Bitfinex危机中发币推IEO,拟融资10亿美元,或因这四点缘由


文 | 孙曜

4月30日凌晨,Primitive Ventures 创始合伙人、前丹华资本董事总经理Dovey Wan在Twitter发布消息,表示获知Bitfinex将发售平台币并将进行IEO,并透露其融资目标为10亿USDT。Dovey Wan随后又发布多条推文跟进此事,并表示已有两个独立信源证实了该消息。其中一条指向Bitfinex股东赵东,他在朋友圈表示:“BFX大概率要发IEO,据说已经有土豪预约了3亿美元额度”。随后赵东在微博再次证实了Bitfinex确实有发币计划,但细节未定。

截至发稿,火星财经APP(ID:hxcj24h)跟踪的Bitfinex交易所公告及其Twitter并没有任何对此事的回应。而火星财经APP(ID:hxcj24h)回溯Bitfinex及其CTO Paolo Ardoino的Twitter,也没有发现任何将要发售平台币及IEO的蛛丝马迹。综合目前所获消息,及根据赵东的两次发言中“大概率要发IEO”、“的确有发币计划,但细节未定”判断,Bitfinex极可能在近期刚刚决定发售平台币及进行IEO,很可能是在Bitfinex和Tether及其母公司iFinexInc.被纽约州检方指控挪用价值8.51亿美元USDT之后。



Bitfinex交易所涉嫌两次挪用Tether资金,以解决流动性问题

4月24日,Tether更改比特币网络Omni Layer的USDT发行密钥;北京时间4月24日-25日凌晨,Tether先后增发Omni、ERC20、TRC20三个版本的USDT,总增发4.2亿枚USDT,其中Omni增发3亿枚。这次增发是近期USDT增发量最大的一次,且将USDT市值推到接近历史最高点的28.3亿美元。

美国当地时间4月25日下午,距这次巨量增发仅12个小时,纽约州检方就将Tether及其母公司iFinex Inc.以及Bitfinex告上了法庭。火星财经APP(ID:hxcj24h)追踪报道,从长达23页的起诉书中发现,纽约检方从2018年下半年就已经开始对Tether及Bitfinex进行调查,在调查过程中发现Bitfinex及Tether可能涉嫌多项违规,包括无照经营、重大事项未予披露、资金管理不善、关联交易等,但核心焦点在于Tether借给Bitfinex的9亿美元贷款(其中7亿已经完成交易)可能存在巨大的利益冲突,或令持有USDT的投资者蒙受巨大损失。

根据纽约州检方起诉书,这笔9亿美元贷款发生的罪魁祸首应当是Bitfinex的支付处理商Crypto Capital。Crypto Capital声称有8.51亿美元Bitfinex所属的巨款被葡萄牙、美国、波兰政府扣押,此事最终造成Bitfinex内部恐慌。

2019年2月21日,Bitfinex和Tether的律师曾向纽约州检方表示,“为了弥补8.51亿美元(Crypto Capital声称被扣押的)损失,Bitfinex和Tether正在考虑促成一项交易,允许Bitfinex根据需要提取Tether的现金储备”。代理律师表示,Tether或将从USDT准备金中提取6~7亿美元,以循环贷款信用贷款的形式借给Bitfinex。

3月29日,代理律师寄给纽约州检方的邮件中表示相关交易已经于3月27日完成,并且又透露出一笔于2018年11月发生的、未经披露的6.25亿美元资金转移(从Tether向Bitfinex),以解决Bitfinex的流动性问题,据纽约检方描述,这两项巨额资金变动都没有向公众披露。

简单来说,根据纽约州检方起诉书中记录的交流内容,支付处理商Crypto Capital持有的Bitfinex的8.51亿美元被扣押(目前没有官方证明),以致Bitfinex向Tether发起9亿美元贷款,并已经从Tether的USDT储备金中提取了7亿美元;而此前在2018年11月,也发生过一次从Tether到Bitfinex,金额为6.25亿美元的资金转移。火星财经APP(ID:hxcj24h)推测两次大额资金转移都被用来解决Bitfinex的流动性问题。



Tether、Bitfinex团队重合,合作伙伴高管存疑

Tether和Bitfinex团队重合其实已经不是秘密了,此前就有路透社透露Tether和Bitfinex共同的CEO,但在本次诉讼中,纽约州检方在起诉书中详述了三者之间的关系:双方的签字代表同时也是DigFinex(疑似笔误,遗漏了iFinex)、Tether、Bitfinex的董事和股东。而为双方借贷行为做担保的DigFinex,其所有者和实际运营者也是同时是Tether和Bitfinex的所有者和运营者。这也就不难理解Tether和Bitfinex之间资金交换的轻而易举。

其实在Tether、Bitfinex高管重合之外,Bitfinex外部合作伙伴也被疑存在重合情况。去年Bitfinex的银行合作伙伴Noble Bank破产事件后,The Block分析师Larry Cermak表示Bitfinex已经将银行储备转移到Global Trading Solutions,LLC持有的汇丰银行账户中。而根据另一篇报道,Crypto Capital的总裁IVAN MANUEL MOLINA LEE曾是Global TradeSolutions AG的总裁,而Global Trade Solutions AG与Bitfinex的银行业务服务商Global Trading Solutions有惊人的相似之处。但目前仍无法确定IVAN MANUEL MOLINA LEE与Global TradingSolutions之间的关系,即无法确定Bitfinex支付提供商与其美元银行业务合作伙伴之间的关系。

无论此事的元凶是谁,背后还隐藏着什么暗流,但经过银行业务合作伙伴的变动,及多次从Tether大额贷款、转移资金,Bitfinex或真在经历着流动性问题,通俗地说就是缺钱。但最新曝光的Bitfinex发币却使人人一头雾水,USDT与Bitfinex的关系已是人人心知肚明的,Bitfinex如此急切的试图用新发平台币的方式筹资?还是想用新发币与Tether USD撇清关系?

对Bitfinex此时发售平台币和IEO的四大思考

此前LinkVC林嘉鹏在接受火星撞上499采访时阐述了一个观点,从博弈论角度来讨论交易所、项目方、用户三者在IEO中如何取得均衡点,他表示IEO实际上就是项目方、交易所出钱出力,让利给散户投资人,在项目吸引到足够多的流量和关注度之后,交易所和项目方自然也能从中分到更多好处。

根据这个理论,火星财经APP(ID:hxcj24h)推测,作为全球头部交易所的Bitfinex,以及USDT发行方Tether来做IEO定会与币安Launchpad一样轰动,那么就有一个问题,项目方获益是项目币价的提高,那Bitfinex的获益在哪里呢?因为USDT是稳定币,波动极小,以IEO的方式获得的升值空间极小,所以如果Bitfinex要将IEO利益最大化,就必须要推出一款可以大幅获益的产品,那一定就是Bitfinex平台币。

所以火星财经APP(ID:hxcj24h)推测,Bitfinex如果想做到利益最大化,确实需要将其平台币与IEO“捆绑销售”。如果Bitfinex在当前负面缠身的背景下仅发售平台币,那平台币价格在舆论及现状面前将出现很高的风险,但如果同时放出IEO的消息,在“IEO将使用平台币发售”的心理预期下,Bitfinex平台币很可能在发售时就出现非常大的涨幅。

但我们推测,Bitfinex的IEO很可能使用平台币+USDT双币种出售的模式。在这种模式下,Bitfinex既可以从IEO中获得较高利润,又可以名正言顺的借项目方之手回购USDT。而Dovey Wan也在Twitter中表示,如果Bitfinex IEO接受USDT,那将有效的较少USDT的流通供应量,从而弥补它的储备金漏洞。

除此之外,IEO从2019年初就已经开始流行,但是Bitfinex并没有在那段时间参与进来,反而在IEO热度正在消退的时候行动,Bitfinex的这种行为很难不联想到受纽约州检方起诉事件。同时,Bitfinex受到纽约州检方起诉后,当日即有17250枚BTC、63.33万枚ETH,约合1.85亿美元自Bitfinex冷钱包中转出,交易所资金流通性问题没有解决的当口,又出现新的流失,Bitfinex急需引入新的资金和用户,激活交易所流量。火星财经APP(ID:hxcj24h)推测,在被起诉之后,Bitfinex或许已经很难再从Tether的储备金中提取资金,于是需要另一条路来弥补漏洞,这就是发售平台币和IEO。

简单总结我们推测Bitfinex此时将要进行平台币发售及IEO的目的:

1. 通过平台币、IEO引入新资金和用户,激活交易所流量;


2. 可能是提取Tether储备金断路后弥补漏洞的新路径;


3. 平台币与IEO“捆绑销售”,以期获得更高收益;


4. 同时通过项目方之手回购USDT,减少流通供应量。

Bitfinex、Tether的危机不仅仅是资金能解决的

但是,就如Dovey Wan在Twitter中所表达的,Bitfinex发售平台币并进行IEO的行为并不是可持续性的。即便Bitfinex能在短时间内解决资金问题,并将贷款自Tether的7亿美元还清,Tether的储备金支撑问题依然悬在头上。并且连续的负面事件后,Bitfinex及Tether的信誉已经遭到不可挽回的伤害,这是金钱无法弥补的。

其实Bitfinex目前最需要解决的,是证明Crypto Capital声称被冻结的8.51亿美元真实存在,被冻结的原因,以及是否能够解冻。当然,判断能否解冻的关键还是要分析这笔资金被冻结的原因。

其次,在起诉书中,纽约州检方至少提及了4处Bitfinex存在应予未予披露的重大事项,包括合作的支付处理商的信息,8.5亿美元资金损失的信息,与Tether达成的9亿美元循环信用贷款可能涉及利益冲突的信息,及6.25亿美元资金转移的信息,如何向公众回应这些实锤式Bitfinex应该真诚思考的。

再次,Bitfinex与Tether的团队也应该就起诉书中提到的高管团队重合的问题给出答复,既是交易所又是“银行”的运营模式只会带来更多的质疑。

最后,就之前来说,我们可能永远也不会知道Tether到底有多少真实的美元支撑,预计Bitfinex很难将其真实数据公开于众。但是在一次次的负面事件之后,Bitfinex或许将面临迫不得已公开所有数据的一天,但那时USDT或已霸主地位不保。

时至今日,摆在Bitfinex面前的选项已经不多,已经没有所谓的最优解决方案,Bitfinex的操作空间已经非常有限,这次危机爆发后,Bitfinex甚至出现了用户退出式买入BTC,即在无法通过USD退出时,买入“硬通币”BTC,借此离开Bitfinex交易所。自此之后,Bitfinex信任危机加剧,Tether江湖地位不保,若还不能警醒Bitfinex进行符合大众利益的行动,那真将无力回天。

New York District Attorney Charges Two for Shadow Banking Crypto Companies

The Southern District of New York Attorney has charged an Arizona man and Israeli woman for allegedly shadow banking cryptocurrency companies, according to an official announcement published on April 30.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced the arrest of Reginald Fowler for allegedly operating an unlicensed money transferring business and bank fraud. His purported co-conspirator Ravid Yosef has also been charged with bank fraud and is still at large, according to the announcement.

In 2018, the accused allegedly worked for several associated companies that provided fiat currency banking services to cryptocurrency exchanges, where Fowler made numerous misleading statements to banks in a bid to open bank accounts further used to receive deposits from individuals purchasing digital currency. Fowler and Yosef purportedly falsified electronic wire payment instructions to cover up the true nature of their business.

Berman said that “their organization allegedly skirted the anti-money laundering safeguards required of licensed institutions that ensure the U.S. financial system is not used for criminal purposes, and did so through lies and deceit.”

Earlier in April, the Manhattan district attorney Cyrus R. Vance, Jr. indicted a group of individuals with allegedly operated stores on the dark web that sold and shipped “hundreds of thousands” of tablets of counterfeit drugs and laundered millions of dollars with bitcoin (BTC). The individuals reportedly withdrew more than $1 million.

Also in April, Cointelegraph reported that LocalBitcoins trader Jacob Burrell Campos, who sold bitcoin to more than 1,000 people in the U.S., will serve two years in federal jail. Burrell, a Mexican citizen, amassed more than $820,000 from bitcoin sales on the P2P platform between 2015 and 2018.

Prediction: 20 Percent of Leading Global Grocers to Use Blockchain by 2025

20 percent of the top 10 global grocers will use blockchain by 2025, according to information released by research firm Gartner Inc on April 30.

Per Gartner, the main advantage of blockchain for grocers is that it provides a high degree of transparency.

For grocers, this means they can use blockchain as a way to convey reliable information to their customers and retailers. Gartner even claims that blockchain “appears as an ideal technology to foster transparency and visibility along the food supply chain.”

Gartner says that grocery sales are increasing globally, and that consumers now know more about a food’s source and freshness, as well as the provider’s efforts toward sustainability.

“Grocery retailers who provide visibility and can certify their products according to certain standards will win the trust and loyalty of consumers,” it says.

Gartner also points out that there is potential for internal usage by retailers, who may avail themselves of data collected on a blockchain platform to quickly determine the source of a recalled product.

Gartner’s Senior Director Analyst Joanne Joliet posits that grocers will “lead the way with the development of blockchain.”

A number of companies are already experimenting with blockchain to ensure the quality of their food products. Gartner cites Walmart, Unilever and Nestlé as among their ranks; the former is using blockchain for a “store-to-farm” tracking system, while the latter two are using the data to track food contamination.

As previously reported by Cointelegraph, Walmart, Unilever and Nestlé are all partners of IBM Food Trust, a blockchain-based food tracking network. IBM Food Trust has also partnered with Dole Food Co., Driscoll’s Inc., Golden State Foods, Kroger Co., McCormick and Co., McLane Co., Tyson Foods Inc. and Unilever NV.

NEO 3.0 Roadmap Revealed, Co-Founder Erik Zhang Explains Key Changes to Smart Contract Platform

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NEO 3.0 Roadmap Revealed, Co-Founder Erik Zhang Explains Key Changes to Smart Contract Platform

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The developers of NEO, a leading platform for building and deploying decentralized applications (dApps), have officially released a roadmap for NEO 3.0, which consists of a several codebase modifications that are intended to enhance the blockchain network’s performance.

Erik Zhang, the co-founder and core developer at NEO, revealed via Twitter on April 29th, 2019 that the changes made to the platform’s protocol with NEO 3.0 will allow for “large scale commercial application ready” solutions to be developed on the blockchain network.

NEO 3.0: “High Throughput, Enhance Stability”

Zhang, a graduate of Shanghai University, explained that the changes activated with NEO 3.0 will enable “high throughput, enhanced stability, an optimized smart contract system,” and a wide selection of tools for infrastructure development.

As detailed in a recent Medium blog post authored by Zhang, the upgrades associated with NEO 3.0 will allow developers to create dApps that cater to a diverse set of enterprise-grade business requirements.

Working With Academia, Industry Leaders To Develop Governance Mechanisms

According to NEO’s development team, the proper governance of blockchain networks involves managing processes that ensure the “long-term evolution” of a distributed ledger technology (DLT)-based network. Zhang also revealed that in 2019, the developers of NEO “will be actively collaborating with experts from the academia, industry and community to explore various governance mechanisms including liquid democracy, futarchy,” as well as other techniques.

As noted by Zhang, “economic models [are often] tightly interlaced with governance mechanism, therefore they will be treated as an integrated system.” He added that NEO’s Enhancement Proposals (NEPs) “regarding on-chain governance changes will be published if satisfying outcomes are achieved” after conducting adequate research.

dBFT To Provide “Single Block Finality”

Some of the new features that will be included in NEO 3.0 consist of an upgraded network consensus protocol, called the Delegated Byzantine Fault Tolerance (dBFT) mechanism. As described by Zhang, dBFT is “a consensus mechanism designed specifically for blockchains.”

A typical dBFT implementation involves “a set of consensus nodes [that] are selected through a voting process, and these consensus nodes jointly generate and validate blocks. As consensus nodes are required to come to a shared consensus on a new block before it is committed to the blockchain, dBFT provides single block finality, meaning the NEO blockchain cannot be forked and transactions are irreversible.”

Moreover, “once a transaction is confirmed” on a blockchain network that uses dBFT, “it cannot be reversed or cancelled.” This, Zhang explained, is a “necessity” for financial applications.

NEO 2.x To Be Deployed Soon

The Chinese developer also mentioned that the development of dBFT 2.0 began in the last quarter of 2018 and that it was finalized by Q1 2019. The developers of NEO are now planning to deploy NEO 2.x to the platform’s mainnet.

Enhancements To Pricing Model For NEO 3.0

The NEO platform utilizes a dual-token economy, meaning that like Ethereum, the NEO network uses two native tokens, the NEO and Gas tokens, to facilitate transactions on its network. Gas “is used to pay transaction fees and smart contract execution fees,” Zhang wrote. However, there are certain issues with this approach such as the “relatively high cost of deploying and running smart contracts,” the NEO co-founder noted.

This problem, Zhang believes, “leads to a reluctance in smart contract usage and development.” According to Zhang, NEO’s “current pricing model becomes a significant obstacle in the Gas application scenarios, and thus hinders the continuous growth of DApp development and usage on NEO platform.”

The set of system-wide upgrades that will be activated with NEO 3.0 have been developed to address the current challenges with NEO’s pricing model, Zhang explained. He added that this will be achieved “by significantly reducing the deployment and execution costs of smart contracts, thereby expanding the application scenarios of Gas and increasing the number of DApps.”

NEO 3.0 To Include “Built-In Oracle Implementation”

Additionally, NEO 3.0 will include “a built-in oracle implementation” which will allow smart contracts “to access Internet resources during execution.” NEO 3.0 will also address issues such as “inconsistencies between nodes when accessing Internet resources” which will be “resolved thanks to the security and efficiency of dBFT 2.0.”

Changes that will go into effect with NEO 3.0 will also “redesign the peer-to-peer (P2P) protocol, add support for the UDP communications protocol, and enable compression options. This is expected to greatly improve the TPS and stability of the network.”

Upgrades To NEO Virtual Machine

As noted by Zhang, the NeoVM is “a lightweight virtual machine for executing smart contracts. It features fast startup, low resource consumption, and supports multiple high-level programming languages to allow developers to build contracts with familiar tools.”

When NEO 3.0 is launched, the NeoVM will be “completely decoupled from the blockchain and become a pure virtual machine.” Implementing an independent virtual machine will enable “easy implementation of native contracts,” allow developers to work on “application scenarios of NeoVM outside the blockchain,” and the “smooth integration of NeoVM into any integrated development environment (IDE)” and “easy debugging of smart contracts without loading blockchain data.”

The NeoVM will also include support for “static members” and “exception handling.” Other changes that NEO 3.0 will introduce involve the integration of NeoFS, which is “a distributed decentralized object storage platform integrated with NEO.” Additionally, NEO 3.0 will feature NeoID, which is “a decentralized identity protocol built on NEO.”

Report: Former Barclays Exec Joins Fidelity Investments to Work on Digital Assets

A former executive of British investment bank Barclays, Chris Tyrer, has joined Fidelity Digital Assets, the crypto platform of American financial services corporation Fidelity Investments, Finance Magnates reported on April 30.

Tyrer began working on digital assets for Fidelity Investments after serving over 13 years at Barclays as Head of Digital Assets Project, Head of Commodities Trading, and Global Head of Crude Oil Trading, according to his LinkedIn profile.

Tyrer and commodity trader Matthieu Jobbe Duval reportedly attempted to establish a digital currency trading desk at the bank, but the project was reportedly put on hold as prices continued to fall at the end of 2018.

As reported earlier in April, Fidelity Digital Assets named former Head of Equity Electronic Sales for the Americas at Barclays Christine Sandler as Head of Sales and Marketing.

Fidelity Digital Assets went live in the beginning of March with a selected group of clients. The company’s head Tom Jessop said then that they were still working on various parts of the platform. He noted that while some users have been on the platform since January, others may wait until September, as it “really depends on the facts and circumstances of each client.”

In February, Fidelity Investments received and passed on the Lightning Torch — a community-driven experiment aimed at raising awareness about the protocol and testing its robustness — to the Harvard School Blockchain & Crypto Club. The trend first reportedly started when Twitter user and bitcoin (BTC) enthusiast Hodlonaut sent 10,000 satoshis (the smallest, indivisible denomination of a bitcoin) to another Lightning user, and the user added another 10,000 satoshis and passed it on.

Cryptocurrency Security Threats Are Keeping the Market Down

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Cryptocurrency Security Threats Are Keeping the Market Down


From the start, Bitcoin has been seen as something of a ‘behind closed doors’ asset. With SilkRoad and other black market sites been heavily Bitcoin dependent, the image has not been good. 


While this has begun to change, and the general public has started to hear more positive reports, things are still touch and go. And the main cause of the loss of consumer confidence in the cryptocurrency is the almost incessant security breaches that plague the industry.

A quick summary

Because Bitcoin is a digital currency, the potential for hacking is extreme. Of course, this is also true of banking institutions that handle digital funds, but it seems more prevalent in cryptocurrencies. In fact, the total for stolen funds in cryptocurrencies crossed $1.3 billion—a massive amount of loss for an industry just ten years old.

And, for those who think the direction is positive, and security is improving, statistics show that more than 61% of the losses occurred in 2018. It seems that as values for cryptocurrencies increase, the motivation to steal them increases proportionately.

Seeking solutions

This increase in security failures is due, in large part, to the early stage of adoption of the industry. While banks have had thirty years of digital transactions to improve security, Bitcoin has been around just ten. The nascent technology has left gaps for some to exploit, and exchanges are the biggest culprit.

But beyond simply security threats, exchanges are often their own worst enemy. For example, the recent news of the death of the CEO of QuadrigaCX, and the loss of his personally held private keys for investor funds only highlights the need for better and stricter exchange policies.

This has led investors to pursue new and more secure exchange options, and particularly those with financial backing. Exchanges that refuse to move toward security and fiscal responsibility will eventually be left on the sideline.

Secure and backed

One such example of this new exchange model is FT Exchange or FTX for short. The company has the backing of Alameda Research, responsible for more than $1 billion in trades. With this level of external support, the exchange offers a level of investor security that is rarely available in the cryptocurrency world. Plus, they have created some of the tightest security protocols around.

Other exchanges are coming into the market or seeking to enhance their value proposition as well. The main goal is to allow the freedom of financial transacting that has characterized Bitcoin and cryptocurrencies, while at the same time protecting investor funds. This sort of ‘safe/freedom’ model has been tricky to provide but is growing.

Of course, as with most assets, Bitcoin and cryptocurrencies can be stored offline for maximum security. Simply storing private keys on a hardware or paper wallet will make the coins effectively 100% safe for users. But this defeats the purpose of a cash/payment methodology originally conceived by Bitcoin creator Satoshi Nakamoto.

Crushing the market

As security threats continue, the adoption cycle for Bitcoin has begun to slow. No wonder the euphoria of 2017 turned into the crypto winter of 2018. What seemed a great opportunity for quick returns turned into a security nightmare.

And, convincing banks and business owners to offer cryptocurrency support for payments and transfers is an uphill battle. The risks associated with moving into the space are dramatic. And, given the risks, the cost associated with creating the necessary security protocols can be dramatic.

Of course, those costs can be offset by market gains and profits. And, the current bull run that Bitcoin is experiencing should provide additional incentive. However, the end game of market adoption won’t be easy to achieve without massive change.

Whether Bitcoin and its cryptocurrency cousins eventually grow in adoption remains to be seen. However, the great need in the market is not another low-security exchange startup. Instead, the market must find ways to bring well-funded, secure exchanges online for consumers to use. Without these types of market enhancements adoption will stagnate and the market will be crushed before it reaches maturity.

Crypto Community Reacts to Tether Admitting USDT Not Fully Backed

According to the company behind it, stablecoin USDT is not fully backed by fiat currency deposits. It was revealed today that the controversial crypto asset firm Tether only holds around 74 percent of the total value of USDT’s current circulating supply.

Tether and the crypto exchange Bitfinex are currently defending allegations from the New York Attorney General’s office that the latter borrowed $600 million from Tether to stay afloat after the trading venue reportedly lost $850 million. The dramatic shortcomings are thought to be the result of Crypto Capital, a Panama-based payments processor that Bitfinex used, having assets frozen in various nations around the world.

USDT Not Backed 100%, But Did Anyone Think That it Was?

An affidavit filed by Stuart Hoeger, the general counsel at both Tether and Bitfinex, has today claimed that the stablecoin crypto asset USDT is only backed by around $2.1 billion. This falls short of the $2.8 billion worth of USDT currently in circulation. The document states:

“As of the date [April 30] I am signing this affidavit, Tether has cash and cash equivalents (short term securities) on hand totaling approximately $2.1 billion, representing approximately 74 percent of the current outstanding tethers.”

He also details that a credit agreement between Tether and Bitfinex did indeed exist and was in place “for the protection of the virtual currency market.”

According to a memorandum by Tether’s defence lawyer, Zoe Phillip of Morgan Lewis, there is no need for each USDT token to even be backed by a dollar:

“According to the Attorney General, the line of credit needed to be frozen because it improperly impairs the reserves Tether would use for redemptions. The Attorney General appears to believe that Tether must hold $1 in cash fiat currency for every dollar of tether. These allegations are wrong on multiple levels.”

Hoegner’s affidavit seems to support this by highlighting that the stance of the company had officially changed with regards the 100 percent backing of USDT in recent months. Given that this was widely reported at the time, it seems a wonder firstly that anyone was even continuing to use USDT when numerous other stablecoins now exist and secondly, why the news of the New York Attorney General’s allegations against the two companies should drop the price in the way it did last week.

Crypto Community Reacts to Tether and Bitfinex Legal Troubles

The CEO of social trading platform eToro, Yoni Assia, took to Twitter to opine about the revelation’s likely impact on crypto prices. He mused on the likelihood of a potential Bitcoin price pump if the news causes people exit USDT en masse. Ultimately, however, he admits that the shady goings on between Tether and Bitfinex will be negative for crypto. Although, he is sparse on specific details.

Meanwhile, independent crypto researcher and analyst Hasu seemed to hint that the debacle would inevitably invite greater regulatory scrutiny to exchanges, which could in turn damage the utility of Bitcoin and other crypto assets:

Cardano (ADA) founder and Ethereum (ETH) co-founder Charles Hoskinson used the news to draw attention to the fact that banks routinely operate on far lower reserves than those admitted by Tether today. This sentiment was also echoed by RT’s Max Keiser and many others.

Ultimately, such a comparison is largely redundant, however, as any form of fractional reserve backing USDT the anti-thesis of what many people in crypto signed up for when they got involved with the industry. Larry Cermak, an analyst with The Block, stated that comparisons between the percentage reserves held by Tether and those of the average bank ultimately ignore the shady goings on of the crypto exchange Bitfinex. He went as far as to state that both companies are guilty of pathological lies:

The Tether/Bitfinex saga is far from over yet. NewsBTC will continue to bring you coverage of the legal hearings as they develop.

 

Related Reading: Technical Indicator Suggests Tether Trouble Has Put an End to Bitcoin Rally

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Microsoft Outlook Security Breach Targeted Bitcoin Accounts

Microsoft Outlook Security Breach Targeted Bitcoin Accounts

Earlier in April 2019, Microsoft Hotmail, MSN, and Outlook email accounts suffered a severe security breach. Now, a  good number of the victims have revealed that their cryptocurrency wallets were hacked during the ugly incident, reports Motherboard on April 29, 2019.

Microsoft Customer Support Account Hacked

Per the report, the login details of a customer support staff at Microsoft was illegally obtained earlier this month. The breach enabled the attacker to access several email accounts including those on Outlook, MSN, and Hotmail.

Armed with the login details, the cyberpunks were able to gain access to sensitive information contained in other non-corporate Outlook, Hotmail, or MSN email accounts, using the data to hack into peoples’ cryptocurrency wallets.

For instance, Jevon Ritmeester,  one of the victims’ of the hack, revealed that the password of his account on the Kraken cryptocurrency exchange was changed and his single bitcoin was stolen.

Ritmeester revealed that he failed to implement 2-Factor Authentication (2FA) on his Kraken account, making it much easier for the fraudsters to steal his holdings since they did not have to bother about conducting a SIM swapping attack.

To make their unlawful act easier, the hackers implemented an email forwarding feature on the victim’s email account which automatically redirects any message containing the keyword “Kraken” to a Gmail address controlled by them.

In the same vein, any Bitcoin withdrawal request, approvals, and password-related messages were also forwarded to the new address.

Ritmeester in a publication on Reddit stated that Microsoft is not taking the security breach seriously and is trying to cover up the event. He also said that he is taking the matter to the police and Microsoft will have to pay for the losses he incurred.

It’s worth noting that Ritmeester is not alone in this strange ordeal. A Reddit user with the moniker, shinratechlabs stated that he lost about $25,000 worth of cryptocurrency as a result of the hack even though the virtual assets involved were not mentioned.

Despite the severe losses suffered by users of Microsoft, the firm has been accused of not doing enough to commensurate the victims or even offer a form of apology.

“I feel Microsoft is trying to cover up and is not taking this matter seriously,” lamented Ritmeester. he also added that:

“I am looking to file a police report and I’m thinking about holding Microsoft liable for the financial damage and the fact that a lot of my personal info may get leaked again.”

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US-Based Traders Dominate Crypto Trading, More Than Next 5 Countries Combined

The United States has long been one of the world’s most important economies, having a massive influence on the overall global economy and often helps to shape economic policy all over the world. It’s no surprise that the the country dominates the Bitcoin and overall crypto market similar to how it does other financial markets.

A new report on the global distribution of crypto traders based on exchange traffic shows that not only the United States as the dominant country in all of crypto trading, it has more crypto traders than the next five ranked countries behind it combined.

Bitcoin Traders Across the Globe: United States Leads the Crypto Charge

In a new published report by cryptocurrency and blockchain analytics firm Datalight, the company has revealed the results of a detailed analysis on the global distribution of Bitcoin and altcoin traders by country. The research looked at website traffic from “the 100 most popular crypto exchanges” to determine the rankings.

The report reveals, “as expected” the United States leads crypto trading “by a long distance.” Bitcoin and other altcoin traders in the country account for over 22 million visits per month.

Related Reading | Sell in May and Go Away? A Look At Historic Bitcoin Price Performance in May 

Following behind the US is another one of the world’s most important economies, with Japan being home to over 6 million monthly crypto traders. Japan has also been home to a number of hacks over the course of the last couple years, and the abundance of crypto traders in the country may be part of the reason.

In third is Korea, home of Samsung and other tech-forward companies that have recently warmed up to the crypto space. Korea is also home to many cryptocurrency projects, such as ICON (ICX).

The UK follows in 4th place, with just under 4 million monthly crypto traders. Russian and Brazil ranked 5th and 6th respectively, with both garnering just 3.1 million monthly crypto traders each.

The United States and its 22.26 million monthly crypto traders amounts to more active traders each month than Japan, Korea, the UK, Russia, and Brazil combined, showing what a dominant economy the United States is.

Related Reading | Visualized: Bitcoin, Ethereum, Ripple, and the Rest of Crypto Battle for the Top Ten 

China is large missing from the list, despite being an economic superpower and having a massive population. China tightly controls the way its citizens interact with the internet, and hasn’t been welcoming to the new financial technology and asset class, which could be why the country is absent from the data.

The remainder of the top 20 countries by monthly crypto traders all have roughly 1-2 million monthly users.

The amount of crypto traders in the United States suggests that roughly 6.7% of the country’s population is actively trading cryptocurrencies, according to the data.

Featured image from Shutterstock

Research: Crypto Mining Hardware Market to See 10% Compound Annual Growth by 2023

Digital currency mining hardware market is set to expand by 2023, according to a report from market research firm Reportlinker published on April 29.

Per the analysis, the rising number of product launches will facilitate the growth of cryptocurrency mining hardware, that will purportedly register a compound annual growth rate (CAGR) of more than 10% by 2023.

The report suggests that one of the major drivers of the cryptocurrency mining hardware market growth worldwide is the increasing demand for cryptocurrency-specific hardware, such as field-programmable gate array (FPGA) processors and application-specific integrated circuits (ASICs).

The high operational cost that results in low-profit margins reportedly remains one of the challenges to growth of the global digital currency mining hardware market, while the increasing number of crypto-related startups that cease their operations will also affect the growth of the market.

Low prices during the crypto bear market in 2018 affected crypto miners and hardware producers alike. In its Q3 2018 earnings report, computer hardware manufacturer Nvidia announced it was experiencing a “crypto hangover” as a result of inventory excess that was the result of decreased demand for its graphics processing units from crypto miners.

In February, cryptocurrency mining service Coinhive announced its closure, as the project had reportedly become economically inviable. Coinhive reportedly had to shut down its services amidst a 50 percent decline in hash rate following the last Monero hard fork. The firm said its would halt operations on March 8, 2019, while users’ dashboards will be accessible until April 30, 2019.