Author: José Oramas

José is a journalist and translator with a keen interest in blockchain and cryptocurrencies.

Categories
Australia Bitcoin Bitcoin BSV Crypto News

Exchanges Suspend BSV Deposits and Withdrawals Following 51% Network Attack

Exchanges are suspending Bitcoin SV (BSV) following double-spending attacks registered on the coin’s network.

According to a blog post, developers of the BSV network identified a wallet address that was linked with a history of illegal activities, such as ransomware. The attacker tried to mask double-spending of coins by causing block re-organisation attacks – which usually occurs when miners work together to remove previously confirmed blocks from the blockchain.

A malicious actor has recently been carrying out block re-organisation attacks on the Bitcoin SV network, which appear to be intentional acts in an effort to mask the illegal double-spending of coins.

Bitcoin Association blog post

According to analyst Lyn Alden, forked networks like Bitcoin Cash and Bitcoin SV are susceptible to these types of attacks as BSV has only 0.5 percent of Bitcoin’s hash rate.

Rough Year for BSV

BTC-forked blockchains have suffered from the same vulnerability since they were created. Ironically, the coins were made with the intention to shore up the vulnerability of the main network. Allegedly, developers have tried to contact law enforcement to take legal action against the hackers.

Bitcoin Association intends to file reports with appropriate law enforcement authorities and work with affected parties to pursue all available legal remedies. Since first identifying the malicious activity, the Bitcoin SV Infrastructure Team has collected and documented relevant data to provide to appropriate authorities.

Bitcoin Association blog post

As previously reported, Australian exchange Independent Reserve delisted BSV on January 28 after considering the actions of Australian computer scientist Craig Wright as anti-ethical – something echoed by many in the Aussie crypto community.

Following a lawsuit filed by Wright earlier this year, the London High Court granted default judgment for copyright infringement against “Cøbra”, the pseudonymous operator and publisher of the bitcoin.org website.

Categories
Crypto News Cryptocurrencies Institutions Payments

VISA Partners with 50+ Crypto Companies as Everyone Plans to Launch Crypto-Linked Cards

Visa has announced it will partner with more than 50 leading crypto companies after reporting a successful first quarter of 2021, with over US$1 billion spent on crypto-linked Visa cards.

After working with industry-leading companies such as BlockFi, Coinbase and Crypto.Com, Visa plans more partnerships to facilitate conversions across 70 million merchants worldwide.

Merchants won’t have to accept cryptocurrencies as such, as the network will convert crypto transactions into fiat. As reported in March, Visa expanded its MCO cards in Australia via a global alliance with Crypto.com.

Cardholders Will Have the Option to Pay with Stablecoins

Visa outlined the “developer-friendly” features of stablecoins and how the market for these has grown to US$100 billion: “Stablecoins are starting to live up to the promise of digital fiat: the developer-friendly characteristics of cryptocurrency combined with the reliability of fiat-backed reserves.”

In a 2020 project, Visa worked on integrating the US Dollar Coin (USDC) into its network.

In the future, we also plan to allow cardholders to pay their balances using stablecoins. We are also working on giving cardholders the option to select how they would like to earn their rewards from any cryptocurrency that we support on BlockFi.

Visa blog post

Visa continues to support the cryptocurrency ecosystem because it foresees a sizeable market with potential use cases. “It’s clear that the crypto community sees value in linking digital currencies to Visa’s global network,” reads the blog post.

Visa Moves to Alleviate Cryptocurrency Concerns

However, Visa has faced numerous inquiries and concerns from investors and regulators about the perceived risks of digital assets. To alleviate these concerns, the payments giant has engaged with policymakers and global organisations to help promote a better concept of cryptocurrencies.

We are doing a lot to create an ecosystem that makes cryptocurrency more usable and more like any other currency. People are exploring ways in which they can use cryptocurrencies for things they would use normal currencies for. There are lots of issues in terms of volatility, etcetera. But that’s up to the owners of cryptocurrencies to manage and track.

Vasant Prabhu, chief financial officer, Visa

While it is bullish to help spread further adoption of cryptocurrencies, some in the DeFi and crypto community argue that a centralised institution holding and operating cryptoassets undermines the original ethos of crypto.

Categories
Australia Banking Blockchain Crypto News

Big 4 Australian Bank Uses Blockchain Technology to Address Climate Risks

National Australia Bank (NAB) will participate in a new project with several overseas banks to offset carbon emissions using blockchain technology. 

The Big Four bank is joining the Canadian Imperial Bank of Commerce (CIBC), Brazil’s Itaú Unibanco, and UK’s bank and insurance company NatWest to launch Project Carbon – a voluntary pilot to enter the carbon marketplace.

Project Carbon to Use Ethereum Blockchain to Provide Transparency

More companies are buying carbon offsets, which are rights to reduce carbon emissions. This follows a surge in demand for greener assets in recent months, prompting institutions to set net zero targets in response. 

The strategy has been heavily criticised for the lack of transparency of transactions and its overall effectiveness. However, Project Carbon will use smart contracts from the Ethereum blockchain to record all transactions, demonstrating demand, trade sizes and prices of offsets. Drivers of the project hope this will provide enough transparency to encourage investors to stake their capital in green projects.

Project Carbon is a terrific example of how technologies such as blockchain can address existing barriers and make carbon offsets more accessible for our customers.

Victor Dodig, CIBC chief executive officer

Using Blockchain to Tackle Emissions

Blockchain technology can be an useful tool for institutions that aim to reduce CO2 emissions, and Australia is already addressing social and global eco-friendly issues using blockchain. As reported this week, Australia’s first international hackathon – an event hosted by Melbourne’s Monash University – will receive submissions from applicants worldwide to suggest ideas on how blockchain can address global issues.

The local crypto community has criticised banks in Australia, especially the big four lenders, for their indifferent and outdated policies regarding cryptocurrencies and potential blockchain technology use.

However, NAB marks the difference here and it hopes that blockchain will serve as the key technology for Project Carbon and be the backbone for the future of the carbon marketplace.

Categories
Australia Crypto News Institutions Regulation

Aussie Crypto Companies Call for Regulatory Certainty

More Australian crypto companies are requesting clearer and updated regulations for the digital asset environment, prompting the Australian Fintech Senate to create “innovation-friendly” measures.

These suggestions come after the fintech committee set specific guidelines for submitters to send their requests regarding topics related to technology and finance and how Australia can benefit from emerging technologies, as well as becoming a hub in those fields.

Aussie crypto exchange Swyftx recommended the senate should look at establishing a robust regulatory regime for digital assets in Australia that would remove any uncertainty or doubt for service providers and customers.

A dedicated and harmonised framework is therefore necessary … to provide specific rules for crypto assets and related activities and services and to clarify the applicable legal framework … Such a framework should support innovation and fair competition while ensuring a high level of consumer protection and market integrity in crypto-asset markets.

Swyftx letter to Fintech Senate

Australians are Demanding Access to Crypto Services

The interest in cryptocurrencies in Australia remains strong despite the fact that several high-market cap currencies as Ethereum and Bitcoin have halved while DeFi tokens and altcoins are leading the market.

The crypto community in Australia has already pointed out that the current regulatory measures do not necessarily work for blockchain and cryptocurrencies. According to R3, an enterprise software platform working with blockchain technology, simplicity is key to designing proper frameworks for crypto assets.

Simplicity is key in designing frameworks. Layering additional regulations on top of already robust and effective frameworks would only complicate the industry and inhibit innovation with no resulting upside.

R3 statement

The company noted that the government should align digital asset regulations following the principle of “same risk, same activity, same treatment”.

Australia Has a ‘Unique but Diminishing Opportunity’ to Become a Leader in the Crypto Space

On the other hand, Bitaroo, an Australian BTC-only exchange, suggested Australia should follow El Salvador’s example and recognise bitcoin as a foreign currency.

By recognising bitcoin as a foreign currency and by exempting capital gains tax on foreign currencies, Australia has a unique but rapidly diminishing opportunity to position itself as a global and forward-thinking leader in this space.

Bitaroo statement

In a consultation paper published on June 30, the Australian Securities and Investment Commission (ASIC) laid out guidelines for the inclusion of cryptocurrencies in exchange-traded products (ETPs). ASIC is seeking feedback from market participants to adjust rules for local operators and to protect crypto service platforms and consumers alike.

Categories
Crypto News DeFi

DeFi Tokens Leading the Market as BTC Nears $35,000

Several DeFi tokens are seeing considerable surges in the market as Bitcoin nears US$35,000, pushing the total crypto market to over $1.5 trillion again.

Bitcoin fell to US$33,000 on the weekend, quickly bouncing to US$35,000 again this week. The altcoin market, despite marking some minor losses, has seen a strong surge by double digits – especially in the DeFi sector.

DeFi Market Grows 7% in 24 Hours

The DeFi market cap has surged over US$79 billion, representing 5.3 percent of the total market and locking US$96 billion in TVL (Total Value Locked), according to CoinGecko. 

DeFi tokens and altcoins are now taking the lead, including the Australia-founded Synthetix (SNX). At the time of writing:

  • Ethereum (ETH): 3.4% – US$ 2,319.23
  • Uniswap (UNI): 11% 24h – US$22.33 
  • Binance Coin (BNB): 6% 24h – US$318.59
  • Cardano (ADA): 2.59% 24h – US$1.41
  • Litecoin (LTC): -0.97% 24h – US$138.37
  • Chainlink (LINK): 7.69% 24h – US$20.04
  • Aave: 7.11% 24h – US$319.70
  • Synthetix (SNX): 10.76% 24h – US$11.77

Synthetix has been recovering from some minor losses last weekend, while Aave has surged in price after the protocol announced it would launch a permissioned version of its lending platform, following strong demand from financial institutions.

Bulls Regain Control of BTC

Bitcoin has been stagnating in price levels of US$32,000 – US$35,000 in the last weeks, followed by several tweets from Elon Musk and China’s constant crackdown on BTC miners across the country.

However, bulls are regaining control of the market and closing the gap. It seems the crypto community is ignoring Musk’s attempts to pump or dump cryptocurrencies like Doge – but if Tesla resumes BTC payments for its vehicles and if BTC mining becomes more eco-friendly, it could still give BTC a considerable boost and break the US$40,000 barrier.

As reported, more than 25 Bitcoin mining companies have joined forces to make BTC mining greener thanks to the Bitcoin Mining Council, which has gathered information from over 32 percent of the current global network. According to the results, the global mining sector is using electricity with a 67 percent sustainable power mix.

Categories
Australia Crime Crypto News

Australian Crypto Executive Faces Money Laundering Charges Amid BitMEX Investigation

Australian crypto executive Gregory Dwyer is facing extradition to the US from the island territory of Bermuda for his alleged involvement in several crimes, including money-laundering schemes and operating an unregistered exchange in the US.

Dwyer, referred to as “the Australian Bitcoin Mogul”, was the first employee of BitMEX, a crypto derivatives platform. Dwyer turned himself in to authorities along with BitMEX colleagues Ben Delo and Sam Reed in a surrender agreement with the US Federal Bureau of Investigation (FBI).

All were accused of violating the US Bank Secrecy Act for not establishing an adequate anti-money laundering program and operating an exchange without a licence from the Commodity Futures Trading Commission.

Dwyer Confined to Bermuda on Bail

BitMEX set up shop in Bermuda following a visit by Hayes in July 2018, who met with the territory’s Premier, David Burt. Dwyer moved there the following year, but after the BitMEX case was investigated between 2019 and 2020, Dwyer was required to be extradited to the US for participating in money laundering. 

Last year, Magistrate Khamisi Tokunbo released Dwyer on US$20,000 bail. Dwyer was not allowed to leave the country pending his extradition hearing. 

We have been in touch with the government on this matter and Mr Dwyer has every intention to defend himself in court against these meritless charges.

Jenna Dabbs, lawyer from US firm Kaplan Hecker & Fink LLP, representing Dwyer

According to the US Justice Department indictment filed against Dwyer and his colleagues, they “wilfully failed to establish, implement and maintain an adequate anti-money laundering [AML] program, including an adequate customer identification program, more commonly referred to as a know your customer program [KYC]”.

ATO, IRS Jointly Investigate Crypto Money Launderers

Dwyer is the latest in a growing list of Australians involved in money-laundering schemes using cryptocurrencies. As a result, the Australian Tax Office (ATO) has been targeting cryptocurrencies, reportedly joining forces with the IRS (Internal Revenue Service) in the US to investigate criminals and tax evaders in Australia.

Two months ago, Aamer Abdulaziz, CEO of Phoenix Holding Group, was accused of money laundering and being part of a cryptocurrency scheme called OneCoin.

Categories
Banking Bitcoin Crypto News Institutions

NYDIG is Expanding Crypto Adoption to 650 Banks and Credit Unions in the US

New York Digital Investment Group (NYDIG) has partnered with payment giant NCR to expand Bitcoin adoption in the US.

The partnership will enable up to 650 banks to offer Bitcoin services to 24 million customers. While the NCR will provide the infrastructure for mobile apps, the NYDIG will be delivering custodial services to financial institutions that want to offer crypto services to their clients.

Banks to Compete with Crypto Exchanges

The move will put NCR’s institutional clients in direct competition with crypto exchanges, as banks and credit unions reported massive outflows of customer’s savings to make crypto purchases.

According to Douglas Brown, NCR’s president of digital banking, banks could soon follow PayPal’s success with crypto adoption and offer crypto payments for its clients worldwide. Besides, the NCR is exploring the possibility of paying its 200,000 retail clients with BTC.

We’re firm believers in the benefits of crypto and the strategic application. And that’s true for our banking relationships, as evidenced by NYDIG, and across retailers as well as restaurants and the like.

NCR president of digital banking, Douglas Brown

Despite the bearish market, NYDIG has seen massive interest from institutional clients to individual and wealthy investors who want to join the crypto space.

Just days ago, NYDIG partnered with Texas fintech firm Q2 to provide BTC exposure to Q2’s 18.3 million users, following massive client demand.

Categories
Bitcoin Bitcoin Mining Crypto News Mining

25+ Bitcoin Mining Companies Join Forces To Make Bitcoin Greener

More than 25 Bitcoin mining companies have joined forces to make Bitcoin greener thanks to the Bitcoin Mining Council (BMC), founded by MicroStrategy CEO Michael Saylor and backed by high-profile members including Galaxy Digital and Hive Blockchain.

In its first voluntary survey, the BMC has revealed information about Bitcoin’s sustainable energy use from over 32 percent of the current global Bitcoin network. The results show that the global mining sector uses electricity with a 67 percent sustainable power mix, representing a 56 percent growth spurt during Q2 2021.

The results of this survey show that the members of the BMC and participants in the survey are currently utilising electricity with a 67 percent sustainable power mix. Based on this data, it is estimated that the global mining industry’s sustainable electricity mix had grown to approximately 56 percent during Q2 2021, making it one of the most sustainable industries globally.

BMC report

An Attempt to Demystify the Bitcoin Mining Industry

Bitcoin’s energy usage has been the primary topic for its detractors, highlighting environmental concerns in the long term. A new wave of criticism came with Elon Musk’s decision to reverse bitcoin payments for Tesla vehicles, causing the price of Bitcoin to drop even further. 

However, recent investigations have shown that banks and gold consume more energy than Bitcoin, and most miners are moving to clean power using hydrothermal and geothermal wasted energy in countries such as Iceland and Norway. 

A recent example of clean, renewable energy is El Salvador’s plan to build a huge mining operation using its geothermal excess.

Some Pundits Are Not Convinced

It seems this report is backed by the BMC’s own analysis, assumptions and methodologies, and the validity of the data appears unclear as most responses were from a subset of the network.

During a live virtual briefing, Nic Carter, a general partner of Castle Island Ventures, asked Saylor how the Council came to these figures. Saylor said the report was based on an estimate of off-grid and unsustainable power.

Then we allocated another portion that we applied to our BMC sample in order to get a blend. The blend ended up being slightly more than the electricity grid.

I think if you back into it and take the 56 percent and then look at the 67 or 68 percent that we don’t have, that’s the out-of-sample and then you know that number is … 50 percent sustainable … so … generally it works out that the out-of-sample mix is … assumed to be about 50 percent sustainable power and we tested that with a variety of analysts.

Michael Saylor on Bitcoin’s Sustainable Energy Mix

But some people were not convinced, knowing that the responses were from mostly mining companies that worked together to “provide critical information to the general public”.

Categories
DeFi Scams

WhaleFarm Token Crashes 99% in Another DeFi Rug Pull

Another project with high-yield promises and an anonymous team has pulled the rug on its investors, stealing over US$2.3 million.

On 29 June, the WhaleFarm token plunged by almost 100% after its developers drained liquidity pools choked with several coins including BNB, USDT, BTC, ETH, ADA, LINK and DOT (Polkadot). 

Mr. Whale Waves Red Flags

The project presented numerous red flags, as tweeted by crypto analyst Mr. Whale, such as high returns of up to 7,217,848% APY (Annual Percentage Yield). A DeFi project with exaggerated high APYs is too good to be true, and usually turns out to be a scam. Plus, an important pattern to detect shady projects is if the team behind it is anonymous – or if it’s backed by a certain organisation that doesn’t show who the developers are. 

Despite its exaggerated high return percentage, the project saw some growth over time, trading above US$200 on most crypto exchanges. The protocol launched a yield farming program for its users looking to lock up their funds lured by the high returns. 

But in just a matter of minutes, the team redeemed their token at once, causing a sharp price drop – leaving investors with almost no possibility of pulling their funds. The team quickly proceeded to delete its official telegram and twitter account, which is how a typical rug pull ends up.

Yet Another Rug Pull in the DeFi World

Rug pulls are exit scams that are becoming common in the DeFi space. Project developers run away with users’ funds by draining the liquidity pools once they reach a high amount, usually millions.

Developers usually swap stolen tokens for Monaro (XMR) to later swap those tokens again for another currency (usually Ethereum or USDT). Monaro transactions are hard to trace because they use ring signatures – a type of digital signature that can be performed by any member of a set of users that have a key.

This rug pull adds to the list of many that have occurred in the DeFi space, including TurtleDex, a Binance Smart Chain-based DeFi storage that drained US$2.5 million in Binance Coin (BNB) after its launch.

As reported by Crypto News Australia, a project that raised suspicions recently is ICP Coin – which dumped nearly 95 percent amid claims the development team might have deliberately caused it to drop from an ATH of almost US$750 in May, now trading at US$46.

Categories
Australia DeFi

Australia’s Tracer DAO Raises A$6 Million To Build Derivatives Trading Platform

Photo 218312864 © Marina Putilova | Dreamstime.com

Australian trading platform Tracer DAO has raised US$4.5 million (A$6m) in a strategic round backed by various crypto companies, including Melbourne-based crypto investment manager Apollo Capital.

Tracer is an Ethereum-based DeFi protocol that introduces a derivatives marketplace owned by a DAO (Decentralised Autonomous Organisation) – a collective represented by written computer code or member votes through governance tokens.

Tracer is backed by Mycelium, a Brisbane-based group of developers who believe Australia has the potential to attract global blockchain investments . There are however uncertainties regarding the regulatory environment in the country, something many in the blockchain community have echoed in the past.

Mycelium Will Adapt to Regulatory Requirements in Due Course

Mycelium says it will work in a legal grey area, adapting to regulatory requirements once they become clear.

We are by no means anti-regulation and we believe consumers should have protections, but we are innovation maximalists looking to build on the cutting edge of technology with a global solution. We are still in the infancy of this structure coming to fruition.

We are in a discovery phase of this innovation. We need to have public policy conversations to make it safe for people to innovate in this space. We also need to discover how the law treats it; that is not an answered question yet.

Ash Morgan, Co-founder of Mycelium

Australia is an Attractive Target for Blockchain Investment

Australia is a potential market for DeFi and blockchain development, and Tracer is one of the latest protocols to join the various startups to have emerged recently. Speaking about the local regulatory laws and the potential use case for Australia, Mycelium co-founder Ash Morgan added:

[Australia] can definitely compete in this space and, with its global reputation for fintech, we can really lead on a thought basis up there with the US if we take a position early on. We expect Australia to pick up its act on growth around these products and we expect there to be rapid growth in employment in the coming few years. We want to be a part of that within Australia.

Tracer DAO will try to tackle the DeFi derivates space so everyone on the platform has access to new options. One option, Morgan says, is around water rights and energy as solar is more broadly implemented worldwide. This could be distributed by neobanks.

DeFi is expanding fast throughout Australia and soon, more investors may turn their gaze on the country, following the DeFi craze in Switzerland as Sygnum Bank is set to offer custody and trading of DeFi tokens.