigate their regulatory and reputational risks.
Although crypto companies generally try to incentivize network integrity by setting up bounty programs that reward so-called white-hack hackers for exposing vulnerabilities, some industry members like John McAfee argue that authorities should not require cryptocurrency companies and trading platforms to help them control digital currency use in illicit activities.
The Royal Dutch Football Association trialed a new blockchain-based ticketing app during yesterday’s Netherlands-Estonia European Championship qualifying match.
The Royal Dutch Football Association (KNVB) trialed a new blockchain-based ticketing app during yesterday’s Netherlands-Estonia European Championship qualifying match.
The news was reported by Ajax Life, a fanzine associated with the top tier Dutch football club AFC Ajax, on Nov. 19.
Replacing tickets with an app
Yesterday’s match was hosted at the Johan Cruijff Arena in Amsterdam, which the Netherlands won 5-0, as the BBC has reported.
According to Ajax Life, the KNVB used the event as an opportunity to trial its new blockchain-based app, designed to combat ticket counterfeiting and black market sales.
The solution dispenses with ticket PDFs, granting visitors access to the stadium via an app. A barcode used to activate visitors' access to the stadium is only operational at a set time and within a specific radius of the stadium on match day. This ostensibly makes it impossible to resell tickets for a competition multiple times.
Ajax Life reporters note that if the blockchain pilot’s results are deemed successful, the solution will be developed and scaled further with the support of the European Regional Development Fund.
Both KNVB and AFC Ajax were participants in developing a series of innovative products for trial implementation during yesterday’s match, under the aegis of a so-dubbed “Change the Game Challenge,” jointly initiated with the Johan Cruijff Arena.
Blockchain in the sports and entertainment industries
This October, Broadway’s largest ticket operator, the Shubert Organization, revealed plans to pilot an IBM blockchain-powered mobile ticketing solution and is eyeing integrating the product into its business in the future.
In international soccer, blockchain platform Socios.com has partnered with numerous leading clubs — including French soccer club Paris Saint-Germain, Italy’s Juventus and London-based West Ham United — to launch club-branded fan tokens.
The Libra Association, the entity behind Facebook’s forthcoming Libra stablecoin, has logged over 51,000 transactions on its network during the past two months.
The Libra Association, the entity behind Facebook’s forthcoming eponymous stablecoin, has logged over 30 projects and 51,000 transactions on the Libra network during the past two months.
Despite global regulators’ controversial stance towards Libra and the loss of a one-fourth of its founding partners, the Libra Association continues to develop the stablecoin’s network and has plans to introduce a range of new features in the upcoming months, which it set forth in a press release published on Nov. 15.
Ten wallets, 11 blockchain explorers, one integrated development environment, one application programming interface and 11 clients have taken part in the network’s development.
The association also managed to log more than 51,000 transactions on the Libra network since it reset the testnet on September 17. As previously reported, non-custodial keyless cryptocurrency wallet solution ZenGo began supporting the Libra testnet in mid-August allowing users to send and receive the stablecoin like any other cryptocurrency, but in a test mode.
Plans for the upcoming months
At the end of November, the association is planning to launch a new process for completing Contributor License Agreements (CLAs), which is aimed at the improvement of the way CLAs are submitted, reviewed and verified for both individuals and businesses. The organization also plans to deploy 100 nodes on the mainnet, which will represent a mix of on-premises and cloud-hosted infrastructure.
Among other near-term objectives, the Libra Association announced the establishment of a Technical Steering Committee, which is set to supervise and manage the technical design and development of the Libra network on behalf of association members.
Facebook Pay vs. the Libra stablecoin
In the meantime, Facebook launched a new fiat payment system called Facebook Pay. The system is designed to facilitate payments across Facebook, Messenger, Instagram and WhatsApp. The firm, however, made it clear that the payment service will be kept separate from Facebook’s new Calibra wallet and the Libra network.
Earlier in November, Kevin Weil, vice president of product at Facebook's Calibra digital wallet unit, said that Libra will be more similar to email tech than payment services such as PayPal. Considering the approximate timing for the Libra’s launch, Weil said that “this will be a journey of years and decades.”
Sideways trading over the past 24 hours is being viewed as an “interesting” interlude, but further drops appear likely going forward.
Bitcoin (BTC) managed to preserve support at $8,000 on Nov. 20, continuing an uneasy sideways pattern since dipping to $7,990 the day before.
Cryptocurrency market daily overview. Source: Coin360
Bitcoin markets “more bearish than expected”
Data from Coin360 showed BTC/USD ranging between just above $8,000 and a 24-hour high of $8,150, with volatility limited since Tuesday.
Previously, Bitcoin had fallen from highs of $8,600 to briefly reenter the $7,000 range before rebounding to press-time levels.
Bitcoin 7-day price chart. Source: Coin360
As Cointelegraph reported, the behavior has turned analysts broadly bearish on the Bitcoin price outlook, not just for the short term, but up to and including next May’s block reward halving.
In particular, Willy Woo and Tone Vays confirmed the overall bearish market sentiment on Wednesday, even anticipating a potential drop to $4,500 for Bitcoin.
For regular Cointelegraph contributor Michaël van de Poppe, the prognosis was also for downward movements if signs of a rebound failed to materialize.
“1) Break back above and hold this support. Break back to $8,300 would be nice. 2) Lose it -> $7,800 and $7,300 next areas to aim,” he summarized in his latest Twitter update on Monday.
Nonetheless, the subsequent sideways period was a surprise. “The price of $BTC is not accelerating down, which is interesting,” he added.
Fellow contributor filbfilb meanwhile agreed with Woo and Vays. “I agree that the market is more bearish than we expected it to be,” he said in private comments on Wednesday.
Altcoins limit previous losses
Altcoin markets showed similar restraint to Bitcoin on Wednesday after a day of heavy losses. Out of the top twenty cryptocurrencies by market cap, most saw moves of less than 1% up or down.
Ether (ETH), the largest altcoin, is up 0.91% on the day to remain around the $175 mark.
Ether seven-day price chart. Source: Coin360
Some fared poorly, notably VeChain (VET), which shed 8.5% after posting strong performance in line with other Chinese coins, but managed to slightly recover to $0.0065 by press time. Tezos (XTZ) meanwhile is seeing gains of over 5%.
The overall cryptocurrency market cap is $221.4 billion, with Bitcoin’s share at 65.27%.
The short-term outlook for Bitcoin could involve a 71% retracement versus 2019 highs of $13,800, warn Tone Vays and Willy Woo.
The Bitcoin (BTC) price has almost reached its bottom for 2019, but the threat still remains for markets to hit $4,500, according to one expert.
Woo: time running out for Bitcoin price drop
As BTC/USD hovers around the $8,000 support, analysts have recently turned more bearish on its short-term outlook, comparing current action to that which preceded 2018’s lows of $3,100.
For Woo and Vays, this year’s cycle could see a drop of around 71% versus the highs of $12,800 seen several months ago.
That would put Bitcoin at $4,500 before next May’s block reward halving event, something which consensus favors as a bullish turning point for price.
Woo added that the market was still net long and that he was waiting for a short phase to trigger a reversal. Time was limited to secure further drops, he said, due to the proximity of the halving. Most weaker miners have already capitulated due to the previous downturn, reducing the desire to further weaken the market.
“No sign of reversal”
“I’m totally back in cash now. There doesn’t seem to be obvious sign of reversal. Going to sit on the sidelines until there is more indication,” he told followers of his Telegram trading channel on Wednesday.
As Cointelegraph previously reported, the popular Stock-to-Flow model for charting the Bitcoin price calls for an average BTC/USD value of $8,300 until May. After that, the trajectory is open for a giant $100,000 leap by the end of 2021.
Singapore's central bank and financial regulator, the Monetary Authority of Singapore, has proposed bringing crypto derivatives trading under its purview.
According to a BNN Bloomberg report on Nov. 20, the MAS’ proposal would make the trading of derivatives based on underlying assets like Bitcoin (BTC) and Ether (ETH) subject to the city-state’s Securities and Futures Act.
Institutional investor interest sparked proposal
According to the MAS, plans to extend its remit to crypto derivatives have been spurred by interest from hedge funds and asset managers engaged in the sector.
Bitcoin derivatives trading globally currently sees $5–10 billion in daily traded volume, exceeding spot volume by 10 to 18 times, the report notes, citing data from Skew and BitcoinTradeVolume.
MAS has said its proposal will “allow approved exchanges in Singapore to meet the need of investors to manage their exposure to payment tokens while bringing the activity under regulatory oversight.”
As reported earlier this month, the Intercontinental Exchange’s (ICE) Bakkt platform is planning to expand its existing Bitcoin futures products to include a cash-settled option. Sources have claimed the new contract will be offered via ICE’s Singapore-based clearinghouse, ICE Clear Singapore, and traded on the ICE Futures Singapore exchange.
Bakkt, CME and beyond
Bakkt made industry history in September with its launch of a physically-settled Bitcoin monthly futures contract.
However, the platform’s underwhelming volumes in the first week following its launch were unfavorably compared to the fiat-settled BTC futures on CME, which first launched back in December 2017.
Bakkt reported 1,135 traded contracts (~$9.3 million) yesterday, Nov. 19, having reported an all-time high of 1,756 contracts on Nov. 8, according to tracking data compiled by Twitter account Bakkt Volume Bot.
Earlier this month, financial technology firm Tassat received the green light from United States regulators to secure the transfer of existing registration rights from an affiliated financial services firm, paving the way toward launching a compliant crypto derivatives exchange.
Yesterday, Tassat revealed a partnership with digital asset market maker Blockfills to launch an institutional Trade at Settlement product for spot Bitcoin (XBT/USD).
The Tor Project, the nonprofit organization behind the anonymous network Tor, announced that it now accepts Bitcoin donations via the Lightning Network.
The Tor Project, the nonprofit organization behind the anonymous network Tor, announced that it now accepts Bitcoin (BTC) donations via the Lightning Network.
The organization announced on Nov. 19 that it will accept Lightning Network donations as part of Bitcoin Tuesday, a fundraising initiative led by the crypto-for-charity organization The Giving Block.
Tor recommended the BottlePay wallet for donations, which allows users to search for The Tor Project inside it and send crypto without copying and pasting addresses.
The Lightning Network is a layer-2 payment protocol for the Bitcoin network that aims to expedite payments and address the network’s scalability problem.
Fiat currencies also supported
Alternatively, the service also allows public donations through a tweet. The wallet also enables its users to donate Bitcoin directly, or automatically convert United States dollars, euros, pound sterlings, Australian dollars, Brazilian reals, Canadian dollars, Swiss francs and 15 more fiat currencies.
The development of the Tor network is mostly financed by U.S. government agencies after its parent technology, onion routing, was first funded by the U.S. Office of Naval Research in 1995.
Despite financial support from official organizations, the technology has been widely applied on the dark web for illicit sites and services like the Silk Road.
On the other hand, the network is also used by political dissidents living under oppressive regimes and by whistleblowers looking for a way to anonymously expose official wrongdoing to WikiLeaks and similar services.
Since the Tor network is used as a way to ensure privacy both in communications and transactions by the use of cryptocurrency — often by people who rely on its efficacy for their safety — its users are frequently targeted by hackers.
As Cointelegraph reported in mid-October, major antivirus software supplier ESET discovered a trojanized Tor Browser designed to steal Bitcoin from buyers in the darknet.
BLOCKTV is proposing to pay sources for providing info for meaningful stories in the blockchain space, while some journalism experts disagree.
Tel Aviv-based media outlet BLOCKTV announced details of a tokenized rewards system to incentivize sources to share exclusive news tips. This comes after BLOCKTV revealed that its native token, BLTV, would be listed on the Bittrex Global exchange on Nov. 21.
BLOCKTV CEO Aviram Elad told Cointelegraph:
“We see the BLTV token as a solution to fix a broken business model in the media industry. The token aims to empower an upcoming token economy that combines content creators, advertisers, and consumers.”
BLTV is an ERC20 token that will be offered to publishers, journalists, advertisers, sources and viewers. It forms the backbone of a media ecosystem in which all participants get compensation for their time and effort in helping tell a story, or for consuming the ads that fund them. Building this kind of economy around a media company will drive that company’s growth — or at least that is the thinking.
BLOCKTV has also said that BLTV tokens will incentivize sources to come forward with exclusive news tips and interesting content deserving a wider audience. With over 15 years of experience in journalism, Elad suggests that providing sources with digital money in exchange for news tips will help ensure consistently high-quality and original reporting within the cryptocurrency and blockchain spaces.
“In my experience, when someone wants to give you a story to cover, they either want to promote themselves or someone else who they know,” Elad explained. “These are the two main reasons why people want to share information today. We want to change this through a token-based economy.”
Creating change through blockchain technology
The BLTV token will begin its life on Bittrex. News sources, which could include journalists, whistleblowers, or other publication staff, can then submit tips to BLOCKTV’s editorial team. These stories will then be verified to ensure that they meet the company’s journalistic standards.
“The token system we are building allows sources to submit a story, which we would then run by our professional editorial team to make sure that the information is true and interesting,” said Ron Friedman, BLOCKTV’s editor-in-chief.
Upon publication of their story, sources will receive a cut of the revenue generated by that story’s views and engagement. The story’s continued performance will be monitored using smart contracts to record the number of impressions and calculate the appropriate tokenized reward.
According to Friedman, BLOCKTV’s token model has also been optimized to align incentives between news providers and broadcasters. As a result, this creates a token model that encourages the mass distribution of quality news, while sharing the proceeds with sources.
“For the first time ever, sources will be compensated for sharing the news with a media outlet. We also plan to add a tipping mechanism and bonus program for stories considered to be extremely important,” Friedman said.
BLOCKTV CEO Elad also noted that while BLOCKTV is providing a proof-of-concept for this model, he thinks that other major media outlets will eventually adopt something similar.
“BLOCKTV is just a proof of concept for this model, but eventually this will expand and be replicated not only for others in the crypto media sphere but for all news organizations,” he said.
But what about ethics in journalism?
While both Elad and Friedman are optimistic that a token-based economy will ensure the production of high-quality, original content, the model also raises questions around concerns of journalistic ethics.
According to Joshua Benton, director of Harvard University’s Nieman Journalism Lab, mainstream journalistic norms specifically call for not paying sources. Benton noted that while this may be the standard today, some have pushed back against it in a number of ways.
“Traditionally, the journalistic norm has been to not pay sources. However, some arguments have been made that go against this. For example, stories that involve multiple sources might include some that have been paid to disclose information. Also, people may not get paid directly for being a source, but could get compensated in other ways, like being offered payment for licensing photographs.”
In the case of BLOCKTV providing sources with BLTV tokens, Benton noted that this sounds similar to a typical publication’s freelance model, in which case it makes sense to provide compensation.
“There is nothing wrong with being a journalist that pitches a good news story to a media outlet, and hopefully, there is some money exchanged there,” Benton told Cointelegraph. However, it’s different if payment is being exchanged to a source that is not a journalist, he warned.
“For example, if a company has news that it wants to announce and it contacts a media organization and receives payment for publication, rather than putting the news on its own website, that would be looked down upon,” Benton explained.
According to Elad, BLOCKTV will primarily accept tips and stories from freelance journalists who do not already contribute to a publication and would like to see an important story get out. Moreover, these sources could remain anonymous or choose to reveal their identity, a concept made possible through a BLTV token function called “BLTV newsroom.”
“The BLTV token allows the source to decide if they want to remain anonymous or not. This function is called ‘BLTV newsroom’ and will include a reputation score. Every journalist or publication submitting a story to the BLTV newsroom will have a ranking based on the source’s credibility, the history of the publication, and more,” Elad explained.
Even with rigid verification of news tips and reputation scores, Benton remains skeptical of a model that uses tokens to reward its sources. This is mainly due to the financial aspect of it all — at the end of the day, it’s still a source taking money for a story.
“News organizations and journalists are supposed to be serving their readers. This means that a journalist is asked to figure out the truth as best determined on a given topic. This information is then shared with an audience,” Benton explained, adding, “The more financial considerations injected into that equation, the more the audience has reason to think that maybe they are not getting the full story.”
Benton also points out that a model such as this raises the concern that a news outlet may be producing biased news by only taking one source’s view into consideration.
“If one source is getting paid to contribute to a story, it raises questions if the news organization pursued others with different perspectives on that story,” he said.
Yet Benton does make an important distinction that sets BLOCKTV’s rewards-based model apart from questionable journalistic behaviors.
“Most journalistic corruption in the crypto world involves sources bribing journalists to run stories. This model is the opposite of that approach. However, I still think that most journalists would say that they wouldn’t want to have money being exchanged for certain interactions.”
Benton, who reported on Civil’s failed initial coin offering, also noted that there is an uncertainty that comes with paying sources via cryptocurrency. As in the case of Civil, the blockchain-enabled media platform that gathered a number of journalists together last year by offering payment with its own token. The Civil ICO ultimately flamed out and the token became worthless.
Based on this example, Benton notes that while a cryptocurrency can be an appealing form of exchange, some people may not be too excited about receiving compensation from a token of uncertain value.
Friedman begs to differ:
“We want to get important stories broadcasted, and that extra incentive might encourage people to come to BLOCKTV first. A token-based model allows all parts of the ecosystem to have an interest in the process of telling and sharing news, which goes hand-in-hand with core journalist values.”
FirstRand Bank has said it will no longer serve exchanges after March 2020, while at least one of those affected says it already has alternative arrangements in place.
As local internet magazine My Broadband reported on Nov. 19, FirstRand Bank (FNB) — one of the largest financial institutions in South Africa — sent letters regarding the move to an unspecified number of “major exchanges,” including Luno, ICE3X and VALR.
Exchanges blocked due to “risk appetite”
Exchanges affected have until the end of March 2020 to make alternative arrangements, Luno Africa general manager Marius Reitz told the publication.
The letter from FNB reportedly blames regulatory uncertainty for the decision. An excerpt reads:
“FirstRand Bank has been considering its risk appetite in respect of virtual currencies and virtual currency exchanges for some time. Within this context the bank has taken the decision to discontinue the provision of banking services to virtual currency exchanges and/or entities dealing/trading in virtual currency. Future regulatory clarity may cause us to revise our decision.”
Other banks still on board with Bitcoin
Commenting on the banking loss, Reitz meanwhile said Luno was not concerned and that other lenders were still prepared to service the business.
“We do not anticipate any impact to our existing customers as we have other banking relationships in place to support deposit and withdrawals on the platform,” he added.
Last week, popular adult entertainment website Pornhub faced a total embargo on payments to its 100,000 models due to a snap decision to end support from PayPal. In an ironic twist, days later, PayPal’s former chief financial officer had his bank account terminated.
Proof of Capital partner Edith Cheung tells mainstream media Beijing’s digital currency could appear as soon as May next year.
Speaking to CNBC on Nov. 20, Edith Cheung, partner at blockchain-focused venture capital fund Proof of Capital, appeared convinced about the digital currency’s imminent arrival.
Cheung: rollout could come in May 2020
“I think definitely within the next six to twelve months,” she told the network about a launch time frame.
China has revealed it has been developing the virtual yuan for several years, but senior government officials have so far declined to state when it could become a reality.
For Cheung, however, foreign powers should already be prepared to respond, as China looks to become the first country worldwide to issue a digital incarnation of its national currency.
“I really think the United States needs to hurry up; to have a strong thinking and policy, at least a direction for virtual USD,” she continued.
Earlier this month, another investor delivered a more bullish forecast for the digital currency rollout, claiming it would appear in just three months’ time.
Blockchain expectation versus reality
China remains in the spotlight as the digital currency plans run in tandem with the official endorsement of blockchain technology. Announced by President Xi Jinping last month, the policy is still having a knock-on effect for Chinese blockchain projects, several of which have seen the value of their own cryptocurrency tokens rise considerably.
At the same time, Chinese state media more recently poured cold water on current levels of commitment to blockchain.
According to new statistics, only around 10% of the 32,000 businesses in China which claim to use the technology actually do.
Binance, the second-biggest crypto exchange, fell out of CryptoCompare’s new exchange rankings due to security concerns.
London-based crypto data provider CryptoCompare has updated its crypto Exchange Benchmark, removing Binance cryptocurrency exchange from the list of the top 10 exchanges. Binance, the second biggest crypto exchange by daily trade volume to date, is not included in the CryptoCompare’s list as the rankings do not rely on aggregate volume data in its analysis, the firm said in a press release to Cointelegraph on Nov. 19.
In order, the top 10 crypto exchanges in CryptoCompare’s second Exchange Benchmark are: Gemini, Paxos’ itBit, Coinbase, Kraken, Bitstamp, Liquid, OKEx, Poloniex, bitFlyer and Bitfinex.
Binance was ranked seventh in the first Exchange Benchmark
CryptoCompare’s first Exchange Benchmark was published in mid-June 2019 with the purpose of ranking around 100 crypto spot exchanges worldwide.
At the time, the benchmark ranked Binance as the seventh top exchange, while Gemini, the top exchange of the just-issued Exchange Benchmark, followed Binance in eighth place. Meanwhile, United States-based Coinbase led the list.
CryptoCompare removed Binance due to security concerns related to the hack in May
Binance is now ranked in 12th place on CryptoCompare’s list. Charles Hayter, co-founder and CEO at CryptoCompare, told industry news outlet The Block that Binance dropped out from the top 10 list following the hack of the exchange in May 2019. Hayter reportedly said:
“Our new Benchmark includes a category for recent hacks for which we penalize exchanges. As Binance was recently hacked, it is marked down in the security category."
On May 7, Binance experienced a major security breach, in which hackers managed to steal more than 7,000 Bitcoin (BTC) worth around $42 million at the time of the hack. Binance subsequently noted that it will use its emergence insurance fund, Secure Asset Fund for Users, to cover the incident.
New Exchange Benchmark adds 60 new spot exchanges
In a press release, CryptoCompare said that the new rankings now include over 160 active spot exchanges. In its Q3 2019 Exchange Benchmark report, CryptoCompare found that only 8% of analyzed exchanges use a custody provider to store user assets, while only 4% of exchanges offer third-party insurance in the event of a hack.
The company also pointed out an increase in margin trading offerings since June, noting that exchanges offering such trading now account for 62% of total volume, against 52% in June.
As reported, CryptoCompare launched its Exchange Benchmark in response to a study claiming that 95% of volume on unregulated exchanges is fake. In mid-November, major crypto data site CoinMarketCap launched a new metric comparing exchanges and token pairs based on liquidity. Hayter reportedly said that liquidity alone is an "insufficient" metric and that exchanges need to be rated holistically. He told The Block:
"We have always incorporated a liquidity metric in our scoring system for each exchange, using depth and spreads across top markets."
Cryptocurrency and blockchain firms are well-represented among a recent KPMG ranking of fintech firms.
On Nov. 18, Big Four auditing firm KPMG released its 2019 Fintech100 ranking, which lists the top 100 fintech firms in the world. The list saw a drop in Bitcoin-related companies but reinforced innovation in the payments industry.
As was the case in 2018, AntFinancial — owned by Jack Ma of Alibaba — led the ranking. AntFinancial controls Alipay, one of China's leading payment systems, and is valued at $83 billion.
Among the companies that offer innovation through blockchain and cryptocurrency, JD Finance was best placed in third place, surpassed by Grab, an Uber-like rideshare app that also functions as a payment system in Singapore.
Robinhood dropped from 8th place in 2018 to 14th in 2019. However, crypto innovation remains strong according to KPMG’s rankings, which featured blockchain-focused OneConnect (18th), Revolut (26th), Coinbase (34th), Liquid (38th) and Banketa (42th).
Commenting on the strength of Chinese companies on the list, Chris Wang, partner and head of fintech at KPMG China said:
"As fintech development continues to go strong in China, we are seeing some changes in China's fintech landscape. Aligned with trends we observe globally, we see an increasing number of wealth, insurance and multi-sector companies in China on the list, which indicates that technologies and innovations have spread into more financial services sectors."
The report also named Binance, MemaPay, Moin, Silot and Tokeny among emerging companies in the top 100.
KPMG further points out that Fintech100 companies raised over $18 billion in the last 12 months and more than $70 billion in their lifetimes. The report identifies these companies as changing the world with their respective innovations, serving over 2.5 billion customers globally.
Although fintech firms have emerged as a financial services option, KPMG points out that many companies on the Fintech100 list have benefited from open banking, allowing them to access customer banking to create more personalized experience and services. Early fintech innovators with single product propositions are now diversifying to fulfill customer needs, often through banking licenses and supported by favorable regulatory developments.
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