Author: Robert Drage

Robert is a freelance researcher, with a background in information science currently interested in blockchain technology and technical developments in the field.

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Blockchain Cardano Crypto News

Cardano Breaks $3 as Smart Contract Upgrade Begins

Cardano’s ADA token has broken the US$3 mark on September 2 as it approaches Alonzo, the much-anticipated hard fork for the blockchain.

Cardano (ADA), the third-largest cryptocurrency by market cap (US$93.7 billion) behind Ethereum’s (ETH) (US$439 billion), is scheduled to release its much-awaited Alonzo update to the blockchain, which will add smart contracts to its functionality.

Since the announcement by lead developers at IOHK earlier this month, ADA’s price rose nearly 10 per cent in one day, pushing its all-time high to US$3.09.

Cardano Now in Phase 3 of 5

A major network update is known as a “hard fork” and is generally seen as a major milestone for blockchain companies in development.

The Cardano network is in the third phase of its five-era road map, which is currently in the “Goguen” era and aims to add smart contract functionality to Cardano. By giving developers the ability to build decentralised applications on the blockchain, the ecosystem should start to expand, bringing more utility and value to the chain.

The Alonzo hard fork is scheduled for September 12 and in the meantime tests are being done to ensure Cardano’s smart contract language, Plutus, is working properly.

Cardano has been busy with some serious development, also releasing its new Djed stablecoin to protect it from volatility in the market, making it useful for its DeFi operations.

ADA Up More Than 2300% in a Year

Cardano (ADA) is up more than 130 percent over the past 30 days and is up more than 2,300 percent over the past year. With the news of the smart contract update, the price rose to new all-time highs. At the time of writing, ADA is trading at US$3.017, with the price up nearly 15 percent since the beginning of this month.

ADA price chart. Source: TradingView

A recent report also shows that the number of Cardano millionaires has mushroomed by 1,850 percent from 3,625 on July 20 to 9,830 on August 24.

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Blockchain Europe Google United Kingdom

Decentralised Search Engine Becomes Default Option for EU Android Devices

Decentralised search engine Presearch (PRE) has officially been added to Google’s default browser choice screen for all UK and European Android devices.

Fair Play Among Browsers

After receiving a €4.24 billion (A$6.8bn) fine from the European Commission in 2018 for using the Android operating system to solidify its place as the most used search engine in the world, Google stopped requiring competing search engines to pay in order to get on the default settings page.

In 2019, the agreed changes were that the five most popular and eligible search engines (including Google) in each EU country would be displayed in random order at the top of the Android choice screen, conforming to metrics from StatCounter.

Nearly 70 percent of smartphone owners in Europe use the Android operating system, which means there is strong potential for the search engine to grow its user base.

With potentially hundreds of millions of users just a click away on the search choice screen, this is one of the biggest wins for any project within the crypto space.

Colin Pape, founder, Presearch

What is Presearch? 

Presearch operates its own advertising platform that uses Keyword Staking, which allows advertisers to stake PRE tokens to a specific word or term. Whichever advertiser stakes the most tokens to a given keyword has its ad show up when someone searches that term.

With more than 2.3 million registered users, Presearch is one of the world’s top 10 most-trafficked blockchain websites and one of the fastest-growing alternatives for private, unbiased searches. Competing with Brave, Presearch aims to join the decentralised service landscape and provide users with a privacy-centric search engine.

Presearch currently processes more than 1 million searches per day and the company says daily searches have increased more than 300 percent since January 2021. The searches are processed by Presearch node operators that earn PRE for their efforts on the Ethereum blockchain.

PRE Token Up 80% Amid Announcement  

PRE tokens are currently trading at A$0.20, having shot up just over 100 percent in the past seven days. The project has a total market capitalisation of nearly US$74 million.

Presearch(PRE) Price: Coinmarketcap

With Android running on about four-fifths of the world’s smartphones including hundreds of millions in Europe, we see this as a huge win in taking decentralized services and blockchain mainstream and driving mass adoption.

Colin Pape, founder, Presearch
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Blockchain Crypto News DeFi Hackers

Cream Finance DeFi Loses $19 million in Flash Loan Hack, its Second Breach in 6 Months

Decentralised finance (DeFi) platform Cream Finance has fallen victim to an exploit, the second time the protocol has been targeted. This latest flash loan attack on August 30 stole an estimated US$19 million from the protocol.

While Cream Finance runs on Ethereum, Binance Smart Chain and Fantom, luckily the only affected market was the v1 market on the Ethereum blockchain:

How Did It Happen?

According to PeckShield, a blockchain security company, the hacker made “a flash loan of 500 ETH and deposited the funds as collateral. [Next] the hacker borrowed 19M $AMP and made use of the reentrancy bug to re-borrow 355 ETH inside the $AMP token transfer. Then the hacker self-liquidated the borrow.”

The flash loan attack process. Source: PeckShield

The process was repeated 17 times, allowing the hacker to get away with around US$18.8 million.

“The funds are still parked in 0xCE1F … 6EDE. We are actively monitoring this address for any movement,” PeckShield noted, providing the hacker’s address via Etherscan.

The price of AMP token plunged more than 14 percent in the first few hours following the exploit but has been recovering since. This is the second time in six months that Cream Finance has fallen victim to an exploit.

The Importance of Reviewing DeFi Contracts

Various security and crypto experts have identified some of the major concerns surrounding the emerging DeFi market. “DeFi can be hacked for two main reasons – vulnerability in the DeFi smart contract code, or hacking the private key of the smart contract owner who has permissions to control the protocol,” said Lior Lamesh, CEO of GK8.

Lamesh added that “in order to prevent such attacks, financial institutions looking to offer DeFi services need to do two main steps: First, review the DeFi smart contract code and validate that it has no vulnerabilities; second, protect the smart contract owner’s private key at the highest level of security.”

As more institutional investors flock to DeFi and the benefits brought by the technology, it’s becoming increasingly important to review code and to ensure contracts execute as intended.

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Blockchain Crypto News Ethereum

Ethereum Experienced Software Upgrade Issues Over the Weekend

In a recent situation affecting the Ethereum blockchain, not all full nodes have installed an important update, resulting in a chain split. It seems like a bug in the older versions of the Ethereum (ETH) Geth client needed fixing and some node administrators were slow to respond.

An Unintended Chain Split

During mid-August, a “high severity” vulnerability was spotted on the Ethereum Geth client used for running nodes to keep the network safe and the data accurate; this prompted the hotfix called “Hades Gamma”.

The exact attack vector will be provided at a later date to give node operators and dependent downstream projects time to update their nodes and software. All Geth versions supporting the London hard fork are vulnerable (the bug is older than London), so all users should update.

Ethereum core developer

The Chiliz exchange even temporarily paused deposits and withdrawals of ETH, BSC and HECO due to the bug. But now, since too few of the nodes had the newest patch up and running, the chain has split.

However, at the time of publication, the majority of nodes are running updated versions of Ethereum, meaning the hash rate is supporting the longest chain. 

Geth client versions: ethernodes.org

What Are the Implications for Ethereum?

This means that the Ethereum blockchain is currently processing at least two chains simultaneously, which could lead to double-spending where users spend cryptocurrency but the transaction is overwritten on an alternative chain.

The Geth client accounts for 74.63 percent of the network nodes and only 66 percent have the most up-to-date version, leaving the rest at risk. An address has been identified by The Block Research as the address that exploited the bug.

What is the Latest?

At the moment the nodes are catching up to get the chain completely up to date, with many within the community calling for node operators to update.

Delays are also to be expected since this is a massive community update requiring many different node operators to update their clients.

There are technologies to make transitions such as these smoother by forcing important updates on nodes, but the Ethereum blockchain should reach normality as soon as nodes catch up.

Categories
Crypto News Cryptocurrency Law Cryptocurrency Tax Regulation

Crypto Enthusiasts Purchase Billboard Attacking US Senator

Republican Senator Richard Shelby has a new billboard dedicated to him in his home state of Alabama, though it’s not the kind he might have wanted. Shelby upset the US crypto community regarding his proposed revision to an important infrastructure bill in the House of Representatives earlier this month and has been publicly pilloried as a result.


Senator Richard Shelby. Source: NY Post

Non-profit organisation Fight for the Future, which champions digital rights and ethics, is behind the billboard “crediting” Shelby for his lone vote against revising damaging crypto regulation contained within the new US$1.2 billion infrastructure bill.

Shelby Holds Out on Otherwise Unanimous Vote

The section in the potentially harmful bill required a unanimous vote to be revised, but Shelby’s objection prevented the amendment to the cryptocurrency tax provision.

In a House voting session, Shelby opposed two amendments to the bill, requesting an additional US$50 billion in defence spending before he would endorse it.

Shelby later tweeted that he supported the amendment in principle but chose to prioritise the country’s security over innovation.

Amendments Have Not Been Made

As a result, the infrastructure bill passed the Senate with its original language, which captures the wider industry with its broad definition of the term “broker”. A last effort was made to amend the language, but Democrats in the House delivered another blow to the cryptocurrency community’s lobbying efforts last week by voting not to include any amendments to the legislation.

However, according to a Bloomberg report, the US Treasury is not going to target miners, stakers, software developers and hardware manufacturers.

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Blockchain Crypto News Industries Tokens

Microsoft Crypto Patent Granted, Allowing Users to Create Own Tokens

Tech giant Microsoft has had its patent granted by the US Patent and Trademark Office (USPTO) for a new system allowing users to create crypto tokens that will be interoperable with all chains.

On August 24, a US patent was granted to Microsoft for developing a “ledger-independent token service”. The end result will be a “software service that enables users (individuals, organisations, automated agents/applications, etc) to create, transact with, and manage tokens across multiple different distributed ledger networks/platforms in a common way”.

Bank of America, one of the largest financial institutions in the US, announced earlier this month that it had received 227 patent approvals in the first half of 2021, 8 percent of which were blockchain-related.

Microsoft’s Token Creation System

In the case of the MS patent, the technology will allow the user to choose one or more token templates where each fits a type of physical or digital asset. The tokens have a set of one or more attributes and one or more control functions associated with each type.

The computer system receives from the user the selected token template and then creates the token on the distributed ledger network. In other words, it could allow anyone to create their own token without having to write smart contract code, but by using predefined and parametrisable smart contract templates available on different blockchains. 

As well as creating their own tokens, users could upload their smart contracts between different blockchains, letting the system do all the technical work. Under the MS patent, the creation of these cross-chain tokens can be managed with a single user interface, making it much more user-friendly to adopt the technology.

Will It Be Available to the Public?

Despite the patent being granted to Microsoft, it’s not a sure thing that this technology will be publicly available as it has not been explicitly stated it would be made into an actual product.

The goal is to make token development more efficient for business use cases that involve surpassing the limits of a single blockchain. Companies that wish to enter the blockchain industry or make use of blockchain technologies can use this kind of system without needing the skills and savvy to create such a technically advanced layer for a business.

Microsoft has been actively involved in blockchain-related development in recent years, filing a wide number of patent applications related to the cryptocurrency industry with Hyperledger and the Enterprise Ethereum Alliance. It also recently developed a blockchain-based anti-piracy system.

Microsoft may play a significant part in the future of blockchain by using this patent, perhaps becoming one of the protagonists of the cryptocurrency revolution, which for now is still in its relative infancy.

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Bitcoin Crypto News Scams

Man Robbed of 16 Bitcoin Sues Young Thieves’ Parents

A man in the US has taken civil action against the parents of two young men in the UK for stealing 16 bitcoin (BTC) from him after the pair used clipboard-stealing malware to alter the destination of the crypto when the man tried to transfer it.

According to a civil order filed this year, in 2018 Colorado man Andrew Schober had 16.4 BTC stolen when he tried to move the digital asset from one account to another. When Schober realised the bitcoin never reached the intended account, he began to worry something had gone wrong.

After losing about 90 percent of his net wealth at the time, saved to finance a home and support his family, Schober spent over US$10,000 hiring a team of investigators to track down his lost crypto. On closer inspection of Schober’s computer, they found he had accidentally downloaded some malware after clicking a link posted on Reddit for a supposed cryptocurrency wallet application called “Electrum Atom”.

After months of investigation, the crypto was tracked to two young men in Britain who were minors at the time of the theft.

The first defendant had been found just hours after Schober’s bitcoin was stolen when he posted a message to GitHub asking for help accessing the private key corresponding to the public key of the bitcoin address used by the clipboard-stealing malware. The other defendant had the malware code that was bundled with the Electrum Atom application in his GitHub code library.

Beware Clipboard-Stealing Malware

The malware used to steal Schober’s bitcoin was bundled with a wallet program that was designed to wait for a user to copy in the lengthy wallet address. When an address is copied to the computer’s temporary clipboard, it gets swapped with another new address to which it gets sent.

How the malware scam worked. Source: Colorado Court file

Difficulty Retrieving Funds

After Schober tried to contact the young defendants’ parents for redress, there was no response. He stated that “losing that money has been financially and emotionally devastating. He [sic] might have thought he was playing a harmless joke, but it has had serious consequences for my life.”

After being met with continued silence from the parents for several months, Schober filed suit against both the young men and their parents in a Colorado court.

“These crimes can be monumentally difficult and expensive to track down,” said Mark Rasch, a former prosecutor with the US Justice Department who is now in private practice. “It’s designed to be difficult to do, but it’s also not designed to be impossible to do.”

Rasch said he was currently acting in several lawsuits involving young men who’ve been accused of stealing and laundering millions of dollars of cryptocurrency, specifically crimes involving SIM swapping.

A lot of these crimes are being committed by juveniles, and we don’t have a good juvenile justice system that’s well designed to both civilly and criminally go after kids.

Mark Rasch, attorney

It makes sense that some victims of cryptocurrency theft are spending serious money to track down perpetrators and sue them civilly.

In a related story from last year, Ledger users flagged a class-action lawsuit after having their personal information breached.

Categories
Australia Crypto Exchange Crypto News Trading

Report: The Average Australian Crypto Trader Made $10k Profit in Past 12 Months

New research has revealed that three out of four Aussies are turning a profit from their crypto investments, with the average Australian crypto trader making around A$10,000 over the past 12 months.

Aussies Making Bank with Crypto

According to research from international analytics firm YouGov, more than three-quarters of Aussies have made good profits over the last year, averaging out at A$10,662, the equivalent of nearly two months’ average salary in Australia. However, more than one in five Aussie cryptocurrency holders say they made profits worth over A$30,000.

The survey was commissioned by Australian crypto exchange Swyftx, which has more than 320,000 customers, and uncovered some interesting statistics about Aussie crypto traders.

Aussie millennials and gen Xers saw especially big returns, with around one in five saying they made more than $20,000 over the last year from cryptocurrency. Aussie mums and dads appear to have been especially successful, as well as men in general and [other] crypto users who report a strong or some understanding of the market.

Tommy Honan, head of strategic partnerships, Swyftx

The survey found that Aussie parents with children under 18 were the most likely to make money from their cryptocurrency trading, with 86 percent reporting an average profit of A$12,428.

In terms of location, crypto users in Brisbane were the most likely to report a profit with 83 per cent, followed by Sydney and Melbourne at 76 per cent and then Perth.

A previous report by Nine News showed that more than a quarter of Aussies are now trading crypto.

Experienced investors have been buying the dip, with some Aussies expecting bitcoin to hit the US$100,000 price mark by the end of the year.

New Users Urged to DYOR

With the increase of crypto adoption, Honan stated that it’s becoming increasingly important to do your own research (DYOR). The survey found that “the group who were least likely to report a profit on their crypto holdings over the last year were people who said they had little or no understanding of the market”.

At the moment, this is a relatively small proportion of crypto users in the country, just 16 per cent [who] report having little or no understanding. But for this group and anyone who wants to grow their confidence, it really is essential to do your research.

Tommy Honan, Swyftx

According to Honan, one of many pro tips is to “research the team behind any digital assets you are thinking of buying, and also look at indicators like the size of a coin’s market and its liquidity”.

That said, the Australian Securities and Investments Commission (ASIC) has again cautioned citizens to be wary when investing in unlicensed cryptocurrency companies. New users have lost significant amounts of money to scams, hacks, and using crypto products like options and leverage without proper understanding of how they work and the associated risks.

Not only could crypto investing be risky to newcomers, they also need to be aware of the tax implications. During the past few months, the Australian Tax Office (ATO) has reminded Australian crypto investors that they will be put under the microscope when filing their 2020-21 returns.

Categories
Crypto Art Crypto News NFTs

$100 Million ‘Feisty Doge’ Briefly Becomes Most Valuable NFT Token Ever

The ‘Feisty Doge’ non-fungible token (NFT) was briefly the most valuable NFT ever, valued at over US$100 million. The owner of the NFT allowed the public to buy part ownership of the digital art piece, pushing the price to record heights.

The Nine-Figure NFT

The Feisty Dog NFT recently became, but is also no longer, the world’s highest valued NFT. How does this happen, one might ask. The owner of the NFT announced it would be fractionalised, allowing the public to buy a share of the 100 billion tokens made available.

By fractionalising NFTs, an interested party can gain exposure without the large upfront cost. As the news spread that there was a possibility to buy into the acclaimed NFT, investors jumped in. The price of the fractionalised asset shot up 721 percent, pushing the estimated value to over US$100 million.

The tokens trading under the ticker NFD can be bought and sold on SushiSwap or Uniswap like any other token. Users with just a few dollars can buy a piece of this NFT (in the form of an ERC-20 token), with hopes that the implied value will rise with time, or that someone will make a fixed price offer for the entire NFT and pay out all the holders in ETH.

NFD Token Price Chart

Based on the total NFD token supply sitting at 100 billion, the token’s price briefly gave the NFT a valuation of US$110 million, making it the most valuable NFT ever, overtaking Beeple’s “Everydays: The First 5,000 Days” that sold for US$69 million.

The Feisty Doge picture is part of a shoot with the Japanese Shiba Inu Kabosu, which rose to internet fame as the actual dog behind the Doge meme. It was sold as an NFT back in June, fetching a total of US$43,279. With its price cooling down, the NFT is now hovering around US$50 million.

Feisty Doge NFT – Fractional

While those who bought in early enjoy their gains, some have been critical of @Cryptopathic’s project. Twitter user @0xShual called the Feisty Doge fractions a “scam”, highlighting on-chain data that shows @Cryptopathic removing liquidity from NFD/ETH trading pairs, taking profits in the process. 

While removing liquidity is not technically a scam, doing so has previously drawn the wrath of the crypto community. Also, the opportunity for a rug pull becomes apparent when 90% of tokens are held in just two wallets.

Fractionalised NFTs the Next Big Thing?

Unlike many tokens, there’s no underlying protocol, team, mission or revenue-producing product when it comes to most fractionalised NFTs. People who buy are purely speculating on what the cultural value of the underlying image will be down the line.

NFTs are one of the more recent innovations in blockchain technology with power to change the arts and culture landscape. But since the technology is in its infancy, there are lessons to be learnt and new methods of utilising the technology to be understood.

In a related story, a new Aussie NFT project suffered from errors on launch and will reimburse affected users.

Categories
Bitcoin Crime Crypto News

Swedish Government Pays Convicted Drug Dealer 33 Bitcoin Due to Prosecutor Error

The Swedish government has had to pay a convicted felon US$1.6 million upon release thanks to the increasing value of bitcoin (BTC) and a slip-up on the part of the prosecutor.

According to a report from Swedish news source Sveriges Radio, Swedish law enforcement has found itself in a rather unusual situation where it has to pay out roughly US$1.6 million to a released convict. The authorities are being forced to pay the man 33 BTC after his illegally obtained bitcoin appreciated while behind bars.

Appreciating Bitcoin Makes a Nice Get-Out-of-Jail Present

Two years ago, Swedish law enforcement arrested a man who was operating an illegal online drug shop, earning himself 36 BTC, or about U$136,000 at the time.

While he’s been locked up, the price of bitcoin has risen and as of August 20 was trading at around US$48,978 per coin, pushing the value of his 36 BTC to more than US$1.6 million.

By the time the convicted drug dealer was released, to satisfy the court’s original settlement of US$100,000 the Swedish Enforcement Authority needed to sell off just 3 BTC. This left the dealer with 33 BTC worth US$1.6 million in his wallet of ill-gotten gains.

An Unfortunate Turn of Events For the Prosecutor

Tove Kullberg, the prosecutor in the case, had reported the illegal funds in dollars instead of crypto. Kullberg admitted that in retrospect it was a mistake not taking into account how much the value of bitcoin would increase.

It is unfortunate in many ways. It has led to consequences I was not able to foresee at the time […] The lesson to be learned from this is to keep the value in bitcoin. The profit from the crime should be 36 bitcoin, regardless of what value the bitcoin has at the time.

Tove Kullberg, Swedish prosecutor

Since this was one of the first crypto-related cases that the department had to deal with, there was no established protocol or precedent to follow. Kullberg added: “I think we should probably invest in internal education in the [prosecution] authority, as cryptocurrency will be a factor we’ll be dealing with to a much greater extent than we are today.”

With the increase in crypto crimes, law enforcement is facing new crypto-related cases it hasn’t seen before.

On a related note, earlier this year we saw an Australian couple charged for running DarkMarket, a dark net marketplace.